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Will economic growth trump environmental concerns?
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This week, both the UN Summit on Climate Change in New York and the G20 Summit in Pittsburgh will provide more insight into the direction that the governments of the world are willing to take on economic and environmental issues.
Economies are driven by energy, and energy extraction and use are currently having disastrous effects upon the environment. Without agreements that limit the use of fossil fuels or control their emissions, the environmental degradation that has defined the twentieth century will continue into the twenty-first. If we limit fossil fuels without a transition to cleaner energy sources, the global economy will will not have enough power to keep growth curves positive.
While President Obama stated, "Our generation's response to this challenge will be judged by history, for if we fail to meet it, boldly, swiftly, and together, we risk consigning future generations to an irreversible catastrophe", many critics noted that the overall message of his speech at the UN fell far short of the conviction necessary to develop an international agreement on the issue.
He was quick to note "how his administration has made major investments in clean energy, set new fuel economy standards for vehicles and pressed for House passage of a bill to cap emissions and allow companies to trade pollution permits" (Wa. Post), but he was not able to clearly define America's stance on the larger issues of cap-and-trade passage and emission reduction figures. China's President Hu Jintao followed President Obama's ambiguous stance saying, "We will endeavor to cut carbon dioxide emissions per unit of GDP by a notable margin by 2020 from the 2005 level" (Reuters). Climate change mitigation tomorrow, economic growth today ...what's new about that?
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It seems as though the Obama Administration, for all the praise it received in the early days after the election, has developed a case of the 'bad-timings'. Conditions were ripe for financial reform back in March when the economy was teetering on total collapse, but the Administration worked harder at getting money into the hands of the crooks than on reforming the behavior that caused the calamity. Again, after the energy and climate bill passed the House in June, momentum could have been better managed in order to reform energy ahead of the Copenhagen conference later this year. Instead, the Obama Administration threw its weight behind healthcare reform, which had neither momentum nor global matters pressing for action. Time magazine reports, "it's looking increasingly as if the U.S. will go to Copenhagen with no national carbon caps in place. Senate majority leader Harry Reid told reporters on Sept. 15 that the Senate might have to wait to act on cap and trade until after tackling health care and banking reform".
Tomorrow, President Obama shifts his focus from climate change to economic and financial issues. The two summits are intimately interrelated, but economic growth has always trumped environmental responsibility. This time around, though, many are hoping that global economic systems can be used initiate the development of a clean energy economy.
As the G20 meeting gets underway in Pittsburgh this week, it should be noted that the G20 has considerable responsibilty for and control over global energy and environmental issues. "G-20 member countries represent around 90% of global gross national product, 80% of world trade, as well as two-thirds of the world's population. The G-20's economic weight and broad membership gives it a high degree of legitimacy and influence over the management of the global economy and financial system."
President Obama gave a glimpse into his speech at the G20 tomorrow by saying, "Later this week, I will work with my colleagues at the G-20 to phase out fossil fuel subsidies so that we can better address our climate challenge". Phasing out subsidies to fossil fuels will essentially level the playing field for renewables to make a stronger push into the mainstream.
According to The Washington Post, "Many countries, including the United States, provide tax breaks and direct payments to help produce and use oil, coal, natural gas and other fuels that spew carbon dioxide. The costs of these subsidies are estimated in the tens of billions of dollars annually worldwide. In the U.S. alone, the federal government gave $72 billion in subsidies to the fossil fuel industry between 2002 and 2008". The Environmental Law Institute, after looking into the issue, concluded that "the largest U.S subsidies to fossil fuels are attributed to tax breaks that aid foreign oil production. The study, which reviewed fossil fuel and energy subsidies for Fiscal Years 2002-2008, reveals that the lion’s share of energy subsidies supported energy sources that emit high levels of greenhouse gases."
Reports indicate that a deal to phase out subsidies for fossil fuels in on the table at the G20; but there is no telling whether the G20 will agree to phasing out subsidies to fossil fuels, or if the U.S. would go it alone if other countries did not sign on to the deal. G20 advisor, Michael Froman, "declined to flesh out the U.S. ideas by including a timeframe or identifying which countries were targeted". (Reuters)
An international agreement to phase out subsidies for fossil fuels would go a long way toward leveling the playing field for clean energy development to sprout, but some critics claim that negotiations for the larger Copenhagen climate deal have turned distinctly inward. The Washington Post reports that "initially, many climate activists had hoped this year would yield a pact in which nations would agree to cut their greenhouse gas emissions under the auspices of a legal international treaty. But recent announcements by China, Japan, and other nations point to a different outcome of U.N. climate talks that will be held in December in Copenhagen: a political deal that would establish global federalism on climate policy, with each nation pledging to take steps domestically". It appears as thought the governments of the world are moving in the direction of independent action on domestic economic, energy, environmental, and climate issues. With climate change forecast to "increase pressure on water, food, and land, reverse years of development gains, and exacerbate poverty, destabilize fragile states, and topple governments", it seems more likely that the nations of the world will retreat inward in order to deal with their own problems.
In the U.S., it seems likely that this trend will also continue. Some are concerned that economic issues will bury the climate debate. The state of the economy and rate of unemployment (not to mention the already taxed airways due to the healthcare debate) here makes it more likely that actions to protect the economy at the expense of the environment will continue to be the law of the land. The debate in Congress has yet to transfer from healthcare to energy, threatening prospects for an international climate deal later this year in Copenhagen. It seems likely that we struggle domestically for another year or so trying to balance energy and environmental issues, and only be able to promise far lower emission reductions at Copenhagen than international scientists say are mandatory to avert an environmental catastrophe.
If Congress fails to pass carbon legislation, the EPA is prepared to limit greenhouse gases under the Clean Air Act, but the Chamber of Commerce has already threatened the EPA with lawsuits to slow that process down. The act of delaying action to protect natural ecosystems by the Chamber is seen as despicable by some of its members.
Many of the Chamber's members support climate legislation, and recently Pacific Gas & Electric (a utility company in CA) left the chamber over 'fundamental differences'. "We find it dismaying that the Chamber neglects the indisputable fact that a decisive majority of experts have said the data on global warming are compelling and point to a threat that cannot be ignored. In our opinion, an intellectually honest argument over the best policy response to the challenges of climate change is one thing; disingenuous attempts to diminish or distort the reality of these challenges are quite another," PG&E said in their statement.
Still, the conflict between economic issues and environmental concerns seems to be tipped in favor of the economy. With the energy debate still sitting on the sidelines of the Senate, it appears that economic growth will be favored over emission regulations for at least the short-term.
Sen. Lisa Murkowski sums up America's conflicting interests between climate change and the economy best when she said, "I believe very strongly that action on climate change has to include meaningful reductions, but we have also got to make sure that we don't kick the economy in the head" (Wa. Post). In order to protect the economy from getting kicked in the head, Murkowski has begun crafting legislation that would limit the EPA's ability to protect the environment. "The U.S. Environmental Protection Agency would be prohibited for one year from clamping down on some new carbon dioxide pollution . The 'time out' would stop EPA from issuing regulations aimed at reducing greenhouse gas emissions from utilities and factories." (Reuters) For now, though, it appears as though Murkowski's bill is DOA. (Reuters)
The idea that emission regulation will hinder economic growth is an idea that many businesses simply do not agree with; many businesses are finding that reducing emissions trims waste and saves them money. A recent study found that "roughly 52% of respondents to the organization’s survey describe programs to reduce emissions, up from 32% a year ago". In addition, the Center for American Progress has found "that clean-energy investments generate roughly three times more jobs than an equivalent amount of money spent on carbon-based fuels".
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