Responding to Trump, climate change and global delinquency

Posted on May 26, 2017
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By Paul Keenlyside, Coordinator of the Trade Justice Movement

As the Trump Administration prevaricates over the Paris Agreement, countries that remain committed to avoiding dangerous climate change may well ask what can be done if the US pulls out. 

They may look to the text of the Paris Agreement for guidance. Unfortunately, due to the weakness of the Paris Agreement – for which US negotiators are in part responsible – they will find little guidance, and still less any legal mechanism for responding to recalcitrant parties. It is worth recalling that the US government has form in this area, having weakened the Kyoto Protocol in the 1990s by loading it with offsetting mechanisms, before pulling out under a subsequent president

It is also worth recalling why this matters. If one country takes little or no action to reduce its greenhouse gas emissions due to the short term economic gain of dumping into the atmosphere, the costs - extreme weather, crop failure, mass extinctions and so on - are shared by every person on earth. The bigger the country and the more polluting its economy, the worse the effect. 

Known in economics jargon as ‘free-riders’, large polluters acting in bad faith sap the popular energy and political will out of efforts to tackle climate change elsewhere. As George Orwell noted in 1941, the lady in the Rolls-Royce car is more damaging to morale than a fleet of bomber planes. 

That is why a globally coordinated response to global warming is needed. But in 2017, this looks further away than ever. The Paris Agreement, though symbolically important, is not by any means a globally coordinated response. 

To provide a sporting analogy, the Paris Agreement is a bit like a game plan for winning the Champions League (the 1.5 degrees target) in which every player gets to choose their position and style (known as ‘nationally determined contributions’), where there are no salaries (e.g. climate finance) and no penalties for staying in bed on a Saturday morning (e.g. an enforcement mechanism). Relying on corporate social responsibility meanwhile, is a bit like hoping that the opposition team score enough own-goals for you to win without turning up. 

So let’s assume that a country or group of countries are serious about climate change, and are in the process of swiftly decarbonising their domestic energy, transport and agricultural sectors. What measures can they take to avoid being totally sunk by emissions elsewhere? 

This is where trade and investment policies could offer some answers. Trade policies can level the playing field between domestic producers subject to climate change regulations, and overseas producers turning out cheaper goods with a higher carbon footprint. Trade policies can address the huge amount of emissions ‘embedded’ in goods from palm oil and beef to cotton and steel that are poorly regulated at the point of production, and poorly accounted for at the point of consumption. Investment policies can limit the carbon intense development overseas driven by capital exporting countries that are often the financial beneficiaries of ‘development’. And trade and investment policies can be designed in a way that is sensitive to a country’s historical responsibility for climate change and its resources and technical capacity to address it. 

A robust, trade-based response to Trump’s climate absurdism would not be anti-American. There are many people in the US that worry ‘a great deal’ about climate change – 45 percent according to the latest polling. Showing that there are consequences to riding roughshod over all of our futures would be an effective way to support their struggle against denial at the highest levels of government. 

Of course, this would require a rethink of what trade and investment policy is for. Whereas trade policy traditionally tries to tackle the dumping of goods at below market prices, it must now tackle the ‘environmental dumping’ of goods at prices that discount the social cost of pollution. Whereas trade policy traditionally aims at tearing down ‘market barriers’, it must now assess whether barriers are indeed necessary to shield responsible producers and deter global delinquency. 

Bringing together trade and climate policy is no small task. The World Trade Organisation agreements do not mention climate change, and in the mega-regional trade agreements of recent years, climate change is either absent or discussed in tokenistic fashion. More often than not, trade agreements have the opposite effect, placing roadblocks in the way of ambitious action on climate change. Meanwhile, the Paris Agreement and the UNFCCC are silent on trade. This is no accident, but the result of a lack of political courage to address what climate negotiators understand to be an elephant in the room. 

With atmospheric levels of carbon dioxide spiralling ever higher, it is time for that to change.