Davos is a spectacle to behold, always threatening to reflect our worst Darwinian inclinations. Copenhagen, on the other hand, was meant to reflect humans at their best, open to collaboration for the public good. And yes, you have guessed it (you smart, cosmopolitan blog readers), life has its way of inverting the expected. Copenhagen actually demonstrated humans’ capacity to be petty, narrow-minded, and deeply tribal. far from being focused on the public good, it was focused on the private gain of vested interests largely not in the room, whether they were businesses, parochial politicians or even short-sighted populations of citizens who should have known better.

And Davos…well it is what it says on the tin, in one moment abstracted from any sense of reality, at another exhibiting the human ego at its most profoundly revolting. Yet it somehow unlocks the participants’ passion, innovation and a will to imagine and take risks. In muddling up the public good with private gain, it evokes much of what is amazing about our species and without doubt explains how we have survived to date (for better and worse). It is in Davos that investors in green technology have the stage,

yes aching for public subsidy if they can get it, but in truth knowing that they will fund the low carbon economy if it is going to happen. It is in Davos that the Chinese business community schmoozes with Western Governments and vice versa. It is on these snowy hills that more irreverent potential is discussed than could be dreamed of in any formal multilateral procedure.

Yes, a Managing Director of the World Bank was right when she reminded us at Davos that the farmers we were discussing were not in the room. And who knows what complex political equation Strauss Kahn from the IMF was making when he supported Soros’s proposal to unlock capital to fund climate management. And it is slightly crazy making when Sarkozy proposes to rewrite the rules of capitalism (better than his Italian counterpart though), and it makes you wonder when Davos declared itself ‘green‘ on the back of a half-hearted labelling of carbon-spewing, attending SUVs. But frankly such weaknesses are chicken-feed when compared to the cynical nonsense that stalked the corridors of the Bella Center in Copenhagen just weeks before.

You may well despair, and I might join you for an accompanying drink when you do, but Davos is more about our future than Copenhagen will ever be in bringing more of the right people to the table, and providing more opportunities for the deal making that is needed to safeguard our children and theirs in turn. We can bemoan the elitism, the false dawns too often announced and then neglected forever more, and the fly-in humbug of much that is said and neither meant nor even heard. But through this there is an authenticity in the demonstration of real power, truly extraordinary wealth, unbelievable innovators (for whatever reason and end), and a will to grasp the world as it is and shape it into the future. The tens of thousands leaving Copenhagen were angry, burnt out, and deeply exhausted. Those leaving Davos will be tired, often confused, but in the main better informed, connected and able and willing to act.

Have I drunk the Davos Kool Aid for too long to have any remaining sense? Well maybe, self-diagnosis is not humankind’s speciality, far from it, and I am no exception to the rule. Certainly Davos exhibits in technicolor more than it resolves what I called in an earlier blog this week sustainability’s very own Valley of Death, in a nutshell our ‘struggle to innovate at scale in a timely way in addressing the world’s toughest problems‘. But its more likely that the solutions lie lurking beneath the canapes at Davos than the decrepit cheese sandwiches of Copenhagen if only because the folks in the former are actually treated with respect, treat each other in the main with respect, and have a will to live rather than just survive.

Tomorrow’s history is rarely created by extraordinary moments, it is merely punctuated by them.

Copenhagen will be seen as a failure of vision, leadership, and compassion. The Copenhagen Accord, ‘noted’ in extra time at COP15, will be stuck with the Sudanese’s naming as a “suicide pact”. And President’s Obama, Hu and many others, however they speak to their domestic constituencies, will have been party to this failed attempt to strike an ambitious deal.

Tomorrow’s history, i suspect, will profoundly disagree with this finger pointing diagnosis.

Studied history will point to Copenhagen as the last serious attempt to use 20th century techniques to arrange our 21st century affairs. Seeking consensus between 193 sovereign states through a zero-sum negotiation process was always going to be a fool’s errand. It failed because it handed exclusive rights to national governments, leaving 99% of the energy of business, civil society, cities, and the youth (just to same a few) as frustrated bystanders (see them in my Walk through Babylon). It failed because it sought to secure a “one for all, and all for one” consensus, unworkable even in the relatively simple world of trade. It failed, finally, because of its use of old style negotiation techniques where we have learnt so much from the “deliberative” approaches of communities and business in envisioning change and creating unlikely pathways to achieving it.

For Copenhagen to serve us well, we must learn from it.

It has failed because our global commons can no longer be managed by top-down, government-led, compliance focused, publicly-funded agreements between nations. Presidents and prime ministers, along with legions of negotiators, have been complicit in this by playing, frankly, their well-defined allotted roles in appealing to their domestic political constituencies (accountability) and in seeking re-election (whether in democracies or not). Who can blame folks for doing what we ask them to do, even if in the last hours we demand that they shift gear and behave as if they were chosen to lead in saving the global commons (which they were decidedly not).

Two things need to, and can happen now.

The first of course is to deal with climate with the right people where the action is. Whilst not wishing to trivialize today’s pain, we can deal with climate more effectively by catalyzing ambitious national action leveraged with international co-operation. We can get a better global deal, but only once nation’s have whetted their appetite for low carbon growth and development through action, not theory. This is not, as i have repeatedly argued, downgrading expectations, but upgrading them by leveraging where the real energy for change lies, and then uploading the results into a far smarter global deal going forward ( see my Revising Plan A).

Second concerns our global governance arrangements. Reforming global governance has been an esoteric topic for many years pursued by policy analysts, academics and international bureaucrats offering unintelligible diagnostics and incremental and largely technocratic recommendations. Copenhagen, and its potentially ghastly implications, makes this obscurity unacceptable. In the last two decades we have in fact already invented far more effective ways to do business internationally, from how we do global health through public private partnerships to building the hadron collider in CERN (it works now, but the amazing thing about it is how the global scientific and political community made it happen, not merely that it is ‘about the origins of everything’). We do not need another Commission made up of those who have presided over our failing global institutions, we need fresh blood and urgency in surfacing today’s institutional innovations and working out how to make these work in practice.

COP15’s real legacy.

Coming back, then, to climate. We should surely be disappointed by the final deal. But we are now poised to have to invent an alternative pathway in moving forward. John Maynard Keynes, the most extraordinary 20th century economist, argued that ‘our challenge is not to invent new ideas, but rather to let go of old ones’. Well, if he was right, and i suspect he was, then COP15’s greatest contribution to the public good may be to bury, once and for all, our outmoded ways of doing global governance. Such an achievement, whilst sad to contemplate today, may turn out in tomorrow’s history to be an extraodinarily important legacy that served us and our children well in decades to come.

Whilst these are not trivial sums (official development assistance is roughly US$150 billion a year), this round number requires some context. US Treasury Secretary Tim Geithner, estimates, based on IMF predictions, that global lost output as a result of the recession could be in the order of US$3-4 trillion in just one year.

Revealing also is the financing costs of such a sum, around US$5-20 billion a year on average over the period (depending on which number one takes if financed through low-cost sovereign debt. Such a modest sum would be shared between all rich (OECD+) countries whose combined national incomes are running at about US$60 trillion annually.

Put differently, the cost of sustaining our global community as we know and love it is 15-50% of the US$40 billion or so we spend annually on dog and cat food.

On the specific suggestion of sovereign debt as a possible policy pathway, front loading funding for global action through sovereign debt is not a new approach. The International Finance Facility for Immunisation was launched in 2006 through the initiative of the UK Government and supported by France, Italy, Spain, Sweden, Norway and South Africa. It raises finance by issuing bonds in the capital markets and so converts long-term government pledges to support global health goals into immediately available cash resources for the Global Alliance for Vaccines Initiative (GAVI).

Three objections are usually raised against debt-financed approaches, that: (a) the developed world have no appetite because of the debt burden they have already taken on in seeking to spend themselves out of the recession, (b) the low annual numbers are deceptive because the principal still has to be repaid by tomorrow’s tax payers, and, (c) a focus on government-raised funds will place too much power in the hands of inefficient governments in determining the allocation of funds.

These arguments are weak or simply beside the point. On (a), the opposite is in fact true, that the extraordinary levels of debt incurred by developed country governments in the last 18 months makes the amounts we are discussing quite trivial in economic or indeed political terms. On (b), we can and must assume that carbon markets will become more robust over time and generate more revenues, further augmented by the additional taxes coming from successful low carbon growth. In essence, the money is in fact an investment in creating that future, and should not be treated like a deadweight cost funded by debt. The third argument is simply beside the point, not because it is irrelevant (it isn’t), but because we would need to deal with this issue irrespective of where the money came from.

Do the maths, and it is clear that the money can be found, cheaply, now. It is not a ‘pay-off’, but an investment in our future, or if you must the cost of staying on the rails. Sovereign debt is the most cost-efficient way to ensure predictability of needed funds, and can be the source of last resort once any other sources have been exhausted.

My piece, ‘Revising Plan A’, published a couple of weeks ago first on OpenDemocracy.net and then on ChinaDialogue.net, has generated some heated responses, covered now on various forums including ChinaDaily.com. With 48 hours to go before the end of the Copenhagen talks, i thought it relevant to offer a couple of reflections based on my original argument and the current situation.

My argument, in a nutshell, was that any top-down multilateral agreement relying for success on sovereign abatement commitments and international public finance funding credibly verified outcomes is doomed to failure. Instead, i argued, we need to rely on the power of national interests, supported where possible by international co-operation. Of the many national interests that might exist, I argued, growth and development comes top on everyone’s list, so ‘low carbon growth and development’ should and will be the touchstone of success in climate management.

Respondents to my argument (which can be read through the linked articles) told me that I should not be so pessimistic, that some international agreements worked, and that national self-interest would not do the job alone (apologies if i have missed the breadth and nuance of the arguments).

Being right is not the point, but getting it right most definitely is.

If Plan A was indeed a conventionally-understood strong deal in Copenhagen, then we have underachieved. If this was the only way to save us from ecological meltdown, then such underachievement is indeed a disaster unfolding. My take is different: first, we will under-achieve in conventionally understood terms (too little legally binding commitment, too little public money); second, we are not doomed if we catalyze self-interested action, raising its timely ambition through international support. India’s solar drive, China’s extensive investments in low carbon growth, Europe’s carbon trading framework, and Brazil’s action on deforestation are all unilateral moves that work better through international co-operation.

My point is not that national, self-interested actions are instead of, but rather than that they are the heartland of real change. Hence the article’s title ‘Revising Plan A’. They might be effectively catalyzed by international action, but they are also in danger of being distracted by them, especially in weaker countries which could end up with yet another generation of rent-seekers rather than wealth creators.

Driving low carbon growth and development does require action on adaptation, which does require public as well as private money, and in some cases international public finance. Technology transfer is not going to be enhanced through a global climate deal, but does have to be facilitated through technology and country(ies) specific deals. Reducing deforestation and land use changes (REDD+) is hugely important, and will benefit from a strong international component, but even here money will flow mainly bilaterally when push comes to shove.

So far from being pessimistic, I am wildly optimistic. The difference is that i am looking somewhere else for my optimism, where real communities, domestic politics, national government actions, and private money rule the day. One last thing: a stronger global deal can be induced through action on the ground. That means that we need a political agreement now that does not ‘freeze’ the deal, then we need 1,000 days of intensive nation-level action to show how this stuff can work at scale. Then we can re-visit the deal and I warrant the appetite for more and stronger will be greater as Chinese, US, European and Indian economic interests converge on not just the logic but the practice of low carbon economics.

Walking through Babylon from SImon Zadek on Vimeo.

Well, the ‘walk out’ (not formally a walk out because the G77 spokeperson said “we have not walked out, we are firming up our position on the KP, the KP is our exodus point”) an hour or so ago by G77 negotiators provides a dazzling display of ‘negotiators’ itch’, akin to the itchy trigger finger of someone holding a loaded gun who is feeling frustrated and let down. So they are out, at least for now, just as their political masters begin to arrive in mass. Or at least just as these noble ministers stand for hours in the huge queues outside the Bella Centre that reflect no less than a fit of Danish sense of fairness in not distinguishing between those representing the global voice of vegetarians and the actual ministers who are meant to be inside negotiating.

Scratching the negotiators’ itch has happened on the face of it because of the perceived abandonment of the Kyoto Protocol by wealthy nations as a basis for doing business beyond 2012. And they are right that this is facing a Northern axe, but is that really a smart or even the real reason for walking. History suggests that cumulative frustration leads to walk outs and wars, a fact that is as true for BA facing yet another strike, or us all as these proceedings degenerate by the hour.

There is little money on the table, and certainly nothing that has the number of zeros required (to the right) to do the job on mitigation or adaptation. China has now publicly accepted that it is not a candidate for public financial transfers from wealthy countries (accepting the inevitable, but in rather an elegant and constructive way it has to be said, since they probably could have pulled G77 to walk out just on that point). And the domestic mitigation offers remain stuck decidedly low, at the very best still delivering 5GT too little mitigation in 2020, a seemingly little number but in fact one that would be impossible to claw back beyond 2020 because of the carbon-intense investments that would take place in the next decade without a high carbon price and money to mitigate.

The truth is that there is a deal to be made today, a pathway to COP16 in Mexico that could raise ambitions, and the potential for a ‘review and strengthening’ in 2014 once we are out of the recession and in receipt of the IPCC’s 5th Assessment Report. But the truth also is that the negotiator’s itch has become so irritating that it is being scratched at every opportunity. Indeed, it might be a viral problem in that it is becoming less likely that the 100 or so politicians due ‘to come in out of the cold‘ (for those into old movies) can find a way to ditch the itch and do the right thing.

Mr Tony Blair led a high-level session yesterday on forests, which as we all now know provides up to fifth of global opportunities to 2020 for carbon mitigation. Blair is the unquestioned master of messaging, so i sat humbly seeking to read the tea leaves in his eloquent words. That said, there is an Obama-like complexity in his dialectics so that it can be a little tough to derive a straight line from the word to the meaning.

Framing his remarks, Mr Blair made clear that his role was to talk about policy, rather than science, economics or some other polemic. So with that in mind, i think what was he said, roughly speaking, was that ‘one needs to accept that this is tough, and that different folks have different views; that the science is agreed, but there are differing views; that there is common cause, but differing perspectives, and that there is lots that can be achieved in Copenhagen, and yet lots to do from next week‘.

Mr Blair’s erudite remarks were of course in large part correct, being a blend of axiomatic and tautological statements. But such accuracy does not serve what I trust was Mr Blair’s intended purpose, to strengthen the chances of an effective deal rather than prepare us and position key folks for a sadly inadequate deal. Yes, we are all challenged here in this compact Northern capital to get to a deal that works, that passes if you like the ‘laugh test of history‘. Yes, there will be weaknesses in whatever is agreed if anything is agreed. But no, we do not need pacifying at this or any stage by great politicians or fly-by pundits, however well meaning.

We need leadership that instills courage not acceptance, and clarity not obfuscation. We need leaders to call what we have by what it is, and to work hard to establish the bar below which spells disaster and to find ways to stay above it come what may.

So thank you Mr Blair for coming by, and i remain as always in awe at your style. But no thank you for your guidance today and please reconsider your messaging, aptly and uniquely communicated, when you pass by tomorrow.