The Paris Climate Agreement – how COVID-19 changed the calculus of climate policy
Presented by:
Tom Rutherford, R. Richels, C. Böhringer
Department of Agricultural and Applied Economics
University of Wisconsin-Madison
Wednesday, September 23, 2020
12:00 pm-1:30 pm
The science is unequivocal. Global warming is occurring, and it is human induced. In the absence of immediate action, we risk irreparable harm to human health, the environment, and the ecosystems on which we depend. Yet progress to halt warming has been slow. Now we face a new global threat. One that was not even on most people’s radar screen until recently. Policymakers are just becoming aware of all the ties between climate change and COVID-19. No, we are not talking about the sudden recent drop in greenhouse gas emissions as people shelter in place. We are referring to the effect that a warming planet has on the likelihood of such viruses and their toll. And the effect that the pandemic will have on future economic growth. Epidemiologists have been warning for some time that the emergence of novel coronaviruses was not a question of “ if” but “when“. The public health experts had “connected the dots” linking warming to the weakening of the natural barriers that separate humans from the wild. But the link between containment and extreme climate events was less obvious. We examine climate policy in light of recent events. The focus is on several areas of critical uncertainty. Important is how the pandemic alters future economic growth. Even more important is the impact of the pandemic on climate change damages. Past experience suggests that COVID-19 will reduce economic growth in the future, resulting in a contraction in the size of the energy sector, and a slowing in temperature rise. But of greater significance, a novel coronavirus adds a new type of extreme event, to the already formidable list attributed to climate change; one capable of causing worldwide pandemonium in a matter of weeks. This new existential threat will serve to tighten the temperature limits as it increases the risks due to human-induced warming. The Paris Agreement is right to focus on universal involvement. At issue is whether it contains the means to achieve it, especially in times of social and economic discord. If the accords do not arrive at an acceptable distribution of burden, perhaps increased focus on coalition formation is in order, with expanded incentives for poorer countries and sanctions on noncompliance. We examine the benefits of such an alliance and some of the issue that will arise.