SPERI spotlight on the UN climate summit V

From the politics of climate summitry to the political economy of climate-change mitigation

Martin CraigToday, the 21st ‘Conference of the Parties’ to the UNFCCC begins in Paris. The climate of international affairs has changed dramatically in recent weeks. Yet the four contributors to this blog series point to troubling continuities. They highlight, in different ways, the ongoing failure of multilateral climate negotiations to respond adequately to the political-economic context in which climate change and a myriad of other ecological issues arise, and within which they must be addressed. Contemporary capitalist political economies confront an ecological crisis in which they are themselves implicated, and of which the accumulation of greenhouse gasses is but one symptom. Viewed in this way, climate-change mitigation and political-economic change are inseparable issues.

For Matthew Paterson, the focus of climate negotiations on (scientifically insufficient) emissions targets misses the crucial issue of how changes in investment, production and consumption can be mobilised to achieve them. He argues that the UNFCCC must evolve into a mechanism able to facilitate and coordinate changes among the preferences and behaviour of a variety of different interest groups that comprise the international political economy.

If Paterson’s contribution brings the international political economic context into view, Greg Fry’s draws our attention to the ongoing relevance of domestic political economies and their associated growth models. He notes the role of high per capita emissions in shaping the preferences and tactics of Australia and New Zealand, whose opposition to tighter emissions targets is tantamount to a position of ‘sink thy neighbour’ for their small Pacific island negotiating partners.

The importance of domestic political economies in shaping national negotiating positions is sometimes neglected in the literature on ‘global governance’, wherein there is a tendency to speak of so-called ‘state actors’ and juxtapose them with supposedly distinct categories such as ‘business actors’. This obscures the reality that the kinds of intervention that national and sub-national state officials are willing or able to make are shaped by the way that power, income and influence are distributed among the various societal interests groups that exist within their jurisdiction. The interests of industries and sectors that are integral to a country’s growth model, for instance, are likely strongly to influence the negotiating position of ‘state actors’. This is unfortunate if, as in the case in Australia, one of these industries is coal-mining.

The issue, of course, is how robust environmental policies can be advanced in the face of such conservative forces. Hayley Stevenson’s injunction is that ‘bottom up’ deliberation of environmental policy is a prerequisite of its successful implementation. She argues that without public debate ambitious international commitments cannot be translated into public support for effective action. Her argument hints at the importance of the relative strength and strategies of the domestic social interest groups that animate social change. Such groups include social movements, organised representatives of industries and sectors, trade unions and so forth. The conflicts, compromises and alliances that emerge among these groups are the very stuff of domestic political-economic analysis, shaping the way in particular that associated growth models develop. The emergence of more ecologically sustainable growth models (or indeed ‘post-growth models’) implies a strategy to reconfigure these social conflicts, compromises and alliances in a way that attracts support for the corresponding ‘green’ forms of investment, production and consumption.

I consider in more detail what such a strategy might entail presently. However, it’s important to note immediately that the scope for domestic political-economic change is unquestionably shaped by international governance. Yet, rather than enabling the ecological restructuring of domestic political economies, the mechanisms that have emerged from the UNFCCC have, thus far at least, largely conformed with the prevailing ‘neoliberalising’ dynamic in the international political economy.

Neoliberalism is a tendency in domestic and international political-economic restructuring that favours the extension of market rule and the consequent instrumental treatment of various natural and human resources as commodities to be allocated in the pursuit of profit. It is reflected in the embrace of statutory carbon markets in international environmental governance, thereby extending this principle to the carbon-absorbing capacity of the atmosphere itself (whilst also creating a new class of speculatively priced assets in the process). As Sian Sullivan notes in her post, such approaches imply a specific way of valuing ‘nature’ – as a stock of resources that is divisible into fungible and monetarily priced assets. If appropriately priced, it is assumed that these will influence the cost-benefit analyses of profit-seeking enterprises and encourage investment in green technologies and infrastructure projects. But the problem, as she notes, is not simply that there is little evidence that such instruments actually work, but rather that they may accelerate the broader ecological crisis of contemporary capitalism by legitimating practices with highly uncertain or counterproductive ecological impacts.

If contemporary capitalism can indeed be saved from its ecological crisis, it is surely not by further entrenching market rationality as the rudder of political-economic development. Instead, what is demanded is the supplementation of the allocative logic of the market with principles that emphasise longer-term environmental, economic and social policy considerations. For my part, I think this implies a role for what has come to be called ‘green industrial strategy’.

Despite its technocratic air, industrial strategy is implicit in both radical and moderate forms of green thought where there is call for the purposeful restructuring of existing political-economic models. Fortunately, economists and some policymakers are beginning to recover from the phobia against industrial strategy they acquired in the late twentieth century, and a fresh wave of research is beginning to ask how it might be most effectively formulated.

The ‘strategy’ in green industrial strategy’ refers to the role that its practitioners play in facilitating investments that, although unprofitable in the short run, are likely to yield long-term economic, environmental and social benefits. Yet green industrial strategy could also constitute part of a broader strategy to reconfigure the conflicts, compromises and alliances among domestic social interest groups in ways that favour far-reaching changes to extant economic models. Green industrial strategies oriented towards the creation of secure, well-paying and regionally distributed employment in the development and production of ‘green goods’, for example, could potentially attract support from working people, firms and regional officials for environmental policies that they would otherwise oppose.

Green industrial strategy also raises a host of international considerations. An increasing number of trade conflicts have emerged as some governments have attempted to capture employment and growth opportunities accruing to their environmental policies in a manner that has been perceived as unfair or protectionist by their trade partners. Such developments signal the inadequacy of having separate frameworks for international environmental, trade and financial governance. For as long as international trade and financial governance remain orientated to advancing ‘neoliberalisation’, national experiments in green industrial strategy are likely to remain uncoordinated, vulnerable to legal challenge and potentially mutually undermining. Yet, if international environmental governance is instead understood as a process that occurs (in part) through international trade and financial governance, then the purposeful restructuring of domestic political economies becomes a realistic proposition. This is the key challenge facing governments as they arrive at this latest climate summit.