A New Grand Theory of Why Decarbonization Is So Hard

Why has it been so hard for the world to make progress on climate change over the past 30 years? Maybe it’s because we’ve been thinking about the problem wrong. Academics and economists have often framed climate change as a free-rider or collective action problem, one in which countries must agree not to emit greenhouse gases and abuse the public commons. But maybe the better way to understand climate action is as a fight that generates winners and losers, defined primarily by who owns what.

On this week’s episode of Shift Key, Rob and Jesse talk with Jessica Green, a political science professor at the University of Toronto. She calls for “radical pragmatism” in climate action and an “asset revaluation”-focused view of the climate problem. Green is the author of the forthcoming book Existential Politics: Why Global Climate Institutions Are Failing and How to Fix Them. Shift Key is hosted by Jesse Jenkins, a professor of energy systems engineering at Princeton University, and Robinson Meyer, Heatmap’s executive editor.

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Here is an excerpt from our conversation:

Jesse Jenkins: So what are some of the strategies that you think policy makers can take if they adopt this sort of asset theory mindset?

Jessica Green: So there’s kind of two pieces to this. One is to recognize the many flaws in the status quo approach, which sidesteps all of these questions of asset revaluation. So I spend a lot of time explaining why managing tons of carbon dioxide in the atmosphere or [greenhouse gases] in the atmosphere is not a helpful approach.

There is a huge swath of the policy space — and I know this may upset some of your listeners that are dedicated to things like greening the supply chain and voluntary net zero commitments and public-private partnerships and improving the robustness of carbon offsets. And you know, I document extensively in the book why these things do not work. And so even though many of us think, Oh, well, we’re past that, this is everywhere in climate policy. Anywhere you see net zero — anywhere you see the word ‘net,’ you have some kind of offset, whether it’s a carbon offset, CCS. This is really everywhere in climate policy.

So I think that’s step one. And then step two is to really address both pieces of the equation of fossil and green asset owners. One is you have to build green asset owners, which is the thing you guys talk about so much in your podcast. How do we do industrial policy and create carrots to incentivize particularly these decarbonizable industries to flip?

But the other piece, which is the one that nobody wants to talk about, is how do we constrain the material and political power of the fossil fuel industry or fossil asset owners? And that is the big one. And so I try, in my own pragmatist way, to talk about the international institutions that are available to us to think about constraining them both in trade, but also in tax and investment law. And I think those are ways that we can think more productively about how to lessen this power asymmetry between fossil and green asset owners.

Also mentioned in this episode:

Asset Revaluation and the Existential Politics of Climate Change, by Jessica Green, Jeff Colgan, and Thomas Hale

Tax Policy Is Climate Policy by Jessica Green

Why Carbon Pricing Falls Short, by Jesse Jenkins

Jesse’s 2014 article on asset specificity and climate change

Jesse’s downshift; Rob’s downshift.

Music for Shift Key is by Adam Kromelow.