Traditionally progressive economists start by explaining why both neoliberal globalization as peddled by establishment political parties, and xenophobic protectionism as preached by right wing populists like Donald Trump, are the wrong kind of globalization.
Less often progressive economists go on to propose an alternative to both forms of corporate-sponsored globalization, one which would regulate international financial investment, direct foreign investment, and international trade so as to not only generate global efficiency gains but distribute them fairly between and within countries.
However, this approach implicitly treats economic globalization as a matter of convenience: If it can be managed in a way that improves outcomes it should be, but otherwise not. Economic globalization can no longer be treated as a choice to be made when convenient. The imminent threat of climate change if we do not reduce global greenhouse gas emissions dramatically means that globalization is now a necessity rather than a convenience.
Nothing – other than perhaps preventing the outbreak of nuclear war – is more important than winning the war to prevent cataclysmic climate change before it is too late. If one begins with this task in mind the immediate conclusions are:
• Energy systems and economic infrastructure must be completely transformed in more developed countries to become carbon neutral.
• Less developed countries must pursue development paths which are not based on fossil fuels.
• All this must be accomplished starting now in the next few decades.
And the important consequence which follows from these conclusions is:
• A high level of international economic cooperation among countries is necessary because reducing carbon emissions is a global public good and most of the benefits when one country reduces emissions are enjoyed by citizens of other countries.
The good news when one begins with this understanding of the facts is there are plenty of socially useful jobs for everyone – in more and less developed countries alike. The trick is how to make sure that the considerable income generated by global full employment, which preventing climate change requires, is distributed more equitably. Concretely, what can progressives in more developed countries such as the U.S. do?
Environmental movements
Environmental movements in developed countries must support an effective, equitable, and efficient international agreement. Such an agreement should (1) reduce global emissions sufficiently to keep average global temperatures from rising by more than 1.5 degrees Celsius; (2) assign responsibility for emission reductions according to countries’ differential responsibilities and capabilities; and (3) leave the choice of whether to certify carbon emission reduction credits for sale up to national governments. This will minimize the global cost of preventing climate change, establish powerful incentives for developed countries to decarbonize their economies, provide financial resources for lesser developed countries to pursue non-fossil fuel development trajectories, and distribute the burdens of preventing climate change equitably. Whereas environmental movements in the developed countries have fought hard for No. 1, they have been largely missing in action on No. 2, and terribly confused and inconsistent on No. 3.
To forge an effective alliance with progressive movements and governments in lesser developed countries, environmentalists in more developed countries will have to get up to speed on No. 2. And to elicit the cooperation of corporations in more developed nations – without whose help it is no longer possible to prevent cataclysmic climate change – environmentalists must renounce ill- informed objections to No. 3.
Environmental movements must champion domestic Green New Deals. There are many more jobs in energy conservation, expansion of renewable energy production, and building a smart electric grid than there are in coal, oil and natural gas production. As long as there are plenty of jobs transforming developed countries’ economies, there is no need to wage what would be a losing fight in any case to bring back jobs producing shirts, TV sets or smartphones from China and Mexico. Just as jobs mining coal are gone forever, many jobs producing manufactured consumer products are gone forever as well. Trump isn’t going to bring them back, and hopefully those who voted for him because they believed his promises to do so will become quickly disillusioned when he fails to deliver on this campaign promise. But we should understand that we can’t bring back many of these jobs either. The important thing is that we don’t need to, because what we can do that Trump certainly is not going to do with a cabinet full of executives from the fossil fuel industry, is provide plenty of green jobs as well as jobs producing next generation “clean” capital goods for export to lesser developed nations.
The environmental movement not only has to emphasize that a Green New Deal provides the only remedy for joblessness in developed nations, it must also join in principled solidarity with the labor movement and insist that these new jobs be good jobs, with decent pay and benefits. Since large corporations producing renewable energy and transforming our built infrastructure will be a big part of the political coalition pressing for a Green New Deal, and since these corporations will have to be hard pressed to embrace unionization and pay decent wages with benefits, this is a key commitment the environmental movement will have to embrace in order to keep a Green-Red alliance together. The days when the environmental movement could wash its hands on the issue of unionization and fair wages, and say to labor, “that is your problem, not ours,” are over.
Labor movements
In every developed country, the labor movement is weaker than it has been in more than 80 years and has reached a crossroads. Traditionally, the labor movement has left the choice of what its members produce to their employers, and fought for more jobs, better pay and better working conditions. In a world where what we are producing has become the crucial issue of our time because it will determine whether or not we trigger climate disaster, labor can no longer be agnostic about what workers produce. Labor cannot continue to fight for more jobs mining coal, extracting natural gas, and building pipelines and fossil fuel export facilities and expect other progressive movements to ally with labor and support labor in its fight for better pay and working conditions. And make no mistake about it, without broader support the labor movement will continue on its march to oblivion. Labor must make a clean break with fossil fuel industries and hitch its wagon to the Green New Deal.
The grand bargain
Here’s the deal: Labor will cease lobbying for environmentally destructive jobs, and instead throw its political muscle behind fighting for the largest Green New Deal possible. In exchange the environmental movement will pledge to do everything labor asks of it to help the labor movement make those jobs good jobs – steady jobs with career ladders, well-paid jobs, jobs with benefits, jobs that a worker – male or female – can raise and support a family on.
There are many progressives in both the environmental and labor movements who realize that this is the deal that both must strike if they are to be successful. Unfortunately this Red-Green alliance has suffered numerous setbacks as some in both camps have betrayed the other camp repeatedly over the years.
The environmental movement was painfully slow to realize that it needed to craft policies that did not generate adverse effects on jobs and income distribution. Most recently the behavior of leaders of some building trades unions doing photo ops with President Trump, and lobbying to restart pipeline construction which the environmental movement spent eight years pressuring the Obama administration to finally shut down, is a huge setback. At this point there is a clear internal problem in the labor movement. And if the labor movement does not solve this problem – which may require some organizational splits – the labor movement will end in the dustbin of history. The choice is that simple.
Economic globalization is no longer a matter of convenience. Incipient climate change has made international economic cooperation a vital necessity.
Robin Hahnel is a professor of economics emeritus at American University in Washington, D.C., faculty affiliate at Portland State University and co-director of economics for Equity and the Environment. Street Smart Economics is a periodic series written for Street Roots by professors emeriti in economics.