Despite increasing public pressure, both coalition parties within Merkel’s so-called Climate Cabinet favor taxes or market based trading schemes to tackle the climate crisis instead of new regulations to increase renewable energy or hard measures to phase out fossil fuels. L. Michael Buchsbaum takes a look
Emission trading or CO2 taxation is one of the topics to be negotiated (Public Domain)
It’s not often anymore that the leader of the German government visits the former national capital city of Bonn, let alone gives a speech in its old Parliamentary hall. While politicians back in Berlin vigorously debate which new laws should be included in a raft of climate protection measures intended to enable Germany to meet it’s national and international climate goals by 2030—scheduled to be introduced on Friday, September 20, Chancellor Angela Merkel traveled to quieter Bonn in order to present to Klaus Toepfer, who once held the cabinet post of Minister of the Environment and later went on to head the United Nations Environmental Program, the State Prize from North Rhine-Westphalia, its highest civilian honor.
The sagacious 81-year old Toepfer is still revered as something of the green conscience within Merkel’s CDU. Prior to Merkel herself, the party never had a more prominent environmental politician. Earlier in her career, he became something of a mentor to Merkel while she served under him in the Environmental Ministry and later succeeded him.
From the stage of the former Bundestag plenary, Toepfer used the occasion to criticize the methods and framework now being employed by Merkel’s so-called Climate Cabinet which is charged with hammering out the direction the nation will take to meet its emissions goals, spur the growth of renewable energy and revive the flagging Energiewende, while ensuring a livable future for generations to come.
While the proposals now being considered include many incentives, he lamented the lack of legal requirements and actual regulations being proposed—something Merkel and her party have taken a strong stance against. Echoing the famous warning by another former German scientist, Albert Einstein that “we cannot solve our problems with the same thinking we used when we created them,” Toepfer said that the state must make clear “that we can not solve the problems that the market economy has brought us through climate change with the market economy alone.”
Behind the ever growing sound and fury in Berlin is the fact that Germany is way behind on its climate efforts. Following the hottest summer in recorded history, ever more greenhouse gases continue to billow into the atmosphere from the nation’s filthy brown coal-fired power plants and tailpipes of its ever growing fleet of SUVs.
In elections throughout the year, the public has clearly showed its disapproval as the governing parties were punished and support for the more climate-focused Greens surged. Indeed, opinion polls now show that climate change has surpassed immigration as the German public’s primary concern. Nevertheless, the government has abandoned a self-imposed target to lower CO2 emissions by 40% from 1990 levels by next year as Germany risks missing its legally binding EU goals. Governing coalition partner SPD, which has been particularly hammered in recent elections, is additionally threatening to quit the coalition altogether and bring down the government with it if a climate package they approve isn’t passed.
Heightening the political drama, the Climate Cabinet is set to announce its framework on the same day as millions of students and adults worldwide plan massive strikes and demonstrations for climate justice and just three days before United Nations Secretary-General António Guterres holds a summit in New York to encourage aggressive action by countries to make good on their commitments under the Paris Climate Accord.
According to various media reports, the Climate Cabinet is deadlocking around whether to employ a CO2 taxation scheme and new debt to finance climate projects —favored by the left-of-center SPD or a market based approach, favored by the CDU/CSU such as an expanded Emissions Trading System that lets companies buy or sell new carbon allowances.
Both parties, however, believe public transportation should be increased as a way to lure people out of their cars. Proposals include a reduction in VAT on long distance train tickets. The SPD is also proposing a nationwide 365 Euro annual ticket to cover local transport. Additionally, Andreas Scheuer, the Minister of Transport, has proposed investing 75 billion euros through 2030 to develop new fuels, expand bicycle lanes and enrich electric vehicle sales premiums.
Most assume that whatever plans are adopted will derail Merkel’s prized Black-zero balanced-budget if the government ended up footing the bill, which news outlets like the Sueddeutsche Zeitung report could stretch to as much as 50-75 billion euros.
If the CDU plan to impose a trading scheme instead of a carbon tax wins out, that would give the government flexibility to help out companies and consumers when the economy slows. Officials could increase the supply of the emissions permits during a recession to lower costs for companies, or cut supply during a boom. But no such system actually exists today. “That would be a completely new approach for Germany,” says Christoph Kühleis, Chief Economist of the Emissions Trading Office. “The preparation would take more than two years, so it would not be possible to start the system before 2022,” he estimates.
Details around how exactly the new plans will boost the build out of renewable energy—which has cratered recently, are hard to find. Reviewing the debate from the sidelines, Green Party head Robert Habeck warned that none of these proposals are sufficient, “neither in speed nor in liability,” he said. “The most urgent action would be the coal exit. There has been a national consensus on this, now it’s time to implement it.” Instead, he says, the SPD may actually be fighting to open new mines and stall the phase-out of lignite. And neither party seems to be directly pushing for the expansion of renewable energy. Though plans to promote electric vehicles and replace old oil-heaters in buildings are all well and good, these measures are “not enough to prevent the environmental harms” that go on every day—and against which the public is largely rebelling. Despite the noise, as we come down to the finish line, fears are mounting that the Climate Cabinet’s proposals will actually signify nothing.