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Courtesy of major blockbuster films, we are perpetually immersed in the heroic universe of Marvel and DC, where superheroes tirelessly battle to avert utter catastrophe for humanity.
With the climate crisis escalating swiftly, the urgent reality is that every one of us in the tangible world requires salvation. This raises the pressing query: Where is our superhero?
We know trillions of dollars in investments are necessary for the world to decarbonize so we can mitigate and adapt to global warming. We also know that most of this finance must come from the private sector. However, the role of the federal government is both necessary and critical to get the capital moving both domestically and abroad.
So, will a country throw on the mask and cape and step up as the much-needed superhero?
Let’s begin with the world’s largest economy, the United States of America.
The chances of the US being that hero for the foreseeable future are not great. Passing significant climate policy has essentially come to a halt. The Inflation Reduction Act of 2022 (IRA), the world’s largest climate change investment ever, was entirely partisan with zero Republican support. The bill passed through a special policy procedure known as budget reconciliation and was only possible because Democrats had control of the White House, Senate, and House of Representatives – a reality that ceased to exist in 2022 as Republicans flipped the House. As impressive as the IRA has been, it is not enough to help us win the fight, so future investment and action is necessary.
The results of the 2024 presidential election are not a clear picture either. If the individual who is currently leading polls for the Republican nomination doesn’t find himself barred from taking political office in the next year, polls indicate the presidential race is presently a toss-up. The Senate is also up for grabs. Neither of these realities bodes well for finance aimed at climate change and environmental protection.
If Republicans were to win control back of both Congress chambers and the White House, conservative groups will be prepared for massive rollbacks. A slew of conservative organizations are feverishly working on Project 2025, a nearly 1,000-page playbook that will abolish the current “woke” agenda and take direct aim at environmental regulations, IRA finance, and the clean energy transition. If a Republican sits in the White House come January 2025, expect some version of Project 2025 to be enacted.
So, with Democrats no longer in complete control and an utter lack of appetite from Republicans to address climate change, it could be many years before Captain America suits up again to be a major hero in the climate finance battle.
Well, what about the world’s second-largest economy, China? Is China the hero that the world needs? The jury is still out.
We’ll investigate that next week.