After months of interviews, analysis, and research, Climate XChange has released a new report, Carbon Pricing in a Just Transition. Using California as a case study, the report proposes a new framework for carbon pricing policies to help address key social and environmental justice issues of our time.
This article series breaks down our findings and lays out the groundwork for how market proponents and environmental justice advocates alike can get behind policies that achieve the broad vision that we all strive for – a just, sustainable, equitable, healthy, regenerative economy achieved rapidly enough to avoid the worst impacts of climate change.
This article is part 1 in our series. Check out our other articles in the series:
After last week’s climate strikes, when 4 million people around the world skipped school and work to show support for climate action, public support for the cause has never been more evident. Nowadays, 60% of the US public is reported as “alarmed” or “concerned” about climate change, with that number increasing. Yet the federal and state governments in the U.S. lack a cohesive plan to address climate change.
There are plenty of political explanations for such lack of action. Corporate interests have framed the conversation on the climate crisis to be intentionally misleading since 1997, when ExxonMobil scientists first uncovered (and consequently squashed) evidence that their fossil fuel products were a leading cause of climate change. What resulted was a misconception and false equivalency in public discourse that painted climate action as inherently at odds with economic vitality.
And indeed, many continue to regard economic growth and fossil fuels as inherently tied together – but this is extremely antiquated and no longer reflective of the realities of energy economies in the 21st century. In truth, reducing pollution, investing in clean technology and green innovation has become a main driver of growth, job creation, and overall economic benefit to those countries and states that have aligned their policies to reflect, and be conducive to this new reality.
Taking on these interests requires a strong collective voice. However, the environmental movement remains divided along party and policy lines. On the political right, blatant climate denialism has slowly transformed into a solutions denial, which seeks to undermine and oppose any and all meaningful climate policy on the supposed grounds of economic protectionism.
On the left, widespread agreement on bold climate change action can be forgotten in debates over policy solutions. On one hand, some see the power and efficiency of the free market as a key tool in achieving rapid change – by accounting for the social costs of burning fossil fuels in their market price, we can reveal how uneconomic they really are, therefore freeing individuals and businesses to seek out cleaner, more economically viable alternatives. Market disruptions have the ability to fundamentally change the economy at an unbelievable pace, as firms innovate and compete to play a role in building the new clean economy.
Meanwhile, the concept of a just transition has emerged from roots within the environmental justice and labor movement, emphasizing that the transition away from a fossil-fuel reliant, extractive economy to a regenerative economy must also address deep-seated issues of social and environmental inequality. These include the heavy pollution burdens from power plants, vehicles, and other toxic sources faced by disadvantaged and low-income communities, as well as the impending loss of jobs by workers and communities currently reliant on fossil-fuel industries.
We can create massive market incentives, raise substantial revenue for the just transition, and erode the hegemonic corporate power of the fossil fuel industry at the same time. We can create the space for rapid innovation and technological deployment while giving communities the keys to unlock their own sustainable and self-sufficient future. In arguments between market and justice perspectives, their complementary nature is often forgotten. But it requires an interdisciplinary approach to build the space for these perspectives to work together.
For carbon pricing advocates, this means integrating ways to address justice into our notions of “economic efficiency.” Thinking critically about what the strengths and shortcomings of market-based approaches are. Engaging in the fight for social and environmental justice, because doing so should be a central pillar of any policy we pass. The momentum ignited by the Green New Deal, and subsequent discourse around its vision, highlights the need for bold cohesive action that connects climate policy with the other social and environmental justice issues of our time.
Simultaneously, my research challenges environmental justice advocates to closely examine how market-based mechanisms can contribute to their vision of a just transition to a regenerative economy. Expressing healthy skepticism towards carbon pricing is a vital force that pushes the policy to be stronger and more inclusive. At the end of the day however, based on our own research as well as scientific consensus, putting a price on carbon pollution is an essential aspect of moving the needle towards decarbonization. As carbon pricing proliferates in jurisdictions around the world, now is a pivotal moment to steer these programs to include a just transition framework, so we can craft policies that create massive public health benefits, transformative change, and political empowerment in the communities that need it most.
With that said, I set out to investigate what exactly could and should be the role of carbon pollution pricing in a just transition, using expert interviews, economic analysis, and a close examination of California’s cap-and-trade program. This is what I came up with:
Strong carbon prices must be a priority design choice. Weak proposals aren’t going to cut it. We need carbon prices with real teeth in order to: avoid the worst impacts of climate change; generate the trillions of dollars needed to fund a rapid just transition; and to create public health benefits in the communities that need it most.
Invest in community-driven, transformative projects. This new source of revenue can be directed towards transforming our most disadvantaged communities, empowering them to facilitate a just transition in the local context. It requires getting serious about community representation, new ground-up governance structures, transparency, and education. These can’t be token projects.
Direct protection to vulnerable families and businesses. Achieving carbon prices with real teeth will require protecting vulnerable households from the short-term costs of increased fossil fuel prices. Communities that currently depend on fossil fuel industries will also need assistance in seeking new sources of economic vitality. We can provide this assistance while leaving significant funds for transformative investment.
Complementary policies. No single policy, including carbon pricing, is sufficient to address the climate crisis by itself. Above all else is the need for a cohesive plan for achieving a just transition that contextualizes what carbon prices do and do not achieve. No policy or plan can be designed in a vacuum.
There is much more to unpack here. We will be publishing weekly articles that hope to spur conversations around rethinking the role that market mechanisms can play within the broader environmental movement, to achieve our shared goals. We’ll break it down step by step in an attempt to establish consensus around the need for substantial, rapid, and inclusive action against climate change and the polluter-industrial complex.
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