The Green New Deal will fail without China’s support

It’s not just their greenhouse-gas emissions that will cause problems—it’s their politics, too.
It’s not just their greenhouse-gas emissions that will cause problems—it’s their politics, too.
Image: AP Photo/Andy Wong
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In today’s globalized world, everything has some international context. The Green New Deal is no exception.

The GND is commonly recognized as a progressive and decisive response to the public threats of global warming and environmental degradation. However, it has a second core purpose: to advance democracy.

As well as proposing new climate-change policies, the GND explicitly addresses a range of social injustices and economic inequalities, such as inadequate public education and housing, wealth concentration, de-unionization trends, and historic racial and gender oppression. The GND describes these conditions as “systemic injustices” that are related to global warming. The proposal goes on to present more than a dozen different goals to confront climate change while simultaneously promoting a just and equitable society.

However, addressing climate change and human rights necessarily entails addressing China, which is the world’s largest emitter of greenhouse gases. In addition, as the economies of the US and China have become increasingly intertwined, any serious jobs program must address the challenges and opportunities China presents for US industries, too.

The GND must therefore develop a policy toward China. This possible China policy is based on three initiatives: building democratic institutions to engage China; strong international labor and environmental standards; and currency alignment.

Building democratic institutions to engage China

Given the ambitious scope of the GND, US-China relations intersect with many GND goals that are beyond climate change. Therefore, the GND needs a framework for engaging China across all issues.

Any political and economic understanding of China must include China’s public sector, which includes the institutions of the central government, provinces, cities, counties, and municipalities. Public institutions articulate and implement China’s trade and industrial policy, and its public-sector institutions are dominant economic actors both directly (such as state-owned enterprises) and indirectly (through incentives, financing, risk management, tax policies, and the state’s role as a supplier and client). China’s public sector is omnipresent in China—and in China’s relations with the world.

A China policy for the GND must begin with building democratic US public institutions to engage with China’s public institutions. In a world of growing economic and political exchanges across the Pacific, we need public dialogue and public decision-making to govern these flows. Indeed, the GND states that democratic and participatory processes are necessary to achieve GND goals and mobilization.

To achieve this, the GND could call for a new official body that would be a public-private-academic institution. This institution would be charged with evaluating, promoting, managing, and facilitating bilateral trade and investment flows, including resolving disputes, from environmental standards to steel overcapacity to capital controls and everything in between. Policy goals toward China and negotiating objectives would be democratically determined by stakeholder groups. In so doing, this democratic public institution would channel relations with China’s public institutions to meet the purposes of the GND: mitigating climate change while promoting justice and equality.

Strong international labor and environmental standards

The GND resolves to achieve net-zero greenhouse-gas emissions while creating millions of dignified jobs. As part of achieving these goals, the GND demands strong international labor and environmental standards. However, these goals need to specified and clarified, especially with respect to US-China relations.

The GND does not address pollution and greenhouse gases from other countries. Just as the GND establishes highly ambitious goals for the US, the GND must challenge China to be equally bold. The GND can create legal links between US-China trade and investment flows and environmental commitments, such as conditioning trade and investment on adopting, maintaining, and implementing policies to ensure compliance with international environmental laws, both old and new.

International labor standards are essential to the vitality of domestic jobs. As globalization puts workers around the world in direct competition, international labor standards are necessary to stop and reverse the global race to the bottom when it comes to working conditions. Not only can the GND require our trading partners meet standard international labor laws, but it can also support proposals for new labor protections (such as “social dumping” measures applied to international competitors, who derive their principle comparative advantage from depressed working conditions). In setting these international labor standards, the GND would safeguard US workers from unfair competition and wage depression while challenging China (and others) to improve human rights and labor conditions.

Currency alignment

The GND resolves to mitigate deindustrialization and develop new clean-energy industries. As the US and China have the largest bilateral trade flows in the world, GND goals are unsustainable without measures on currency misalignments, in which one country purposely devalues their currency to make their exports more globally competitive.

Currency misalignments with China have contributed to the spread of deindustrialization in the rust belt and the continuing effects of the great recession. Exchange rates are determined by market forces and government interventions: In this sense, exchange rates have political determinations. Both the US and China have been no exceptions to this; both use government intervention to adjust the values of their currencies. The GND must demand currency arrangements with China with the goal of stopping competitive devaluations and politically unacceptable under-valuations. Without currency measures, the GND will be unable to meet its goals in stopping deindustrialization and growing clean manufacturing.

Challenges and opportunities ahead

China presents the GND with a unique set of challenges and opportunities: Challenges, because China is a primary driver of global warming, as well as a competitive threat to politically vital industries and jobs; and opportunities, because of the chance for job creation, developing clean-energy technology, and political organizing.

In demanding strong labor and environmental standards, GND proponents would build political alliances with organizations that have been demanding these reforms to US trade policy for more than 20 years, including major labor unions and environmental, consumer, and human-rights groups. In building a democratic institution to engage China, the GND can facilitate exports and foreign direct investment in China, particularly from small- and medium-size businesses. Moreover, this institution could promote cooperation with China in developing the next generation of clean-energy technology. And in addressing currency misalignments, the GND would encourage cooperation in political organizing between GND proponents and the diverse organizations that have been lobbying for currency regulations for more than 10 years, including manufacturing groups that would otherwise be opposed to many GND initiatives.

The GND needs a China policy to address climate change and implement social and economic policy goals. In developing this China plan, proponents of the GND can take a leadership role in building a more harmonious relationship between the US, China, and the world.