What is earth worth

Economics
VS
The Climate
prepared by Peter Bruijns
1

Introducing the
Context
Economics

Peter Bruijns
P.Eng., MBA
Economics
Peter Bruijns is an experienced executive with global management
experience having worked for years in China and has experience in many
other countries. He has worked as a leader in health care, biotechnology,
environmental technology, construction, economic development and as an
entrepreneur. He has a Mechanical, Engineering Degree from Western
University and Executive MBA from the Ivey School of Business as well as a
Diploma in Architecture from Fanshawe College.
He has established three businesses in China and has met with or
negotiated with every level of Government. He worked for seven years as
the CEO of an environmental air pollution company which had operations
in more than 25 countries around the world. There he acquired a deep
appreciation of the challenges within the environmental sector.
He has been the keynote speaker at multiple events with emphasis on
global economics as relates to the climate emergency. He has lectured at
the Ivey School of Business on multiple occasions focused on International
Business and Marketing.
He is now the Executive Director of the Sault Ste. Marie Innovation Centre
focused on the Digital Smart City, Advanced Manufacturing and Ag Tech
components of the economy. The organization is charting an economic
development course that factors in global issues. Understanding our global
environment as a series of threats leading to opportunities for the creation
of high value employment pillars.

Geo-Political
Compromises
Corporations
Big Business
Government
All Levels
Agencies
Wealth
Siphons
Technology
Acceleration &
Impacts
Household
Unit
Small
Independent
Businesses
Pays for Everything
But has no influence
prepared by Peter Bruijns 4
Global Economic Forces VS the People

Wealth
Siphons
Geo-Political
Compromise
What is it?
- It is concessions below domestic standards in foreign trade agreements that unfairly
adjust cost competitiveness in favor of corporations across two or more sovereign
countries. Power transfers to corporations from government.
- Foreign worker programs. Inappropriate use of child labour.
- Environmental regulations on air, water and soil.
- Human and worker rights legislation
- Dangerous working conditions.
- Lack of enforcement commitment when regulations are in place.
What is it?
- It is corporate practices that draw wealth out of a corporation for the benefit of a small
group of people who put greed above performance.
- Share buybacks to inflate share prices.
- Ultra high executive compensation disproportionate to the organization.
- Accumulation of unprecedented wealth transferred from a corporation to individuals.

Global Trade
Agreements
• In 1947 General Agreement on Tariffs and
Trade to spur economic recovery post war
• GATT updated 7 times for increased trade
liberalization
• In 1979 China and USA sign trade agreement
• Canada-USA initiate FTA in 1988
• NAFTA formed 1994 to include Mexico
• World Trade Organization founded 1995 to
replace GATT
• China joined WTO in 2001
• WTO has 164 member nations now

Let the Games Begin: The Rise of Corporations
Or playing one off the other with no repercussions
DEVELOPING NATIONS (the have nots)
• Cheap power using dirty coal with no scrubbers
• Freedom to dump into waterways with no consequences
• Using local people with far fewer rights than back at home
• Dangerous working conditions
• No respect for local workers, decrepit housing, no benefits
• No emissions control on VOCs, Carcinogens
• Cost of negligence low
• All transportation logistics polluting
WESTERN NATIONS (the have’s)
• Worker rights protected
• Union option kept a balance of power
• Utilities more expensive
• Wages negotiated within strong labour laws
• Powerful environmental regulations
• Regulatory environment drove technology adoption
Result of Trade Policies:
Reduction of Regulations, lower wages, more debt, populism

Trade deficits exploded once trade opened up. Production moved to low cost regions with no
ethical restrictions as fast as possible.
Governments
Mexico

Corporations
Big Business
Walmart, Wayfair and
Amazon
As volumes of goods
grew sales and
distribution pipelines
grew with them.

Companies with few constraints entered China and used it.
While back home companies could not compete.
Governments

How many manufacturing jobs disappeared?
How many others disappeared along with them?

If trade with China grew that fast and it drained so many jobs and money out of the US economy,
where did it go? It went here.

At end of 2018 US Federal Debt
was $21.8 Trillion.
Governments
13

The Canadian government has not faired
well either. Below are Canadian Federal
Debt and the largest province, Ontario
debt.
Canadian
Governments

So we let companies import almost anything from outside.
We didn’t apply any controls on them …. at all.
And we thought it would help our own people?

16
Unemployment Rates Have Trended Down for Decades
Each major recession sparked huge job losses. However, jobs recovered after each but at lower
wages. Unemployment rates are no longer the key metric.

Household
Unit
Over time lower wages took over and wealth shifted to
a small minority. The real wage gap is the expression of
how much wealth we gave up to global free trade.
Population
Incomes
What Households Lost
50% 100%

Household
Unit
United States Family Unit average household income performance. Over past 30 year period
income rose 20% in total and real GDP rose 55%.
What Households Lost
While you were growing up, a lot happened.

Household
Unit
• How much has the Family Unit lost over the past 30 years? (Well from 1985 to 2015).
• Total lost household income over the 30 year period was: $ 21.6 Trillion.
• This is equivalent to $6,400 per year per household.
• Canadian experience likely similar on a per Family Unit basis.
The Surrendered Economic Foundation

What everyone seems to forget is the Household Unit pays for absolutely everything
including the taxation dollars of corporations.
Some viewpoints
• 11.5% of Ontario workers earn minimum wage, up from 1 in 40 over a 20 year period.
• Almost 60% earn under a living wage or are in precarious jobs.
• Inflation is higher for me than what the Government says it is. My wages are flat.
• Almost every week it seems the government is offloading a cost or service to us.
• I am surprised at how many of us kids, teens, adults have some kind of auto immune
illness or a mental health issue. Stress is hard.
• Our society is falling behind on everything . Education, health care, retirement
support, housing, climate change, justice, social services…..everything, but taxes go
up.
• We are constantly afraid of losing our jobs and governments cut services every day.
• I cannot keep up.
• I have no faith that Governments are there for us. I want change, any change that
feels like it is disruptive.
• Everything I read warns us of major problems around me.
• Whether it is fake news, real news or just too much news, it is all bad.
• I don’t know who to trust for real information. Companies and governments always
seem to lie.
Victim Impact
Statement
Household
Unit

A Look at Just One Wealth Siphon
A company makes a decision to take cash off its balance sheet to buy down the denominator of its
share value to create trading volumes. The primary intention is to drive the share price up for
insiders benefit.
The last 5 years saw $3 Trillion vaporize out of the economy into buybacks. $10,000 per person in
the US.
Made legal in 1982.
Wealth
Siphons

Small
Independent
Business
• This group of employers cannot ‘benefit’ from Wealth Siphons but are penalized heavily by
Geo-Political Compromise.
• SIBs are forced to, or opt to employ people in lower wage situations because their margins
are slim in the vast majority of firms.
• Their global competitors (i.e. Walmart) take full advantage of Geo-Political Compromise but
small firms have no leverage or buying power, nor do they have lobby power even within
business associations.
• Are subject to all global forces including AI effects.
• Tend to serve a local or regional market.

Corporations have no option but to devalue their wealthier home markets as the pressure to
drive down costs and drive out higher cost employees is never ending.
The main reason for domestic jobs is the need to protect intellectual property, R&D, legal
framework, financial systems and governance along with the minimum staff needed to support
sales to domestic markets. (Amazon, Walmart, Wayfair, etc.)
This is to the detriment of the Household Unit, Corporation and Government but to the
advantage of the few individuals who are Wealth Siphon beneficiaries and those individuals that
feed off them.
Offshoring is going to continue and expand into many service sectors such as IT, Software , etc.
Corporations
Big Business
Corporations still do not value western workers

This is not a problem of political ideals. There is a shared set of behaviours
within all major political parties, left, right and centrist. Liberal, Conservative,
Democrat, Republican … are all similar. How?
• Political leadership and power is a system of favours, trade offs,
relationships and it is marked by a short lifespan in the political framework.
• Almost all political people have a reliance on political concessions to
sustain them and provide for their lifestyle after office.
• Politicians are obliged to issue patronage appointments and are motivated
to position for same after leaving office.
• For every issue there are opposing forces which politicians are ill equipped
to discern. They are simply not qualified.
• Corporations have distanced themselves far ahead of citizens as the drivers
of political behaviour and the influence of policy.
• Corporations love the domestic struggles on all issues (gay rights,
immigration, racism, #meToo, political confusion) that separate political
party fundamentals and polarize people because those all distract from the
fiscal structures in place and it allows them to take an ethical stance if they
so choose.
So Why Do Politicians Do It?

It may seem odd that this slide show is about Climate Change.
It is but you wouldn’t know it…..yet.

Climate Change accelerated due to
lack of environmental consideration
and enforcement in all Trade
Agreements.
The globe was in trouble by 1900.
the tipping point line
When we got in trouble

A look at all sources of energy in
the world.
- Only Wind, Solar, Hydro are
clean sources of power.
- WiSH power is <10% of
global energy ~ 17,000 Twh
We have to replace about 120
Twh with all clean power ASAP.
- Not much hydro capacity left
- Wind & Solar need scaling by
factor of 50.
Im-Possibilities

Methane Emissions
Just another slide to help you
reach the conclusion that this is
all man made.

China: Nothing Is Going To Change
Unless we apply pressure globally

Human Health Impacts
When you burn fuel you create
fine particulate matter. This
harms human health.
“The researchers focused on air
pollution called PM2.5 – responsible
for an estimated 4.2 million
premature deaths every year
globally. This includes over a million
deaths in China, over half a million
in India, almost 200,000 in Europe,
and over 50,000 in the United
States.” McGill University March 2021
People have been dying for
decades due to air pollution.

Earth Impacts
Microplastics

The earth, until 2010 was
able to absorb 50% of all
human emissions to the
atmosphere per year.
The rest?
The brown-yellow colour of this lake is due to dissolved
organic carbon, or DOC. Photo by Dr. Bill Donahue

Human population is only one factor
that drives global emissions. From
1985 to 2010 China’s population rose
30% while emissions rose
approximately 500%.
Global population grew about 40%
between 1985 and 2012 with rapid
growth concentrating in southeast
Asia, Africa and the Middle East but
CO2 increased 100%.

Technology
Acceleration
& Impacts

Why We
Should
Collectively
Gasp
prepared
by
Peter
Bruijns
• So far, all society has done to
vent its anger is electing populist
leaders who spend their days
attacking government cost
structures but NOT the policies
that actually change the future.
• Society is going to realize very
soon that populism will not
resolve anything and then its
anger will build up because there
is no option beyond that
emerging in our political systems.
• Meanwhile, the planet keeps
degrading, the value of human
effort keeps going down and the
top 2% keep on taking what is
available into their personal
coffers.
• Ignorance still dominates public
opinion on all of this.
36

This should give a sense to how severe the problems are.
No solutions will be pain free.
The menu of solutions must factor in pain tolerance; here are a few musts.

Eliminate Wealth Siphons – Especially Share Buy Backs
They serve no benefit to society whatsoever, have no effect on inflation and ultimately will have a positive
effect on wages, investment, corporate culture and job growth as all that cash will be used to create real
value.
Will Be Painful
Taking $1 Trillion out of markets will trigger a
correction.
Retirement plans of families will take a hit.
Implementation has to be real smart and
timing perfect.

Apply Targeted Environmental Tariffs
If a product goes from one country to the next,
there is an index differential. The higher index
country may at its option tariff any product in
relationship to this differential.
Mexico Index: 59.69
Canada Index: 72.18
Difference: 12.49

Economic and Personal Freedom
A big part of Geo-Political compromise is tolerated
abuse of human rights, working conditions, fair
wages and others.

Apply Significant
Logistics Tariffs
• Ocean freight is responsible for up to 2.5% of all global
air emissions plus undetermined ballast dumping.
• Force shipping, trains and transports to go hydrogen or
EV.
• Importing from overseas jurisdictions adds additional
burden of freight emissions.
• A dot to dot levy on freight distance is easy to calculate
and assign.
Make Long Range Logistics Expensive

How Much Time Do We Have?
Two 4 year government cycles to make a fundamental change. If COP26 is not revolutionary we have failed.
Why 8 years? Because within 6 8 years AI and computational power will provide computing power greater
than a human mind, affordably to anyone who wants it for less than $1000. AI unpredictable.
And within 11 years 6 years the Arctic is projected to degrade permafrost to such an extent that methane
releases may well take over and could offset any rate of reduction we can attain as humans.

Methane Concentrations In Our Atmosphere
An ‘Oh Crap’ moment

50 years ago we experienced
the first moon landing. Since
then we have made a mess
here on earth.
•family incomes, jobs and your kids future ….
•government being able to provide good basic services like health care, education, social
services …
•a safe society ….
•then you also care about Climate Change.
If you care about …
Because all of this arises from the three cancers affecting the health of our world.

Wasted days and wasted nights…
Freddie Fender
• Assume we need to get to 1950 emissions levels as the number one
goal.
• We have to get there in 10-15 years or less from TODAY
• That means reducing and offsetting about 120k Twh of fossil fuel
consumption

But ……. urgency is OPPORTUNITY.
But now requires immense scale to realize success

The Role of Tariffs by example
Tariffs are a source of cash and outbound pressure on other nations
Canada imports about $740 billion a year, about $320 billion from USA and $47 billion
from China. Put a 30% tariff on every country under the top 30 on Environmental and
Human Freedom indexes.
Raises Canadian inflation on these products. Could raise $9.4 billion from just China.
• Puts pressure on China and others, Bangladesh, Indonesia
• Helps reduce consumption overall
• Provides Canada with capital to invest in climate solutions.
• Helps equalize competitiveness
• Gives Canadians choice on buying these products.

If Canada:
• Applies a peaking 30% tariff on all countries below 30 * it will raise $11 billion
• Removes subsidy from the oil and gas industry will raise $5 billion
• Adds a gas tax of $0.10 per litre EXTRA onto gasoline it will raise $4 billion
That is a $ 20 billion annual war chest to enable a climate economy that drives down emissions and
creates jobs. Uses of funds could be:
• Install nation wide EV charging stations in partnership with private sector
• Subsidize major emission reduction projects for major emitters such as steel, cement
• Invest in hydrogen generation infrastructure.
• Subsidize conversion of remaining coal power to natural gas or clean technology
• Install major grid energy storage reservoirs to maximize solar and wind power.
• Invest in R&D on climate solutions leading to scalable technology companies.
• Invest in other small countries to flatten/lower their emissions.
* See slides 39 and 40 for latest country rankings for human freedoms and environment

Organizing Global Trade Rebalancing
Based on an idea proposed by William Nordhaus – lecture on The Economics of Climate Change
Professor Nordhaus proposes a global ‘climate club’ which seeded the idea for this solution.
Create a ‘Climate Club’ with founding members the USA and/or the European Union and create
a charter of membership in the club which forms the foundation for a global trading block
dedicated to eliminating climate emissions and establishing a wealth creating network of
countries with improving freedoms for people.
Countries can join the ‘Club’ by signing onto the charter. Countries outside the club face
escalating tariffs on imports into the club.
Tariffs raised within the club are invested 100% into a climate economy platform with 75% going
to EU and USA and 25% to all other members again for emissions projects. The Club values
sequestration as much as it values reduction.

Worrisome Ramifications of the ‘Countries Club’
This will be an ugly process.
1. Countries outside the Club will retaliate with counter tariffs and other measures especially
major entities like China and Russia. This retaliation will create a lot of lobby reaction and
political pressure points.
2. Countries in the club will have committed to a major undertaking without clear pathways.
A really effective process of engagement and communication will be needed or the club will
break apart, especially in the first few years.
3. The more countries that opt in the more and harsher the reaction of China and Russia, even
Brazil.
4. Countries like Canada or Norway will have to join the Club but the required reforms will
cause major internal escalations of populism.
5. The transition of the O&G and other industries will fuel internal unrest in the USA in
particular where a large part of the population is change averse.
6. There will be an economic transition that may create a valley of uncertainty that populations
will struggle with. Process management must be flawless or war could result.
7. Tariffing will drive inflation which has political and societal impacts.

Peru as a possible example
51
• Assume Peru represents 5% of Club GDP except USA/EU.
• It could tariff China (and others 20%) so about $2 billion.
• It would get 5% of the international portion of USA/EU tariffs.
• 5% of 25% of about $160 billion or $2 billion of new investment
in country
• Would be required to invest negotiated % of GDP into climate
and human freedoms. (education?)
• This offsets retaliatory risk of China and enables significant
investment in emissions mitigation activities annually.
• Peru would get an elevated trading status within USA/EU to grow
exports.
Imports from China
$9.6 billion
Population 32.5 million
GDP of $226 billion
Avg Income of $15,000 USD
Annual GHG emissions 60 M tons
Emissions growing 10% annually

The End
Or a new beginning?
Your choice.
prepared
by
Peter
Bruijns
52

What is earth worth

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