US and China Forecast: Economic Climate Change Cyclones

The climate change agreement between the United States and China announced at COP26 is about to create a new order of winners and losers around the world. Countries and blocs with intelligent and nimble leadership will fall into line with the two global superpowers on matters of climate change action, and will accelerate their own transition by further heavy cuts in carbon emissions. However, fossil fuel hold-out countries like Australia, India, Russia and Saudi Arabia run the risk of fading fortunes in the neo-eco nexus of the imminent climate change economic regime, and rightly so.

Politicians who think someone else can do the heavy lifting to hold global warming to 1.5 degrees C and believe that they themselves will never be climate change victims or refugees, are now defying more than their own desperate global citizens, and the global citizens of other fragile states. Climate change action is now the global mainstream. China and the US say so.

Both superpowers, together the world’s biggest carbon dioxide emitters, can collaborate to not only power down coal and methane, champion renewables, and share technologies by sharing the load fairly, they can bring the world with them in a virtual global economic cyclone. This initiative would use market leverage and political pressure to destroy the power of coal, oil and gas interests over a matter of years. The US and China agreed at COP26 only to ramp up cooperation on addressing climate change, deforestation, reducing methane emissions and phasing out coal. But the wording does not matter here, it is the intention of the world’s two leading superpowers publicly announcing collaboration and a profound shift in priorities, that matters.

The US and China have attempted to work together before, but now both countries understand the urgency and the responsibilities of this moment. The key issue is that both the US and China seem prepared to quarantine the climate change action issue from business as usual – threats, hacking, trade wars, defence agreements, territorial and human rights disagreements, and space incursions. It appears that the US and China see climate change action as a single issue, fundamental imperative to preserve the planetary environment into the future. China under the control of President Xi Jinping, and the US under precarious control by the Democrats and President Joe Biden, are experienced enough, and bold enough, to force change on other countries by using flows of capital and innovative solutions. The plan will not work if there are freeloaders distorting the markets.

Leadership on the compliance of other countries is underpinned by the moral rights the US and China hold as leading global citizens of a world about to self-destruct because of runaway global warming. It is significant that the two leaders have held a three and a half hour summit carefully raking over the coals of existing disagreements, all serious issues. A sudden flare-up over any of them could potentially destroy collaboration on climate change measures. It looks a lot like careful preparation by highly capable leaders who are about to action a plan of the highest consequence. However, this is not spelled out.

Keeping monumental change low key is the point, in order for both countries to maintain stability while delivering the global level changes that are still required to keep the global warming target in play following the COP26 shortfalls. The US must work around Trump’s lost legions, already starting to disappear into the mists of anti-vax and cruel deceptions. In the short term though, they remain a real threat to US democracy and to climate change action. On the plus side, the charge there is already being led by progressive states and world-beating commerce and tech sectors.

China appears to be about to demonstrate the ability of a tightly-run centrally controlled state to wheel an economy at full speed and force its corporations and regions to absorb the pain of a rapid transition from coal-fired power to renewable energy sources. But as with the US, it needs to project a strong, some might say overly aggressive nationalistic presence to maintain cohesion of its vast domain of diverse provinces. If these two superpowers can make it happen, other countries in their sphere of influence can slipstream, citing the need to respond to a transformed global economic environment as they transition their own industries rapidly to net zero.

Significantly, all countries can forward the pragmatic justification of not only saving the global environment and preventing climate change disaster, but can also point to the uprising of global citizens who believe climate change action must happen now. By taking part in a virtual revolution, global citizens will be actively supporting the superpowers to intervene in the global order of governance. The balance of power may have already shifted, so that coal-loving, fossil-fuel dealing politicians are now the radicals, and the commercial interests who continue to bankroll these environmentally destructive industries, the climate criminals. A virtual climate change revolution will happen when we put aside our differences and work together, finally, to protect our planet, and we will see the real world change as a result.

China and the US are displaying leadership the world needs.