Let me answer some of your likely questions about the next 40 years as I expect them to unfold.
1. WILL I BE POORER?
Some of us will, others will not.
In order to give a clearer answer, the question must be asked more precisely. The question must be: Will I be poorer compared to x? And you must decide whether x should be (a) today, (b) what you would have been if humanity rose to the occasion and ran a rational world, or (c) relative to your peers.
Furthermore you must be precise about what future time you are asking about. Is it 2052? Or the halfway mark, 2032? You do remember, I hope, that the average income path to 2052 will not be a straight line. Per capita consumption in my forecast grows to a peak sometime within the next 40 years and is in decline in 2052—details depending on where you live.
If we’re willing to sacrifice some precision, though, I can provide this general answer: As long as you are not a citizen of the United States, you will be richer in 2052 than you are today. But only slightly so, unless you live in China or BRISE. I can add some detail: you will be much poorer than you would have been in 2052 if a benevolent dictator took control in 2012 and forced through the necessary investments to keep everyone employed and global warming below plus 2°C.
And I can add: Unless you do something very stupid (or very unconventional) during the next 40 years, you will be in the same position vis-à-vis your neighbors and peers as you are now. Both you and your peers will experience the same parallel development over the next 40 years. The only exception is if you are presently very affluent. Then it may be that your social rank will have declined through the processes of redistribution, which I believe will occur during the next 40 years in order to reduce some of the tension implicit in the rapid increase in inequity in the capitalist world.
Finally, I will give you a piece of uninvited advice: Yours is the wrong question. You should not ask, “Will I be poorer?” You should rather ask, “Will I be more satisfied?” Whether you are satisfied with life is more important (for you) than whether you are somewhat richer or poorer. Empirically, for some, income is the sole determinant of life satisfaction. But for the majority, a whole host of factors influence our well-being—job, health, family, community, prospects for the future—in addition to income. It is the sum total of all aspects of life that determine your well-being, both now and in the future.
So when you privately assess the implications for yourself of my global forecast, try to judge what it will mean for your well-being, not only what it will mean for your income.
2. WILL THERE BE ENOUGH JOBS?
Yes.
Or to be slightly less flippant: there will be as many jobs in the future as there have been in the past—relative to the workforce, that is. Or to be more scientific: there is little reason to expect that underemployment will be much higher (or lower) in the future than it has been over the last generation. This means that 10% of those who would like to get a paid job won’t get it overnight. The number will be closer to 5% during business upturns and closer to 15% during downturns. In the future, like in the past.
The reason is simple. A job is absolutely crucial from the point of the individual in industrial and postindustrial urbanized society. It is the only way in which the individual can get part of the societal pie–without engaging in theft. Since a job is crucial, the individual will do his utmost to obtain one. And society–at least in the long run–will do its utmost to ensure there are jobs, typically by seeking rapid economic growth. But we know from recent history that this is a taxing task, and that politicians often fail. As a result we do experience lengthy periods of excessive unemployment, even in the advanced economies. And the task of securing full employment may become harder in the future, since I forecast lower growth rates in GDP.
But given the importance of employment for societal peace and order, and given the real fear among the elite about a reshuffling of the cards, the necessary effort will be applied–sooner or later. The reason why I am willing to state this so blatantly is that the task is solvable in principle. When the unemployment problem is not solved in the short term, it is because society is not immediately willing to use the tools that the ruling elites actually have at hand. Because these tools imply taking from the rich (those with a job) and giving to the poor (those without a job).
For in the end the rulers can print paper money and pay unemployed people to do what society needs to get done, in return for the paper money. For example, politicians can decide that society needs to build dikes to protect against rising sea levels, or remove litter from public places and highways, or paint all roofs white (in order to reflect more sunlight and reduce global warming), or create new pieces of art for public enjoyment. And they can print the necessary money to pay for this work. The new money will boost demand for everything that the workers need–food, shelter, energy, vacation–and have the traditional expansionary effect. The cost will be higher inflation, but that bothers the rich more than the poor. As long as there are underutilized resources in the economy, deficit financing of compulsory work for the state is sustainable. It is possible to lower unemployment by printing new money. But the rich will scream. Because they will see this for what it is: namely, a transfer of wealth and income from the rich to the poor.
If the elite is stupid enough not to solve the unemployment problem within reasonable time, revolution (or at least sufficient rattling of the system to get crisis work going) will result. Such disruption will lower incomes in the short term, but it will distribute the cards in new ways in the longer run and therefore provide new opportunity for the formerly unemployed. Disruption makes unemployment more bearable, and probably gets it back down into the 10% range.
So I see little reason why there should be higher levels of unemployment in the future. But that is not the same as saying there will be smooth sailing. Unemployment figures will continue to fluctuate between the barely acceptable and the totally unbearable. And all along there will be unnecessary suffering.
3. WILL THE CLIMATE PROBLEM HURT US?
Yes, but not critically before 2040.
My forecast shows in quantitative detail how I believe the global average temperature will increase over the next couple of generations. The average temperature will go from plus 0.8°C relative to preindustrial times in 2012 to plus 2.0°C in 2052, and a maximum of plus 2.8°C in 2080.
The forecast maximum in 2080 is above the threshold that world leaders agreed would place us in the danger zone for runaway climate change; but it is important to realize this is a politically negotiated goal. Views differed, and still differ, on what will be safe. Or in other words, what will hurt us.
There is a large body of literature about what will happen at plus 2°C. Science agrees on the broad lines–more drought in drought-prone areas, more rain in rainy areas, more extreme weather (strong winds, torrential rains, intense heat spells), more melting of glaciers and the Arctic sea ice, somewhat higher sea levels, and a more acidic ocean, in addition to the higher temperature and the higher CO2 concentration in the atmosphere that will boost food and forest growth in higher northern latitudes. Ecosystems will move poleward and uphill.
But science cannot yet predict the detailed strength and regional distribution of these impacts. Thus it is impossible to forecast what will be the effect on your surroundings over the next generation. But you can get a strong indication if you start looking slightly beyond science. By asking locals in daily contact with nature, you will get to know what has changed over the last 20 or 40 years. You can do worse than assuming that these changes will strengthen during the rest of your life.
Let me give a concrete example. The only rational reason to live in a cold, northern city like my hometown of Oslo during the dark subfreezing period from mid-November to mid-March is the great opportunity for cross-country skiing (ideally on moonlit white glades in the pine forests just north of the city) on the one meter or so of cold fluffy snow that covered the ground until the last real winter in 1986.
But over the last 25 years, the average winter temperature in Oslo has gone up by plus 2°C. This has shortened the period of stable cold weather from four to two months. Instead, we now have two months of good skiing and two months of wet, gray, and cold slush, which keeps the forest dark and makes it impossible to even go jogging there after work. One-half of the Oslo winter is gone, sacrificed on the altar of climate change. This is clearly visible in the eyes of someone who has been skiing regularly over the last fifty years. It is discernable in the snow statistics, but it is not yet an established fact in the urban public mind. And certainly not institutionalized in a strong Norwegian climate policy.
This loss of skiing is a nuisance, but not catastrophic. As is the prolongation of the dry period in the western United States, or the increased number of very hot days in Provence. But they do constitute a loss. And a longing, among the grown-ups, for the good old days. A little more problematic, to say the least, is the slow rise of the ocean level around those Pacific islands that will be submerged if the ocean actually rises by a meter—just twice the expected sea-level rise by 2052.
So if you want to find out how climate change will hurt you, ask a local elderly outdoorsman or old farmer what he believes is going on. And then try to answer the question “Will I be more satisfied?” under the conditions that he thinks are emerging. But please be aware how subjective the answers you get will be: Most Norwegian farmers living next to my moonlit skiing forest are delighted at the prospect of higher temperatures, better forest growth, and the opportunity to clear-cut more often, with less snow bothering the cutting operations.
4. WILL ENERGY BE MORE EXPENSIVE?
Yes.
But once more, the precise answer depends on the detail in your question. Let us start by deciding what cost you are thinking about. Is it your total energy bill (in hard-earned dollars per year)? Or the national bill? Or the cost per unit of energy (in dollars per kWh of electricity or gallon of gasoline)? Or is it the share of the economy that is engaged in getting hold of all the energy that is needed to run the economy (measured as the percent of GDP in the energy sector—which should include those export sectors that are required to finance the importing of energy, if there is importing)?
I can answer only some of these questions, and the answers differ with the precise questions asked. The average per-person use of energy will increase. But only for a while–energy use per person peaks around 2040. So we will each have more energy available to us for some decades, until growth slows and growing energy efficiency leads to reduction in our annual use of energy.
So we will use more energy–more tonnes of oil equivalents of energy per person per year–until the 2040s. But will this cost more? I can’t predict in detail. My spreadsheets tell me that the energy intensity of the economy will decline monotonically from 300 kilograms of oil equivalents per $1,000 of GDP in 1970 to 180 in 2010, and some 120 in 2050. This means that the value created per unit of energy used will increase dramatically, which also means that the share of total value creation that is expended on energy is likely to decline. But I can’t say for sure, for it depends on whether the new forms of energy, replacing increasingly the old fossil sources, will prove to be very much more costly than power and heat based on coal, oil, and gas.
