Ex-Head of Estonia's Biggest Bank Speaks of Green Deal: We Are Highly Hypocritical
In an interview with us, Estonian entrepreneur Indrek Neivelt talks about the hypocrisy of Net Zero promoters and compares the related policies to absurd Covid rules.
Indrek Neivelt is an entrepreneur, investor, and long-time banker. Until 2005, he was Chairman of the Board of Hansapank, Estonia's largest bank, before he stepped down from the position as the bank was bought up by Swedbank of Sweden. Until 2014, he also functioned as Chairman of the Supervisory Board of Bank Saint Petersburg in Russia.
Neivelt is currently an entrepreneur and investor, while at the same time being a highly respected commentator and opinion leader in Estonian society, especially on economic issues.
In an interview with Freedom Research, Neivelt discusses the economic consequences of the so-called Green Deal or Net Zero climate policies and marvels at the hypocrisy of its promoters, both in Estonia and around the world.
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Indrek, I will start very simply. Is this Green Deal or Net Zero something you can understand and grasp? Do you understand what exactly we are doing here and why?
No, I do not understand it. What I do understand is that there is a need to protect nature, that there is a need to consume less, that there is a need to make products that will last longer, products that can be repaired. Conservation of nature is common sense to me. I understand that. But I don't understand the Green Deal. How can we have an expanding economy and at the same time use fewer resources to make that economy grow? That also brings us to the question – if we are talking about Europe or North America – to what point does this economy need to grow? And what does that growth mean? After all, the consumption growth has come from a kind of a lower life expectancy on products, hence we have to buy more, and on the other hand, it's all more and more automated. I do not understand which way we intend to go – one way or the other. You can't have it both ways at the same time. But they try to say we can go both ways.
You are an economist and surely you can explain what will be the economic consequences of these Net Zero policies?
I would say there are several layers to it. One is the context of Europe as a whole, another is that of Estonia. If we are talking about Estonia, very few people live that far in the North – in the Northern Hemisphere. Most people still live in the south, where you don't need as much heating. Where you don't need as much energy. Where people live closer together and the settlements are not as dispersed as here and hence our huge transport costs are logistically not required. We live in conditions that inevitably mean a greater consumption of energy. Both for heating and transport. And as we consume more energy, we have managed to live in the North, historically speaking, thanks to natural resources. We have more natural resources per person and we are then living, figuratively speaking, next to a borehole – be it for oil shale or forest, or metal deposits. And it is through that that we have been able to have competitive energy here.
Now, if we go into competition with solar, for example, and put up solar panels here and, on top of that, cover their cost from the national budget – that is to say, from the pockets of people – we must know at the same time that we do not have that many opportunities for solar energy. Our solar panels are 20-25% less efficient than those in central Europe or southern Europe. This economic math just does not add up, this arithmetic. Elementary arithmetic. There's a little bit you can do – the first solar parks are subsidised and so on, but it can't cover the whole picture. Wind farms are another matter. We've got wind here. But at some point, when there is no wind, you have to replace it with other energy sources. Energy is the whole foundation of today's society. Without energy, there is nothing. Nothing works without energy. And that's where it starts to come down to what happens to our competitiveness if energy is more expensive for us. If until now energy was cheaper for us, now our energy will be more expensive than elsewhere. The question is then, why would anybody want to produce anything in this region? Well, except for the forest. Some forest produce that comes out of the forest. The forest is growing and it needs to be cut down and the bigger jobs need to be done here. It is logical not to take raw logs somewhere else, but to process them here. But in terms of the rest of the economy, why would it have to be here?
So we could be in for this kind of gradual economic contraction in your view?
Precisely, this is the fundamental question, relevant for Estonia. If we additionally tax ourselves sick in Europe, basically, with all this green agenda, then once again, we are unable to compete with Asia and North America. The German economy, for example, was very much based on cheap Russian energy, with several industries having small advantages over others. There too, the benefits of the German economy are disappearing. And then the question is, what will take its place? Can we have this welfare state in Europe at all in the form we are used to?
Well, you find no economic logic in this 'Green Deal'. But is there any other logic for you as to why we are doing this?
Why are we doing this? Well, I don't know. The communication out there is very powerful and very nice, that we have to save the world and so on. That's a very good objective. I don't think anybody would argue with that. But then again – how? And if we keep saying that the climate is warming up and it's all this CO2 and whatever else that's to blame, then it would be very easy for us to start by stopping certain activities. Well, if we are talking about cars, for example, that electric cars are the future and that internal combustion cars are totally evil, then the logical thing would be to stop the production. Let's not make any new cars that have internal combustion. Finished. Banned. From tomorrow. Well, if we think this problem is that serious for us.
Well, aren't we?
We're saying in ten or twenty or whatever years we'll stop it. It will be extended. The Germans there said something – I can't remember all the details (the European Union has decided to ban the sale of new internal combustion engine cars from 2035, but the Germans insisted on an exemption for so-called 'e-fuels', see e.g. here – HS) But if it’s so serious, we should stop it now. Or the fact that the biggest Net Zero propagandists all fly into their meetings on their private jets. And once there, they all immediately start to worry about the climate. They worry away, they fly off to somewhere in the Mediterranean where there is a beautiful little yacht waiting for them that consumes 300 litres or more of fuel per hour. And there they go on worrying about their climate. It is fundamentally very hypocritical.
I don't know if you noticed, but a while ago, King Charles III set off a “climate clock” in London with the Mayor of London, Sadiq Khan. Well, it's the kind of clock that counts down the seconds to 2030, when the time to act on this green deal will run out – the temperature will probably have risen too much. And, well, in the same way, for example, UN Secretary-General António Guterres was talking a while ago about entering the boiling era because of global warming. These are such frightening messages, such messages of doom. How do you think they affect societies?
Of course, there is an impact. And if you look, even in a lot of big companies – at least a couple of years ago I had a look into this – the people who were responsible for all the climate matters and all this stuff were actually PR people. It was a very good indication of what people really thought about it. So what did they do? Well, now it's pop to be green, it's pop to talk about it and worry about the planet and be in the picture with this greenness. It's so popular that you get publicity with it. If you don't do anything about it, you don't get publicity. And then it's probably the case that various big institutions have a lot of PR people, marketing people, and they're discussing how we can be green and be more in the picture. And then somebody sets up a clock, somebody puts up something else somewhere, and so on.
We had a visit from the King of Sweden not so long ago (the King of Sweden visited Estonia in early May this year - HS). How did the King of Sweden travel to Tartu (Tartu is a regional capital of Estonia approximately 200 km away from the national capital Tallinn - HS)? By train. How did the King of Sweden return to Stockholm after that, and from where?
Well, he probably took a plane.
Yes, from Tartu. Three private jets came from Stockholm to Tallinn and after that, I don't know how many planes went to Tartu. But the King personally got on a plane in Tartu and flew to Stockholm. And I am convinced that this plane was not transported by road from Tallinn to Tartu. That the road was not blocked and it was not transported. It was still airborne, and I don't know whether the other two were also airborne, or just one or two, or all three – I haven't checked, I guess somebody can tell – but that’s not the issue. The only thing that was in the news was that the King boarded a train and travelled from Tallinn to Tartu.
No hypocrisy, right?
No-no, it's all green. Like Kersti Kaljulaid, when she was the president (Kersti Kaljulaid was the president of Estonia in 2016-2021 - HS), flew to Antarctica on a private jet. She was proud of this since no president of any other country has so much free time that they can go somewhere where there is nothing. She flew to Antarctica on a private jet and as soon as she got her feet to the ground there, she started to worry about the climate. About the ice melting. It's an anecdote, really, it's a joke. If anybody took the matter seriously, they wouldn't behave like that.
I think a lot of people when they watch it, don't really understand what's going on.
Well, they don't, and if we look back at the Covid pandemic, a lot about it was similar in the sense of a very powerful PR campaign, very powerful. I'm not a Covid denier. I've had it myself and I've been vaccinated twice and everything. But it went to the point of restricting basic human rights in some ways. It got absurd. At one point I wasn't allowed to go to a certain part of the mall, but I was permitted to go to a certain room in the mall, a certain café, where I was in a much tighter space with other people. People were allowed to be together there if they had that vaccination certificate to present. Things got so out of hand at times with logic there that we were willing to accept restrictions on basic human rights. And try as we did, if somebody thought that maybe human rights still had to exist – well, that person was cancelled. And it's exactly the same with climate change and Net Zero. If you don't believe in it, then you're basically nobody. You're not presentable anymore.
Part of the hypocrisy is probably also the fact that while we claim our aim to be the reduction of CO2 emissions and thus not driving cars or not running coal-fired power stations, we are simultaneously literally trying to achieve these Net Zero goals with the support of the same old CO2-intensive industry somewhere in East Asia. Or look at the amount of minerals that need to be extracted, etc.
There are so many examples, e.g. the batteries – where do we get lithium from? At the same time, the same cars that are discarded here, which are said to be hugely polluting – nobody is disposing of them, even though they are hugely polluting. They mostly go to Africa. People keep driving them there. And then, when you start arguing with somebody on this when you start saying that what is the point of us saving the world if other people are building tens upon tens of coal plants every year somewhere, you are told that each step counts. But at the same time, we send all these old, clunky cars to Africa, or we move our production that we do not want to have here to somewhere else, and so on. In truth, we are highly hypocritical.
It feels pretty brainless as well – if you, as a human being, see this information, it should really set you thinking, but I don't see that we can even have a calm discussion about it in society.
No, once again, you will immediately get labelled. Even if we would like to discuss it, would like to ask, how will we remain competitive, how will we put bread on the table in five years, in three years, you will be told something about the number of subsidies that are paid. But where will these subsidies come from? The law of conservation of energy should still apply, right? Subsidies come from the European Union budget. Where will the money come from in the European Union budget? Soon Estonia will also start paying money into the EU budget. The time is not far anymore when we will become a net contributor, not a net beneficiary.
So what does this tell us about our society?
Our freedom is getting smaller and smaller. The screws are being tightened quietly. I liken it to the fact that when we look at what is happening in the economy when we compare it to entrepreneurship, we are restricting entrepreneurship all the time. This space, this cage in which we have to operate, is getting smaller all the time. And now the politicians are talking about how they give subsidies. But who's going to pay for those subsidies? It comes straight from the printing press, the money, doesn't it? So the opportunities get fewer and then some, friends of those in high places, are handed subsidies into this cage. Instead of saying that there is no need to pay any subsidies. And in general, the payment of subsidies as such is philosophically very strange. I am not opposed to giving subsidies to those who cannot manage on their own. On the contrary, they should be subsidised and helped. But for entrepreneurs, for entrepreneurship, paying subsidies – well, I equate it with the fact that the most alpha kind of people should be in business in principle. Like the leaders of the herd who have to be able to cope in any situation. And now if we put these herd leaders in a cage and then start feeding them bananas, basically, we're going to kill off the species. They won't have instincts anymore. And that's what we're really doing, in every area. And we keep squeezing that cage smaller and smaller and saying we can't do anything anymore.
Why do we put up with it?
Well, I don't know why we put up with it. It's that a man does not want to be different from the herd. And those who go against it, are thrown out of the herd. But the herd is moving in the wrong direction.