Less CO2 and more GDP: the chart that sparks the war

Less CO2 and more GDP: the chart that sparks the war

“The economy grows while CO₂ falls.” The phrase sums up a chart circulating these days with remarkable success and which has peine a deeper debate: is the decoupling of GDP and emissions real, or is it accounting sleight of hand? The raw data exist and are not debatable. Peak per-capita CO₂ emissions were reached in 1973, fell with the oil crises of that decade, recovered slowly until 2005, and since then have been falling in practically every developed country while their economies keep growing. The optimistic conclusion writes itself. So does the pessimistic one.

Growth without emissions: what the chart shows

The phenomenon has a name: decoupling. The thesis of whoever spread the chart is that decarbonisation is increasingly evident and undeniable, and that it does not matter which indicator is used —GDP, the Human Development Index or any other— because the pattern repeats: the economy grows and environmental impact falls. On that basis, developed countries would have entered a phase in which producing no longer requires burning.

The argument rests on publicly available historical series. The problem is not whether the data exist. The problem is what is done with them and what is accepted without question.

Is oil running out, or are we leaving it in the ground?

Here the knot of the matter begins. One camp argues that decarbonisation is voluntary: renewables compete advantageously and displace fossil fuels. The opposing camp replies that it is forced, because easily accessible fossil fuel is depleting and its availability tends to decline. Two incompatible narratives with the same data in front of them.

The clash is settled over coal. It is the fossil fuel with by far the largest reserves, well ahead of gas and oil. If the problem were the end of crude, the logical thing would be to burn more coal to replace it. The opposite is happening. The US case is the most cited: counting only mines in production, and with no doubt about how much is left because it can be seen, there would be coal for 21 years, with untapped deposits that may never be exploited. It is hard to argue that coal is being abandoned because it has run out.

The geological counterargument does not give up. There is a technical bottleneck: liquid coal requires on the order of 2.4 tonnes of coal for every tonne of oil, so replacing large volumes of crude would require moving amounts of coal that today have other uses. And there is a coincidence that invites suspicion: decarbonisation pressure arrives just as the discovery of new reserves stalls.

The CO2 that gets exported: deindustrialisation and assembly

The third front questions whether falling emissions are a merit. A widely repeated analysis argues that developed countries reduce their CO₂ because they no longer produce: polluting industry has been offshored to the developing world, leaving assembly and services here. Well-being is maintained, but the emissions are counted somewhere else.

By that logic, China absorbs the pollution that Europe and the United States externalise, and does so by burning coal so as not to depend on imported oil. The clean chart of the first world would, at bottom, be a photo with the frame cropped.

GDP is a 1930s invention that nobody questions when it rises

The crux remains: the reliability of GDP itself. Until 2005, when emissions grew in step with the economy, nobody questioned gross domestic product or its direct relationship with energy consumption. From 2005 onwards, when emissions fall, suspicion appears: monetary tricks, debatable deflators, growth inflated by intangible sectors. GDP was born in the 1930s, the most critical recall, and since 2007 we have been living through an unprecedented monetary experiment whose end nobody knows.

There is also an uncomfortable reading for the other side: including sectors such as certain services or activities that were not previously counted inflates the figure without producing a single tangible good. If GDP is doubtful when it rises, the chart collapses entirely. If it is only doubtful when CO₂ falls, then we are not looking at analysis: we are looking at a trench.

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One question remains unresolved, and it is the one that truly matters: if decoupling is real and sustainable, the coming decade should confirm it with less energy consumption per unit of GDP and with the economy still standing. If in a few years the series cross again, we will know we were looking at the wrong chart. And that the problem was never the chart.