Recommitting to the Paris agreement would reap significant economic benefits for the US, say leading climate economists and policy experts.
In a policy brief published today, experts outline the economic case for the US, as the world’s second largest emitter of greenhouse gases, to continue participating in the Paris Agreement. The policy brief is authored by the Grantham Institute – Climate Change and the Environment at Imperial and the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science.
President Trump announced on 1 June 2017 that he intended to end the United States’ participation, claiming that it economically disadvantaged the country. In November 2019, the US Government initiated withdrawal from the agreement, with completion due on 4 November 2020.
In the report the authors state: “The long-term interests of the United States are best served by continuing to participate in the Paris Agreement. The arguments put forward by the Trump Administration to try to justify withdrawal are inaccurate and misleading. Essentially, the Trump Administration has ceded control over the future economic impacts of climate change on the United States to its trading partners and competitors.”
It recommends that if withdrawal is completed, the United States Government should re-join the Agreement at the earliest possible date and should support ambitious domestic and international policies on climate change.
"The changing climate will harm the US and its economy, but action to tackle climate change can bring economic opportunity instead - especially vital as countries around the world are reeling from the economic impact of COVID-19." Alyssa Gilbert Director of Policy and Translation at the Grantham Institute - Climate Change and the Environment
Dr Charles Donovan, Executive Director of the Centre for Climate Finance & Investment at Imperial College Business School, and one of the report’s authors, said: “The current Administration has done American business a disservice by putting its head in the sand on climate change over the past four years. It’s not only done harm to the planet, it’s also put the US behind in the global race for dominance in clean energy. We are in the midst of a technology disruption that no major economy can avoid.
He continued: “Solar power, wind power, and electricity storage are getting cheaper every year. So, too, has the cost of capital fallen precipitously. In the current interest rate environment, the cost-benefit analysis on climate skews heavily towards action now.”
The authors cite several studies and government assessments that have shown that the benefits of climate change to the United States, such as longer growing seasons for crops in some parts of the country, are far outweighed by the overall damage it will cause to the lives and livelihoods of a growing number of Americans through sea level rise and increases in the frequency and intensity of extreme weather events, such as heatwaves, droughts and heavy rainfall.
Alyssa Gilbert, Director of Policy and Translation at the Grantham Institute - Climate Change and the Environment, said: “The changing climate will harm the US and its economy, but action to tackle climate change can bring economic opportunity instead - especially vital as countries around the world are reeling from the economic impact of COVID-19.
“The US should be helping to define a future that minimises these impacts both at home and abroad, shaping the opportunities that climate action can bring. By disengaging from global dialogue, the US would actively be reducing its long-term prosperity.”
The policy brief warns of the risk of diminished socio-economic and political influence by the United States on other countries if it withdraws from the Paris Agreement. It also suggests that it is in the interests of the US Government to acknowledge climate damages that occur outside the United States due to its emissions in order to persuade other nations to substantially reduce their own emissions, which are harming American lives and livelihoods.
The policy brief “The economic case for the United States to remain in the Paris Agreement on climate change” is available to download from the Grantham Institute’s website.
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