AMAC Exclusive – By Ben Solis
With the global economy experiencing a serious slowdown, some liberal politicians throughout the West are still plowing forward with their far-left “green” agenda that is imposing a significant financial burden on ordinary people. But others may be recognizing the political infeasibility of their environmental plans.
A new report out earlier this month from the International Monetary Fund (IMF) – an organization that has long embraced the left’s environmental agenda – offers several subtle but noteworthy admissions about the realities of liberal climate policies.
The report notes that many countries “are facing high debt, rising interest rates, and weaker growth prospects,” but maintains that “Global warming threatens the planet and human livelihoods.” Even in the face of record deficits as a result of legislation like President Joe Biden’s “Inflation Reduction Act” subsidies in the United States, the IMF recommends spending more still. They assert that in order to stave off a climate catastrophe, “public debt in advanced economies would rise by 10-15 percent of GDP by 2050.”
In addition to deficit spending, the IMF also recommended that governments adopt “carbon pricing” policies, otherwise known as a “carbon tax.” These taxes are imposed on fossil fuel companies, with the revenue generated from them supposedly used for projects to reduce emissions and pull carbon out of the atmosphere.
For consumers, the reality of “carbon pricing” is higher energy costs, as utility companies pass the added financial burden on to their customers. In fact, the IMF even sees higher energy prices as a sign that carbon pricing policies are working, noting, “The surge in energy prices in 2022 has shown that firms are able to invest in energy efficiency and reduce energy consumption when confronted with large energy price shocks, suggesting that regulations, incentives, and carbon pricing schemes can accelerate firm decarbonization efforts.”
The IMF also recommends other strategies to “raise revenues to maintain debt sustainability” – in other words, higher taxes. These strategies include more “fuel excises,” a policy that would mean already high prices at the pump would increase even further.
In Europe, some political leaders seem eager to implement the IMF’s recommendations. The European Union’s new climate chief, Wokpe Hoekstra of the Netherlands, has said that he wants to explore “an international kerosene tax, a maritime levy, a fossil fuel tax and even a share of ETS [emissions trading scheme] proceeds.”
Liberals in the United States have likewise continued to advance a series of far-reaching climate policies. In addition to the hundreds of billions of dollars in green subsidies included in the Inflation Reduction Act, the Biden administration is looking to impose what is in effect an electric vehicle mandate on American automakers. Biden has also introduced more costly regulations on fossil fuels companies.
But the recent election of several conservative governments in Europe in part over opposition to liberal climate policies has even some liberals rethinking their position.
U.K. Prime Minister Rishi Sunak rolled back several environmental regulations last month, including pushing back Britain’s ban on new gas-powered cars from 2030 to 2035. Sunak said that he was “sparing the public from the unacceptable costs” of liberals’ “net-zero” agenda, and would continue to enact other similar policies in the future.
Greek Prime Minister Kyriakos Mitsotakis, who was elected in June, has emphasized “quality over quantity” on climate policies. A former financial analyst, Mitsotakis has said that Greece must balance the risks of overzealous environmental policies that place an undue burden on Greek families.
Italian leader Giorgia Meloni’s Cabinet has hustled to temper the astonishing escalation of green radicalism, particularly in business regulations that deter investment, after two decades of Leftist rule. In her first year, Meloni successfully negotiated an “Italy First” energy policy, including a slowdown on the EU combustion engines ban, an exemption to excavate Italian gas, and the building of an “energy hub in the South” for Europe.
There have also been some signs that traditional climate hardliners like France and Germany have started to realize that disaster was looming. Both countries have reversed course on shutting down coal-fired power plants amid threats of winter blackouts.
Even Roberta Metsola, the President of the European Parliament, has backtracked on her prior enthusiastic support for the left’s radical environmental agenda. In a recent interview with the Financial Times, Metsola asked, “Why have we stopped talking to our businesses? Have we not placed being climate ambitious as not being mutually exclusive with economic growth?”
Although Metsola later clarified that she was still “very green,” the comments nonetheless showed that even European liberals recognize that their environmental policies are growing increasingly unpopular. European Union lawmakers face elections next June, with energy costs sure to be top of mind for voters.
But for liberals, softening their stance on climate policies risks alienating their base, as well as many institutional sponsors who have embraced the radical climate agenda in exchange for lucrative subsidies and tax exemptions. Those unprofitable businesses that rely on green subsidies will surely be fighting very hard to keep their income stream in place.
The progenitors of the “green” agenda thus may have placed themselves in an electoral bind. The consequences for those in power may be quite unpleasant.
Ben Solis is the pen name of an international affairs journalist, historian, and researcher.