Climate crisis calls for U-turn in EU’s economic governance – EURACTIV.comhttps://www.euractiv.com/section/economy-jobs/opinion/climate-crisis-calls-for-u-turn-in-eus-economic-governance/Already 50 years ago, Dutch politician Sicco Mansholt, who was at the time the European Commissioner for Agriculture, wrote to the President of the European Commission a legacy letter, in light of the findings of the Club of Rome “Limits to growth” report.
He wrote that a fundamentally different policy needs to be pursued to prevent the world from ‘breaking down’ and that the economy should no longer be aiming at maximising GDP growth per capita.
He called for giving priority to food production; reducing material goods, compensated for by increasing immaterial goods (education, intellectual development, use of free time, access to culture); prolonging the life-span of ‘capital goods’ (which we today call ending programmed obsolescence, ensuring goods and products can be repaired, re-used, then recycled in a circular economy); avoiding the production of ‘non-essential’ products (today, private jets and SUVs are on the spotlight for their huge environmental impact and their uselessness); and combating pollution and the depletion of natural resources.
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Investors will refrain from putting their savings in certain countries or regions, making access to finance more difficult for countries most exposed to extreme weather events.
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But as recently stressed by Mario Draghi, no single country can curb climate change on its own: “Just as the euro cannot be stable if large parts of the monetary union are failing, climate change cannot be solved by Germany reducing its carbon emissions faster than Italy.”
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1) Include the ‘Do No Significant Harm to climate and environment’ principle as an assessment criterion for investments and reforms committed by member states.
(2) Include an obligation for national governments to integrate a socially just and time-bound reduction of fossil fuel subsidies in their fiscal-structural plans.
(3) Require Member States to use Green Budgeting tools when presenting their national budgets to the EU.
(4) Require that national fiscal-structural plans include an assessment of the national investment gap to achieve climate, environment and social goals, and make sure that debt and deficit reduction does not jeopardise their realization.
And of course (5) Make sure the rules don’t prioritise growth at the expense of climate and environment.