Estonia’s e-governance revolution is hailed as a voting success – so why are some US states pulling in the opposite direction?

Estonian Prime Minister Kaja Kallas reacts to e-vote results on March 5, 2023. Raigo Pajula/AFP via Getty Images

Erik S. Herron, West Virginia University

Estonia, a small country in northern Europe, reached a digital milestone when the country headed to the polls on March 5, 2023.

For the first time, over 50% of voters cast their ballots online in a national parliamentary election.

As a political science researcher who focuses on elections, I was in Estonia to learn about the process of internet voting. In the capacity of an international election observer, I visited standard polling places and also attended the final internet vote count held in the parliament building.

As someone who also regularly volunteers as a poll worker in the United States, I found the contrast between Estonia’s integrated information systems and internet voting, and the patchwork system operating in the U.S., to be notable. And with several U.S. states withdrawing from the Electronic Registration Information Center, or ERIC, that contrast is growing sharper.

I believe Estonia offers America an important example of how information sharing can be used to enhance the integrity of elections.

Estonia’s e-governance system

Estonia has long been seen as a pioneer in digitizing the democratic process.

Internet voting, which began in Estonia in 2005, is just a small part of the e-governance ecosystem that all Estonians access regularly. Using a government-issued ID card that allows Estonians to identify themselves and securely record digital signatures, they can register a newborn baby, sign up for social benefits, access health records and conduct almost any other business they have with a government agency. This ID card is mandatory for all citizens.

Central to the success of Estonia’s digitization revolution is a secure data-sharing system known as the X-Road.

Government agencies collect only the personal information they require to provide their services, and if another agency has already gathered a piece of information, then it is accessible through the X-Road. In other words, each piece of personal information is collected only once and then shared securely when it is needed. A person’s home address, for example, is collected by the population register and no other government entity. If it’s needed by election administrators, health care workers, a school or any other agency, those organizations request it from the population register online.

So, imagine that you are applying for admission to a university, which requires both your date of birth and your school grades. These are stored by two different agencies. By using your ID card, you can auto-populate the application using data that the system instantaneously pulls in from the two agencies that store that information.

Because of this information sharing, election officials know who is eligible to vote and which online ballot they should receive no matter where they live in the country.

A decentralized approach in U.S.

For many reasons, the U.S. system of election management is very different from Estonia’s, and online voting is rare.

Developing and maintaining an e-governance system requires technical, political and social forces to align. Because each U.S. state manages its own elections, and decisions can vary at the county level or below, it is difficult to envision a consistent technical solution. It is also more challenging to coordinate a solution across such a large country and safely implement secure online voting given current U.S. internet voting technology.

Additionally, concerns about federal interference in state matters have prompted political and social pushback on recent election reforms. Public consensus on instituting a nationally mandated electronic ID similar to the one that forms the foundation of Estonia’s internet voting appears unlikely.

Research shows that most Estonians trust their e-governance systems, although there are skeptics. Some critiques focus on perceived security shortcomings.

The internet voting process has also become politicized. In the most recent election, one political party that had discouraged its voters from using online voting – and unsurprisingly trailed its rivals in the online count – challenged the process in court. Its effort to annul internet voting failed. The U.S. witnessed a similar dynamic around absentee ballots in the 2020 elections.

Nearly all U.S. voters vote in person or by absentee or mail-in ballot. Michael M. Santiago/Getty Images

Balancing security, efficiency and access

While the United States’ decentralized approach has its advantages, it also creates shortcomings in security, efficiency and access.

Secure elections means that only people who have the right to vote are able to cast a ballot and that they aren’t improperly influenced in the process. Efficient elections means the process is smooth — voters don’t have to wait in long lines, and their ballots are counted quickly and accurately. And access emphasizes that people who have the right to vote can register, gather the information they need in order to vote, and successfully cast their ballot.

Sometimes changes to voting practices that enhance one of these values – say, security – may create impediments for another – say, access. Requiring a photo ID to vote, for example, may reduce the small likelihood of voter impersonation, but it also risks preventing a legitimate voter who forgets to bring, or doesn’t have, a valid photo ID from exercising their right to vote. Finding an acceptable balance among these values is a challenge for citizens and policymakers alike.

Misinformation derails digital efforts

Several states, including my own state of West Virginia, recently made a decision that I believe undermines all three of these values by making our elections less secure, less efficient and less accessible.

In early March, West Virginia joined Florida, Missouri, Alabama and Louisiana in withdrawing from the Electronic Registration Information Center. ERIC is a multistate, data-sharing effort to make voter rolls more accurate and encourage eligible citizens to vote. The 28 participating states and the District of Columbia provide voter registration and driver’s license data to ERIC and receive an analysis that shows who has moved, who has died and who is eligible to vote but has not registered.

These reports help states clean up their voter rolls, identify incidents of fraud and provide unregistered voters with information about how to vote.

In other words, ERIC is designed to enhance security, efficiency and access. However, over the past year, unsubstantiated claims have circulated that ERIC is being used as a partisan tool to undermine election integrity.

ERIC was established, however, as a nonpartisan information provider with bipartisan support. States that exit ERIC may be sacrificing the integrity of their election process based on unfounded conspiracies.

The U.S. can learn a tremendous amount from Estonia’s e-governance revolution. Estonia faces a hostile security environment with an antagonistic Russia next door. But its integrated systems have helped balance security, efficiency and access in a wide range of government services. With the decision to withdraw from ERIC, some states are in danger of pulling the U.S. in the other direction.

Erik S. Herron, Professor of Political Science, West Virginia University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Misuse of Adderall promotes stigma and mistrust for patients who need it – a neuroscientist explains the science behind the controversial ADHD drug

Many people with ADHD are finding it difficult to get their Adderall prescriptions filled amid the shortage. AP Photo/Jenny Kane

Habibeh Khoshbouei, University of Florida

The nationwide shortages of Adderall that began in fall 2022 have brought renewed attention to the beleaguered drug, which is used to treat attention-deficit/hyperactivity disorder and narcolepsy.

Adderall became a go-to drug for ADHD over the past two decades but quickly came under fire because of overprescription and misuse. In some cases, people who do not have a proper ADHD diagnosis are using the drug for its perceived cognitive-enhancing effects, leading to an increase in its abuse rates and drug dependence.

Not only has misuse of Adderall led to its stigmatization as a drug of abuse, it can also lead to negative physical side effects, including cardiovascular complications, sleep disturbances and addiction.

I am a neuroscientist with a focus on studying the dopamine system in both the brain and peripheral immune system. My research specifically examines the short- and long-term effects of psychostimulant drugs like methamphetamine on a protein that transports dopamine, a chemical messenger that is not properly regulated in people with ADHD.

Through this work, I aim to better understand the complex interplay between drug use and the dopamine system, which may ultimately lead to new treatments for drug addiction and related disorders. Unfortunately, I’ve seen that the stigma and false narratives surrounding Adderall have made it more difficult for patients who need this medication to access it.

A surge in demand for Adderall during the pandemic along with supply chain issues have led to a nationwide shortage.

How Adderall treats ADHD

Adderall is the commercial name of a mixture of a few types of amphetamines, which are stimulants that increase dopamine levels in the brain to help address deficits in those with ADHD.

The underlying processes that lead to ADHD are poorly understood. The core symptoms include hyperactivity, inattention, mood swings, temper, disorganization, stress sensitivity and impulsivity.

Multiple studies suggest that these symptoms may be due to the improper regulation of dopamine levels in the brain.

Neurons have a protein called dopamine transporter that normally functions like a vacuum cleaner that sucks the chemical into the neuron. But people with ADHD have a leaky dopamine transporter, meaning that dopamine gets pushed out of the neuron into the surrounding environment of the synapse – the space between neurons where chemical messages are passed back and forth.

Adderall is thought to work by blocking this leaky protein, preventing dopamine from spewing out of the neuron through the dopamine transporter. This is thought to stabilize dopamine levels in the brain of ADHD patients, thus reducing their debilitating symptoms.

Adderall helps stabilize dopamine levels in the brains of people with ADHD.

The paradoxical effects of Adderall

People who don’t have ADHD usually have a functioning dopamine transporter that is able to maintain balanced levels of this chemical inside and outside of the neuron. When they use amphetamines like Adderall, however, the drug can disrupt the transporter’s ability to remove dopamine from the synapse as well as cause it to work backward and push dopamine out of the neuron. This results in too much dopamine in the synapse, which can lead to feelings of euphoria and increased wakefulness.

While these effects might sound good on the surface, misusing the drug is problematic because it can lead to cardiovascular problems. Current evidence suggests that Adderall doesn’t significantly increase cardiovascular disease risk for people with ADHD. But people without ADHD who misuse Adderall can develop a dependence on the drug and take it at dangerous dosages.

Adderall misuse doesn’t just involve a harmful cycle that reinforces its use because of its rewarding effects. It also reinforces dependence by causing negative emotional states some researchers have dubbed the “dark side” of addiction. Excessive activation of the brain’s reward system disrupts how it normally functions, resulting in a decrease in overall sensitivity to reward signals. It also leads to persistent activation of the brain’s stress systems, which results in feelings of anxiety and restlessness in the absence of the drug.

Adderall works when you need it

Other drugs like methylphenidate, known by the brand name Ritalin, also treat ADHD by targeting the dopamine transporter.

While Adderall and Ritalin reduce the hyperactive, impulsive and inattentive symptoms in people with ADHD by stabilizing dopamine levels, they do so using different mechanisms. Ritalin reduces the dopamine transporter’s leakiness by directly blocking entry. Adderall also reduces leakiness, but by competing with dopamine for entry into the transporter.

In people without ADHD, both Ritalin and Adderall significantly increase brain dopamine and induce euphoria, hyperactivity and other symptoms. However, both drugs are equally beneficial to patients with ADHD.

To treat anxiety, depression, narcolepsy and other neuropsychiatric diseases, millions of patients worldwide take medication that targets the transport of dopamine and other neurotransmitters like norepinephrine and serotonin, but their use is not stigmatized by recreational misuse.

Because of the euphoria-inducing properties and hyperactivity that Adderall can induce for those who do not need the drug, its misuse and abuse have unfortunately promoted false narratives about Adderall for those who do need it. For ADHD patients, however, it can reduce negative symptoms and greatly improve quality of life.

Habibeh Khoshbouei, Professor of Neuroscience, University of Florida

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Blessed are the (tiny) cheesemakers

Cheese is not just a tasty snack — it’s an ecosystem. And the fungi and bacteria within that ecosystem play a big part in shaping the flavor and texture of the final product.

By Ute Eberle

Some cheeses are mild and soft like mozzarella, others are salty-hard like Parmesan. And some smell pungent like Époisses, a funky orange cheese from the Burgundy region in France.

There are cheeses with fuzzy rinds such as Camembert, and ones marbled with blue veins such as Cabrales, which ripens for months in mountain caves in northern Spain.

Yet almost all of the world’s thousand-odd kinds of cheese start the same, as a white, rubbery lump of curd.

How do we get from that uniform blandness to this cornucopia? The answer revolves around microbes. Cheese teems with bacteria, yeasts and molds. “More than 100 different microbial species can easily be found in a single cheese type,” says Baltasar Mayo, a senior researcher at the Dairy Research Institute of Asturias in Spain. In other words: Cheese isn’t just a snack, it’s an ecosystem. Every slice contains billions of microbes — and they are what makes cheeses distinctive and delicious.

People have made cheese since the late Stone Age, but only recently have scientists begun to study its microbial nature and learn about the deadly skirmishes, peaceful alliances and beneficial collaborations that happen between the organisms that call cheese home.

To find out what bacteria and fungi are present in cheese and where they come from, scientists sample cheeses from all over the world and extract the DNA they contain. By matching the DNA to genes in existing databases, they can identify which organisms are present in the cheese. “The way we do that is sort of like microbial CSI, you know, when they go out to a crime scene investigation, but in this case we are looking at what microbes are there,” Ben Wolfe, a microbial ecologist at Tufts University, likes to say.

Early on, that search yielded surprises. For example, cheesemakers often add starter cultures of beneficial bacteria to freshly formed curds to help a cheese on its way. Yet when Wolfe’s group and others examined ripened cheeses, they found that the microbial mixes — microbiomes — of the cheeses showed only a passing resemblance to those cultures. Often, more than half of the bacteria present were microbial “strangers” that had not been in the starter culture. Where did they come from?

Many of these microbes turned out to be old acquaintances, but ones we usually know from places other than cheese. Take Brachybacterium, a microbe present in Gruyère, which is more commonly found in soil, seawater and chicken litter (and perhaps even an Etruscan tomb). Or bacteria of the genus  Halomonas, which are usually associated with salt ponds and marine environments.

Then there’s Brevibacterium linens, a bacterium that has been identified as a central contributor to the stinkiness of Limburger. When not on cheese, it can often be found in damp areas of our skin such as between our toes.  B. linens also adds characteristic notes to the odor of sweat. So when we say that dirty feet smell “cheesy,” there’s truth to it: The same organisms are involved. In fact, as  Wolfe once pointed out, the bacteria and fungi on feet and cheese “look pretty much the same.” (An artist in Ireland demonstrated this some years ago by culturing cheeses with organisms plucked from people’s bodies.)

Initially, researchers were dumbfounded by how some of these microbes ended up on and in cheese. Yet, as they sampled the environment of cheesemaking facilities, a picture began to emerge. The milk of cows (or goats or sheep) contains some microbes from the get-go. But many more are picked up during the milking and cheesemaking process. Soil bacteria lurking in a stable’s straw bedding might attach themselves to the teats of a cow and end up in the milking pail, for example. Skin bacteria fall into the milk from the hand of the milker or get transferred by the knife that cuts the curd. Other microbes enter the milk from the storage tank or simply drift down off the walls of the dairy facility.

Some microorganisms are probably brought in from surprisingly far away. Wolfe and other researchers now suspect that marine microbes such as Halomonas get to the cheese via the sea salt in the brine that cheesemakers use to wash down their cheeses.

A simple, fresh white cheese like petit-suisse from Normandy might mostly contain microbes of a single species or two. But in long-ripened cheeses such as Roquefort, researchers have detected hundreds of different kinds of bacteria and fungi. In some cheeses, more than 400 different kinds have been found, says Mayo, who has investigated microbial interactions in the cheese ecosystem. Furthermore, by repeatedly testing, scientists have observed that there can be a sequence of microbial settlements whose rise and fall can rival that of empires.

Consider Bethlehem, a raw milk cheese made by Benedictine nuns in the Abbey of Regina Laudis in Connecticut. Between the day it gets made (or “born,” as cheesemakers say) to when it’s fully ripe about a month later, Bethlehem changes from a rubbery, smooth disk to one with a dusty white rind sprouting tiny fungal hair, and eventually to a darkly mottled surface. If you were to look with a strong microscope, you could watch as the initially smooth rind becomes a rugged, pocketed terrain so densely packed with organisms that they form biofilms similar to the microbial mats around bathroom drains. A single gram of rind from a fully ripened cheese might contain a good 10 billion bacteria, yeasts and other fungi.

But the process usually starts simply. Typically, the first microbial settlers in milk are lactic acid bacteria (LABs). These LABs feed on lactose, the sugar in the milk, and as their name implies, they produce acid from it. The increasing acidity causes the milk to sour, making it inhospitable for many other microbes. That includes potential pathogens such as Escherichia coli, says Paul Cotter, a microbiologist at the Teagasc Food Research Centre in Ireland who wrote about  the microbiology of cheese and other foods in the 2022  Annual Review of Food Science and Technology.

However, a select few microorganisms can abide this acid environment, among them certain yeasts such as Saccharomyces cerevisiae  (baker’s yeast). These microbes move into the souring milk and feed on the lactic acid that LABs produce. In doing so, they neutralize the acidity, eventually allowing other bacteria such as  B. linens to join the cheesemaking party.

As the various species settle in, territorial struggles can ensue. A study in 2020 that looked at 55 artisanal Irish cheeses found that almost one in three cheese microbes possessed genes needed to produce “weapons” — chemical compounds that kill off rivals. At this point it isn’t clear if and how many of these genes are switched on, says Cotter, who was involved in the project. (Should these compounds be potent enough, he hopes they might one day become sources for new antibiotics.)

But cheese microbes also cooperate. For example, the Saccharomyces cerevisiae yeasts that eat the lactic acid produced by the LABs return the favor by manufacturing vitamins and other compounds that the LABs need. In a different sort of cooperation, threadlike fungal filaments can act as “roads” for surface bacteria to travel deep into the interior of a cheese, Wolfe’s team has found.

By now you might have started to suspect: Cheese is fundamentally about decomposition. Like microbes on a rotten log in the woods, the bacteria and fungi in cheese break down their environment — in this case, the milk fats and proteins. This makes cheeses creamy and gives them flavor.

Mother Noella Marcellino, a longtime Benedictine cheesemaker at the Abbey of Regina Laudis, put it this way in a 2021 interview with Slow Food: “Cheese shows us what goodness can come from decay. Humans don’t want to look at death, because it means separation and the end of a cycle. But it’s also the start of something new. Decomposition creates this wonderful aroma and taste of cheese while evoking a promise of life beyond death.”

Exactly how the microbes build flavor is still being investigated. “It’s much less understood,” says Mayo. But a few things already stand out. Lactic acid bacteria, for example, produce volatile compounds called acetoin and diacetyl that can also be found in butter and accordingly give cheeses a rich, buttery taste. A yeast called Geotrichum candidum brings forth a blend of alcohols, fatty acids and other compounds that impart the moldy yet fruity aroma characteristic of cheeses such as Brie or Camembert. Then there’s butyric acid, which smells rancid on its own but enriches the aroma of Parmesan, and volatile sulfur compounds whose cooked-cabbage smell blends into the flavor profile of many mold-ripened cheeses like Camembert. “Different strains of microbe can produce different taste components,” says Cotter.

All a cheesemaker does is set the right conditions for the “rot” of the milk. “Different bacteria and fungi thrive at different temperatures and different humidity levels, so every step along the way introduces variety and nuance,” says Julia Pringle, a microbiologist at the artisan Vermont cheesemaker Jasper Hill Farm. If a cheesemaker heats the milk to over 120 degrees Fahrenheit, for example, only heat-loving bacteria like Streptococcus thermophilus will survive — perfect for making cheeses like mozzarella.

Cutting the curd into large chunks means that it will retain a fair amount of moisture, which will lead to a softer cheese like Camembert. On the other hand, small cubes of curd drain better, resulting in a drier curd — something you want for, say, a cheddar.

Storing the young cheese at warmer or cooler temperatures will again encourage some microbes and inhibit others, as does the amount of salt that is added. So when cheesemakers wash their ripening rounds with brine, it not only imparts seasoning but also promotes colonies of salt-loving bacteria like B. linens that promptly create a specific kind of rind: “orangey, a bit sticky, and kind of funky,” says Pringle.

Even the tiniest changes in how a cheese is handled can alter its microbiome, and thus the cheese itself, cheesemakers say. Switch on the air exchanger in the ripening room by mistake so that more oxygen flows around the cheese and suddenly molds will sprout that haven’t been there before.

But surprisingly, as long as the conditions remain the same, the same communities of microbes will show up again and again, researchers have found. Put differently: The same microbes can be found almost everywhere. If a cheesemaker sticks to the recipe for a Camembert — always heats the milk to the relevant temperature, cuts the curd to the right size, ripens the cheese at the appropriate temperature and moisture level — the same species will flourish and an almost identical kind of Camembert will develop, whether it’s on a farm in Normandy, in a cheesemaker’s cave in Vermont or in a steel-clad dairy factory in Wisconsin.

Some cheesemakers had speculated that cheese was like wine, which famously has a terroir — that is, a specific taste that is tied to its geography and is rooted in the vineyard’s microclimate and soil. But apart from subtle nuances, if everything goes well in production, the same cheese type always tastes the same no matter where or when it’s made, says Mayo.

By now, some microbes have been making cheese for people for so long that they have become — in the words of microbiologist Vincent Somerville at the University of Lausanne in Switzerland — “domesticated.” Somerville studies genomic changes in cheese starter cultures used in his country. In Switzerland, cheesemakers traditionally hold back part of the whey from a batch of cheese to use again when making the next one. It’s called backslopping, “and some starter cultures have been continuously backslopped for months, years, and even centuries,” says Somerville. During that time, the backslopped microbes have lost genes that are no longer useful for them in their specialized dairy environment, such as some genes needed to metabolize carbohydrates other than lactose, the only sugar found in milk.

But not only has cheesemaking become tamer over time, it is also cleaner than it used to be — and this has had consequences for its ecosystem. These days, many cows are milked by machines and the milk is siphoned directly into the closed systems of hermetically sealed, ultra-filtered storage tanks, protected from the steady rain of microbes from hay, humans and walls that settled on the milk in more traditional times.

Often the milk is pasteurized, too — that is, briefly heated to high temperatures to kill the bacteria that come naturally with it. Then, they’re replaced with standardized starter cultures.

All of this has made cheesemaking more controlled. But alas, it also means that there’s less diversity of microbes in our cheeses. Many of our cheddars, provolones and Camemberts, once wildly proliferating microbial meadows, have become more like manicured lawns. And because every microbe contributes its own signature mix of chemical compounds to a cheese, less diversity also means less flavor — a big loss.

Lea en español

Ute Eberle is a science journalist in Baltimore.

This article originally appeared in Knowable Magazine, an independent journalistic endeavor from Annual Reviews.

How direct admission is changing the process of applying for college

A college admission letter might come from a school you haven’t applied to – or even heard of. Antonio_Diaz / iStock / Getty Images Plus via Getty Images

Mary L. Churchill, Boston University

For students and families who are considering college, a relatively new option for admission is gaining popularity. In addition to the long-standing regular admissions process, and various options for early admission decisions, is something called “direct admission.”

The Conversation asked Mary Churchill, a scholar of higher education administration at Boston University, to explain what direct admission is and how it works.

What is direct admission?

In direct admission, soon-to-be high school graduates can be accepted into a college or university without having to submit an application.

This often happens during a student’s senior year of high school, but some colleges make these offers during junior year.

Direct admission is one of several strategies colleges and universities use to make it easier for high school graduates to go to college. They are also hoping it can help reverse a trend of declining higher education enrollment in the U.S.

Applying to college can take a lot of money and time and requires students to figure out the college application process, which can sometimes be complex. The fear of rejection also discourages some people from applying.

With direct admission, this fear of rejection is removed because qualified students receive an acceptance letter from a college without needing to apply.

One university’s explanation of the direct admission process.

How can students qualify?

In some cases, all a student has to do is graduate from high school. In other cases, students have to achieve a certain GPA or score on the ACT or SAT.

Students don’t typically know that they have qualified until they receive an acceptance letter. Many community colleges are charged with offering educational opportunities to any member of the public. So they will often directly admit all students who successfully graduate from a given high school or district. Other colleges are more selective and may admit all graduates with grades or standardized testing scores above a minimum target.

In some states, all students who graduate from a public high school are offered admission to a set of public colleges and universities. Idaho was the first to do this, in 2015.

What are the benefits for colleges?

One of the biggest advantages is they get more direct access to the students the college wants to attract, which can be different for every college. Often the most desirable students are top scholars, people from a particular geographic area or some combination of demographic attributes, like racial or ethnic background and family economic status.

This enables colleges to reach more students than they would if they only did high school visits and college fairs, or direct marketing to students.

In addition, the college has an opportunity to reach potential students who are from more demographically diverse backgrounds than their usual applicants.

For example, colleges can target schools that have a lot of students from a particular group that is underrepresented on campus and that the college hopes to attract – and offer direct admissions to all the students in a graduating class.

If a college wanted to enroll more male students, it could offer direct admissions to all-boys high schools. If it wanted to enroll more Black and Latino boys, it could offer direct admissions to all-boys high schools with larger populations of Black and Latino students.

What are the benefits for students?

Direct admission does not require students or their families to fill out an application or pay application fees. Of course, students who accept their admission must complete paperwork and pay tuition and other costs associated with enrolling – but they need not do anything to receive an admission letter from the college.

When an unexpected welcome letter arrives from a well-known college, it can help students who didn’t see college in their future begin to envision themselves as college students.

Some colleges target students for direct admission even earlier than their junior years, because they know that students often decide whether they want to go to college or not as early as middle school.

Evidence shows that direct admission programs lead to more students admitted to colleges, and more students attending.

When Idaho launched its statewide direct admissions program in 2015, overall college enrollment grew by about 8%.

Is this the future of college admissions?

For colleges that are nonselective, the answer is yes.

Direct admission is a relatively inexpensive way for an individual college, or an entire state, to make college opportunities more clearly available to more students. Colleges can get the attention of their ideal student populations.

As direct admission becomes more common, colleges – especially community colleges – will likely need additional staff and money to handle the large-scale influx of admissions.

Some institutions are even partnering with education management companies, such as Concourse, Sage Solutions and The Common Application. These colleges may be able to spend less on marketing and recruitment over time. But initially, they will need to spend more to process students admitted directly.

Students may find themselves receiving admission letters from colleges they’ve never applied to – and perhaps never even heard of. This may lead students to turn more to guidance counselors to help them decide which direct admission offers to accept based on a school’s cost, academic programs and other factors.

Mary L. Churchill, Associate Dean, Strategic Partnerships and Community Engagement and Professor of the Practice, Boston University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Beyond COP27: Who will pay for climate solutions?

VIDEO: Economic issues were front and center at the most recent global climate summit. Join Tobias Adrian of the International Monetary Fund and Shuang Liu of the World Resources Institute to take stock of the investments needed to prevent future climate disasters.

Watch the replay of this event held on December 7, 2022. (Transcript below.)

Trillions of dollars every year, for decades. That’s what we need to spend on green technology and infrastructure to stave off the worst impacts of climate change, experts calculate. As negotiations continue beyond this year’s UN climate summit (COP27), join our free online conversation with Tobias Adrian, of the International Monetary Fund, and  Shuang Liu, of the World Resources Institute, about how governments, banks and investors can fund a greener future — and why that’s a smart investment.

Attendees will learn:

• The role of national governments, international organizations and private industry in addressing the economics of climate change
• Why many argue that wealthy countries such as the US should do more to help poor countries adapt to climate change
• Why large investments in science and technology are needed to meet emissions targets

Speakers

Tobias Adrian

Financial Counselor and Director of the Monetary and Capital Markets Department, International Monetary Fund (IMF)

Tobias Adrian leads IMF efforts to find strengths and weaknesses in the global financial system, and to ensure its stability. Before joining the IMF, Tobias was a senior vice president of the Federal Reserve Bank of New York, where he contributed to monetary policy, financial stability policies and crisis management. He has published extensively in economics and finance journals and is on the editorial committee of the Annual Review of Financial Economics. He holds a PhD from the Massachusetts Institute of Technology.

Shuang Liu

China Finance Director, World Resources Institute (WRI)

Shuang Liu leads the WRI Sustainable Finance Center’s work on China finance and the Belt and Road Initiative. She works with governments, private financial institutions, NGOs and other partners to shift China’s investment to sustainable finance. Prior to WRI, Liu oversaw the development and implementation of strategies on climate mitigation and economic transition at Energy Foundation China. She developed Greenpeace’s first coal campaign strategy in China and has worked for consulting firms to assess greenhouse gas mitigation opportunities for private sector clients and government agencies. Liu holds a master’s degree in environmental and resource economics from University College London.

Moderator

Emily Underwood, Knowable Magazine

Emily Underwood is the host and producer of virtual events at Knowable Magazine from Annual Reviews. She has been covering science for over a decade, including as a staff neuroscience reporter for  Science. In 2016-17, she was a Rosalynn Carter Fellow for Mental Health Journalism, and her reporting has won national awards, including a 2018 National Academies Keck Futures Initiatives Communication Award for magazine writing.

About

This event is part of an ongoing series of live events and science journalism from Knowable Magazine and  Annual Reviews, a nonprofit publisher dedicated to synthesizing and integrating knowledge for the progress of science and the benefit of society.

Future Tense is a partnership of Slate, New America and Arizona State University that examines emerging technologies, public policy and society. Sign up for  Future Tense’s newsletter.

Resources

More from Knowable Magazine

• The obscure calculation transforming climate policy
• The tricky task of tallying carbon
• Now is the time to prepare for the economic shocks of battling climate change
• How cities can fight climate change
• Many mangrove restorations fail. Is there a better way?
• A rise in US flooding — and a rethink
• The creative way to pay for wildlife recovery
• A lifetime of climate change
• Rethinking air conditioning amid climate change
• How green are biofuels? Scientists are at loggerheads
• What can cities do to survive extreme heat?
• Rethinking insurance for floods, wildfires and other catastrophes
• Recycling meets reality
• Make electric vehicles affordable for the rest of us
• Europe should shape the clean fuel market now

Related Annual Reviews articles

• Climate Finance
• Financial Stability Monitoring
• Climate Change and the Financial System
• Three Decades of Climate Mitigation: Why Haven't We Bent the Global Emissions Curve?
• The Economics of 1.5°C Climate Change
• Beyond Technology: Demand-Side Solutions for Climate Change Mitigation
• The Consequences of Uncertainty: Climate Sensitivity and Economic Sensitivity to the Climate
• Optimal Taxation in the Macroeconomics of Climate Change

More from Slate

• The SEC Should Require Companies to Disclose Climate Change Risk
• A Promising Technology to Fight Climate Change Is Finally Becoming a Reality
• Oil Companies Are Whining About “Discrimination.” Now What?
• Will Climate Tech Save Us?

Transcript

Emily Underwood: “Hello everyone. Welcome to our 21st live online event, ‘Beyond COP27: Who will pay for climate solutions?' I’m Emily Underwood, your host today, and the producer of events for  Knowable Magazine. This is a special event brought to you by Annual Reviews,  Knowable Magazine and Future Tense. Future Tense is a partnership of  Slate, New America and Arizona State University that examines emerging technologies, public policy and society. If you haven’t checked out Future Tense before, please do, sign up for their newsletter and sign up for  Knowable’s newsletter, too. We will be recording this event. You can replay it after it’s over and share it with others.

“A few technical things, if you can’t hear the audio, please refresh your browser and make sure the mute button is off. Do the same if one of the speaker tiles goes black. This is a known quirk, so you’re going to refresh your browser — same thing. OK. Put your questions in the question box at the bottom right of the screen. This is different from the general chat that you’ve been saying hi on. So take a second and make sure you can see that question box. You’re going to put your questions there. After about 30 minutes of discussion, our editors are going to pick from the list, and then we’ll answer as many of those questions as we can.

“All right, let’s meet our guests. First, we have Dr. Tobias Adrian, who joins us from Washington, DC. Tobias is the financial counselor and director of the Monetary and Capital Markets Fund of the International Monetary Fund. He’s on the editorial committee of Annual Reviews of Financial Economics, and he’s written extensively for Annual Reviews and many other publications. So welcome, Tobias. Can we bring Tobias up?”

Tobias Adrian: “Hello, Emily.”

Emily Underwood: “Hi. OK. Let’s meet our other guest, Shuang Liu. She is the acting director of the World Resources Institute’s Sustainable Finance Center. Among many other responsibilities, she works to help China shift its massive investments, at home and abroad, away from fossil fuels toward green development. And that’s just one of her many, many roles. So Tobias and Shuang, thank you for joining us today. And I also just want to say hi to everyone in our audience. I am seeing guests from Nairobi, Detroit, Ghana. Welcome. It’s really fun to see where you’re joining from, so please do share that in the chat if you like.

“We’re going to start this event off a little differently. We’re going to start with a poll that we can all participate in. So if you look to the right of your screen, you’re going to see a little icon for a bar graph. Can everybody click on that bar graph? Does everybody see the poll? Yes? OK. What you should be seeing in front of you is a question, which is just, where do we stand when it comes to funding climate change solutions? And you have six different options.

“First, ‘It’s going great!’ We’re golden. The other is ‘It’s going in the right direction, but we need to move much faster.’ The third is, it’s hard to say: There’s either plenty of money, lots and lots of money, or not nearly enough — outlook hazy. The other is, ‘We’re in deep trouble, but it’s still possible.’ ‘We’re out of money and/or time.’ And then the answer is, ‘Wrong question! Concentrate and ask again.’

“And, yes, I did get some of these answers off of a Magic 8 Ball. So please make your votes. We will show the results of this poll when we get to the end of our conversation, but I’d like to kick things off by asking what our speakers think. So Tobias, let’s start with you. Where do you land? We’re golden or we’re doomed or outlook hazy?”

Tobias Adrian: “Well, we have our work cut out. Still a lot more needs to be done to get the planet to a green transition and to ensure that the climate that we know is preserved in the future. We have started on this journey, but we have a long way to go. Many, many trillions of dollars.”

Emily Underwood: “OK, so answer 2 for Tobias. Shuang, where do you stand right now? Do you agree with Tobias? Are you more or less optimistic?

Shuang Liu: “Yeah, I think I would like to agree with Tobias and also to add, I think what we need is that we have a lot of the pieces, but probably not in the right place. There could be sufficient funding to support it. There could be sufficient capacity to access and mobilize the funding, but it’s not really flowing fast enough for us to see where the money can support the right efforts on climate solutions.”

Emily Underwood: “OK. Thank you for playing. And now I’d like to talk a little bit about why we are here today, which is not just can we pay for climate solutions, but who will pay for climate solutions? Where is the money going to come from? This has been in the news a lot lately because of the latest UN meeting in Egypt, which, Shuang, you attended. Correct? And Tobias, I’m sure either you or your team were there.

“So when we ask this question, it starts to get really complicated obviously, because we’re really talking about at least three buckets. So paying for climate mitigation, moving away from fossil fuels. Second, all the upgrades or adaptations that we need to make to avoid the catastrophic damages from climate change. And then third, this issue of loss and damage where we need to find a way to pay for the damages and losses that are already happening and that are causing such suffering around the world already.

“What I would like to start with is to talk about you, Tobias, and what is the International Monetary Fund, and why was it such a big player at COP27? Why is it such a big part of these conversations?”

Tobias Adrian: “Yeah, absolutely. The International Monetary Fund was created, together with the World Bank, after World War II, and the International Monetary Fund is really there to ensure that the global monetary system works well. So the mandate of the IMF is anything that is macro-critical, so that amounts to economic developments that are of macroeconomic magnitude, and certainly climate change falls into that bucket.

“One of the main differences between the IMF and the World Bank is that the IMF has global membership. We have 190 countries that are members, and that is stretching everything from the richest to the very poorest country in the world. So when we think about climate change, climate mitigation, climate adaptation — as you put it so nicely, Emily — we really have to think about the entire membership. And that’s one particular advantage point of the IMF is this global membership. It’s macro-criticality, global membership and how do we get the whole world to have a strategy to address this fundamental issue.”

Emily Underwood: “Can I ask, what does it mean to be a member? What powers does that give you if you’re a member of IMF?

Tobias Adrian: “Absolutely. There’s a kind of legal foundation to the IMF, which is called the Articles of Agreement. So any country that becomes a member has to adopt domestic laws to make its own functioning compatible with the IMF. And so there are both obligations and benefits from being a member. So it is very much universal. They are only about two or three countries that are not members, because it is viewed as being so beneficial and so important to be a member.

“The IMF does three things: surveillance, lending and capacity development. Let me just elaborate a little bit on those three things and what they mean in the context of climate change. So surveillance is really about assessing policies both at the global level and at the individual country level. This is where, for example, we play an important role in the COP and we cooperate with many other institutions such as the World Bank but also the NGFS, the Network of Greening the Financial System, or the Financial Stability Board. These are all global institutions that are involved in climate to some degree. So surveillance is about policies. Lending is about lending money to countries and we can elaborate more on that in a moment. And then capacity development is about building institutions in countries to deal with climate change.”

Emily Underwood: “Great. We will come back to those big buckets, but right now I’d like to hear from Shuang about what you do at the World Resource Institute. What is your role there?

Shuang Liu: “Yeah. Well, very different from IMF. We identify ourselves as a think-do tank. So the approaches that we take to tackle basically the human, nature and climate, that’s our focus, is that we provide research so that we can provide evidence to support a lot of the policy discussion and also the practices discussions. We also do a lot of convening, and this is only achievable with our global network in 12 regional offices in Latin America, Africa, Asia, Europe and the US.

“We also work very closely through our partnership, not just within WRI, but also with partners in different countries and regions. So if I can actually make analogy of, at the finance center, how we are looking at not just the climate finance, but also a lot of the nature and people-oriented finance, it’s like we are looking at the topic as it’s serving a pie. How we can make the pie, which is the size of finance that’s available to support the climate, people and nature goals, is that we need to make the pie larger.

“There’s still a large funding gap, particularly in the Global South countries, where we need a resource to do the work. That’s the first piece, how we look into the issue. The second piece is how we can cut the pie. The topic of today’s discussion is who’s going to pay for the climate solution. It’s part of the discussion on who is getting what size of the pie on the climate finance and the other global finance.

“And the last piece, how we frame it is that how we can serve the pie right. A lot of the discussion won’t end just as the developing countries on the national level can get climate finance, all other types of finance. It’s also about how to serve that finance service to the sub-national government and ultimately to the community and people who need finance to make magic happen. So by looking at the three different angles, that’s how WRI and our finance center can make our contribution to this global discussion.”

Emily Underwood: “OK, thank you. And, Shuang, when you’re talking about this pie, who are the big players? Who do you want to get to the table, not necessarily to eat the pie but make the pie?”

Shuang Liu: “It depends on how large the table is. I think the table should be very large. It’s very difficult to answer that question because it needs to be, in a lot of cases, a country-by-country discussion, if not a community-by-community discussion. So I’m just going to simplify, if not oversimplify, the question, and particularly because we’re talking about COP27 and the whole UNFCCC [United Nations Framework Convention on Climate Change] process. A very essential discussion on the global negotiation on climate is that developed countries have to pay developing countries for their climate action.

“The rationale behind it is because developing countries historically are not responsible for the global warming problem. So that in order to support developing countries to achieve their NDC [nationally determined contributions] and other climate mitigation and adaptation goals, the developed countries will have to pay for those efforts in developing countries. Well, we have been paying attention around COP and the UNFCCC process, that there is a commitment for all the developed countries to pay at least $100 billion every single year to developing countries to help with both mitigation, adaptation goals.

“However, we are actually behind on achieving these goals. And so a lot of discussion is how we can still make this a commitment realized in the reality. The other part of the story, again — let’s take the focus on the UNFCCC first — is for next steps; there’s this discussion that we have to raise the ambition from the developed countries on the climate finance to beyond $100 billion. There hasn’t been any concrete plan on how to achieve this, but that’s actually one of the areas we need to pay attention to under the question of who should pay for the climate finance.”

Emily Underwood: “I think that this question of who should pay and the equity issue, we’re going to spend more time on that as we get towards the end of our discussion. I want to give us plenty of time to hash some of these problems out. Before that, though, I want to move back to the basics of how to raise this money. And I want to use the example of coal, because that’s something that you and Tobias have both worked on extensively.

“Tobias, you’ve argued that countries like the US should be financing, should be paying for the replacement of coal. And I mean wealthy countries like the US, often referred to as the Global North, should be paying for the replacement of coal with renewable energy around the world, not just out of responsibility or equity, but out of self-interest. And you’ve calculated that there are huge economic benefits to be gained. If we don’t do it, it’s leaving $85 trillion on the table. So your challenge is to explain how you got to that enormous sum, in a minute or less.”

Tobias Adrian: “Yes, very happy. The usage of coal in the production of energy is polluting the environment, and that is extremely costly for the world. It generates global warming. Global warming is destroying the pie, what Shuang was talking about earlier. The pie is getting smaller — i.e., the world is getting destroyed by global warming. So preserving the planet is extremely beneficial and that’s the $100 trillion number. So to preserve the planet has a huge amount of economic value.

“The costs of replacing energy production from coal with greener sources of energy production is only about $30 trillion or so. So the cost of transition is perhaps $30 trillion, say, over the next 20 or 30 years, while the benefit is over $100 trillion. So the net benefit of transitioning from, say, coal production of energy to green sources of energy, the benefit is enormous, and the benefit is essentially preserving this planet and preserving the economic pie that the planet is producing.”

Emily Underwood: “So when you’re talking about this net benefit and you’re trying to convince countries that this should happen, how do you explain, when will this net benefit arrive and who will get it and are there going to be losers, as well, in that calculation?

Tobias Adrian: “There is of course always an adjustment, right? Because you have to move from energy production by coal to other sources of energy production. So some jobs, for example, need to be reallocated, but we estimate that those costs are relatively small relative to the benefit of preserving the planet. And so think about countries that can grow agriculture that become deserts — that is the cost that we are talking about. It is the literal destruction of the planet and that is costly for everybody.

“So as you alluded to, Emily, even for nations that are only indirectly exposed to these costs, paying for the transition can be extremely valuable. So some nations might not just be interested in transitioning in their own country, but to also pay for other countries to transition. And that is exactly the rationale why institutions such as the IMF, the World Bank and the multinational development banks are set up.

“Those are institutions to realize those net benefits for the world as a whole via transfers of financing. So I think that it is a combination of these public sector transfers of money, much of it from advanced economies to emerging markets and developing economies in combination with capital market activity, as well. So it is a combination of public and private sector funding that can solve this enormous challenging problem.”

Emily Underwood: “It seems to me that there is quite a bit of agreement and consensus about what needs to happen and a lot less agreement about how it should happen. So, Shuang, can you talk about your perspective on this, how to mobilize this transition, who should really be leading it?”

Shuang Liu: “Yes. I really love the framing that Tobias gave us. If I can actually just complement Tobias on not necessarily the macro level but micro level discussion and some of the efforts we have seen in the past several months on coal, and also particularly we’re talking about the replacement of existing coal power stations. I do want to bring our attention to the so-called Just Energy Transition Partnership, of JETP, which is G-7 countries … working with some of the countries where there’s a heavy exposure to fossil fuel, particularly to coal, in namely South Africa, Indonesia, India, Vietnam.

“And the design of the Just Energy Transition Partnership, the JETP, is for the G-7 countries to pool their funding together and to support the host country, or the JETP countries, to design a plan of how to retire the operating coal power stations earlier than those coal power stations were designed for. And what I meant is that normally, for instance, in those countries, the coal power station, when they became operating, the expectation is they will be there for 40 years, 50 years. I’m just making this as an example.

“And what funding from G-7 countries is trying to support is for those host countries to retire or put their coal power station off-grid 10 years early, 20 years early. It depends on the final package to say the details. But this is one way of how developed countries can put their funding together to pay developing countries to take the coal power stations off the grid. And this is what exactly the climate science is asking us to do.

“I just want to share one data point that IEA — that’s the International Energy Agency, who’s very good at their energy modeling work, and that’s very often that we will refer to — is asking that all the OECD countries will have to phase out all the coal power stations by 2030, and for the rest of the world, all the existing coal power stations have to be phased out by 2040. So to achieve that goal, which is in line with the 1.5-degree climate scenario we’re talking about, we’ll need a lot more funding than we currently have to replace those coal power capacities.”

Emily Underwood: “There’s a lot of talk about the need to mobilize or unleash, release money, especially private capital, for climate change solutions. And blended finance is one model for how that can work. Can you explain what that is and also, if somebody could just explain to me how money gets trapped or leashed, that’d be a bonus. But Tobias, why don’t we start with you?”

Tobias Adrian: “Yeah, happy to start. I will give you a very concrete example. At the IMF we have a new lending tool, which is called the Resilience and Sustainability Trust. That is about $40 billion at the moment — it could be scaled up over time — that is aimed at lower-income countries and vulnerable middle-income countries, oftentimes smaller countries such as islands that are really exposed to climate change. About 143 countries are eligible for this Resilience and Sustainability Trust. And we already have programs in place with Barbados and Rwanda, and our board approved a program with Costa Rica as well.

“So those countries are going to get a certain amount of funds from the IMF. Blended finance would mean that some of those funds are then combined with private sector funding to leverage up the public money. And a very good example of that was provided by the IFC, the International Finance Corporation, which is part of the World Bank Group. So that is the public-private sector arm of the World Bank.

“And so what they did a couple of years ago was to team up with a private investment operator, Amundi, to offer a tranche investment vehicle. So the public funding by the IFC and other development banks such as EBRD [European Bank for Reconstruction and Development] and EIB [European Investment Bank], those other multinational development banks, they funded sort of like the riskiest tranche in a kind of structure. And that was levered up 10 to 1. So say out of $200 million, $2 billion of total funding was generated by combining the $200 million with $1.8 billion of private sector money. So that’s a template that could generate, say, from this $100 billion, the magic number that Shuang mentioned earlier, if that was levered at 5 to 1 or 10 to 1, we would get into the sort of magnitudes that we think are needed to really have a global tranche transition.”

Emily Underwood: “OK, thank you. A couple questions. When you say give money, are you saying lending money or these are loans and are these loans with a different borrowing cost or interest rate than other types of funds? I’m just wondering if this is the same initiative that Prime Minister Mia Mottley from Barbados sort of brought about.”

Tobias Adrian: “These are loans that come with relatively low funding costs and they can be used by the country to help in building resilience and some of that could be used to be leveraged with private sector funding. So we did some work, some analytical work for the Global Financial Stability Report, which is one of our reports, where we looked systematically across development banks, how much leverage they generate. And on average it’s about 1.2. We think we can get to five times leverage or even more by structuring these public-private partnerships, which is what blended finance is about, in a better way.

“So when we talk to the private sector, there’s an enormous appetite to actually invest in climate transition. Investment managers, pension funds, insurance companies, they want to do that but they can only take on a certain amount of risk. And so this is where the public sector can come in. The public sector can take on a certain amount of risk, like country risk, off the table, and then the private sector complements the kind of risk-taking of the public sector. That’s the fundamentals.”

Emily Underwood: “Thanks. Thank you for that very nice explanation with a minimum of jargon, I really appreciate it. So, Shuang, do you think that what Tobias just described, are these types of changes going to be enough to make this happen?”

Shuang Liu: “Yeah, I would think, given the funding gap we’re talking about, we need a whole package of every solution. Also, just building upon what Tobias has shared, another example I’d like to bring our attention to is some of the international financing focusing on the infrastructure sector, the power generation sector. There are some of the bilateral players who actually played a very important role in this international infrastructure of the power generation financing. The way that, Emily, you asked the question, the blended finance … de-risking, the public finance mobilizing private finance. The reason we’ll need a solution like it was because there are perceived risks for private finance investors to invest in overseas, particularly in developing countries. That’s where the public finance or public investors can help with sharing the risks so that they will make private investors more comfortable in increasing their investment in the renewable energy and other climate efforts.

“The other part is that the public finance does have a different mandate than private finance. They are not as profit-driven as the private ones. So that having the public finance creating some of the … policies for private finance to come in, that’s another reason why we are seeing that the blended finance can play a more important role than what it does nowadays. And what I shared, for instance, for the international infrastructure projects or power generation projects, very often we have seen that, for instance, OECD countries, and China as well, there will be a so-called export credit agency that’s a public money and public agency who actually provides either insurance or sometimes the concessional loans as the public money.

“But they will also engage the private players — it can be the commercial banks or it can be the corporate who can actually invest directly in the developing countries, in other countries. That’s how they sometimes come together in a project-financing structure so that the public money can work with private money to support the infrastructure and other kinds of projects abroad.”

Emily Underwood: “Tobias, do you want to respond to anything that Shuang just brought up?

Tobias Adrian: “Let me frame it in the following way. I think there are three issues. One is the scale, and that is what Shuang was really talking about. So is there enough public money available to finance the transition globally? And what the exact number is, I think we can debate, but I fully agree that more is needed, for sure.

 “The second question is what do you do with the money? Are there sufficient projects to, say, make a country, I mentioned Barbados, for example. Do you have concrete projects available to really generate transition in a country like Barbados? Or Shuang mentioned South Africa or Indonesia. So that’s the second question. And then the third question is how does the private sector complement public sector funding? And let me just spend a little bit of time on this third question.

“So the private sector is going to demand a certain return which is comparable to other returns, but the public sector can take some of the risks off the table, add a cost that is relatively lower than what would have to be asked by private sector. For example, the World Bank has a specific insurance product called MIGA [Multilateral Investment Guarantee Agency], that is specifically ensuring some of those risks that are very difficult to insure in the private sector. There is a public sector solution for those risks.

“That is, for example, something that could be used at much more scale in these blended finance structures. So it’s really thinking about how to tranche and make risk, allocate risk to different players, to the public sector with the private sector to, say, asset managers with insurance companies, with pension funds, in a way that increases the total capacity to finance the green transition. So a lot of plumbing there, but I’m quite optimistic that this can be a very important element to generating steps in the right direction.

“It doesn’t solve everything. You need the other parts, too, you need the right projects and you need sufficient public sector funding. But once you have the projects, once you have the public sector funding, combining that with the private sector I think will be very powerful and can be potentially much larger than the kind of numbers we see at the moment.”

Emily Underwood: “OK. Well, I’m glad you’re optimistic. I would like us to make sure we get to some of our audience questions. As a reminder, hey, audience, you've got to put your questions in the question box so make sure you’re putting those in there. Our editors are going to move them into a document that I will be looking at. But I’m just going to throw one question out there that’s obviously in the chat. So isn’t coal burning in China, the elephant in the room? Are these funds being focused on China? So, Shuang, can you take that question first?”

Shuang Liu: “Yes. … Is the question, those funds, like multilateral funds? Are those funds focusing on China? Those funds, are they referring to the multilateral funds?”

Emily Underwood: “It isn’t specified, so I think you should respond with the funds that are.”

Shuang Liu: “Yes. So maybe I can just take one step back. Yes, I think the coal conception, in China and the rest of the world — as I shared, the data point from IEA scenario — that’s what we need to address. And I believe that it’s also in China’s own interest to talk about the coal conception and how to reduce it. There are many policy discussions we have observed in China, including put a cap on the coal and also the total energy conception. Those are certainly the right directions that we will have to travel to.

“We do also notice that a lot of the coal power stations in China are actually not really economical to run … anymore. There is a lot of more political economic analysis and also discussions we can have. But just look at the performances, also how many hours those coal power stations in China are running. It doesn’t really make sense from, of course, the environmental perspective but also from the economic and financial perspectives, to keep them on the grid. And that’s certainly something that we will need to look into.

“On the multilateral funds, and I’m sure that Tobias will be able to give more answers to, but I do think that for China and maybe the other countries, we’re talking a lot about those international financing so far. But we also need to pay attention to how to mobilize the domestic finance within certain countries to support those efforts. China’s one example. Even in Africa, where the COPS27 countries, the data shows in the past decades, almost half of the investment in energy in Africa was actually from the domestic funding sources. I was actually surprised, looking at the data point, so just want to flag that domestic finance as well as the international finance are needed to support the climate efforts.”

Tobias Adrian: “Emily is not visible at the moment, and I’m not sure we can hear Emily, so why don’t I just complement what Shuang was saying. In many countries, I fully agree that domestic funds can be very instrumental in generating a green transition, and China of course is a good example because China is one of the largest countries in the world, by GDP, right? It’s the second-largest economy and by some measures it’s very close or comparable to the US in terms of size. So there’s certainly financing capacity there to finance transition and it is a question of policy priorities to get there. And this is where I think both the IMF and institutions such as the WRI, where Shuang is working, I think are pushing the debate in the right direction and policy orientation in the right direction is very first order.

“I did want to mention a complementary thought. We have been very much focused on coal and carbon in terms of carbon production. But of course, preserving nature is the other first order priority. We have rainforests around the world, in the Americas, in Africa, in Asia, and the value to the planet, to everybody on the planet, of preserving those forests is tremendous.

“But of course, this benefit, from the global perspective and from the global citizens’ perspective, in some sense, is not fully internalized at the local level, right? Because everybody is better off by having forests around the world. But of course any individual might be better off by planting agriculture or raising cattle on those areas where the rainforests are. So aligning the global interest with the local interests is another first order objective in this debate.”

Emily Underwood: “Tobias and Shuang, can you hear me?

Shuang Liu: “Yes.”

Tobias Adrian: “Yes, we can hear you.”

Emily Underwood: “Can you see me?”

Shuang Liu: “No.”

Tobias Adrian: “No.”

Emily Underwood: “Well, luckily you don’t need to see me and you’re carrying on beautifully without me. Sorry, we had a connectivity issue. I just want to make sure we get to a few more of our audience questions, and apologies if I’m repeating anything.

“From Donald Samulack, it’s a mixture of a statement and a question: ‘I find that we are all in the same conversation loop globally, lots of commitment through talk and money but not much political will to affect change. Other priorities like Covid seem to stifle the momentum. In the end, real solutions are going to come from private sector rather than big government.’

“Basically, the question is, ‘Are we going about this all wrong?’ You’ve talked a bit about incentivizing the private sector to offer a better and faster return on investment. But I want to actually add to this question with a metaphor of my own that has been on my mind. When I think about the job that you’re trying to do, Tobias, and the job of the IMF, I think of this car hurtling towards a cliff. And to me, it seems like you’re sort of trying to change the tires of the car without slowing down or stopping, because there’s an element of risk to changing these moving pieces, but you also have to keep the car from going off the cliff. So does that metaphor ring true for you? And that goes to the ‘Are we going about this all wrong?’ question. Does something fundamental need to change?”

Tobias Adrian: “I think we have to work on many different solutions and hopefully all of them in combination are going to make a difference. I fully agree that the private sector plays an enormously important role, but it’s not clear to me that the private sector has the full incentives to go all the way. When I talk to major financial institutions, for example, at COP26 in Glasgow, GFANZ [Glasgow Financial Alliance for Net Zero], often called the Glasgow Alliance, was created. Mark Carney is very much associated with that. At this point, $150 trillion of financial institutions in their alliance. So, enormous amount of money.

“But they always say we need collaboration from the public sector. Because they can’t take all those risks from the private sector side. Incentives are not fully aligned. This is why I think that blended finance, the public-private partnerships are so important. Similarly, research of the private sector is certainly going in the right direction, but is it going all the way? If the private sector can solve it, that’s great. I’m very happy. From what I hear, we do need the partnership between the public and the private sector at this point.”

Emily Underwood: “Shuang, do you want to add anything to that?”

Shuang Liu: “Yes, I would love to. I think, because we are talking about everything on climate change, there are very different initiatives we’re talking about. Again, simplify everything. We have mitigation, which means we need to cut the greenhouse gases emission. We also have adaptation, which is climate change is happening. So we need to have better infrastructure and a resilient way of protecting people in the community who are already suffering from climate change. And particularly for adaptation — I’m just giving this as example — the private finance have even less incentives to invest in a lot of climate adaptation efforts.

“So I personally don’t think that we can only rely on private investors on a lot of the projects where we don’t see a very clear... Private investors are profit-driven and when we are seeing this is actually public good that we need to provide under the climate umbrella, then perhaps private finance is not the only solution and the sole solution that we can rely on. But I absolutely agree they need to play an essential role in many ways with the other finance resources.”

Emily Underwood: “Next, I would like to ask a question from Chirag ‘Jay’ Patel. ‘Why can’t there be an implementation of a global carbon tax to fund a transition to clean and green energy?’ This is certainly a question I have wondered about. Tobias, do you want to take that first?”

Tobias Adrian: “Yeah, that is very much aligned with our No. 1 policy priority at the IMF, which is carbon taxes. So from a sort of economics principle point of view, that is the right answer. You have to align pricing with externalities. So the cost you’re paying for pollution is way too low relative to the damage you’re doing. And so carbon taxes are fixing that problem. The problem with carbon taxes are the politics. In some European countries, carbon taxes are fairly close to what economists think is the right level.

“But outside of Europe, the gap is very, very large in between what the price of carbon is and what the social cost of carbon or the right price of carbon, from a pollution point of view, is. And the politics are very, very difficult around getting from the currently very low price of pollution, to the right price. So it’s not only politically hard to do, that’s why I think carbon pricing in practice has to be complemented by things like blended public-private kind of finance.”

Emily Underwood: “Thank you. That’s helpful. Shuang, what is your take on a global carbon tax or how carbon taxation should be applied?”

Shuang Liu: “I wish that somebody can give me the clear answer on that. In my previous job, I worked on the carbon market or the emission trading program in China, on the national level and sub-national level. I very much with agree with what Tobias has shared. It’s actually not a technical discussion. And as an economist by training, I also agree this probably should be the most convenient solution and the minimum that we can do to have this global carbon pricing. But because of the political will and, as Tobias has pointed out, that I think there are only very few existing carbon markets where the carbon pricing is at a level that will make a difference to the mitigation efforts.

“In a lot of the regions and countries where there is a carbon market, because of the lack of ambition, in a way, the carbon market pricing or the carbon tax is actually not at a level where we can make a difference in there. So again, I think a lot of groups, including IMF, are still working on how we can push for global carbon pricing, but we can’t afford not to be looking at the other options, just given how challenging it can be to have such global initiative.”

Emily Underwood: “This really also speaks to the issue of accountability and tracking all of these things. One of our questions is, ‘We see a lot of goodwill money being talked about or being made available, but how do we track how much is actually spent and spent properly?’ Shuang, I know that you do a lot of this type of work at WRI. Can you speak to that? And then we’ll hear from Tobias.”

Shuang Liu: “Yes, I’m happy to. Yes, at WRI, that’s one of our work … that we get really excited and talk about this all the time — the accountability and transparency and tracking. For instance, some of the efforts we have is that how we can … As Tobias has pointed out, some of the private financial institutions last year around Glasgow has found this defense and a lot of them have this commitment of whether that they can set up their science-based target, to make sure their investments are aligned with the 1.5 degree and the other targets.

“But there isn’t a go-to place to find out how the financial institutions are making progress towards their targets. So organizations like WRI, and we know there are other key organizations working on this as well … we go out to collect the information from different reports that the private financial institutions publish on either the environmental performances from their annual report to pool out the data and consolidate them into one so we can put those efforts from different financial institutions next to each other to give us a better mapping of where they are in terms of their progress on the climate goals.

“The other players we’re talking about also, the public ones, including the developed countries and naturally their progress on $100 billion. Also, there is a reporting program, how these developed countries will have to report. So a lot of the organizations, including us, will also try to provide some of the more timely efforts, watching how they’re making progress. The other effort is that a lot of the … development financial institutions publish their own report on the climate finance progress with shared methodology. So I think there are different groups working on different angles, but ideally in the coming future there will be more comprehensive and consolidated efforts, making it much easier for us to track where the progress is. And of course it has to come…”

Emily Underwood: “Great. We’ve been getting some requests for resources, including visibility on what grant opportunities are available for the private sector to access funds and innovate, deploy solutions. So I think after this we will hopefully compile some resources that people can learn more about and follow up on. Tobias, do you want to add anything to what Shuang was talking about?”

Tobias Adrian: “Yeah, I would add something that is closely related but a little bit different, which is about data and disclosure. What Shuang was talking about is really think tanks or public institutions like the IMF and the World Bank are certainly keeping track on what are the needs and how much is being spent and who’s spending what and where it’s being spent. The other element that I think is very important is for the private sector to be able to assess what is green and what is brown.

“So to what extent is a certain company using clean inputs and producing clean outputs, or is polluting. This is where this whole discussion around data and disclosure is coming in. About a year and a half ago, the ISSB, the International Sustainability Standard Board, was created to basically generate an accounting system globally for the degree of greenness of corporations and products.

“I think that it is difficult to overstate the importance of that. That allows economic actors, individuals, whether you are in the supermarket or whether you are an investor or whether you are in the public sector, it’s allowing you to assess to what degree production is green or brown and to provide incentives to move in the right direction by directing new purchases, by directing new investments and by directing tax dollars, so public money.

“The initiative here is to generate the data, disclose the data and then basically classify what is green and what is brown. And so there it’s really on the classification, the third leg, it’s the European Union and China that are leading there. Data and disclosure, it is a global effort where actually the SEC [Securities and Exchange Commission] in the US has made an important step in a proposed rule this year. And this is done very much aligned with this is ISSP, which is the global standard data for essentially climate data.”

Emily Underwood: “Thank you. And there are so many acronyms in this field. That’s my own personal comment here. So we only have four minutes left, and I want to make sure that we see the results of our initial poll. And I hope that people who have attended this have learned something and found it interesting. Maybe you’ve become a little bit more optimistic, maybe you’re less optimistic. That’s something I’d be curious to see. You could tell us in the chat.

“And I’m wondering, since we have four minutes, I just want to get to one last audience question. This is kind of an interesting proposal from Moira Magneson. ‘Might a global climate conservation core — with buy-in and recruits from constituent IMF countries — be launched as a workforce to develop and build green alternative infrastructure in the countries that need it most? Or does such an organization already exist?’ I’ve never heard of one.”

Tobias Adrian: “Is the question for me or for Shuang?”

Emily Underwood: “Well, you’re from the IMF, so let’s start with you.”

Tobias Adrian: “OK, I will start. So I told you at the beginning that we do three things: surveillance, which is essentially policy advice; lending, which is getting the dollars in the countries; and capacity development. And I think your question is very closely related to capacity development. So we do that at the IMF, but also the World Bank is doing that. And capacity development is really about having people in countries to build institutions to put the right policies into place. So we are not building an energy company. If you’re thinking about engineers that are building solar panels, that, neither the World Bank nor the IMF is doing, but creating policy frameworks that allows to then build those solar panels, that is already something we do through capacity development, and the World Bank, as well. So let me stop here and perhaps pass to Shuang.”

Emily Underwood: “Oh, that’s helpful. I have learned a lot about what the World Bank and IMF do and what they don’t do in the course of this conversation. Shuang, is there anything you want to add to that? And we do have to end in a minute.”

Shuang Liu: “Yeah, maybe just one point. I don’t think such one organization exists, but there are certainly efforts working this way, and I think it’s extremely important to have on-the-ground, in-country capacity because a lot of the solutions are actually country by country and it has to be so customized to the local situation.”

Emily Underwood: “Thank you. OK, one last question from me. If you could have one superpower that would help you do your job well, what would that be? And as you guys think about it, I want everybody to take a look at the poll results. You can click on the bar graph again and take a look.

“As a reminder, if you’ve enjoyed this event from Future Tense and Knowable, please sign for our newsletters, follow us on Facebook and Twitter. And thank you everybody for taking the time.

“We’re going to be working on an exciting new series of events in 2023, so please keep an eye out for those invites. We’ll also send out a survey soon to gauge what’s working well at these events, what we could do better and get your ideas for future topics. Thanks again, and we’ll end with our superpower reveal. Shuang, what superpower would help you do your job?”

Shuang Liu: “If I can only choose one, I want just unlimited power to clone colleagues, peers I work with. Because the job can be sometimes very frustrating, just with the scale of disaster we are facing, but the inspiring talent, kind, caring colleagues I work with in and outside of my organization — I really wish I can have the superpower to clone as much as possible so that we can have more capacity to solve the climate change.”

Emily Underwood: “Excellent. Tobias, what about you?”

Tobias Adrian: “Climate change is a choice. Humanity can make the right choice or the wrong choice. And so the superpower would be to help humanity to think through the future. So it’s not so much seeing the future, but it’s seeing the future along those two different paths, making the right choices and making the wrong choices. And when you make the wrong choices, you are going to have a planet that will be a desert everywhere or nearly everywhere, and you make the right choices, you preserve the planet, you preserve livelihoods and happiness. And so making people understand so that they can make the right choice to preserve this planet, that would be my superpower.”

Emily Underwood: “That’s a fantastic note to end on. I wish we could talk much longer. This has been really fascinating. Thank you again, Tobias and Shuang, for joining us. And I’m sorry I can’t say goodbye to you with my face. I don’t know if anybody can see me, but I can’t. So apologies for that. But luckily we can see our guests, still.”

Shuang Liu: “Thank you.”

Tobias Adrian: “Thanks for having us.”

Emily Underwood: “Thank you so much.”

Shuang Liu: “Thanks, everyone.”

This article originally appeared in Knowable Magazine, an independent journalistic endeavor from Annual Reviews.