More News from Dubai
Loss & Damage and Big Oil
I’m still not in Dubai. I leave Monday and will be there for the second week of COP28. Traditionally the big heads of state stop by in the first week to make appearances and speeches, and then real work gets done in the second week.
You probably heard that the Pope had to cancel (dang, I was hoping he might stick around and be my bunk mate at the youth hostel), and Pres. Biden decided not to come, sending Kamala Harris instead. But she came bearing gifts.
After my previous post, I’m not sure if I should say shame on myself for jumping too quickly to attack America’s initial (paltry) contribution to the Loss & Damage fund, or whether I can take credit for shaming Kamala into making the big announcement today that the U.S. would contribute $3 billion to the fund. Did you read my proposal for a one cent per gallon gas tax, Madame Vice President??
Whatever the source of that new commitment, $3 billion sure sounds a lot better than the $17.5 million of our initial commitment (171 times better, to be precise). That’s the good news. The bad news is that if the projections are right, it is less than 1% per year of what is needed to help the poorer nations recover from our greenhouse gas emissions. The US currently accounts for 5% of the world’s population but 14% of greenhouse gasses worldwide. And while China has passed us in emissions per year, we are still way ahead in emissions per capita and in total emission since 1750 (the dawn of the industrial revolution) (source). So the $3 billion is a start… but only a start.
I’m not sure if I was serious in suggesting that we should just put a tax on gasoline to pay for the Loss & Damage fund. It is not exactly my area of expertise to know all of the complex relationships of economics. I was merely trying to show the relative amounts of money needed and how much gasoline we use. As another such exercise, today I’m suggesting that the oil companies themselves could pay their fair share. It’s their product that is damaging the climate and the livelihoods of people around the world, and they make a lot of money selling that product. How about they pay?
It made news at COP28 that Darren Woods, the CEO of ExxonMobile, showed up to give lip service to reducing emissions. The reality is that his company made $55.7 billion in net profits last year, and it is his job to see that that number increases. And the oil companies around the world made $4 trillion of net profit. What if they simply tithed on their profits? There’s the $400 billion per year we need to care for the damage we have caused to poorer countries.
$400 billion is a lot of money. No doubt. But what if we took it from the subsidies that governments pay to oil companies? According to the US Senate’s budget committee chairperson (source), the US spends about $20 billion per year of tax payer money to fossil fuel industries. He also reports that the International Energy Agency estimates that fossil fuel industry got handouts from the governments of the world totaling $1 trillion in 2022.
Again, I don’t know how it would work to take 40% of those subsidies and instead of giving them to Big Oil, start giving them to poorer countries who are suffering because of climate change. I’m sure it is not just a pile of money sitting somewhere, but comes in tax breaks and other incentives that are trickier to redirect. But just let those numbers sink in a little:
We need $100 billion per year right now for the Loss & Damage Fund, and probably $400 billion per year in just a few years to rectify the on-going damage that fossil fuel emissions are causing.
The US pledged $3 billion to that, but gave out $20 billion last year to the oil companies themselves.
The biggest US oil company, ExxonMobile, made $55 billion in profits last year, and all the oil companies together made $4 trillion in profit.
Yet the governments of the world contributed $1 trillion to keep them going strong.
There is enough money around to address this! But of course that is simply paying for the damages done. We really need to stop doing damage.
One of the big stories at COP28 to pay attention to is whether the parties will agree to the language of “phase out” for fossil fuels, or merely stick with the current language of “phase down”. Neither of them is precisely defined, but there is a lot more wiggle room in phasing down.
If you’re the praying type, we could use all the help we can get to get everyone onboard with phasing out fossil fuels. We are the generation that has the combination of knowledge and ability to make a difference. They will know more about climate change in another generation or two, but they will have less ability to do much about it by then. Pray that God give us the will to act now!