On 22-23 April the Biden administration is hosting a global climate summit to mark Earth Day, named after the largest ever environmental demonstration, staged in the United States 51 years ago. As Joe Biden nears the end of his first 100 days in office, the summit celebrates the re-entry of the US into global climate politics and is a key test for a government that has defined the environmental crisis as central to its programme. It is also an important shift in focus. So far, the Biden administration’s agenda has been dominated by disaster management. Efforts have been devoted to rolling out the vaccine bequeathed by Donald Trump’s Operation Warp Speed and delivering a third, huge round of fiscal relief to American firms and households. Ahead of the climate talks, the president has to deliver something more long term: a credible commitment to cutting at least 50 per cent of emissions by 2030 and to achieving net zero by 2050. The crisis-fighting has worked. After a slow start, the vaccine roll-out has been impressive, transforming America’s outlook on the virus. The $1.9trn Covid relief bill was forced through Congress on 11 March against unified Republican opposition. On top of the previous rounds of economic relief, it adds up to the largest fiscal package in history – sized at more than 25 per cent of GDP. Provoking fierce criticism from Clinton-era veterans such as Larry Summers, it represents a sharp break with the fiscal orthodoxy defined by the Clinton and Obama administrations. [See also: Leader: A man of action] So decisive is this break that it has encouraged talk of a new age of “Bidenomics”. At the level of economics, this is motivated by a fundamental revaluation of the risk of too much spending leading to the economy “overheating” and inflation. But it is also based on the realisation that the greatest threat to liberal democracy in the US is not macroeconomic instability, but social polarisation and Republican politics. If the Democrats are to steer the US away from the abyss, they must not lose the midterm elections in 2022 as Obama did in 2010 and Clinton did in 1994. The double shock of Trump’s election and Covid-19 has driven centrist politicians like Biden and technocrats including the Treasury Secretary Janet Yellen to take a leap on economic policy. For the Biden team to propel the global transition to clean energy, it must make a similar leap on climate policy. The administration needs to break not only with Trump’s climate denialism, fossil fuel enthusiasm and culture war politics, but with the climate legacy of the Obama and Clinton eras as well. That is a big ask. After all, the Democrats have for a long time been America’s party of climate. The Clinton administration helped to negotiate the original Kyoto accords in 1997, the first international treaty committing participant states to binding targets on tackling climate change. Al Gore was the anointed climate president, but was robbed of victory by the Supreme Court in 2000. The Obama administration pumped money into the US’s solar energy industry and brokered the 2015 Paris agreement. But it was also Obama’s administration, hemmed in by a Republican Congress, that defined the limits of the Paris accord as little more than the aggregate of more or less adequate national plans. Obama’s own energy policy was dominated not by renewables but by the market power of fracked gas – the “cleanest” of the fossil fuels. Given that gas is so much cheaper, even Trump was not able to turn the country back on to coal, but the US now has a large pool of gas assets – fracking wells, pipelines, power plants and associated petrochemical industries – for which there can be no long-term use if it is to meet ambitious emissions targets. With sights now set on net zero by 2050, there is no longer any room for fudges. The Biden administration needs to change the direction of energy policy radically, from Obama’s “all of the above” to a systematic exit from fossil fuels. It needs to find both economic and technical solutions to make a green energy system viable. But it also needs to win the political argument. While the technological uncertainties and economic obstacles of planning for a net-zero future are universal, America’s distinctive problem is the political question of commitment. Decarbonisation is a long-term business. But there is nothing close to a consensus in US politics on the need for action. As serious as the Biden administration may be about tackling the climate crisis, its power to deliver on this depends on having the votes in Congress, a balance that might shift in the 2022 midterms, or in 2024, or in 2026, and so on. Without broader societal agreement, each US election will be a heart-stopping moment of potential derailment. In every advanced economy there are economic interests opposed to deep, rapid decarbonisation, including those of businesses, consumers and some labour unions. The US is unique among advanced economies, however, in having one of its two governing parties committed to outright climate denial, and a large part of the public with it. Unless this can be changed, America will remain a fundamentally unreliable partner in the effort to halt global heating. *** On one count, at least, the Biden administration’s climate policy has clearly drawn lessons from the failures of the Clinton and Obama presidencies. The policy instrument that most economists agree is essential for comprehensive decarbonisation of the US economy is left off the agenda in 2021: carbon pricing – imposing a cost on emissions sufficient to incentivise polluters to reduce, or eradicate, their carbon footprint. This omission is one of history’s ironies. At the very beginning of global climate politics, in the late 1980s, it was the US’s Environmental Defense Fund (EDF) that persuaded then president George HW Bush to adopt cap and trade – a system for allocating the right to emit through permits, which can be bought and sold – as the most effective way to drive down emissions. The model was reluctantly taken up in Europe in 2005, when, with help from EDF, the EU set up the Emissions Trading Scheme (ETS). Today, rising prices in the ETS are beginning to apply real pressure to large polluters in Europe. China is following the European lead and introducing its own carbon pricing system. In the US, carbon pricing was on the agendas of both the Clinton and Obama administrations – in Clinton’s case, through carbon taxation, in Obama’s, through cap and trade. Both had majorities in Congress, but in both cases, when it came to the final agonising battles that accompany every major piece of legislation in the US, the majorities evaporated. These defeats have scarred the US climate movement. One of the striking absences in the Green New Deal Resolution introduced by Congressional Democrats Alexandria Ocasio-Cortez and Ed Markey in 2019 is carbon pricing, which has come to be regarded as a neoliberal placebo rather than an effective policy. A state-level scheme operates in California but it is deeply unpopular among the Democratic Party left, who view it as a discriminatory and regressive mechanism that gives pollution permits to corporations and the rich. Experts insist that if the revenue raised by carbon pricing were reallocated to lower- income households it could be a tool of positive redistribution, but the Biden team despairs of brokering such a complicated deal. The carbon prices necessary to make a real difference would be exorbitant, especially from a standing start. Unlike in Europe, not even petrol is taxed heavily in the US; the last thing the Biden administration needs is a gilet jaunes-style movement. [See also: Why Joe Biden’s Afghanistan withdrawal doesn’t mark the end of America’s “forever war”] But without some kind of carbon pricing scheme, what is the mechanism for driving fossil fuels out of the system? Instead of using prices to incentivise polluters to reduce fossil fuel consumption and to shift supply to cleaner energy sources, the Biden administration’s first actions have centred on regulations and the carbon pricing standards used in internal calculations by government agencies. This is not new. It was the method used during Obama’s second term after the Supreme Court gave the Environmental Protection Agency the right to oversee carbon emissions. It is fragile, because it is subject to court challenge, but it is a first step towards the Biden administration’s aim of achieving a carbon-free electricity system by 2035. Clean energy technologies are already maturing fast but, given America’s huge energy consumption, it is a demanding goal. Shifting from gas and coal to variable solar and wind requires a vast amount of extra capacity, as well as a new cross-country transmission system to ensure clean power gets from the states with plenty of wind and sun in the centre of the US, to the coastal conurbations that need it most. The growth in demand will be compounded by the need to shift transport and domestic and industrial heating to electricity, too. *** Where will the investment come from? On 31 March the Biden administration gave the answer in the form of the $2trn American Jobs Plan – the second, after the $1.9trn stimulus, of three major programmes being rolled out by the government. The third will be a family plan aimed at improving the US’s miserably inadequate childcare system. The Jobs Plan was announced with much fanfare as a three-pronged investment in addressing the ills of American society – from inequality and unemployment to crumbling infrastructure – as well as the challenge posed by China’s autocracy and the climate crisis. Working through dozens of sub-programmes, one has to admire the ingenuity of its construction: covering everything from care for the elderly to laboratory funding at historically black colleges, it is a Rubik’s Cube of intersectionality. But for all the admirable sophistication of its targeting, there is one
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