It’s going to be one for the history books. On Friday 20th September, millions of people around the world will be taking to the streets as part of the biggest climate action ever organised.
By Hannah Dewhirst who studied Philosophy, Politics and Economics at the University of Oxford and has an MA in Peace and Conflict Studies from the University of Manchester.
Cross-posted from Positive Money
It’s going to be one for the history books.
Tomorrow on Friday 20th September, millions of people around the world will be taking to the streets as part of the biggest climate action ever organised.
We’ll be there to protest the tragedy of climate change: the heatwaves, wildfires, droughts and storms which have devastated people’s lives and the natural world. But more than that, we’ll be there to call for change.
And the key to that change is the Bank of England.
The Bank of England is one of the most influential institutions in our economy because it has two immense powers: the ability to regulate private banks and the ability to create new money. Both of which are vital things that need to happen if we’re going to prevent further climate breakdown.
Firstly, even though it’s obvious we’re in a climate emergency, the big banks are still pouring billions into extracting and burning fossil fuels so they can keep making profits. But, if the Bank of England changed regulations, banks would pay a much higher price for funding such carbon-intensive industries. They’d have to stop and redirect their funds into different sectors. This would choke off the flow of funds toward fossil fuels and ultimately mean more fossil fuels stay in the ground. The Bank already uses tools like these to reduce risk in the housing market so why shouldn’t it use them to tackle climate change?
Secondly, transitioning to a greener economy will require a massive amount of investment. We’ll need billions to fund new renewable energy projects, retrain ex-fossil fuel workers and build more public transport – to name just a few things!
Many opponents argue we can’t afford all this, but they’re wrong. The Bank of England has the power to create new money in our economy, and could use it to support public investment in green projects. Since the 2008 financial crash, it has created £445 billion pounds trying to get our economy back on track (and we have a lot of thoughts about that!), and this time the crisis we’re facing is even bigger.
We’ve already seen that change at the Bank of England on the issue of climate is possible. One of our demands last year was for the Bank to disclose its climate risk and back in April, Governor Mark Carney publicly announced they’d do just that. But given the scale of the climate crisis we need them to move much further, much faster.
As the most powerful regulator in our financial system, the Bank could use its powers to stop other banks pouring more money into fossil fuels, and create money to help fund our transition to a green economy. Both of which would be invaluable steps to tackling the climate crisis.
So, the 3 things we need the Bank of England to do urgently are:
- “Green” its own operations: when it creates new money, use it to fund the green transition.
- Make private banks and finance firms reveal their climate impact and risks.
- Use regulations to actively penalise banks for high-carbon lending and investment.
We’re calling on the Bank to take big, bold action and we need you to as well, so please sign our petition demanding the Bank of England act before it’s too late here, and find your nearest strike tomorrow here!