The ideological choice is not between unbridled capitalism or an overbearing, rapacious state. Successful governance, particularly for major, global problems, needs a mixture of both, argues Tony Kinsella
There's (still) no such thing as a free lunch.
Private enterprise always being the better, more efficient, choice has become our default ideology over the last quarter century. Ideologically driven choices can quickly become blinkers - narrowing the viewer's field of vision.
The complex challenges and choices we face on climate change and energy policy over the coming 30 years demand uncluttered vision. What works best will have to replace what we perceive to be preferable.
US economist Milton Friedman, the ideological father of Reagan's and Thatcher's monetarist economics, is often credited with the truism that "There's no such thing as a free lunch". A truism many of his followers chose to ignore, preferring ideologically tinted paradises where free meals abound.
One of the greatest modern free meal trips was to have been the privatisation of Britain's railways. Transport secretary Cecil Parkinson announced in 1990 that the question was not "whether . . . but how and when" British Rail would be privatised.
A transport policy vacuum and decades of under-investment would be miraculously expunged. The UK would develop a world-beating rail system - Sir George Young talked of a "renaissance" - without taxpayers having to dig deep into their pockets. The Railways Act was passed in 1993 - when the British Rail subsidy was €1.8 billion. Ten years later British taxpayers would provide just over €5 billion in subsidies to their privatised rail system.
Private enterprise, however efficient, remains bound by the laws of economics - it must make a profit. If society wants a modern rail system, it has to pay for it either through exorbitant fares, or through taxation. Even the Conservative Party now admits that UK rail privatisation was a disaster.
Next month, the embryo of our new world order - China, the EU, India, Japan, South Korea, Russia and the US - will effectively hand over a cheque for €5 billion to build a 20,000-tonne experiment at Cadarache, near Aix-en-Provence in southeastern France. A further €5 billion will follow to operate the International Thermonuclear Experimental Reactor (Iter) over the next 20 years.
If Iter works, we will have managed to harness nuclear fusion, the energy source of our sun, offering abundant electricity with almost no radioactive waste, no carbon emissions, and no weapons material - and all from seawater. Scientists have been working on nuclear fusion since the 1940s. By the mid-1980s they knew they needed a bigger experimental "tokamak" reactor and that given the costs, our world could only afford to build one of them. They finished its design in 2001.
It has taken 30 governments a mere five years to agree on the budget, the distribution of task and costs, and location.
Iter remains a scientific and engineering gamble - a €10 billion bet. If it works we can look forward to abundant and sustainable electricity by the middle of the century, with significant quantities of hydrogen for fuel cells as a by-product.
It is an educated, even indispensable, gamble. A wager only governments can afford. No private corporation, however wealthy, could convince its shareholders to invest €2 billion a year for 20 years in something that might, or might not, work.
This year's Nobel prize for economics was awarded to Prof Edmund Phelps of Columbia University. Phelps's main focus is on the realisation of self-worth through what he terms "the satisfactions of employment". These, he argues, are one of the main motivating forces for personal effort and thus economic growth. A key element of his "satisfactions" is public action to boost the earnings of the low paid, and provision of satisfactory public goods in terms of environment, culture, and infrastructure.
In short, Phelps revisits the 18th century Enlightenment arguments of Adam Smith and other Scots for a mixed economy where private enterprise is left as free as possible to generate wealth, which the state then taxes to finance public provision.
Political fashions of the last quarter of a century view such arguments as leftist heresy. In the arguments of US neoconservatives and their European allies, the key to successful development is slashing the role of the state, creating a society where collective action is confined to voluntary efforts.
Under such arguments, volunteering for the Red Cross is fine, but public healthcare is questionable. Raising funds for Concern is praiseworthy, but pushing for global economic justice smacks of state intervention. Switching appliances from stand-by to off is a valid means of reducing CO2 emissions. The very concept of global warming is rubbished since once accepted, it demands government action.
All but the most ideologically blinkered now accept both the reality of global climate change and human activity's contribution to it. The Central Statistics Office reports that the 1990s was the warmest decade on record in Ireland, with the island's mean temperature having risen one degree Celsius in the last 100 years.
Surely the 149 per cent increase in CO2 emissions between 1990 and 2004, or the 93 per cent increase in the number of registered vehicles on the road over the same period must have something to do with that? Doubters should find 100 minutes to watch Al Gore's An Inconvenient Truth.
We need to change our vehicle park, replacing gas guzzlers with flexi-fuel, hybrid, electric and perhaps later with hydrogen fuel cell vehicles. We need carbon-neutral, energy-efficient buildings.
Massive investment in electricity generation and distribution, and in electrically powered public transport systems, will be required. Changing our energy consumption and switching to new energy supplies, on a planetary scale, requires collective action.
German foreign minister Frank-Walter Steinmeir argues that "energy security will strongly influence global security".
The UK's Margaret Beckett goes further in declaring that climate change "is not just an environmental problem. It is a defence problem. It is a problem for those who deal with economics and development, conflict prevention, agriculture, finance, housing, transport, innovation, trade and health."
Collective action is required, public debate leading to policy decisions, framing mixed public and private action. The survival of life on our planet hinges on our collective political decisions. Guardian columnist Jonathan Freedland wrote (October 25th) that the climate change/energy challenge cannot be addressed by "virtuous individuals hopping on a bus instead of taking the car . . . this is a job for government".
Adam Smith's Enlightenment would have had no problem with that, even if his ideologically blinkered descendants continue their Orwellian "Private Good, Public Bad" bleating.
Tackling climate change and replacing fossil fuels won't be a free lunch - but the nice thing about paying is that you get to choose the menu.
Tony Kinsella is an Irish-born writer and former Labour Party activist now living in France