U4 AOS2 Pt 1 Flashcards

Question

Reasons for PMI's response to climate change

Answer 1

• External regulation e.g. EU trading scheme • Risk gl warming poses to tobacco leaf prod • Reputation – inc expectation that cos are soc + environ responsible • PCA set specific targets (2C) + addressed mitigation and adaptation - Intl Co-Op Initiatives

Answer 2

#1 Created the Good Agri Program aligned w SDGS o Triple bottom line standards applied before all purchases from growers + suppliers o Specific + time-bound aims: → 70% dec overall GHG emissions from 2010 levels by 2020 → 0% coal use for tobacco curing by 2020 → 0% defor from cultivation by 2020 #2 Financial incentives o Monetary rewards for all empl for meeting emission reduction targets o Set internal price on carbon $17/tn = low vs EU 90-130 eur/tn but high on business scale = typically $5-20/tn (updated every 1-2yrs) #3 Support for LDCs/NGOs → adaptation o Partner w Swiss Red Cr → promo sus/resilience-building farming techniques (e.g. irrigation systems) in Mozambique to ensure food sec

Answer 3

Evidence: • 2010-15 10% improvement in fuel eff (7% of which in 2015 alone) • 2010-18 dec CO2 emissions 36% in manufacturing • 2021 PMI = 1 of 200 st on CDP’s A-List out of 9.6K submissions + 1/118 cos on water sec A list + 1/24 cos on forest A list Overall evaluation: PMI’s status as TNC means it can use econ power to influ own actions + actions of suppliers  improve own environ practices sig to be in line w PCA H/e effectiveness lim by relatively sml scope of influ = impact minute BUT X address root cause = capitalism Also shows effectiveness of UN’s PCA/SDGs to bypass challenge of NIs + appeal directly to NSAs thru Intl Co-op Iniatives

Answer 4

1. Radically overhaul current econ/soc structures = challenge cap/consumer mentality 2. Help LDCs adapt 3. Popularise a more intersectional view of CC to ensure protection of “our common home” + avert “a perfect storm that could rupture the bonds holding soc together” 4. Encourage a multilat response thru “a renewed sense of shared responsibility for our wprld, and an effective solidarity based on justice”

Answer 5

• June 2015 PF issue papal encyclical ‘Laudato Si’ → earth = “immense pile of filth” o Addressed challenge of CC denial – “a very solid scientific consensus” shows gl warming “mainly a result of human activity” o Addressed challenge of cap – combatting CC req dec “unlimited appetites of consumerism” o Addressed challenge of NIs/funding – polluting st need to help developing st o Addressed challenge of prog being too slow – bemoaned current pol responses = remarkably weak • Jan 2019 PF addressed 180 dips – complains current response = “remains v weak + a source of grave concern” • Cath Ch divested from FF • June 2019 PF declare “climate emergency” + meet w top oil execs + FF investors

Answer 6

Positive: • PCA adopted 6 mo after LS • UNFCCC Exec Dir Christina Figueres: “PF’s encyclical underscores the moral imperative for urgent action on CC… this clarion call should guide the world towards a strong + durable univ climate agreement in Paris” • June 2019 oil execs call on govts to put price on C to encourage low-C innovation Limited: • Oil execs X make any promises to voluntary reduce their own emissions Overall evaluation: Failed to change soc/econ system (e.g. EU response) so action is X at pac req + X achieve help to LDCs (e.g. problems w climate financing) BUT shifted view of CC from being a sci issue to a soc/moral issue = reflected in PCA/incl of climate objectives w/in SDGs (see Figueres’ comments above)

Answer 7

• Recession (2 consecutive ¼ s of neg econ growth) • High inflation • Asset bubbles/bust • Credit crunch • BoP crisis • Depression (severe recession)

Answer 8

• inc cyclical unemp (as opp to nat unemp = frictional + structural) • dec consumer → dec spending • dec investor confidence → dec capacity to prod • bankruptcies

Answer 9

Capitalism’s boom/bust cycles contributes to economic instability by creating the conditions that leave states’ more vulnerable and less equipped to restimulate their economy. Because a capitalist economy relies on supply vs demand to determine production, demand will inevitably become saturated during a boom period, creating an over-supply. This incentives companies to produce less, causing to job losses and a decrease in consumer confidence, which both lead to less spending and thus an economic contraction (bust). This links to broader economic stability, because when governments or the private sector attempt to pre-empt or cushion a bust, like during COVID, this often creates a market failure, exacerbating the bust later, whilst reducing the number of levers they can pull next time, like lowering interest rates or handing out stimulus. e.g. UK/Aus

Answer 10

Legitimate or widely recognised ability to exercise effective control over a territory within defined borders. This is the primary organising principle of global politics, providing states with the authority to represent their territorial entity in the international community. Sovereignty can be challenged both internally (secessionist groups) or externally (invasion).

Answer 11

Refers to a system of co-ordinating relations between three or more states, usually in pursuit of objectives in specific areas.

Answer 12

Refers to the acceleration and intensification of the exchange of goods, services, labour and capital, which promote global interdependence. This has been facilitated by rapid changes in communication and technology.

Answer 13

Used as an all-embracing concept to justify policy preferences and actions, and includes the goals or objectives of foreign policy.

Answer 14

Firstly, the exploitation of resources, namely the burning of fossil fuels, is a key aspect of climate change because it is making the crisis inevitable. Fossil fuels account for 85% of energy consumption globally, resulting in 9.5bn tonnes of CO2 being released from the ground into the atmosphere every year. This leads to an enhanced greenhouse effect, which contributes to global warming and thus causes climate change. This impact is evident in the fact that 50% of all GHG emissions ever were produced in the last 30 years, accelerating the world's charge towards a climate crisis, with global atmospheric temperatures already 1.1C above pre-industrial levels and thus closing in the UN's 1.5C limit. Secondly, national interests is a key aspect of climate change both in the challenge it poses to the crisis' effective resolution and the threat posed to national interests by the crisis itself. For example, after losing access to Russian gas in 2022, Germany and Italy prioritised protecting their economic prosperity by reopening coal-fired power plants, posing a challenge the effective resolution of climate change by increasing their GHG emissions and thus worsening the size of the problem. However, for small island nations, rising sea water levels as a result of global warming also demonstrates how climate change is linked to national interests in that it is a direct threat to their sovereignty. Thirdly, methods of adaption and mitigation are a key aspect of climate change as they aim to resolve the causes of the crisis and also reduce the impact of its irreversible effects on human life and ecosystems. For example, methods of mitigation, such as transitioning to renewable energy, developing large-scale carbon capture technology, and instating carbon taxes will reduce the emission of GHGs and boost their absorption to bring the atmosphere to a 'net zero' status, stopping further global warming. Adaption methods, like flood protection installations, building regulations and migration, will improve resiliency to extreme weather events and protect people from harm's way.

Answer 15

Firstly, because globalisation promotes increased international independence, it is a key aspect of economic instability by providing more avenues for contagion to spread. This creates economic instability because contagion prevents states' ability to regulate their own economy and challenges its effective resolution since global interconnectedness means efforts of one states can be undermined by the actions of others. However, globalisation can also help resolve economic instability because its existence creates opportunities for international co-operation, such as through the IMF or G20. Secondly, capitalism's boom and bust cycle is a key aspect of economic instability by creating conditions that make the economies more vulnerable. In a capitalist economy where production is based on supply and demand, the demand during the boom period is eventually saturated, creating an over-supply which decreases consumer confidence, triggering a bust in which unemployment increases and monetary circulation stagnates. Because the boom/bust cycle is accepted as a natural part of a capitalist economy, periods of contraction are inevitable, and so this may put some states economic positions they can't get out of. Thirdly, key actors like the IMF and G20 are a key aspect of economic instability for their role attempting to stabilise the global economy. For example, the IMF provides loans to states experiencing balance of payment difficulties paired with austerity conditions in order to prevent states defaulting on their loans and thus spreading their economic instability globally, whilst also addressing the underlying causes of the crisis to deter it reoccurring.

Answer 16

1. The pandemic itself o Req partial shutdowns → restrictions apply to 93% gl workers → lose 8.8% work hrs → 3.4-7.6% neg econ growth gl 2. Lockdowns o inc govt spending to supplement for lost work hrs/cushion econ impact → inc govt debt → inc vulnerability to future crises + LT impact o e.g. UK Q3 2021 GDP still 2.1% below Q4 2019 + 21.9% inc in GDP vs govt debt 3. Politics o Pub confidence in govt’s eff response to health/econ crisis → impacts consumer/investor behaviour o E.g. Sw X serious lockdowns but econ shrink at similar lvl to Den bc lack of conf in govt o E.g. UK high mortality + Johnson govt parties → low conf → FTSE 100 (Brit stock market) exp 11.6% dec stock prices as of 2021 vs 2020

Answer 17

- Youth unemp Q1 2020-Q3 2020 inc 4% vs 1% for non-youth - 33% indiv financial diff bc of COVID can be attributed to st’s GDP per cap + 47% to pub expenditure per cap → US exp 5.2% unemp inc bw 2019-20 bc less safety nets (despite $5.4tr fed help) - Gr exp 55.4% dec in tourism revenue → 80% households exp at least 1 job loss vs 40% unaffected

Answer 18

Short term: - Dec 2019 – May 2021 US 0.2% dec consumer spending vs 12.8% dec in UK Long term: - 75 central banks inc interest rates in past yr – avg 3.8 times each

Answer 19

Short term - UK share prices -2.2% change Q4 2019-Q3 2021 Long term - UK share prices trending up since vax deployment

Answer 20

Short term - Ch – Q1 2020 GDP dec 6.9% = 1st dec since 1976 BUT 2020 overall 2.3% growth - US GDP dec 19.2% 1st ½ 2020 BUT inc 15.4% 2nd half  -3.4% 2020 overall - UK 2020 GDP -9.9% = largest dec of G7 st - Majority of st in recession Long term - 3.4-7.6% neg econ growth gl - Ch lose $680bn worth in econ growth - US V-shape recovery facilitated by $5.4tr fed support  LT budget burden - EU lost $2tr GDP output - Ind lost $950bn - UK grew 4.2% Q2 2021 - UK pub debt vs GDP inc 21.9% Q4 2019-Q3 2021 - All but 2 adv econ will recover by end 2022 vs only 8 emerging econs

Answer 21

1. black swan event 2. covid = mainly supply issue, X demand → harder for govts to influ → inflation in US reached 9.1% = highest in 40yrs

Answer 22

Fiscal - Total $5.4tr govt spending - Initial response = CARES Act → tax rebates/expanded unemp benefits/$25bn to prov food safety/$510bn to X corp bankrupt/$349bn to sml bus admin loans/$100bn for hospitals - Aug 2020 T exec order $44bn extre unemp benefits/student loan + rent relief - Dec 2020 $868bn govt funding bill = unemp benefits + incl $600 dir payment to indiv - Mar 2020 B →Am Rescue Plan = $1.8tr (8.8% GDP) = pub health investment + fam support + unemp benefits + $1400 cash to eligible indiv Monetary - Fed Reserve dec IR to bw 0-0.25% + inc lending

Answer 23

Effective: - GDP dec 19.2% 1st ½ 2020 → GDP inc 15.3% 2nd ½ 2020 - Unemp 14.7% Apr 2020 → 6% Apr 2021 → 3.5% Aug 2022 Counter-productive: - Pop reliant on temp social safety nets e.g. unemp benefits, rent relief - Debt skyrocketed = 2019 108.8% → end 2020 160% → end 2021 150% (well above healthy 60%) → govt have less levers to pull for next crisis + ppl are more vulnerable

Answer 24

Monetary - 19 Mar 2020 BoEng cut IR to 0.1% Fiscal - $575.5bn across 6 diff lg stim packs → mainly targeted at sml bus + paying bus to keep ppl emp e.g. tax cuts + program offering to pay 80% of salaries for otherwise laid off workers - $8.5bn tax credits for poor + unemp → $1200/yr more in pockets - $2.5bn job program for ppl under 25yo - 6mo VAT cut 20% → 5%

Answer 25

Effective: - Unemp X exceed 5.2% = now at 3.6% Limited: - GDP dec 10% 2020 = lgst dec 30yrs + lgst in G7 → grew 4.2% Q2 2021 Counterproductive: - GDP dec 10% 2020 = lgst dec 30yrs + lgst in G7 → grew 4.2% Q2 2021

Answer 26

Fiscal - Mar 2020 Econ Stab Fund = $650bn - June 2020 expanded: -incl VAT cut 19% → 16% on all goods = cost $22.5bn -$6bn inc to welfare programs -$12.4bn reductions to renewable E fees for 2021+22

Answer 27

Effective: - Unemp stayed below 4% Limited: - Debt not too bad = 2019 60% → end 2020 68% → end 2021 79% - GDP dec another 1.8% Q1 2021 - Consumer conf X returned – spending = 5.4% below pre-pandemic lvls - Trade still 5% below pre-pandemic

Answer 28

Fiscal - $223bn worth relief + stim packs: -$4.4bn payments to sml/med bus → extended $16.5bn w payments up to $65.4K to cover wages -$490 dir cash to ppl on govt benefits -$85bn Jobkeeper - Oct 2020 release budget: - $12.9bn personal income tax cuts - expand 1st Home Loan Deposit Scheme → guarantee homeloans for 10K more buyers - invest $3.3bn in broadband/5G networks Monetary - Res Bank cut cash rate 0.1%

Answer 29

Limited - Unemp inc to 7.48% but stab to pre-pandemic levels =3.9% - Aus GDP 2.8% behind pre-covid trendline - GDP growth shows V shape recovery by Q3 but tapering downwards now bc current crisis Counterproductive - Feb 2021 housing price inc 2.1% = lgst inc in 17 yrs - Consumer conf currently dec bc govt X use stim against for current crisis bc already big debt + low IR - Debt skyrocket = 2019 47% → 2020 97% → 2021 84%

Answer 30

Basically stim worked in ST but failed to prev current crisis + actually made it worse bc less levers to pull/ppl + govt more vulnerable