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  July 23, 2014

The Politics of Going Green


PERI Co-Director Robert Pollin and Prof. Chris Williams discuss the feasibility of shifting to a green economy
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biography

Robert Pollin is Distinguished Professor of Economics and Co-Director of the Political Economy Research Institute (PERI) at the University of Massachusetts-Amherst. He is also the founder and President of PEAR (Pollin Energy and Retrofits), an Amherst, MA-based green energy company operating throughout the United States. His books include The Living Wage: Building a Fair Economy (co-authored 1998); Contours of Descent: U.S. Economic Fractures and the Landscape of Global Austerity (2003); An Employment-Targeted Economic Program for South Africa (co-authored 2007); A Measure of Fairness: The Economics of Living Wages and Minimum Wages in the United States (co-authored 2008), Back to Full Employment (2012), Green Growth (2014), Global Green Growth (2015) and Greening the Global Economy (forthcoming 2015). He has worked recently as a consultant for the U.S. Department of Energy, the International Labour Organization, the United Nations Industrial Development Organization and numerous non-governmental organizations in several countries on various aspects of building high-employment green economies. He has also directed projects on employment creation and poverty reduction in sub-Saharan Africa for the United Nations Development Program, and has worked with many U.S. non-governmental organizations on creating living wage statutes at both the statewide and municipal levels. He is presently a member of the Scientific Advisory Committee of the European Commission project on Financialization, Economy, Society, and Sustainable Development (FESSUD). He was selected by Foreign Policy magazine as one of the "100 Leading Global Thinkers for 2013."


transcript

The Politics of Going GreenJESSICA DESVARIEUX, TRNN PRODUCER: Welcome to The Real News Network. I'm Jessica Desvarieux in Baltimore.

Summer is in full swing, and there's news now that the world just had its hottest June on record. And it also had its hottest May on record. With growing concern over the burning of fossil fuel affecting climate change, there's been an increased interest in shifting our economy to one that revolves around renewable energy, otherwise as known as a green economy. But is this shift even feasible?

Now joining us to get some answers to this question are our two guests.

Chris Williams is a professor of physics and chemistry at Pace University and chair of the science department at Packer Collegiate Institute.

And also joining us is Bob Pollin. He's a professor of economics and founding codirector of the Political Economy Research Institute at the University of Massachusetts Amherst.

Thank you both for joining us.

ROBERT POLLIN, CODIRECTOR, POLITICAL ECONOMY RESEARCH INSTITUTE: Thank you.

CHRIS WILLIAMS, AUTHOR, ECOLOGY AND SOCIALISM: Thank you.

DESVARIEUX: So let's start off by talking about Germany. In May, Germany hit a milestone with renewable energy generation accounting for nearly 75 percent of the country's total electricity. Bob, you recently wrote an article in Boston Review. Can you just map out your thesis, really? And is this possible in the United States?

POLLIN: Yes, thanks. In my article and in forthcoming research, more extensive research, what I have found, along with my coauthors, is that let's say the United States invests only about 1.2 percent of GDP annually for 20 years in renewable energy, solar, wind, geothermal, hydro, small-scale hydro, and in energy efficiency, crucially in energy efficiency. The U.S. could reduce its emissions by 40 percent within 20 years, which would be a massive achievement. But, mentioning Germany, at the end of the 20 years, even if we achieve the 40 percent reduction, we'd still be 20 percent over where Germany is today in their emissions. So we've got a long way to go and there's a lot of room for improvement. And Germany is at roughly our standard of living, and they are right now at an emissions level that is half what the United States emission level is.

DESVARIEUX: Right. Right. But, Chris, could we do that here in the United States? I mean, with the powers that be, you know, the big oil energy, fossil fuel industry, how could we actually make that leap here in the United States? Is it possible?

WILLIAMS: I think some of the interesting things coming out in the research, Professor Pollin's article and others', Mark Jacobson and so on, illustrate how this is really not a technical, scientific issue. We could certainly achieve a much cleaner energy economy. We could be on track with regard to what the IPCC (Intergovernmental Panel on Climate Change) says that we need to be in order to avoid dangerous levels of climate change or extremely dangerous levels of climate change. And we have the technical answers. We have the money as well. It's a question of is the political will there. And judging by the latest pronouncements from President Obama in terms of opening up the Atlantic to offshore oil and gas prospecting, the increasing fracking across the country for oil and gas, the coming exploration of the Arctic, all of the above, President Obama's energy policy looks very much like more of the same. And so I think that while the technical-scientific possibility and the economic possibility are there, the question is more political and social than anything else, which in one respect is very good news, because if we didn't know the answers, they were not available to us, then we wouldn't be able to emulate Germany or do better than Germany is currently doing without them. And so that does leave the scope open or the future open for the kind of changes that we need.

DESVARIEUX: Let's talk more about that future, because let's say that we do get a green economy and advanced energy markets will have to cope with this transition. So, Bob, do you think that we'll see an emergence of sort of this big solar or big wind taking over these markets? How do you sort of guarantee that this will be more bottom-up as a rather than top-down economic model?

POLLIN: No guarantee whatsoever. However, there's a lot of reason to think that a green energy economy will be more egalitarian than our present fossil fuel based economy. For one thing, the existing big oil energy companies are going to face a massive contraction in the value of their fossil fuel assets. I mean, this group called Carbon Tracker, in the U.K., estimates that they are going to have to lose about $3 trillion in the value of their assets in order for us to stop burning so much fossil fuel and to meet the emission reduction standard.

In addition, in Europe there is a very large-scale movement, especially in the wind sector, for community-based, cooperative-based energy generation. There's some of it also in the United States, especially in the Midwest. And these are not necessarily greens that are doing it. They're people that have come together because it's good for their community to get their power that way. So there is evidence.

And third, when we think about solar, everybody has a rooftop. And as solar costs come down, people are going to start increasingly to install solar on their rooftops. And the net effect is going to be to undercut gigantic utility companies, similar, I think, to what happened over the previous 20 years with traditional phone companies getting undercut by cell phone technology, and even still further by internet-based telephone technology. You know, in another 20 or 30 years, what we thought of as traditional landline phone companies are going to be dead. I think a similar thing is in the works with respect to solar over the next 20 years.

DESVARIEUX: Right. I'm glad that you brought up the issue of cost, because I want to ask you both what really needs to happen in terms of subsidies, in terms of tax incentives and federal policy for a significant transition from fossil fuels to renewable energy to take place. Chris, I'm going to ask you first. What's your take?

WILLIAMS: Well, according to the International Monetary Fund, there are about $750 billion a year in subsidies to promote the use of fossil fuels. So that would be something that would be significant to change. We could reduce the billions of--or should reduce the billions of dollars of subsidies to a well-established and highly profitable industry in the United States and around the world and move those subsidies to things that are fuels of the future, such as solar and wind. And I agree with Bob there. A lot of that can be distributed and achieved. Rather than these huge centralized plants, it could be done in a much more democratic and inclusive manner, as we are seeing in some places around the world to a certain degree.

But the subsidies are obviously only one part of the problem, because the other part is political and the amount of influence that these giant corporations have on politics, on Congress, and so on, and the amount of investment that they have. So the hundred largest oil and coal companies collectively are worth about $7 trillion. That's an enormous amount in sunk investment costs too, and they're not just going to write that off, in terms of transmission lines, in terms of gas pipelines, oil pipelines, ports, the expansion of LNG, and so on.

So I think that it's a complete economic rearrangement of how the economy is run, because, as Bob mentioned, the U.S. is by far the most inefficient of all of the industrialized nations. And that is for historical reasons, the way that the country has developed in the last 50 or 60 years.

DESVARIEUX: Right. And, Bob, I want to get your take. Do you agree with that? Do you think we need a whole economic rearrangement in order to get this done?

POLLIN: Well, I think getting it done is a massive economic rearrangement. Transitioning the energy infrastructure of the country towards clean energy is--as Chris said, that in itself is a massive project.

Now, what are the power dynamics that'll make it happen? Obviously, there's going to be a lot of opposition from the fossil fuel companies that will lose the value of their assets.

But, again, why are we talking about Germany as a model of a better alternative? It didn't come out of the blue. It happened because over 40 years the German Green Party existed. They built a green party out of nothing. They have had significant power in the country, such that even a center-right government that has prevailed in Germany now for whatever, a decade, really can't go back too far relative to what has been achieved in that country. And they are committed to building a clean-energy economy.

Same thing is true in South Korea. South Korea has a center-right government. But what's the mantra of the government, the center-right government in South Korea? So-called green growth. We may not agree with all the features of their green growth agenda, but there it is. And that is not the green party in South Korea; that's the center-right party.

DESVARIEUX: Chris, I want to get your take and just some comments from what Bob had to say. Do you think we could do what he said has been done in Germany and South Korea here in the United States?

WILLIAMS: Well, I think it's certainly possible. But I think we also need the subjective factor that Bob mentions, which is a mass movement demanding those kind of changes, because it's about rearranging social power as much as it is electrical power. And we're not really going to get one without the other. And the change in social power relations more towards people and organizations and movements that are demanding firmer action and more immediate action on climate change is what we need to build in this country.

Germany also--there are strong geopolitical reasons in addition to the strength of the Green Party in Germany for the reasons that Germany made this change to renewable energy faster than other countries. So it doesn't have any oil resources, and that goes back to the First and Second World War, why Germany has chosen a different path in terms of its development since then, whereas the U.S. has enormous quantities now, we know, of oil and gas. And so there are bigger tasks and larger barriers, both politically and geopolitically, and in terms of where the fossil fuels are, to changing the pathway of the United States than there are in Germany. But we can affect one side of that equation, which is building a movement to demand the kind of changes that we need in line with the kind of plans that Professor Pollin is putting forward.

DESVARIEUX: Alright. Chris Williams and Bob Pollin, thank you both for joining us.

POLLIN: Thanks very much for having me on.

WILLIAMS: Thank you very much.

DESVARIEUX: And thank you for joining us on The Real News Network.

End

DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.



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