Viewpoint: The Paris Climate Deal’s Unlikely Champion
Wednesday, December 16, 2015
The deal will likely die on the political vine, leaving investors to take the lead in addressing global warming.
The COP21 climate agreement reached on Saturday in Paris looks more like a bureaucratic cop out than a serious commitment to combat climate change.
While delegates at the Paris conference from all 195 nations may have agreed over the weekend to a new “framework” of cooperation to reduce carbon emissions, there is no guarantee their respective governments will ever ratify the deal. Indeed, for many of the world’s biggest emitters of carbon, namely—the United States—the agreement is practically dead on arrival amid fierce internal political opposition.
But as the U.S. government fiddles while the earth heats up, an unlikely hero is emerging from the shadows that may end up saving the day—Wall Street. From green investment portfolios to ecofriendly shareholders, Wall Street is helping to divert capital away from the polluters of the world to cleaner—and, in many cases, more lucrative—alternatives.
There are a lot of things to dislike about the COP21 agreement, but its single biggest problem is that it is a non-binding resolution. This means that the agreement would need to be ratified at the national level, which, for many of the world’s biggest polluters, isn’t going to happen. Nowhere is this more of a problem than in the United States, where the head of state and the majority of the nation’s legislature hail from opposing political parties. The Republican-led Congress has made it quite clear that they oppose any agreement made by President Obama’s negotiators in Paris.
“The president is making promises he can’t keep, writing checks he can’t cash, and stepping over the middle class to take credit for an ‘agreement’ that is subject to being shredded in 13 months,” Majority Leader Mitch McConnell, the senior Republican in the Senate, told reporters over the weekend.