Was the climate summit in Glasgow good or bad? Has much been achieved or little? Is what political leaders say about climate just blah blah blah or is something really changing? The answers to these kinds of questions are often nuanced and cautious. Such as: much more needs to be done to combat climate change, but progress can be seen. Or: what the Glasgow summit achieved should be reflected in the actions of governments in the coming years.
I don’t know about you, but when I listen to people with sharp opinions about climate policy, I often think: a bit exaggerated, what you’re saying. That goes for both sides. Listening to one you’d think we’re living under a climate policy tsunami driven by climate hysteria. Listening to the other, you think that governments do little, while disaster is approaching us.
“An incredible amount is happening,” wrote Heleen van Soest and Jan Paul van Soest this week in a beautiful opinion piece in NRC. Show that, said the two. “If only to give political leaders courage,” because it shows that the economies are “anything but collapsing” because of climate policy. And yes, there is a rush and more policy is needed, the two write.
As far as I’m concerned, a confident government that makes clear choices is essential. Climate policy has unleashed immense lobbying power from large companies. In Glasgow they were many. They argue for subsidies and for the construction of infrastructure by governments, such as a pipeline network for hydrogen. Many companies screen with green plans to reduce their emissions. But what does this really represent? And do companies make the really difficult choices on their own? I doubt it. It often turns out that green plans only reduce emissions to a very limited extent.
Real change requires government. A government that indeed subsidizes and builds infrastructure, but that mainly reduces CO . emissions2 taxed and impose strict production standards. A government that makes pollution expensive and green cheap. This is not possible with subsidies alone. The assignment is too big to screen every company on its voluntary promises.
As long as the highways point in the wrong direction in the economy, much climate policy can be compared to swimming against the current. It takes a lot of strength, without getting far. You don’t want someone out of the goodness of their heart to choose to go to Berlin by train, you really want it to be cheaper than flying. You do not want flying to become unattainable for people with a small wallet, but you do want frequent flyers (and their companies) to pay extra. In short, you want to change the pricing system.
That is why it is so gratifying that the European Commission is introducing a CO2-want to enter a price (more precisely: want to expand the ETS system). And that the Commission came up with the brilliant idea of a green border levy for products from outside the EU that are produced in a climate-unfriendly manner. That’s why it’s such a shame that US President Joe Biden has this CO2-price doesn’t want to.
Economists are often taunted for their narrow view of what is of value, but they are massively advocating the introduction of a hefty, broad-based CO2-price. To put climate change at the heart of the economy and of every economic decision.
Marike Stellinga is an economist and political reporter. She writes about politics and economics here every week.
Bring climate to the heart of the economy
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