It’s rare in international diplomacy today that dramatic agreements come entirely by surprise. And that’s particularly the case in economic negotiations, where corporate, labor, and environmental organizations intensely monitor the actions of governments – creating a rugby scrum around the ball of the negotiation that seems to grind everything to incremental measures.
That’s what makes today’s ambitious announcement by the United States and China to cut greenhouse gas emissions so compelling. The world’s two largest emitters of carbon dioxide together pledged deep reductions – well in advance of the pressure they will face in the upcoming UN Climate Change negotiations that begin in Lima later this month, and which are scheduled to conclude a year from now in Paris. They also did so at a level deeper than many had expected. While both countries have already begun efforts to cut emissions, the timing of the announcement and the depth of the reductions went beyond what many diplomats, businesses and environmental groups anticipated.
In both countries, the new pledges follow action their leaders had already taken.
In the United States, President Obama has made aggressive action on this front a priority throughout his presidency. He committed over $90 billion in stimulus spending and tax cuts after the 2008 financial crisis, aimed at energy efficiency and renewable energy technologies. While he was unable to pass mandatory greenhouse gas legislation in his first term, he has wielded executive authority by using the Environmental Protection Agency to mandate greater automobile fuel economy standards and, most recently and controversially, to regulate power plant emissions.
In China, President Xi Jinping rose to power when air pollution had become a major political issue. Air pollution in dozens of Chinese cities regularly and vastly exceeds World Health Organization standards. The public at large has mobilized on the issue. Despite the Great Firewall of China, the public has utilized the internet, email, social media and text messaging to send a clear message: air quality matters. Moreover, Chinese diplomats do not relish being the world’s largest greenhouse gas emitter – with nearly double the CO2 emissions of the United States. So two years ago, China announced national abatement targets for all their provinces, and experimental cap and trade systems for six economically advanced jurisdictions.
What makes today’s announcement so dramatic is that, together, both countries have made it politically easier for each other to take even deeper cuts in two regards – one diplomatic and one domestic. On the diplomatic front, both countries were looking forward one year from now to the 2015 UN’s global climate summit in Paris. As that meeting approaches, international pressure will mount on both countries to announce steep reductions. The closer the meeting, the greater the attention. Each country feared that the other might put the blame for a failed Paris meeting on the other. The U.S. and China seemed ready for a game of greenhouse gas chicken, where each driver aims at each other, intent on pursuing middle-of-the-road moderate reductions, waiting for the other to take the responsibility of switching to the fast lane of deeper cuts. By taking their public pledge together, one year in advance of Paris, the countries have wisely taken the rancor out of the negotiations for which nation would act responsibly.
Moreover, this serves a domestic political purpose in each country. In the United States, the President is gearing up for a fight with a GOP-controlled Senate over his use of the EPA to regulate greenhouse gas emissions. Opponents of his plan are certain to argue that American action would put America at a competitive disadvantage against global competitors – especially China, with which the U.S. still runs a sizeable trade deficit. In China, although air pollution is certainly a growing concern, many companies and local officials still feel the need to aggressively grow their economy and catch up to the West, and they would prefer to clean up the environment later. As in any trade agreement, each side has wisely provided the other with an argument against affected domestic industries – that joint action will lead to a level economic playing field.
Much remains to be done. In the United States, President Obama still needs to move forward with the Clean Power Plan, which is the engine that will drive U.S. reductions – working past opposition in both the U.S. Congress and the various states. In China, President Xi needs to make sure that powerful state-owned fossil fuel companies support this effort, and also that provincial authorities are rewarded for cutting carbon emissions, and that industrial emitters pay a price for non-compliance. Internationally, both countries have a range of other issues to address – including working with the poorest nations which lack the resources to make similarly dramatic cuts, but who are deeply affected by a warmer, wetter world. Still, even with all those obstacles ahead, today’s agreement is the beginning of a great leap forward for climate protection.
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The U.S. still has some leverage over China, because China clearly wants a deal. ... U.S. financial markets also seem to have been boosted by the prospects of a U.S.-China trade deal, so I think it could have a negative effect on both financial markets and economic activity in both countries if a deal is not struck