Earth Equity News

Friends of the Earth (UK) Warns Carbon Markets Will Trigger Sub-Prime Crisis. By Andrew Donoghue, Business Green, November 5, 2009. "Carbon cap-and-trade schemes are a dangerous distraction and could trigger the next sub-prime financial crisis, according to environmental campaigners and academics. In a report [released] on November 5, Friends of The Earth says that carbon markets have been hijacked by financial organisations that are creating ever more complex products which echo the mismanagement and greed which initiated the banking and credit crisis. According to the report, A Dangerous Obsession [PDF, full report, 64 pp; summary. 6 pp]... the system has been subverted by speculators creating complex financial instruments, the report states. 'Far from proving to be an economically efficient instrument, carbon trading and offsetting have been beset by inefficiency and, in places, corruption and are set to become the next sub-prime crisis,' said professor Steve Rayner, director of the Institute for Science, Innovation & Society at the University of Oxford. The report says carbon trading is being used as a smoke screen by rich countries to avoid their commitment to help developing nations tackle climate change. Friends of the Earth wants the government to simplify the approach to regulating carbon by developing a clear carbon tax and investing in technologies to help the UK meet its target of reducing emissions by at least 40% by 2020, without offsetting."