Economic questions on global warming during the Trump years

• DOI: http://doi.org/10.1002/pa.1914
• Published date: 01 February 2019
• Date: 01 February 2019
• Author: S. Niggol Seo

ACADEMIC PAPER

Economic questions on global warming during the Trump years

S. Niggol Seo

Center for Economics of Global Warming,

Muaebak Institute of Global Warming Studies,

Seoul, South Korea

Correspondence

S. Niggol Seo, Center for Economics of Global

Warming, Muaebak Institute of Global

Warming Studies, Seoul, South Korea.

Email: niggol.seo@aya.yale.edu

This paper examines the rapid changes made on U.S. climate change policies and reg-

ulations under the Trump administration for the past 22 months since his inauguration

in January 2017. Policy changes are made on a wide range of climate‐related pro-

grams: Paris Agreement, Green Climate Fund, Clean Power Plan, CAFÉ automobile

emission standards, arctic drilling, methane rule, and farm animal emissions. This paper

discusses that Trump effects will soon be observed by several empirical indicators.

1|INTRODUCTION

The transition from the Obama presidency to the Trump presidency

began abruptly and has been turbulent. Donald Trump won the presi-

dential election on November 2, 2016 in a shocking manner by break-

ing the so‐called “blue wall”of Michigan, Wisconsin, and Pennsylvania

with backing from blue‐collar working men and women. With an

unprecedented rate of removal of regulations since his inauguration

and the major tax reform at the end of 2017, the U.S. economy is

booming after a long period of recession and slow recovery. As of

November 2018, after the midterm elections, the unemployment rate

is nearly at all‐time low; the gross domestic product growth rate hit

4.2% and 3.5% for the past two quarters, respectively; the annual

wage growth hit 3.1% in 2018, the highest in a decade; and the busi-

ness optimism is record high (White House, 2018).

On the climate change fronts, the United States witnessed a swift

and sweeping overhaul, rollback, and removal of key climate change

regulations and agreements, including the withdrawal from the Paris

Agreement announced at a Rose Garden event in the summer of

2017 (White House, 2017). These changes are presented in Table 1.

The climate change community across the globe has been paying

close attention to recent developments and is pondering on what will

lie ahead on international policy negotiations, climate sciences, and

national (subsidy/tax) programs and regulations that were kicked in

before Trump presidency. This article highlights the major changes

that are taking place in the U.S. climate policy programs and raises

important economic and policy questions with regard to the effects

of Trump programs.

2|PARIS AGREEMENT

During the early 2016, way before the American presidential election,

the present author predicted that the Paris Agreement will not be an

effective one and consequently may fall apart (Seo, 2016a, Seo,

2017a). The Paris Agreement was still fresh at that time and was

touted by many as a turning point or a milestone in the world's fights

against climate change threats. The most notable of them was Presi-

dent Obama, who played a central role in accomplishing the Paris

Agreement in December 2015 (UNFCCC, 2015).

I predicted an eventual failure of the Paris Agreement based on

several grounds: (a) There are no emission reduction commitments for

China and India; (b) Many countries' mitigation commitments are condi-

tionally stated on the foreign aids from the rich countries; (c) There is no

legal binding force, that is, all commitments are voluntary; and (d) There

is no international monitoring of any of the national commitments and

the progresses to achieve them (Seo, 2016a; Seo, 2017a).

President Trump announced on June 1, 2017 at the Rose Garden

of the White House that he will pull out from the Paris Agreement,

after giving an hour‐long presentation on the reasons for his with-

drawal decision (White House, 2017). The address emphasized unfair

burden of the Paris Agreement on the U.S. workers given the no

reduction commitments from China and India.

3|GREEN CLIMATE FUND

Because there is no legally binding force in the Paris Agreement, the

most concrete aspect of the many agreements in the Paris Agreement

was the establishment of the Green Climate Fund (GCF) with promises

of GCF funding allocations to developing country parties of the United

Nations convention. The GCF was the international fund first declared

by Hilary Clinton upon arrival in Copenhagen Conference in 2009 as

Secretary of State of the United States, which was the first year of

the Obama presidency (United Nations Framework Convention on

Climate Change (UNFCCC), 2009). It was created to assist developing

country parties of the convention to address climate change

challenges. The size of the GCF was declared to be US$100 billion

Received: 29 November 2018 Accepted: 3 December 2018

DOI: 10.1002/pa.1914

J Public Affairs. 2019;19:e1914.

https://doi.org/10.1002/pa.1914

© 2019 John Wiley & Sons, Ltd.wileyonlinelibrary.com/journal/pa 1of5