Ben Horton
Well, hello, everybody. My name is Ben Horton, and I am delighted to welcome you today to this Chatham House members’ event, Tackling the Climate Crisis, which is the third in a series of events looking at the implications of the 2020 US election, Presidential election. I’m a Communications Manager here at Chatham House, and I also co-host the Climate Briefing Podcast, which is produced by our Energy, Environment and Resources Programme.
In November 2019, President Trump formally began the process to withdraw the United States from the Paris Agreement on Climate Change. This retreat from global efforts to addressing the climate crisis stands in stark contrast to a growing concern among the American electorate. Recent protest polls and extreme domestic weather events have contributed to tangible anxieties surrounding the climate change agenda, with voters increasingly aware of its immediate and personal implications.
So, in this webinar, we’re going to be examining whether the climate crisis will play a significant role in the upcoming Presidential elections, how divided is the American electorate along party lines when it comes to climate, whether there are generational similarities between Democratic and Republican voters, and what the priorities of both parties, in their current environmental proposed policy agendas are. What ultimately would a Biden or Trump Presidency mean for America’s wider role in global climate governance? And we have a fantastic panel lined up today to answer these questions.
With me, I have Julia Pyper, who’s a Senior Fellow at the Atlantic Council, and Contributing Editor at Greentech Media. She’s also the co-host of the Political Climate Podcast. So, it’s great to have a fellow podcast – podcaster in the building. Also, with me, Joe Robertson, who is the Global Strategy Director for the Citizens’ Climate Lobby, and also the Commission Director for the Food System Economics Commission. He’s the Founder of Geoversiv, and Lead Strategist in the Resilience Intel Climate-Smart Finance Initiative, which we’ll be finding out a bit more about later. And, last but not least, we have Professor Tim Benton. Tim is the Director of our Energy, Environment and Resources Programme at Chatham House. He joined Chatham House in 2016 as a Distinguished Visiting Fellow, when he was also Dean of Strategic Research Initiatives at the University of Leeds.
Before we begin the conversation, I just have a few housekeeping notes. Initially, just first thing, this event is on the record. We’re not using the Chatham House Rule today, and a recording will be available after the event. If you want to share any takeaways on social media, please feel free to do so, using the hashtag #CHEvents. And if you’d like to ask any questions of our panellists during this session, just submit those questions down in the ‘Q&A’ box at the bottom of your screens. We’re going to kick off with sort of a conversational segment between myself and the panel. But then there will be plenty of time at the end for your own questions, so please do submit anything that crosses your mind.
And I’d like to begin then, with Julia, if I may. It’s a bit of a sort of basic question perhaps, but I just wondered whether you could start off this conversation with an update for our listeners on the Trump administration’s approach to climate policy in this first term of Donald Trump’s Presidency?
Julia Pyper
Yes, well, Ben, thank you so much. Thank you to Chatham House for inviting me to join you. So, yes, I mean, climate policy I think, as many people probably know, has not been a priority for this administration. They would actually say that emissions, criteria emissions in particular, have come down under their administration. But, of course, there’s a lot of factors that happen at any one time and we may not even totally know the impact of the Trump administration’s policies yet. But what we do know, according to The New York Times, they track these regulations, the administration is reversing 100 environmental rules, with 68 rollbacks already completed, and 32 still in progress. In fact, this has been one of their most successful items on their to-do list has been environmental rollbacks. And these are things that would make permitting of oil and gas pipelines easier, removing environmental reviews around clean air and clean water.
I think we’ll talk more about the withdrawal from the Paris Agreement. Obviously, that’s garnered a lot of headlines. But then there are more subtle things that we hear reports of. Like undermining science within the agencies, there’s Staffers who complain about that, reports that are sidelined. Most recently, I believe it was The Atlantic that reported that a grid interconnections study got buried that would’ve basically laid out a pathway to making renewables more available, and interconnect better on our – on the grid here. So those are the kinds of things that we won’t even necessarily know the impact of for some time.
Then there’s just broader administration items like during the pandemic right now, the fact that fossil fuel companies have received billions of dollars in stimulus, and there’s maybe a case to be made for that. But, so far, the tracking shows that these are not dollars that benefit the workers so much as the corporations themselves. This is a policy that stems from Treasury and not necessarily the White House specifically. But you can point to it as something that’s happened under this administration. So, I guess I’d start there.
I do want to actually add one little turn here, is that President Trump recently went to Florida, and talked about his environmental legacy, you know. They are making this case, which I think is curious because it shows that I think even among his base, there are some people who view these issues as important, particularly in states like Florida. There’s a reason he went there and issued an Executive Order banning offshore drilling off the coast of Florida. He didn’t probably do that because – I don’t know. It wasn’t probably a priority for his administration until he really heard from voters that even, you know, those on the right are seeing the effects of climate change now, and it’s something that the administration can’t entirely ignore. So I’ll leave you with that.
Ben Horton
Yeah, thank you so much. Just to pick up on a bit more on what’s been sort of driving the Trump administration’s approach to this, I wonder, do you think that at the heart of what we’ve seen, this kind of rollback of the climate agenda, is that to do with a certain, kind of, denialism in terms of the climate science, or do you think it’s more driven by a, kind of, sense that other priorities, be they economic, you know, business interests, and a sense that those priorities are more important?
Julia Pyper
I think it depends on which administration officially you’re talking to. I think there are people who do understand this. You can talk to, you know, members of the Department of Energy, who are working on things like the Energy Storage Grand Challenge, who acknowledged at the very least that they want to be a part of the clean economy, which maybe gets back to your point that it’s really economics driving this. And on the inverse, I think it’s – there is an economic case that’s pushing the science aside. I mean, I believe it was the Secretary of Energy who acknowledged melting of the Arctic. You can’t both acknowledge that the Arctic is melting and that there’s a new security risk or economic opportunity there, and not in that same statement be acknowledging that climate change exists. So, I do think it is a balancing of priorities and that near-term versus long-term impact that people feel. And then there are some, as we know, President Trump has been on the record calling climate change a hoax, so we do know that there’s some outright denial as well of the science.
Ben Horton
Thanks so much, and coming to the election itself, obviously, I wondered whether you could tell us a bit about the kind of the mood in the country on climate change. Obviously, we’re seeing in recent – in recent weeks, we’ve seen devastating forest fires afflicting much of California, and some really, really horrible events occurring, which obviously have a resonance and a relationship to global warming. I just wondered whether you could tell us a bit about the extent to which climate change is going to be a live issue in this election. How much does it resonant with voters, and how far will they sort of vote depending on this?
Julia Pyper
Yeah, I do think it’s important to remember that while climate change gets polarised often, and it is a polarising issue in many respects, a majority of Americans, according to all the polling, actually believe it is a concern. That includes even strong numbers of people on the right, and independents, so something to keep in mind. And again, maybe harkens back to the point of why the Trump administration hasn’t entirely avoided the issue. It is not necessarily the top issue in this election. A recent poll showed that it was the top issue for Democrats right now, so that was interesting. Usually, it’s around the top, but a new one put it at the very top.
You know, I’m based in California. I do think the wildfires have really made this front of mind. There’s been flooding in the East, so that has really made this a more present issue. There’s a lot going on right on. I do think the economy and recovery is top. But what’s fascinating is to see how climate and clean energy and sustainability writ large is being baked into these discussions of the economy now in a way that I think has not really happened before. So, people are learning that you can’t just separate these issues, and they really are all one of the same, and that’s a really interesting, exciting area of discussion.
Ben Horton
Thank you, and then just my final question, Julia. I wondered if you could tell us a bit about the platform that the other election candidate, Joe Biden, is putting together on climate change. What would a Biden Presidency look like, in terms of the climate agenda, and to what extent is that being driven by elements within the Democratic Party that might be seen as sort of further to the left than the norm?
Julia Pyper
Well, I think you have to credit youth climate activists, people on the left, for really putting this issue on the election agenda in a way that it was not before. In fact, we just had climate change asked at a Presidential debate for the first time in a direct way by Fox News, of all of the platforms, which is not typically engaging on this issue, because of some of that pressure. So that’s been fascinating to see, and I think you have to give a hat tip to the left for really getting that on the agenda and it’s moved Biden’s platform to the left, you know. He put out a comprehensive strategy. His Build Back Better Plan includes things like getting to 100% clean energy by no later than 2050. I know it’s a $1.7 trillion investment plan that he hopes to mobilise up to five trillion with private money as well. And there’s things in there that I think are important like, you know, factoring in environmental justice as part of the plan, things that we haven’t really seen leaders step up on before, a really comprehensive plan for transitioning coal communities and communities that are left behind in the energy transition, which is happening independently of policy. We have to acknowledge that the market forces are accelerating this. So without policy, those communities have the risk of getting left behind, so it gets specific. Things like a task force for coal and power plant communities is in the Biden plan.
There’s been discussion of creating a Cabinet position specifically for climate change, so someone within the White House. We actually had John Podesta, a Democratic operative, on our podcast talking about this, and he really made the case that putting someone in the White House on climate would just elevate that issue in a way that we’ve never seen before. So these are the kinds of things that are out there. Caveat is Biden has not outright denounced fracking and stopping fracking on federal lands or other places. So that is something that I think will appease voters in Pennsylvania and places where it’s a big part of their economy. It continues to get him flak from the left. What he actually does, you know, ultimately, we’ll wait and see.
Ben Horton
Thank you so much, and we’ll come back to you very soon. Joe, I just wondered if I could turn to you now to tell us a little bit about how civil society in the US has been continuing efforts on climate change. I just wondered if we could begin by thinking a bit about the pretty dark picture that Julia painted for us at the start there of Trump’s approach to climate change and climate policy. To what extent do you think the federal system in the US has mitigated that over the last four years? Have we seen state and other local kind of government actors sort of stepping into the breach on climate change?
Joseph Robertson
Yeah, I think that’s an important point, thank you, Ben. And, you know, the federal system means that power is not all concentrated in the Federal Government. It is distributed across the landscape at lower levels of authority. Each of those levels of authority is independent of each other, right, so they don’t have to do exactly what the Federal Government prefers, although we have to abide by the same constitutional principles and protections. So we have seen a lot of leadership at the state level. We’ve seen leadership among cities, especially where there’s been an on-the-ground kind of response and awareness that it is an incredibly urgent matter to build resilience against climate shocks.
We’ve started to see this awareness happening in rural areas as well where the resilience of farmland is also increasingly a serious concern. If you have soil that is so depleted that it essentially cannot function as soil without chemical inputs, it’s much more vulnerable to erosion, and you have a much harder time securing the economy of that region. So we’ve seen states, for instance Montana, having its own state-level climate assessment like the National Climate Assessment to try to build an awareness of what needs to be done to protect the type of economy it has now, and how can that economy evolve.
But I want to say another thing about the – that dark picture, you know. I think there is one common thread, whether people are denying climate science or whether they just have some economic priority, but they realise there are risks. And to me that common thread is that those 100 rules that are being just dismantled or brushed aside, the common thread is impunity, and this is a serious constitutional issue. The Preamble of the United States Constitution says that the law exists to secure the blessings of liberty to ourselves and to posterity. There are lawsuits actively moving forward on that premise.
The First Amendment prohibits Congress from taking any action that would limit redress for grievances. So, to say that government can just allow as much pollution as government’s friends want, that really does not gel with the founding document on which the Federal Government is based. The Ninth Amendment says that all rights are protected, including those not listed anywhere, and the Fourteenth Amendment guarantees equal protection. You can’t say that the value of human lives is secondary to, you know, the interest of non-competitive 19th Century industries wanting to profit from pollution. It just doesn’t make any logical sense, and that’s certainly not equal protection.
So, the crisis in democracy that the world is watching playout every day on social media, on news screens in the United States, it is also at the heart of those environmental rule changes. There is – it’s not just ignorance or irresponsibility. It is a deliberate attempt to expand the space for impunity. And I think in the moment that we’re in, this is part of why climate change has risen to the top of concerns among Democrats, but also, a majority of Republicans recognise that this is happening, and it needs to be dealt with. Something like three-quarters of Republicans under 30 hold that view. I think that when you have a country that is going through what the United States is going through right now where vulnerability is the most common experience, I would say, in terms of our common culture right now, it’s very hard to watch people in government try to expand the space for impunity instead of responding to emergencies. And I think that’s causing people to say this needs a different way forward.
Ben Horton
Yeah, thank you very much, Joe, and just to follow-up on that then, given your experience working on the Citizens’ Climate Lobby and other initiatives, do you see that sort of consensus forming? Do you see that this is becoming a bipartisan issue, at least within civil society and the American sort of public at large sort of outside of the – outside of Washington?
Joseph Robertson
Well, so, there are two ways to respond to that, I would say. One is I think, yes, as Julia pointed out, the majority of Americans think that this is something we have to urgently deal with. Something that we saw when Trump was elected, within our organisation, was that a lot of Conservatives started joining our organisation. And the interesting thing that we heard from people who were coming from that perspective was that they never thought that the United States would not lead on climate, and they never thought that the United States should not lead on climate. But they voted for people who did make those arguments because they just thought those arguments couldn’t possibly win. They voted for those people because they wanted other things those people stood for. And they thought those individuals were simply saying, “This is not my issue.” And when Trump got elected, there was a lightbulb moment for a lot of those Conservative voters and Republican voters that something was going off the rails. So that is an interesting undercurrent that I think is there that doesn’t get enough attention.
There is disappointment among Conservatives that the Republican Party has not led more aggressively or even really at all on climate. But what we’ve seen in the last couple of years, we’ve seen a bipartisan Climate Solutions Caucus in the House of Representatives that at its peak, before the 2018 election when a lot of Moderates were pushed out, had 90 members, 45 Republicans and 45 Democrats. One of the first things that caucus achieved, long before it got to 90 members, was that it was able to stop the, at that time, to stop the administration’s efforts to remove controls of fugitive methane from drilling sites. But that now may be moving forward, but that was a result of that bipartisan action.
There’s now a bipartisan caucus in the Senate as well, and I think this is partly a response to three things. That, first, that rising awareness among Conservatives that this is not right that we’re not doing anything. Two, the fact that economic imperatives are starting to set in. The damage from climate impacts is so extreme now in some places that you’re looking at, you know, there are more and more communities every year where their entire ten-year future budget is going to be consumed just by responding to one disaster, and so that’s no longer tenable. And then the third thing is that, you know, what Citizens’ Climate Lobby does is try to help citizens connect with the people who represent them, even if they’re from different ends of the political spectrum, and have trust-based solutions-oriented conversations.
And what’s happening, as that kind of thing plays out, and everyone in Congress is having those meetings, Conservatives are becoming more comfortable with climate language. There are better ways for them to talk about things that they are now familiar with: stewardship, creation care, competitiveness and innovation, investment in entrepreneurship, these kind of things. There are more options, and so, with those options on the table, there’s a little bit more due. But I think we’re still – my hope is that we’re seeing right now the last national election in the United States where this will be a controversy because the President is so far out of step with the American public, with American business, with the banking and financial sectors. There are only a handful of very narrow interests that really represent the views that he constantly promotes. And I don’t see a future Republican Presidential candidate having the slightest possibility of winning, if they behave like Donald Trump.
Ben Horton
Thank you so much, Joe. We’re pushed for time, and there’s a lot to fit in, so I’m going to move over to Tim now. Tim, obviously, we’ve heard a lot there about the domestic situation in the US, over the last four years. I just wondered if you could kick us off, firstly, by giving us a sense of how the international community has responded to Trump’s position on climate change.
Professor Tim Benton
Okay, thanks, Ben. Well, obviously, the headline thing was the notice to withdrawal from the Paris Agreement, which clearly has a very big implication for the way that climate governance is working out around the world, particularly around – it’s in effect licensing a lack of ambition amongst the international community. As well as the US being potential and past leaders no longer stepping forward to take that position means that there is a degree of who’s stepping up now? And, of course, you know, there are all sorts of dynamics around where China’s going to sit, where’s the EU going to sit, where is post-Brexit Britain going to sit? But it’s not made any easier by the lack of America being part of the Paris Agreement.
But I think there is a broader issue, which is not – doesn’t fall under the realm of climate engagement, per se, and that is the inward-looking nationalism of the current US administration and the Make America Great Again withdrawal from multilaterality effectively, means that, again, that it licenses the world to move away a little bit from international co-operation over some of these big things. And, in particular, just a little anecdote, in 2016, when – the day after Trump was elected, we had a meeting upstairs in Chatham House to say, well, what does this mean for the environment? And we posited the scenario where Trump would protect the Rust Belt, and put tariffs on Chinese steel dumping. China would respond by putting tariffs on US exports, which are largely agricultural exports, from their perspective, particularly soya, and that would license a market response from soya producers to increase the amount of production by chopping down rainforests.
Actually, it’s been burning down rainforests over the last few years. But, effectively, that pathway that by undermining trade and the rule of law or the kind of international rules-based co-operation means that it’s much easier for sovereign states to say, “This is my business. I’ll do whatever I want from an environmental perspective. We’re in this to make our country great again to gain back sovereignty,” or whatever other kind of buzz-phrase might be, “and it’s our decision if we want to trash the environment.” Whereas the peer pressure in the Obama days leading up to and around Paris was much more that, you know, you wouldn’t do that sort of thing. So I think the withdrawal from Paris is one thing, but also this undermining the multilateral architecture of international co-operation around these big things I think is going to, in hindsight, be really important.
And I just came across a modelling study the other day, which was a needs agent-based modelling study looking at how nation states as actors would, you know, lobby themselves, and work together, and peer pressure, etc. And the conclusion of that paper was that one Trump administration means it’s going to be really difficult to hit 1.5-degree Paris targets. Two Trump administrations means that we haven’t got a cat’s chance of living in a world of equitable climate change. And the sorts of things that Joe and Julia have been talking about would just be going through the roof in future decades. Trump’s legacy.
Ben Horton
Thanks very much, Tim. Cheering us all up this afternoon.
Professor Tim Benton
[Laughs].
Ben Horton
Please, by the way, everybody, I hope you’re enjoying this conversation. But if you have any questions at all, please do put them in the ‘Q&A’ box at the bottom of your screen. Tim, just to follow-up, I guess, on that, and look ahead to a really significant event in the – in this conversation on global action on climate change, which is the COP Conference, which was meant to be in a couple of weeks’ time, and is now going to be towards the end of 2021. I just wondered, obviously, you may have kind of pre-empted what I was going to ask. But I’d like to know a little bit more detail about the sort of machinations of that conference, and whether you think that the US engaging meaningfully with that process really is the key to achieving anything. I mean, is – what prospects is there for progress at COP26 without the US?
Professor Tim Benton
So, there’s obviously some chance of progress, and the countries that will not – will be there with a Trump administration, i.e., not the US, are all being exhorted to raise ambition, and we had that statement from China a few weeks ago about going towards zero net carbon in the middle of the century, etc. So there will be a raising of ambition, but that raising of ambition is unlikely to be enough to meet the Paris goals globally. I think the issue of if there is a new administration, and we come back into – or the US comes back into climate leadership, the question is, what form will that take? Because, you know, Paris really only came about because of Obama and China having a rapprochement. It is unlikely that given the political space at the moment that a Biden administration would be able to work with China in the way that Obama worked with China. So, how post a US re-joining, how that would work out, and the degree of ambition that we will get from them re-joining is, I think, a little bit uncertain. And obviously it depends on what happens in the next year when COVID and all of the other imponderables in the times where everything is uncertain. But, clearly, we’re – the world will be in a better place with America back in than it would be with America without.
Ben Horton
Thanks very much, Tim. I just wanted to flip that question slightly back to Julia and Joe, actually, and thinking about that issue of US leadership on the global stage on climate change. Is that an image that appeals to the domestic political scene in the US? Do American citizens feel that their country should be the country that’s leading on issues like climate change and environmental concerns? Julia, do you have – do you want to come in first?
Julia Pyper
Yeah, I think it depends who you ask. I do think there are lot of acute domestic issues right now, so it’s maybe hard. I think that Trump’s messaging around “does the United States have to pick up the tab for all the issues of the world?” did resonate with some people. But I also think there’s lots of people who feel like the US has a unique leadership role to play. And you even saw, recently, in recent days, a Republican-led organisation, the Climate Leadership Council, come out with a carbon tax proposal that would include a border adjustment tax that would basically reward US businesses for being low carbon.
So you could see climate policy, international climate policy coming about through these domestic means. Maybe it’s not on the UN stage, but you could see that happening because, yeah, the US has actually a fairly good story to tell. The power sector has decarbonised, so there are other ways in which we could get back on track here, even if the UN negotiations are a little unsteady. The idea of competing with China I think resonates. Growing US domestic business in battery manufacturing, for instance, Tesla’s story, that resonates. Just how many policies and the strategy put in place to foster that, there is no national energy plan here, so we’ll have to see whether that gets taken up in a real way.
Ben Horton
Thanks so much, Julia. Joe, do you want to come in on this question as well?
Joseph Robertson
Yeah, thank you, Ben. I want to second what Julia said about – I think that, yes, Trump’s message about, you know, picking up the tab kind of resonated with people, some people. But there’s a, you know, a notorious misunderstanding in the United States about how much money the United States spends on other countries. Proportional to our GDP, we spend less than any other developed country. The culture of the United States, very much I think on both sides of the political spectrum, sort of revels in American leadership on the international stage. The critics of President Obama didn’t criticise him for leading on the international stage. What they did instead was to try to defame the way that he led, and to try to undermine people’s confidence in international institutions. And so, I don’t see any problem with a Biden administration coming in and saying, “We’re going to lead on this.” I think that if his plan were to start moving forward, the US would automatically upgrade its nationally determined contribution just by going forward with Biden’s plan. And I think that there would be a lot of support for that. I don’t think that he would face the kind of opposition that we’ve seen in the past.
And then, maybe another thing I would say is also to second what Julia pointed out about carbon pricing, you know. There’s actually been legislation introduced in the House of Representatives and in the Senate, bipartisan in both houses, for that – for a plan very much like the one the CLC is promoting, a carbon fee with 100% dividend to households, so every single household would get the same amount of money. So, Donald Trump would get the same amount of money as everybody else. What that does is it makes sure that the burden doesn’t fall on ordinary people. It falls on polluters and the fact that a border adjustment could be part of a plan like that helps the US take a leadership role. The European Union is of course planning to do that very thing as part of the EU Green Deal. And we know from 2009, when the US House of Representatives passed the Waxman-Markey legislation for cap-and-trade 2010 that it included a border adjustment. And China’s response was to begin emulating that policy in a number of pilot programmes. The reason was to avoid the border adjustment. So, if those three economies form a union of that kind, you have a great possibility of significantly altering the landscape of global climate action very quickly.
Julia Pyper
Could I just jump in quickly with a thought there to throw a wrench in things? So some polling has come from – and I should know that Joe and Citizens’ Climate Lobby has done a tonne of work on carbon pricing that’s really informed that discussion, so that’s been awesome to follow along with. Some recent polling though shows that, especially on the left, there’s much more desire for regulation over carbon pricing. So that is a way, going back to our earlier discussion, about how much is the Biden platform informed by Progressives, you could see that being a real flashpoint in the climate realm of what degree carbon pricing comes up. Some people view it as it’s not – you know, if the prices aren’t high enough, you can get – fossil fuel interests will be let off the hook and the Biden plan, last time I checked, did not officially address carbon pricing head-on. So they’ve kind of sidestepped around this issue. So, that will be an item to watch, going forward, if Biden is, indeed, elected.
Ben Horton
Thank you so much, Julia. I’m just going to turn to a couple of questions from our audience now and, Tim, actually, I think we’ve got one for you here from Ali Alibi. Thank you very much for your question. He asks, “What impact do you think China’s announcement of carbon neutrality by 2060 will have on the US’s stance on climate change? Do you think that, to an extent, China can pressure the US into further action?”
Professor Tim Benton
[Pause] No matter how many Zoom meetings I have, I always forget to unmute myself. Yeah, so I think there is a chance that President Xi is effectively trying to grab momentum and say, “Look at America over there, dinosaurs. They’re going backwards. We’re the kind of new leaders.” And I think, you know, once we get nation states competing over to be greener than the others, then the sorts of things that Joe was talking about there, you know, the tipping points in policy environment or the tipping points in uptake of electric vehicles or, you know, any of the other things that might come through. So, clearly, there is an element of an American response could be, “We must keep up. We must compete.”
As Julia said, you know, the issue that China, by driving itself forward, is also driving the engines of its own economic gain, and it’s very quickly getting to the point where being greener and adopting green technologies is good from an economic perspective. Whereas actually investing in the sunken assets of an increasing – increasingly sunken assets of fossil fuel will hold back development of the economy in the future. So you can only see as well as it being a political question, it’s also an economic question that if China were going to drive ahead batteries and clean energy and phasing out coal and all of the other things, then, from a competitive perspective, that America’s going to need to respond. Otherwise, it will get left behind. So many reasons why it could be a positive thing.
Julia Pyper
Yeah. Can I just jump in on that again?
Ben Horton
Sorry, yeah, please.
Julia Pyper
I think we do need to also note that China is still building a number of coal plants that will have 60-plus-year lifetimes. And some people have pointed to, okay, also how many coal plants is China building internationally? So when you look at its footprint, you know, what does that include? And it seems very much like China wants it both ways. They very much want to dominate the low-carbon economy, and they’re continuing some of their fossil fuel development investments. If those truly get cancelled, those plans, then that will be a really amazing tipping point to watch for. But, as far as I understand, the Chinese Recovery Bill that they have, you know, earmarked money for rebooting their economy includes a bunch of money for coal. So it’s not a one-way street on that front.
Ben Horton
Thank you very much, Julia. I’ve got a question here for Joe from Trisha de Borchgrave. Thank you for your question. She’d like to know how effective the Climate Leadership Council has been to in bringing Republicans onboard in – on sort of climate change issues?
Joseph Robertson
So, I mean, I think the effectiveness, and when you look at – you have a campaign that’s a sort of public expression of an idea, and then you try to find out have minds moved? If you look at legislation, we haven’t seen the legislation follow directly from that. But I would say that the legislation that Citizens’ Climate Lobby has worked on for many years, certainly had a boost from all of the effort that they put in to moving minds of leaders in the Republican Party.
On the other hand, I would say this as well. There’s a question of what moves political will. A good idea doesn’t necessarily move political will. The voices of leaders don’t necessarily move political will. There’s a point at which those who resist change, they are moved finally by the inevitability of that change. And I think we are starting to get to a point where it’s clear within the ranks of – certainly the people in the Republican Party who study these issues, who study, you know, the future of enterprise, the future of capital investment, financial markets, energy and technology, international trade and competitiveness, the people who are looking at those things and looking at policy, I think, are increasingly aligned with the 3,500 Economists that have stood with the Climate Leadership Council’s message.
[Pause] The problem is, will elected officials be more afraid of not acting than they currently are with being penalised for acting? And I think we’re actually very close to that. It’s going to be difficult for Republicans, in most parts of the United States, to get elected if they’re standing on the side of 19th Century industries, when the majority of their own voters want a 21st Century economy. And I would say that the Climate Leadership Council’s way of making sure that message was coming from sort of senior elder Republican statesmen has been very helpful.
Ben Horton
Thank you very much, Joe. We’ve got another question here for Tim, I think, I’ll go to first. But then Julia and Joe, you chip in. It relates – it’s from Domenic Carratu and it relates to the impact of COVID-19, which we’ve not covered so far. We were talking just now about the possibility of, you know, carbon pricing methods, and other kind of economic interventions. Domenic would like to know whether those interventions are going to be affordable in the kind of immediate post-pandemic context where we’ve seen these massive stimulus packages from countries all around the world? Tim, you’re muted, sorry.
Professor Tim Benton
[Pause] See what I mean? You can’t teach an old dog new tricks. I think there will be a question around can we afford not to, as well as are they affordable? So, we live in a world where our economies are actually very interlinked complex systems that tend to lock themselves into a resilient-to-change mode, which we call business as usual. And one thing about COVID is that it has unlocked a lot of the machinery. Now, we can lock it back quickly and fast to get it back to where it was. But we know, as Joe and Julia have said, you know, there is an inevitability about the future that means that at some stage, we have got to move faster in this direction than we currently are.
So, if we lock it back in immediately because the short-term costs are high, then the longer-term costs will become bigger and bigger and bigger. And, as Joe mentioned, we’re getting to the stage where the costs of not dealing with climate change are palpably bigger than the transition costs. So it’s not a matter of the costs, the transition costs, per se. I think it’s a matter of who they fall to, who are the winners, and who are the losers, and how much does incumbent power hold us back from making the right sorts of decisions? And if there’s one thing about the current administration, it does show you how important incumbent power, when used wrongly, makes the wrong decisions.
Ben Horton
Thank you, and Julia, Joe, would you like to come in on this question?
Julia Pyper
There’s lots to say about a green recovery, but there is, you know, that the idea of a US stimulus in general, I think, people have seen the news as being ping-ponged back and forth right now to the chagrin of, I think, even the Fed Chairman right now. So, who knows if we’ll get any stimulus? But a green stimulus would be the next layer to that. And, frankly, unless there’s a change of administration, it probably is not on the table.
I do think there’s an interesting question there, I think I saw about oil companies, which, if we have a moment, Ben, could we touch on that? Okay, I’d love to jump right in ‘cause it’s a fascinating discussion. We’ve seen Chevron, you know, announce it’s going to build 500 megawatts of renewable energy. You’re seeing the American oil companies dip a toe into this space. Will they accelerate it, and become on the level of the European majors? I think not, unless there is some real change in policy. It is possible that a Biden administration, short of banning fracking, could put new rules on methane. They could require environmental justice metrics be met in building new oil and gas projects. These are things that would definitely change the nature of the oil and gas business here.
But you also have reports that Exxon fully plans to emit the equivalent of Greece’s emissions over the coming years. A new report out this week leaked memos talking about Exxon’s own expected emissions spiking. So, they don’t – does not seem at this point seem – see a major change in their trajectory. Something Joe may know more about is the impact of the financial sector here on, you know, people divesting from fossil fuels, pressure coming from both financial regulators at the Government level, but then other investors generally as they try to meet their ESG goals. That could see some pressure on the US oil companies in a new way. But, again, still kind of playing out, and there’s arguably lots of other money out there for these companies to keep operating.
Ben Horton
Julia, thank you, yeah. Joe, do you want to come in?
Joseph Robertson
Yeah, sure, you know, that it’s really interesting to think about that particular point about Exxon and its plans, right? That was revealed in part because when you matched up their planned overall activity and corresponding emissions with their planned reductions, you saw a huge net increase in emissions. And what’s interesting about that is that the Oil and Gas Climate Initiative is planning to invest billions of dollars in lower emissions strategies. A lot of it is about carbon capture, and a lot of it isn’t necessarily going to happen, and they have been incredibly slow in moving that money out. But what’s telling is to compare that amount of money and Exxon’s internal strategies with how much money the financial sector has poured into Tesla. They str so far out of step with the financial sector, in terms of their idea about the future, that this isn’t five years ago. Now, the public sees that news, and they instantly think, “What planet is this company on? Have they not noticed that this is not the future?” There’s something really – you know, there’s a weakness in that way of thinking about the future and it’s now evident to many people who aren’t thinking about the climate, they’re just thinking about money.
And I would say on the subject on money, the Commodity Futures Trading Commission, which is a US regulator of commodity futures, financial assets, relating to all kinds of traded goods like oil, gold, but also wheat, corn, the Commission is a five-member panel. All five are appointees of Donald Trump, three Republicans, two Democrats. They called on a special committee to publish a report on climate risk. And that report came out a couple of weeks ago, in September, and it found that the financial system of the United States is not viable, in its current form, if climate change is not stopped. And so, they’re essentially saying the same thing that the European Central Bank is now saying, that the former Governor of the Bank of England, Mark Carney, the Task Force on Climate-Related Financial Disclosure are all saying, which is that if you are carrying this kind of risk, you’re not viable. And the CFTC report is additionally important because in the sense that it’s saying that the entire financial system will collapse, and the economy of the United States will not be able to be supported by the American financial system, it is essentially the strongest alarm we’ve had from an American Government institution so far, and it was put forward at the request of five Trump appointees. And so, this is a different world, and everything has to start moving towards building resilience.
And I would just say this final point about the question on carbon pricing, is it affordable? Carbon pricing is not a question of affordability. It’s a question of affordability if you do it in a way where your goal is to punish every person in the economy for the actions of a few. But if you do it intelligently, so that you don’t do that, you don’t exert pressure on, you know, the local postal worker or the local schoolteacher or the person who grows vegetables for you, you exert pressure on the polluters themselves and their investors. If you do it that way, and you push the price up high enough quickly enough, and you get money to people, so that they can participate in a greener economy, it’s far from a question of affordability. It’s a much better economic scenario to be in.
And I think a final point about what is and is not affordable right now, COVID-19 is the third major coronavirus that we’ve seen in this century that leapt from animals to humans. Before this century, the only known coronaviruses were common cold viruses. We haven’t had that happen before in modern history. It’s now happened three times in 15 years, roughly. This is an accelerating danger. And in December of 2019, if you asked people, “Would the United States Treasury and Federal Reserve spend $6 trillion in two weeks in April to deal with an unplanned event?” they would say, “No, that’s impossible. There’s no money for that. Disaster-relief spending doesn’t work like that.” It’s, you know, 300 billion is the record for a year. Six trillion in two weeks in April, that happened. We’re in a different world. So, I think all of these things are conditioning what is possible. And one way or another, even if Trump is re-elected, the financial system of the United States has to shift towards practices that account for these costs.
Ben Horton
Joe, thank you, and I’m afraid we’ve run out of time. We’ve run over a few minutes. Thank you to everybody who joined us today, thank you for your great questions, and thank you, panellists. I found it, yeah, both fascinating and terrifying to discuss these issues with you, and I think particularly that last segment there on the impact of the pandemic has really sort of impressed upon us all how significant these questions are in the run-up to November 3rd. So, yeah, so thank you very much to our panel. Thank you for joining us, and hope to see you again at a future Chatham House members’ event.
Professor Tim Benton
Thank you, Ben.
