The political economy of climate change

| Updated: August 01, 2022 21:27:05

People move by boat from a flood-affected area to a safe place in Sylhet, Bangladesh, on June 19, 2022.	 —Xinhua Photo People move by boat from a flood-affected area to a safe place in Sylhet, Bangladesh, on June 19, 2022. —Xinhua Photo

Global warming, through emission of GREEN House Gases (GHG), has steadily deteriorated over the past three decades since the first Earth Summit was held in Rio in 1992. Beginning from 1995 in Berlin, 26 summits of heads of state and governments have been held under United Nations (UN) sponsored Conference of Parties (COP), the last one being in Glasgow in November 2021. The Inter-governmental Panel on Climate Change (IPCC), appointed by the UN, has been presenting scientific evidence on climate change every four years in the form of Assessment Report (AR) to the global leaders who meet in the COP to help them take decisions regarding climate actions. As the science of climate change has become more developed and sophisticated, based on research and studies by climate scientists all over the world, findings and forecasts have become more specific, narrowing down conjectures and hypothetical projections. In the latest, the sixth, AR released before COP 26, the IPCC told governments that the tipping point in global warming through human interference had reached and the world was going to experience series of severe climate disasters like heat wave, cyclone and flood endangering flora and fauna on planet earth. They rang the alarm bell about the impending apocalypse and warned that the time to take climate action to implement the goals laid down under Paris Accord on Climate (2014) was 'now or never'. Seven months have elapsed since the COP26 and yet no visible policy changes on climate have been taken by countries which made commitments to the Accord, particularly by the industrialised and emerging countries contributing more to green house gas emissions than others. The war in Ukraine, starting on 24 February 2022, has eclipsed  the long simmering issue of global warming, drawing more attention and resources to war efforts  from America, Britain, Europe and Russia. To vindicate the dire warning by climate scientists, the beleaguered planet earth has reacted with unprecedented flood in Asia (for instance, Bangladesh and India) and heat wave leading to wild fires in vast swathes of Europe, north America and north Africa. To judge by past records of countries, it does not look likely that these catastrophic natural disasters will prompt countries to take emergency measures to cope with the unfolding crisis. The reason for this lackadaisical attitude towards climate change is no longer absence of reliable scientific evidence but domestic political and economic considerations. In the minds of politicians the perception still persists that impact of major climate policy change on their economies and the electorate will be more adverse than damages wrought by climate change and that the former will be more immediate than the latter. An overview of the views held across the political spectrum, from right to left, the state of commitments made by major contributors to GHG and their  policy stances will explicate why and how the political economy of climate change still trumps over mounting evidence of  climate science.

CHINA LEADS GLOBAL POLLUTION: China is the biggest polluter China is the biggest polluter and the second major contributor to Green House Gas (GHG), including carbon dioxide (CO2).It has been overly dependent on coal for generation of power which had gone on increasing exponentially as the country embarked on planned economic growth with ever higher targets. Because of this dependence on coal average temperature recorded had increased by 0.24 centigrade during the period from 1951 to 2017, exceeding the global rate. During this period China accounted for 30 per cent  of global emission of co2. It became obvious to all, from scientists to politicians in other countries, that unless China significantly cut down on use of coal there could be no plausible pathway to achieving the 2014 Paris Accord on climate change to contain global warming below 1.5 degree celsius or even the less ambitious target of 2 degree celsius by 2030. Because of this important role of China everyone, from scientists to politicians in other countries, are anxious to know if It is doing enough. Chinese leaders have not denied their responsibility to do the needful to contain global warming but they have differed with other countries regarding the pace of its policy change, particularly for use of coal on the ground of its growth imperative. It has reduced the use of coal, the major contributor to co2, slowly but steadily, bringing it down from 70 per cent to 60 per cent over the past decade. President XI  announced in 2021 that China will stop financing  overseas coal- based power plant in Asia and Africa leading to cancellation of 65 giga watts of power generation. Recently, China has established a national carbon trading system in the energy sector but it still lacks a hard cap on carbon emission, preferring its strategy of gradual and incremental  reduction. On the positive side, China has been the world' s leading investor in renewable energy since 2015.It has three times more renewable energy capacity than any other country at present. In 2019 China had about half of electric vehicles  in the world and the share is growing. But in spite  of these achievements on the climate front the country lacks policy ambition, critics point out. This is evident  in both its revised commitments  made in COP 26 in November,2021 and in its current 5 Year Plan (2020- 2025).Both policy document indicate piecemeal and incremental improvement which will make it difficult to limit global warming below 1.5 degree celsius by 2030, the target fixed in the Paris Climate Accord. China has announced that it aims to have its carbon dioxide emission peak before 2030 and become carbon neutral by 2060. Critics point out that these soft targets reflect the traditional policy of under-promise  so that it can over deliver. To comply with the Paris Accord, China will have to place a cap on carbon emission and move forward its carbon emission peak dates, it has been pointed out. Current policy and past history have also raised concern that China's coal use will not decline fast enough over the decade of 2020s to achieve the 1.5 degree celsius target. Three times in the past four years China responded to energy shortage and economic slowdown by allowing coal production and use  surge ,it has been pointed out. In 2020 it added almost 40 giga watts of new coal- generated power. China, thus, continues to revise its climate  policy in the light of economic imperatives. Being an one- party authoritarian country its politics and economic policy move in tandem with economic  goals having a priority in times of need.

Believing in ' peaceful rise', China is likely to be co- operative in the implementation of global compacts like Paris Accord. It may not always take initiative in climate action but neither will it like to be seen as a laggard or a recalcitrant party. Much therefore depends on what other countries, particularly the industrially developed ones, are doing in respect of  global warming.

AMERICA FACTOR: Climate policy in America, the second big polluter and carbon emitter, has been held hostage to party politics of the Democrats and the Republicans, the former, by and large, favouring reduction of carbon emission by winding down power generation with coal, use of carbon- efficient vehicles and the latter inclined to  continue coal- based power generation and support industries without imposing  emission restrictions. Given this polarised view, it was not surprising  to see the Democratic administration under President Obama signing the Paris Accord on climate change in 2014  and President Trump, the Republican President, reneging on the same commitments when he came to power. Reflecting and consistent with this see- saw change of policy and politics, the Biden administration has now re- joined other countries for the implementation of the goals set for carbon emission and other targets of Paris Accord. In spite of this recent change, two factors have handicapped the Biden administration from doing the needful on the climate front. The first is the war in Ukraine that has attracted priority attention of the present administration. Reviving the cold war politics of rivalry with Russia and China, America has invested more time and resources in the war efforts against Russia than on climate change. The second is the unwillingness of the majority in the US Congress to pass landmark legislation on carbon emission and other issues of climate change. The majority on the issue of climate in Congress includes the conservative members belonging to Republican party. Far from having bi-partisan agreement on climate policy, the present Democratic administration does not even have unanimity among its own Congressmen. According to a survey of Pew Research Center in 2020, about 55 per cent of Democrats have faith on the reliability of scientific findings on climate change. This implies that 45 per cent of Democrats belong to the conservative camp and they share the scepticism about climate science with the majority of Republicans who are conservative. But the proportion of liberal Republicans being only 19 per cent, according to the survey of Pew Research, the conservatives belonging to both parties constitute an overwhelming majority in Congress. Frustrated by this bi-partisan majority, President Biden announced that he will give executive orders on climate action overriding the Congress. But the announcement that he made in mid July, after returning from G20 and NATO summit in Europe, fell short of declaring climate change emergency, indicating the delicate balance he has to maintain for political consideration. Though, unlike the majority Republicans( and conservative Democrats) the economic impact of a robust climate policy on their constituencies( coal miners, auto makers)  do not bother the majority of Democrats, the imperative of preserving party unity has  apparently reduced the policy space  for President Biden. In contrast to China, politics has trumped over economics (impact on certain constituencies) in America under President Biden forcing him to water down his executive order.

The  other factor that has handicapped the Biden Administration in the implementation of the terms of Paris Accord  is the role of the Republican dominated Supreme court. The Court has recently restrained the Department of Environment Protection from issuing any order to owners of coal mines regarding their production of coal. Conservative politics has thus percolated through judiciary to limit the remit of the executive branch over climate policy. The Biden Administration, thus, has to navigate through a rough terrain which is not very conducive for taking robust measures in an emergent situation. But the stark reality is, unless America takes the lead other countries will take token measures and convey pious intentions and bide for time.

In spite of political gridlock in the Congress and setbacks during Trump Administration (2016-2020) America has made commendable progress in achieving key targets in climate actions, particularly in reducing carbon emissions, cutting across sectors. GHG emissions from sources in the US  peaked around 17 years ago,in2005, and America began to decarbonise after that cut- off period. Because of switch from coal to natural gas, increased penetration of  renewables and  energy efficiency gains, the US has recently led the world in cutting carbon emissions. While there has been several year- on- year increases in US emission since 2005  peak, the US economy  has become more carbon- efficient  over last decade- plus and is on a decarbonisation trend-- even without the addition of new regulations and government policies to curb  GHG  emissions. The current global GHG emissions' trajectory  leaves room for Democrats and Republicans to come together to develop a new climate strategy anchored in commerce in geo-poltics. As extreme weather conditions like heatwave wreak more destruction and threatens to become regular, willy nilly, the two parties can be expected to converge on a common climate policy. Ironically,the imperative of political economy may nudge them to that consensus.

UK & EUROPE: Between 2006 and 2010 climate change rose rapidly up the UK political agenda. The Labour government, with cross- party support, introduced major changes in domestic and energy  policy, including the landmark Climate Change Act , 2008 which was an important step towards UK becoming a low carbon economy. Cross-party consensus was sustained by the subsequent Conservative - Liberal Democratic Party coalition. But gradually the populist - rightist pressure  diminished the urgency of the  climate policy of David Cameroon after 2010..Climate became  increasingly a partisan issue weakening UK government' s commitment to climate policy. In the latest development, the COP 26 president, British politician Alok Sharma, has threatened to quit as most of the contenders for the top post in the Conservative party, except Rishi Sunak, have equivocated on  the government's net zero target in compliance with the Paris Climate Agreement. The British climate minister has said that climate is ' absolutely a leadership issue". It is obvious that politicians in the UK are haunted by the Scylla of high cost of living, discouraging green tax and the Charybdis of the disastrous heatwave, calling for immediate mitigating measures.

Climate change in Europe resulted in an increase  of temperature of 1.9 degree celsius in 2019 compared to pre- industrial levels. The sharp increase identified climate change as a looming crisis. European Union (EU),a collective of 27 countries, has surprisingly shown a great deal of unanimity on climate policy to address the crisis, until the Ukraine war broke out. The EU  had adopted ambitious legislation  across  multiple sectors to implement its international commitments on climate change.EU countries have set binding emission targets for key sectors of the economy  to substantially reduce GHG emissions. The EU countries clinched deals on proposed laws to combat climate change on June, 2022 backing a 2030 phase out of fossil fuel. The EU is committed to 55 per cent reduction in GHG emissions by 2030 compared to 1990 levels. This is also the commitment made by EU under Paris Agreement.

The war in Uktraine has derailed EU's rock- solid unity by plunging the member countries in oil and gas crisis. Unable to obtain these vital resources for industries and public in the normal volume because of sanctions imposed on Russia and tit for tat retaliation by the country, some member countries of EU including Germany, Netherlands, Austria and Italy have begun extracting coal from their moth- balled mines as an alternative source. The European Commission president has warned EU members  not to backtrack on their long term drive  to cut fossil fuel  use and  emphasised on staying focussed on massive investment  in renewables. Diversification of supplies of oil and gas from other sources have also been emphasised. But these will take time and the urgent need of the moment will make  use of domestic fossil fuel compelling  for countries on both economic and political grounds.

Among the other major contributor to GHG emissions, India has consistently opposed a sharp reduction in the use of fossil fuel on the ground that it is a developing country and needs to use a cheap source of energy like coal. In the Glasgow summit last November (COP26), it was at India' s insistence that ' phasing out' of coal use was changed into ' phase over' which, according to India requires no water- tight  deadline. India also insisted on meeting net zero emission of carbon by 2070 and not 2050 as agreed under Paris Agreement. For developing countries like India both political and economic considerations dictate climate policies

This overview of political economy at work  can be concluded by quoting The Financial Tme Editorial Board' s comment: The scence of climate change is now well understood, as are the technical solutions. The larger problem is politics. Substitute politics with political economy and you are back in the days of classical economics where the twain always met. They continue to do so even now, not across the board, but in many areas of important policy making.

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