Jeff Bezos is getting plenty of unsolicited advice on how to spend $10 billion pledged to his Earth Fund. We join the chorus to offer a somewhat unusual suggestion. If the idea is to make rapid progress on climate change, the Bezos Earth Fund should address political challenges to climate policy.
Technology and innovation already have their patrons. Although venture capital for climate change has not taken off, there are several exciting technologies on the cusp of getting commercialised. Business focus on climate change was evident at the recent World Economic Forum in Davos. Even the federal government may step in to fund climate innovation.
But business and the government seem to shy away from addressing the complex political problems that impede climate progress. Climate protection is a global public good that benefits everybody in the long run, but its costs are immediate and concentrated in a few sectors.
This is the core political challenge. No wonder there is mobilisation against climate regulation. This, by itself, is not problematic, but for the fact that the fossil fuel sectors that will bear the regulatory costs play an important role in swing states of the American Rust Belt, such as Pennsylvania.
Leading blue-collar unions recognise the climate problem but continue to oppose regulatory solutions. Rural voters oppose climate policies even in liberal US states such as Oregon and Washington. This is where the real climate challenge resides.
Why the Opposition to Climate Policy?
One might say climate change will drive the 2020 elections. After all, opinion polls show a rising support for climate action. President Trump and the Republican party are vulnerable on climate issues especially among the younger generation. While this might be true, in the 2018 exit polls, voters did not rank climate policies among top three issues that motivated their vote.
Climate policies suffer from some sort of populist backlash. Drivers of populism are many, but few will disagree that economic hardship provides a fertile ground for populism. As the AFL-CIO President, Richard Trumka notes: “So I would ask each of you: does your plan for fighting climate change ask more from sick, retired coal miners than it does from you and your family? If it does, then you need to think again.”
How to Overcome this Opposition?
The political challenge is to ensure that actors bearing the costs of climate policies see a future for themselves and their families in the low carbon economy. What is required is a “just transition,” which embeds environmentalism in a new social compact where vulnerable sections of society do not see climate progress as being made on their backs.
The European Union recognises this challenge and has devoted a sizeable portion of its Green Deal budget to help coal-dependent regions to make this transition. Germany is also taking the transition issue very seriously.
It has outlined a strategy in the Final Report of the Commission on Growth, Structural Change and Employment. Even the Green New Deal talks about a just transition. New groups such as the BlueGreen Alliance are linking climate action to new jobs. The Labour Network for Sustainability is emphasising the welfare of miners in climate policy.
Jeff Bezos could play an important role here. Previously, we have made a case for launching an American (rust) Belt & Road Initiative. Imagine Bezos’ Earth Fund redeveloping towns, counties, and cities of the American Rust Belt.
In consultation with local stakeholders, the Fund could finance a world-class infrastructure, public health facilities, and worker retraining programs. Bezos does not have to reinvent the wheel: his fund could collaborate with groups that are already working in this area.
This sort of initiative will directly confront the populist narrative that the coastal elites have abandoned the American heartland.
The lesson from the last three decades is that trickle-down does not always work. Islands of prosperity have emerged in a sea of poverty. It is not clear how futuristic technologies be it negative emissions, carbon capture, or geoengineering will fundamentally redistribute wealth.
If anything, these technologies might further concentrate prosperity in cities where the high-tech industry is located. While real estate in Seattle and San Francisco will appreciate further, this technological transformation will probably do little for the house values in Appalachia.
Climate change is fundamentally a political problem. It requires a political solution, namely taking care of the needs of the sectors that will bear the cost of transition to a low carbon economy. While government policies will certainly help, private philanthropy can play an important role. Via the Earth Fund, Jeff Bezos has a tremendous opportunity to become a true climate leader.