‘Megathreat Mountain’: challenges for 2023

By Willy De Backer - European Trade Union Institute, February 20, 2023

The year 2023 promises to be at least as challenging as the previous one, with war still raging between Russia, Ukraine and the West. The climate emergency turning into a real climate collapse also for countries in the Global North which had been spared some of the deadly and devastating effects which some countries in the Global South had already experienced for years.

At the beginning of the year, many ‘expert’ commentators and think tanks published their forecasts for the next 12 months. All of them agree that the new year looks challenging, if not to say scary. In an excellent comment on Project Syndicate, Nouriel Roubini refers to Thomas Mann’s great novel ‘The Magic Mountain’ comparing the current ‘age of mega threats to the tragic period between 1914 and 1945 and stating that we are ‘sleepwalking on mega threat mountain’.

Let us have a quick look at some of the chief challenges for Europe in 2023 but mostly in the form of questions (with further reading links) instead of predictions.

Could the Ukraine-Russia war escalate and cause the end of pacifism in Europe?

As Putin’s imperialist war goes into its tragic second year, the risk of escalation has grown dangerously high. The military security logic has changed from ‘helping Ukraine to defend itself’ to ‘defeating Russia’.

But how will a cornered Kremlin react to deliveries of stronger weapons to Ukraine? The rift between Germany and the rest of NATO over the delivery of Leopard tanks to Ukraine is indicative of the end of the strong post-World War II pacifist movement in Europe.

Recession, ‘slowcession’, ‘richcession’ or limits to growth?

Last year, economists raised alarm flags over the risk of global recession because of the interest rate raises by Central Banks to counter galloping inflation. Although inflation might have peaked and the immediate danger of recession in Europe seems to have receded, many headwinds remain and the fear of global recession has not completely disappeared.

What form would an economic recession take? According to some, it could be a mild downturn or soft landing. Others think it would be more like a longer period of no growth or very slow growth (a ‘slowcession’). There are even a few journalists talking about the possibility of a ‘richcession’, a downturn which would hit the rich harder than the poor. The recent troubles (and layoffs) in the Big Tech industry would be a sign of such a ‘richcession’, although I guess this is not what the laid-off workers would call it.

One thing is for sure. The traditional media narratives about a possible recession have very little to say about the link with the social-ecological emergency. According to some ecological economists, the economic chaos we might see in this and the next year(s) might have more to do with the increasing impacts of biophysical limits on access to energy and natural resources.

The end of globalization?

The top debate at this year’s World Economic Forum meeting in Davos was the future of globalization and the fear of de-globalization. Several workshops tackled the question: is globalization changing shape, is it in decline, or is it already dead, and are we now in the age of deglobalization? The neoliberal elites gathering on the Davos Mountain are clearly worried about the future. The Rich and Powerful’s favourite media, the Economist, explained it in a lead article called ‘The destructive new logic that threatens globalisation’.

Did Davos Man finally discover the absurdity of his “infinite growth” logic on a finite planet and the inequality impacts of this logic? No, what Davos Man and The Economist fear most are Joe Biden’s ‘abandonment of free-market rules for an aggressive industrial policy’ and subsidies for green industries, in other words, the green transition.

Maybe it is time to imagine a different type of globalization, one starting from the idea of planetary ecological limits and social solidarity thresholds but also going beyond the return to populist nationalism?

Quo vadis, climate emergency and global climate policy in 2023?

The year 2022 saw a near-record number of catastrophic climate-related events leading to a global economic loss of more than 310 billion dollars. According to the EU’s Copernicus Climate Change Service, Europe experienced its warmest summer ever and the second warmest year ever with the highest CO2 levels in 2 million years. In a recent speech to the Security Council, UN chief António Guterres warned that the world could face ‘a mass exodus of entire populations on a biblical scale’ because of rising sea levels.

Facing these ‘inconvenient’ realities, European leaders would be expected to speed up their efforts to decarbonize their economies and make the social-ecological transition their top priority. But some developments raise questions over Europe’s (and the world’s) determination to tackle the climate emergency.

First, the war in Ukraine, rising inflation, the cost-of-living crisis and new geo-economic rivalries (see our story on the EU-US green subsidies race) could lead to difficult trade-offs in terms of policies, especially if public opinion turns against green policies.

And this is exactly what we can observe in several countries, where civil disobedience actions by climate activists are increasingly being criminalized and academic climate experts are silenced or attacked when they speak out about the urgency of stronger measures.

Second, Big Oil has started to use the energy security crisis to build the case against phasing out fossil fuels too quickly. The industry, which in recent years got into the firing line of climate activists and policymakers, found back its self-confidence and is now using its exorbitant profits (more than 200 billion dollars in 2022) to double down on its fossil fuel core business. Its pledges to go net-zero and invest in clean energy (‘Beyond Petroleum’) have been forgotten.

The fossil fuel industry even succeeded in hijacking the UN’s COP process by getting Sultan Ahmed al-Jaber, the CEO of Abu Dhabi’s National Oil Company, nominated as president of the COP28 UN climate talks, which will be held in the United Arab Emirates (UAE) in November.

Think tank reports on what to expect in 2023:

• World Economic Forum: Global Risks Report 2023
• EurAsia Group think tank: Report ‘Top Risks 2023’ (3 Jan. 2023)
• European Parliament Research Service: Ten issues to watch in 2023

Disclaimer: The views expressed here are not the official position of the IWW (or even the IWW’s EUC) and do not necessarily represent the views of anyone but the author.