Regenerative Climate Economics: A Capital Architecture for the Age of Permanent Crisis

Climate adaptation fails repeatedly, and not primarily for want of money — the adaptation finance gap is real, measured and large, and this paper is not a denial of it. It fails also, and separately, because the capital systems financing it are misaligned with the physical and temporal dynamics of climate risk. Adaptation is governed by a political fragility cycle: short electoral cycles override the long, recurring lifetimes of climate assets, and grants, debt, insurance and annual appropriations are each single-cycle or liability-bearing. We define PSC-C, the political-fragility mode of Perennial Social Capital, whose function is not financial but constitutional: it separates capital cycles from political cycles, so pumps, levees, coastal buffers, cooling centres and fire equipment are replaced predictably across government turnover. The formal content is one constraint — the capital activation schedule is fixed ex ante and invariant to the political cycle — which is the decoupling condition written on the schedule rather than the stock, and that is what rules out silent deferral. âš ï¸ Sovereign disaster risk finance raises the sharpest objection. Its layering of reserves, contingent credit and risk transfer observes that ex-post liquidity may face fewer political-economy constraints than ex-ante reserving. â–¶ The reply is that the two address different objects: layering finances losses arriving at unknown times, while this paper concerns replacement, which has a known distribution even where the date is uncertain. A pool prices the whole distribution of replacement dates; a credit line prices only its tail. Neither reduces to the other. At national scale PSC-C gives local governments autonomous multi-decade capital cycles while preserving fiscal neutrality; extended globally it yields a federated Global Regenerative Climate Fund. âš ï¸ The constraint does not extend unchanged: federation inherits one political cycle per member, so the global proposition is that jurisdiction-by-jurisdiction pools compose — weaker than the national case establishes. The central claim is that adaptation does not primarily require more capital; it requires capital that behaves differently. âš ï¸ What PSC-C preserves is governance continuity, not a regenerating principal; what it depoliticises is replenishment, not entry.