China in the Lead: It Matters.

Jeffrey Kalmus contends that I have not argued why my previous post, “China in the Lead,” matters. So now I will attempt to do so, echoing and extending what Max wrote in response to Jeffrey yesterday.

The biggest reason – perhaps I assumed it was rather self-evident – why the rapid Chinese clean-energy Manhattan project matters is because it proves that strong climate policy is both possible and necessary.
In a political system dominated by a self-serving, reactionary party that aims exclusively to undermine the federal government’s ability to do anything, especially on global warming, I think that identifying these sorts of compelling, pragmatic reasons to ignore their noise is important.
It’s true, from the perspective of the global economy, individual countries’ “competitiveness” doesn’t seem that relevant, but Congressional politics – and resulting legislation – are rooted in domestic consideration. The U.S. manufacturing industry, and the constituents that represent it, stands to profit – or miss out – on the $2.3 trillion clean-energy market. Already, we import most of the parts to build wind turbines and solar arrays from Europe. (If dependence on China is so frightening, as Jeffrey seems to believe, then we can’t forget that even while renewable systems draw energy from the sun, they’re built with profitable commodities in private factories. I’m unsure how “utilities are sufficiently regulated” to ensure that the U.S. doesn’t foot the bill for Chinese energy systems, or to prevent the resulting transpacific wealth transfer).
U.S. leadership matters from a climate perspective, too – achieving the necessary emissions reductions will require some radical innovation, and for the U.S not to mobilize its unmatched university system that has traditionally dominated global R&D would be to spell disaster. We’re also the second-largest CO2 emitter in the world, and immediate, domestic adoption of clean energy can’t wait for another country to do it first. China’s also going to need our help.
I stand by the article I wrote last fall about green jobs, because it absolutely did not argue against the imperative for clean energy. The argument was against the idea that a government green stimulus can replace comprehensive climate policy:  “Unless legislation is carefully crafted, its overly optimistic proponents could provoke a backlash against the larger environmental movement and complicate efforts to tackle climate change,” efforts later clarified as “global warming legislation.”
My intention for the piece – while I recognize it should have been more explicit – was to problematize a green jobs stimulus, not to make overarching claims about how addressing climate change is too economically difficult, which is obviously untrue. I am, and have always been, absolutely in favor of a comprehensive climate bill that will put a price on carbon (like that which Harvard’s eminent Robert Stavins advocates so persuasively here).
Rather than Jeffrey’s suggestion, the arguments I made in the Fall HPR issue – that government stimulus faces issues with fungible labor markets, siphoning private capital, transmission line regulations, and picking winners – underscore the need for comprehensive regulation of CO2 emissions over haphazard, reactionary subsidies.
These obstacles I identified with stand-alone, government stimulus dollars do not conflict with the need for the U.S. to adopt robust regulatory, R&D, and infrastructural policies to match those of China’s.
Crucially, most investment in Chinese clean-energy is from the private sector, facilitated by strong regulatory policy that creates favorable market conditions for renewables.
This distinction between a green stimulus and necessary climate reform is important, and it reaffirms what I identified in the fall article: the “need for specific, context-dependent policy.”