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A Pause in Globalization Could Reset Carbon Emissions — and U.S. Politics

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Last weekend I bicycled to Long Beach, the Long Island town where I grew up. From the boardwalk, squinting into the sun, my riding partner Dave and I could make out a dozen freighters strung in a long line in the Atlantic Ocean, stacked up like aircraft waiting to land.

Giant ships offshore weren’t something you saw often from Long Beach in the last century. A solitary ordinary freighter was noteworthy. The dozen big ships last Saturday doubtless were a symptom of some downstream jam-up in the supply chain. But they were also a telltale of the vast expansion of global trade since globalization took rise several decades ago and made Asian factories the prime U.S. source of consumer goods.

Yellow circles mark cargo ships we saw strung out in the Atlantic. Photo: David Clark.

As coincidence would have it, both Dave and I had read Paul Krugman’s day-before NY Times column, Putin May Kill the Global Economy. “There are good reasons to worry that we’re seeing an economic replay of 1914,” Krugman wrote, referring to “the year that ended what some economists call the first wave of globalization, a vast expansion of world trade made possible by railroads, steamships and telegraph cables.”

Krugman envisages Russia’s invasion of Ukraine triggering a replay of 1914. Not just the withdrawal from trade of Russian hydrocarbons and Ukrainian wheat but a “partial retreat from globalization,” i.e., a shrinkage in the “world-spanning supply chains” that now constitute global manufacture.

“What Putin has taught us is that countries run by strongmen who surround themselves with yes-men aren’t reliable business partners,” Krugman says, eyeing China above all. “So if you’re a business leader right now,” he writes, “surely you’re wondering whether it’s smart to stake your company’s future on the assumption that you’ll keep being able to buy what you need from authoritarian regimes. Bringing production back to nations that believe in the rule of law may raise your costs by a few percent, but the price may be worth it for the stability it buys.”

Who can disagree? What Krugman didn’t consider, though, is that the simplification and shortening of global supply chains as an antidote to irrational autocracy could become the political equivalent of carbon taxes on international shipping.

I’ve long harbored the notion that a sufficiently airtight regime of global carbon taxes might put a damper on world trade by making ocean-going shipping more expensive. Much trade would remain, of course, although the extent would depend on the magnitude of the tax. At the margin, though, the enormous movement of raw materials and goods across thousands of miles of ocean (or, more expensively, via air freight) would slow and perhaps even decline.

Krugman didn’t see deglobalization’s silver linings. We do.

The resulting cut in global carbon emissions would be no small thing. Global shipping accounts for 2.2 percent of greenhouse gas emissions worldwide, Time magazine reported recently, a figure that encompasses methane and other GHG’s and thus probably equates to 3 percent of worldwide CO2.

Deglobalization’s salutary effect on domestic manufacture might ripple even wider. Automation notwithstanding, relocating the making of goods for the U.S. market to the United States would raise factory employment and the number of stable, high-wage jobs. That in turn might restore a semblance of cohesiveness and meaning to the vast hollowed-out regions of middle America that since the Great Recession have turned in despair to opiates — pharmaceutical and political.

To be sure, this can sound very pie-in-the-sky, until you remember the pre-eminent role that dignified, well-paying manufacturing jobs played in U.S. progressive politics in the last century. Starting with Franklin Roosevelt and continuing until Reagan, labor and political organizing in America’s industrial unions played a vital part in furthering racial and economic equality through policies like progressive taxation and civil rights legislation, as historian Michael Kazin recounts in his latest book, What It Took to Win: A History of the Democratic Party.

It’s not a huge stretch to triangulate from Kazin’s history of mid-century democratic capitalism and Krugman’s prognosis of deglobalization to imagine a resurgence in the kind of working-class progressivism that has largely been missing from the push for a Green New Deal. The victory last week through nontraditional, grassroots organizing by the worker-led Amazon Labor Union in Staten Island, NY, points in this direction. Over time, rising labor power accompanying renascent domestic manufacturing could help deliver the electoral wins and legislative energies needed to help the U.S. transit from fossil fuels to green energy.

Of course this is my take, not Krugman’s. What worries him about deglobalization isn’t the prospect that “wealthy, advanced economies will end up slightly poorer” as cheap imports recede. It’s the possible brake on economic advancement in “nations like Bangladesh that have made progress in recent decades [due to] access to world markets.”

Curiously for a columnist who frequently invokes climate change, Krugman didn’t mention the other, more dire prospect facing Bangladeshis: that continued “progress” in the form of fossil-fueled growth will lead to massive destruction of their country as the sea overwhelms it, monsoons fail, crops collapse, and desperate migrations of biblical numbers ravage the inland. Unless some thing or combination of things creates a different future.

In his 2020 novel, The Ministry For The Future, the “speculative fiction” writer Kim Stanley Robinson conjured a distinctive deus ex machina: “crash day” — an anonymous worldwide action causing jetliners to fall from the sky, killing passengers and crews but bringing down the curtain on hydrocarbon-fueled, climate-damaging aviation (zero-carbon airships take their place) and catalyzing, finally, a rapid global turning from fossil fuels.

After a decade of pining for a global carbon tax to reverse American deindustrialization, constrain global shipping, and then some, Krugman’s forecast of an autocrat-driven but nonviolent trade slowdown can look mighty attractive.

Addendum, May 9: A May 4 NY Times story, The Era of Cheap and Plenty May Be Ending, about the new logistical fragility of global supply chains, noted: “More firms reported moving their supply chains out of China to other countries, and American executives were more positive about bringing more manufacturing to the United States.”

Downturn in U.S. driving led 2020 global CO2 decline

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[Note: A Feb. 23 update to this post with full-year 2020 vs. 2019 data for all eight world sectors revised, downward, the shrinkage of U.S. ground transport carbon emissions that we had highlighted here. That revision is substantial.]

The world’s emissions of carbon dioxide from burning fossil fuels diminished by more than 1.6 billion metric tons in the first three quarters of 2020 from the same period in 2019, a decline of 6.3 percent. Fully one-fifth of the decline, 320 million tonnes, was due to the nearly 25 percent drop in ground transport in the United States, according to data compiled and made available this week by Carbon Monitor, an international collaboration of energy and climate specialists providing regularly updated, rigorous estimates of daily CO2 emissions.

The Carbon Monitor data, downloaded and reshuffled by Carbon Tax Center, reveal the sources and extent of the drop of emissions during the COVID-19 pandemic. In both absolute and percentage terms, the total U.S. year-on-year January-September decline — 514 million metric tons and 13.1 percent — outpaced the world’s other major emitting nations and regions. The percentage drop of 13.1 percent through September more or less guarantees that U.S. carbon emissions for all of 2020 will fall below year-2019 emissions by double digits.

Close behind the United States in percentage terms of decline were Brazil, with a 12.9 percent drop from 2019 to 2020, and India with 11.7 percent. But because U.S. emissions are so large in absolute terms, the tonnage drop here dwarfed that of India (225 million tonnes) and Brazil (44 million tonnes).

China was far down the ranks of emission reducers. From the first three quarters of 2019 to the same period in 2020, its emissions shrank by just 109 million tonnes, a decline of only 1.4 percent. Although China’s ground transport carbon emissions did fall by 15 percent — just short of the rest of the world’s 16 percent decline for that category — none of the country’s other major emitting sectors showed pronounced declines, except for domestic aviation, which fell by 26 percent. Omitting China from the calculations, world CO2 emissions fell by 8.4 percent over the three-quarter periods, though admittedly that construct is a bit like considering recent U.S. presidential popular votes without California.

Nearly half of the global CO2 decline — 787 million tonnes out of the overall 1,621 million tonne drop — was accounted for by reduced ground transport emissions. With truck traffic probably little affected by the pandemic, as indicated by the mere 3.4 percent drop in world carbon emissions from industry, the decline presumably is attributable to decreased use of passenger vehicles. The reduction in aviation emissions was even more pronounced, at 36 percent, as many air travelers deemed it unwise to spend hours in confined aircraft spaces, and teleconferencing filled in for most business travel. The reduction rate might have been higher still, but for “ghost flights” resulting from byzantine government regulations and financial incentives.

Same data as in first chart, shown by use. Ground transport emissions fell the most.

There’s something satisfying in seeing year-on-year carbon emission figures in negative-land, even as we can’t deny the enormous human and social suffering that not only accompanied but to an extent delivered the reductions. A global pandemic causing over 1.3 million deaths and rising, according to the count maintained by Johns Hopkins University, and stunting child development as “remote learning” replaces in-person schooling, to name but one societal forfeiture, is not the path anyone would choose to curb climate-wrecking use of fossil fuels.

Perhaps we could look to the European Union, which pulled off a nearly 14 percent drop in carbon emissions from power generation, accounting for an absolute reduction of 105 million tonnes thus far in 2020 vs. 2019. In contrast, Carbon Monitor’s “Rest of World” group — encompassing all countries other than China, India, USA, Russia, Japan, Brazil and the EU — shaved only 1 percent from its power generation emissions, a decrease of just 27 million tonnes from 2019 emissions of 2,775 million tonnes. A deep dive into the disparate reductions might be useful for devising abatement strategies going forward.

Slicing the 2020 declines in the world’s CO2 emissions.

This post only skates the surface of the data made available by Carbon Monitor. Their downloadable Excel file comprises some 36,000 entries: CO2 emissions for every 2019 and 2020 day (Jan-Sept) for five categories by eight countries or regions (some rows capture individual European countries: France, Germany, Italy, Spain and the UK). The daily data provide a quantitative window into that terrifying but bracing springtime period when lockdowns pushed emission rates in the US and other countries 20 or even 40 percent below year-earlier levels. The CM graphics (same link as above) are marvelous as well, as is an Oct. 14 article in Nature Communications by three CM staff distilling and interpreting their quantitative findings.

The second bar graph was added on Nov. 24. Drop us a line (email here) to share your own excavations of the Carbon Monitor data, or if you’d like us to send you our spreadsheet distilling CM’s data as used in this post.

One Cheer for the Guardian’s Divestment Campaign

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The worldwide fossil fuel divestment campaign got a huge boost this week when Guardian editor Alan Rusbridger boldly thrust his paper into the fray. Britain’s most respected newspaper is urging readers to sign a petition by 350.org demanding that the Gates Foundation and the Wellcome Charitable Trust divest from the world’s top 200 fossil fuel companies within five years.

Divestment can’t loosen the fossil fuel stranglehold without a carbon tax.

Combined, the two charities manage over $70 billion in assets. Both say they consider climate change a  serious threat. But last year the Gates Foundation invested at least $1 billion of its holdings in 35 of the top 200 carbon reserve companies, while the Wellcome Trust invested $834 million in fuel-industry mainstays Shell, BP, Schlumberger, Rio Tinto and BHP Billiton.

We’re both elated and concerned by Rusbridger’s audacious move. Elated that this distinguished and brave journalist has thrown down the gauntlet to the global fossil fuel industry. But concerned that this divestment campaign may raise false hopes.

As Matthew Yglesias articulated last year in a thoughtful piece on Slate, divestment by socially responsible investors, universities and even governments won’t starve capital flows to fossil fuel corporations anytime soon. That’s because in a global market, every share of stock we activists dutifully unload will be snatched up in milliseconds by some trader who can bank on humanity’s continued dependence on fossil fuels to continue generating profits.

South Africa’s historic divestment campaign — the one that helped topple Apartheid and enshrined divestment as a tool against oppression  — was paired with a UN-sponsored boycott of South African goods. Not just aiming at the supply of capital but destroying the demand for goods sheared the Apartheid regime’s economic lifeline to the rest of the world more than either policy could have done alone.

No, we’re not suggesting a global boycott of fossil fuels. Rather, we point to the Guardian’s campaign to reiterate that the best and maybe only broadly effective way to reduce fossil fuel demand (which is the point of a boycott) is with a carbon tax. Economists agree on that policy prescription just as strongly as climate scientists agree on the diagnosis. And national-level carbon taxes can be designed to draw our or any nation’s global trading partners into carbon taxing, which means that a move by a big economy to impose a carbon tax will trigger a wave of followers.

So by all means, divest. The cultural and perhaps political opprobrium that divestment can spark is long overdue for the fossil fuels industry. But let’s not assume that divestment alone will break the chains of fossil fuel dependence. Even with the Guardian’s welcome campaign, the world still needs a transparent price on carbon pollution to strangle demand for fossil fuels by replacing them with non-carbon alternatives.

British Columbia’s Carbon Tax Architects Speak

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A new report from a British Columbia think tank reveals the inside story behind B.C.’s successful tax on CO2 pollution. “How to Adopt a Winning Carbon Price, Top Ten Takeaways from Interviews with the Architects of British Columbia’s Carbon Tax,” published by Clean Energy Canada, draws on extensive interviews with senior government officials, elected representatives and a broad range of experts who helped shape or respond to this groundbreaking policy.

BC C-TX RPT CVRBritish Columbia inaugurated its carbon tax on July 1, 2008 at a rate of $10 (Canadian) per metric ton (“tonne”) of carbon dioxide released from coal, oil and natural gas burned in the province. The tax incremented by $5/tonne annually, reaching its current level of $30 per tonne of CO2 in July 2012. At the current U.S.-Canadian dollar exchange rate (1.00/0.80), and converting from tonnes to short tons, the B.C. tax now equates to around $22 (U.S.) per ton of CO2.

In the tax’s initial four years (2008 to 2012), CO2 emissions from fuel combustion in British Columbia fell 5% — or 9% per capita, considering the province’s 4.5% population growth over that span. [NB: These figures are revised downward from the original version of this post; see editor’s note at end.] During the same period, emissions from the rest of Canada increased slightly. Revenue from the tax has funded more than a billion dollars worth of cuts in individual and business taxes annually, while a tax credit protects low-income households who might not benefit from the tax cuts. [Read more…]

Mythbusting

The entrenched power of the fossil-fuel industry and its political backers isn’t all that stands in the way of taxes on carbon pollution. Outmoded ideas and enduring myths about energy use and taxes are also factors.

This page describes and dissects some of these misconceptions. Please send us your own favorite fallacies about carbon taxes. Ditto your suggestions or criticisms of ours.

Myth #1. A tax on carbon pollution will harm the poor and middle class.

Who says? Some low-income advocates, some left-of-center activists, some conservatives masking as populists. 

Rebuttal: The wealthy use more carbon-based energy than the rest of us, by far. For every gallon of gasoline used by the poorest quintile (20%) of households, the richest quintile uses three.

A similar pattern holds for the other sources of carbon pollution: electricity, jet fuel, even diesel fuel that powers the trucks that deliver goods. It’s true that consumption taxes, a category including carbon taxes, are “regressive” — they take a larger share of income from low-income households — but that’s true only when the use of the tax revenues is ignored. The net impact can be made “progressive,” i.e., beneficial to people of below-average means, by proper distribution of those revenues.

One policy option is to distribute the revenue directly to households as regular “dividends.” Climate scientist Jim Hansen and the Citizens Climate Lobby are among those calling for all carbon tax revenues to be returned to citizens in equal, monthly “green checks.” In 2016 CCL released a working paper analyzing the short-term financial impact of a $15/ton carbon fee under this plan.

Net Effect by Quintile of $15/ton Carbon "Fee and Dividend"

Net Effect by Quintile of $15/ton Carbon “Fee and Dividend”

The report, which estimated household carbon footprints with new levels of detail, including crucial geographical variation, found that 53% of U.S. households (58% of individuals) would reap a positive net financial benefit, i.e., receiving more via the dividends than they would pay directly and indirectly in higher fossil fuel prices. The benefits would be greatest for lower-income, younger, senior, and minority households with nearly 90% of households below the poverty line benefitting from a carbon tax. The distributional effect would essentially shift purchasing power from the top quintile of households to the bottom two quintiles, highlighting the income-progressive nature of a fee-and-dividend plan.

A worthy alternative, which Al Gore and many economists advocate, is “tax-shifting” — use carbon tax revenues to reduce regressive taxes such as sales taxes and payroll taxes. (See our Issues page, Managing Impacts.)  British Columbia has enacted and annually increased its revenue-neutral carbon tax with popular support by dedicating all revenue to reducing a variety of other taxes ranging from sales taxes to business taxes.

What’s really regressive is the impact of global warming. Sea level rise, food shortages and storms like Katrina, Irene and Sandy hit the poorest hardest.

Myth #2. Carbon taxes won’t change habits — after all, high gasoline prices haven’t cut usage.

Who says? An odd collection of groups and individuals, including former Sierra Club “CAFE” (car fuel-economy) lobbyist Dan Becker (“Even as gas prices have doubled and trebled over the past several years, we see little change in driving behavior,” Becker told the New York Times in October, 2006.)

Rebuttal: Four points are key. First, rises in gasoline prices have cut usage, and by more than a little. Comparing 2008, the last pre-recession year, to 2003, U.S. gasoline usage was unchanged even though economic activity was up 13%. What did the trick was the 73% higher price “real” (in­flation-adjusted) price. Second, much of the increase in energy prices in recent years was masked by price volatility; as we show here, over the past decade or more, gas prices have fallen almost as often on a month-to-month basis as they have risen, masking the upward trend and convincing millions of Americans that prices would head south soon enough to make adjustments unnecessary. Third, other sectors, especially electricity generation, which emits nearly twice as much CO2 as cars, are even more price-sen­sitive. Last, price-responsiveness will grow as house­holds have opportunities to buy more fuel-efficient vehicles and appliances, and as society transitions to a more fuel-efficient infrastructure — once we enact carbon taxes to send clear and strong price signals. (See our Issues page, Carbon Tax Effectiveness, for more discussion.)

Myth #3. Taxes on carbon emissions aren’t necessary. Vehicle efficiency standards and mandates or subsidies for wind turbines, ethanol, hydrogen, nuclear power [pick one or more] will solve the problem.

Who says? Special interests, many environmental groups, security advocates, technology buffs.

Rebuttal: Standards and subsidies are blunt instruments — vehicle efficiency standards don’t reduce vehicle usage, for example — and are often contested for years and then undermined by “gaming” (viz., the “light trucks” exemption from CAFE standards, or tax credits for hybrid SUV’s). Moreover, fuel usage is ever-changing and diffuse (a majority of petroleum is not used in cars or light trucks, for example), while efficiency standards are by nature both usage-specific and frozen in time. As for supply, economic theory predicts, and experience confirms, that raising the price of a harmful activity is always more effective at reducing that activity than is lowering prices of the thousands of imaginable alternatives — as we documented in the comments we submitted in January 2014 to the Senate Finance Committee. Only taxes on carbon pollution from fossil fuels can create the clear, rapid, across-the-board incentives needed to propel a massive shift to clean alternatives.

Myth #4. Heavy fuel taxes will constrict the economy.

Who says? Traditional growth champions, fossil fuel interests.

Rebuttal: Price volatility wreaks far more economic havoc than high or even steadily rising energy prices. Even fairly steep increases can be manageable so long as they’re regular and predictable, particularly now that the share of economic activity occupied by the fossil fuels sector is at an historic low — provided the revenues are distributed or tax-shifted back to Americans. And carbon taxes need not be draconian to accomplish their mission. Our program of recurring annual increases of $10-15 per ton of emitted carbon dioxide equates to 5-10% increases in energy prices per annum (with the percentages shrinking as the “base” rises and as non-fossil energy assumes a larger share). By comparison, the average annual real increase in U.S. gasoline prices in 2003-07 was 11%, but that didn’t stop the economy from growing at 3% a year. Needless to say, the true long-term threat to the economy (and everything else) is unchecked global warming, as the National Academy of Sciences warned years ago and the National Climate Assessment reiterated more urgently in 2014.

Myth #5. Carbon taxes will provide more revenue for government to squander.

Who says? Anti-tax groups, some conservatives, Tea-Partiers.

Rebuttal: Not if the tax is made revenue-neutral” via dividends and/or tax-shifting (see rebutgtal to Myth #1). Because higher taxes on fuels will create a strong “market pull” to clean energy, carbon taxes will put a big dent in fossil fuel use and CO2 emissions without having to earmark revenues for hybrid cars, mass transit, biofuels, etc. — or to lawmakers’ pet projects.

Myth #6. Heavy fuel taxes will price U.S. goods out of the marketplace.

Who says? Some business groups, some labor unions.

Rebuttal: This argument assumes a static economy, sans adaptation and innovation. In reality, increased energy taxes will shrink the trade deficit (by cutting both volumes and pre-tax prices of imported oil). The higher prices will also spark innovation in clean, efficient technologies better suited for world markets than, say, supersized automobiles. Finally, taxing energy will create parity with our traditional competitors — the EU and Japan — while encouraging like-minded actions in India, China and other emerging economies. In the interim, border tax adjustments can equalize prices of imports from non-carbon-taxing nations.

Myth #7. A carbon cap-and-trade system is as good as a carbon tax, and more politically feasible.

Who says (or said)? Too many “Big Green” groups; elected officials seeking to “hide the price” signals; business organizations and corporations that know a complex program like cap-and-trade can be more easily gamed in their favor.

Rebuttal: Click here for CTC’s dissection of the logistical and strategic differences between carbon taxes and cap-and-trade (they’re not minor). As for political feasibility, the political process has borne out our belief that carbon cap-and-trade was too complex, regressive, cumbersome and undemocratic to succeed. Supporters of cap-and-trade were never able to resolve this contradiction: either it wouldn’t raise fossil fuel prices, in which case it would be ineffectual; or it would raise them after all, provoking an unstoppable backlash among a citizenry that hadn’t signed off on the higher prices and wouldn’t be getting the dividends from the tax revenues, while carbon-market participants skimmed big profits. Moreover, cap-and-trade’s complexity guaranteed that it couldn’t be implemented for several years — the Northeast states’ electricity cap-and-trade system took five years to institute — whereas a carbon tax can be implemented within months, as British Columbia demonstrated with its 2008 carbon tax startup.

Myth #8. Americans are too myopic, and our politics too broken, for even revenue-neutral carbon taxation to ever take root here.

Who says: Veterans of failed past efforts to take on entitlements; assorted skeptics and cynics — including, sometimes, ourselves.

Rebuttal: This is the myth even we at CTC can’t dismiss out of hand. Witness the failure of past fuel-tax efforts, the resistance to fossil-fuel-displacing wind farms in some areas, and the persistence of costly tax entitlements like the deductibility of home mortgage interest payments from federal taxes — each, in its own way, testament to the dictum that “losers cry louder than winners sing,” in the words of University of Michigan tax policy expert Joel Slemrod.

Nevertheless, we’re working for a different outcome for carbon taxes. For one thing, emphasizing revenue-neutral carbon taxing can help dispel the presumption that a carbon tax is a tax hike. Second, because the non-climate benefits of carbon taxes are enormous, from cleaner air to less road gridlock, there are many opportunities to broaden support from traditional environmentalists. Finally, unlike 1980 or 1993, when fuel-tax proposals that were primarily designed for budget-balancing went down to defeat, the stakes are frighteningly high. Stiff carbon taxes can’t rescue the climate by themselves, but without them a rescue is virtually inconceivable. We remain hopeful that the American people will rise to the challenge.

Other Resources:

The Case for a Carbon Tax (by Prof. Shi-Ling Hsu), reviewed here.  Chapter 4 offers forceful responses to standard (and largely mythological) arguments against carbon taxes and chapter 5 delves into some of the psychology that biases many people against using price instruments to address global warming.

Car Bloat and Carbon Pollution: It’s Both Better and Worse Than You Think

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Streetsblog USA today published my essay, Get the Facts About ‘Car Bloat’ and Pollution. I’ve cross-posted it here to allow comments.

 — C.K., Feb. 1, 2024

The increasing size of passenger vehicles has been catastrophic for road safety, traffic congestion, climate viability, and household budgets. Compared to sedans, brawnier sport utility vehicles and pickup trucks are far more likely to kill other road users, to clog urban streets and suburban roads, to guzzle fuel and emit particulates and carbon, and to keep their owners on a treadmill of car payments and pain at the pump.

Not only that, SUVs and pickups — collectively designated “light trucks” by regulators (“deregulators” is more apt) — may even engender more driving by owners seduced by their roominess, faux road-worthiness and illusion of indomitability. All 12 of the dozen models most preferred by gasoline “superusers” — drivers in the top decile of U.S. gasoline consumption — are SUVs or pickups, with the Chevy Silverado and Ford F150 topping the list.

As I wrote earlier this week, superusers manage the bizarre feat of averaging 40,000 miles a year* — a quantity of driving that consumes 13 percent of their owners’ waking hours — while burning 22 percent more fuel per mile than other U.S. drivers’ rides. Ivan Illich was right.

Just after Thanksgiving, The Guardian added its two cents with a story headlined, “Motor emissions could have fallen over 30 percent without SUV trends, report says.” Translated: Global CO2 emissions from passenger vehicles would have shrunk by nearly one-third if not for vehicle upsizing to SUVs and pickups.

Startling and damning, right? But it’s a vast overstatement: The true 2010-2022 “lost reduction” in passenger vehicles’ carbon emissions due to the growing share of big trucks worldwide was just 6 percent — five times less than the reported 30 percent.

Wait, am I cutting SUVs a break on their carbon spewing? Not at all. To deal effectively with climate we need to be clear about what’s destroying it.

The false 30-percent figure — which you’ll soon see wasn’t the fault of the Guardian — has begun worming its way into energy and climate discourse. This is unfortunate, since it serves to reinforce emphasis on the types of vehicles being made, sold and driven, when American motorists’ carbon profligacy is the inevitable result of our oversupply of pavement and our bias against full-cost pricing of driving.

Whence the error?

The Global Fuel Economy Initiative is a think tank funded by the European Commission, the Global Environment Facility, the UN Environment Programme and the FIA Foundation. Notwithstanding the fact that FIA is the “philanthropic arm” of the Fédération Internationale de l’Automobile (aka Formula One auto racing), GFEI produces high-caliber analysis and research.

GFEI’s November 2023 report, “Trends in the Global Vehicle Fleet 2023: Managing the SUV Shift and the EV Transition,” meticulously examined passenger-vehicle fuel consumption over the 12-year period, 2010 to 2022, and found that average fuel use (and, hence, per-mile carbon emissions) dropped by an average rate of 1.5 percent per year.

If not for more and heavier SUVs, the average annual decrease in emissions, according to the report, would have been around 1.95 percent, a rate that is 30 percent greater than the actual decline rate.

A 1.5-percent annual decrease in fuel intake per mile calculates to a total 16.6-percent total drop during the period. (See math box at the bottom of this post for the arithmetic.) Had the annual decrease been 1.95 percent, its 12-year drop would have been 21.5 percent. The gap between those two drops means that bigger car size worsened fuel economy 6 percent more than if car size had remained the same.

The Guardian, before (left) and after I got out my calculator. There’s a difference, but it’s not sharp enough.

Accordingly, the headline in the story should have been, “Motor Emissions Could Have Fallen 6 Percent More Without SUVs, Report Says,” but that’s not exactly eyeball-grabbing. Don’t blame Guardian reporter Helena Horton, however. She wrote her story off of GFEI’s press release, which (incorrectly) trumpeted a lost 30-percent gain in fuel economy due to “the SUV trend.”

After being contacted by me, GFEI’s study director immediately acknowledged his comms team’s error and labored mightily to get The Guardian to run a full correction. As you can tell from the side-by-side story headlines above, he was only partly successful.

The image on the left shows the original Nov. 24 Guardian headline and lede, retrieved via the Web’s Wayback Machine. The image on the right shows the corrected headline and lede since Dec. 18. The alterations are subtle nearly to the point of invisibility. The new “30 percent more” is confusing (30 percent more than what?), and the subhead is unaltered and thus plain wrong to say that the fall in emissions “would have been far more” than it was, had vehicle sizes stayed the same. No, the fall in emissions would have been 6 percent more — not exactly “far more.”

Why it’s important to correct the error

The Guardian’s erroneous “30-percent-less” headline, though not its fault, has the makings of a honey trap. New York Times climate columnist David Wallace-Wells fell for it on Twitter, along with esteemed climate pundit David Roberts. The Colorado-based climate think tank RMI got ensnared as well, as did our own Kea Wilson at Streetsblog USA. (RMI and Streetsblog quickly corrected their flubs after I emailed.) Consider this post an antidote to future repetitions, or, at least, a means to correct them.

It’s also worth touching on the innumeracy required to imagine that auto upsizing — “car bloat” in the evocative phrase popularized by journalist David Zipper — as loathsome as it is, stood in the way of a 30-percent gain in world-average auto fuel economy. The typical difference between sedan and “light truck” mpg is only around 20 percent (though greater in the U.S., with our supersized SUVs and pickups), so even a complete global switchover from sedans to light trucks would have put only a 20-percent dent in fuel economy.

Of course, the actual carbon damage due to vehicle SUV-ification over the 12 years studied has been far less — just 6 percent as we saw above — on account of longer vehicle turnover times. This should have been readily apparent to The Guardian reporter as well as the journalists and advocates who repeated the error on social media or websites. Errant quantification is hardly journalism’s number one albatross — free-falling revenues and shrinking newsrooms are orders of magnitude more consequential — but it lurks under the surface.

With greater numeracy, it might be easier for journalists, advocates and policymakers to grasp that vehicle electrification and shrinkage alone aren’t going to cut auto emissions at the rate needed.

Driving too must shrink. Collectively, road pricing, congestion pricing, curb pricing, carbon pricing, better transit and livable streets are almost certainly at least as important for climate as improved miles per gallon.

Congestion pricing, coming soon to New York City, could bode well for carbon-taxing.

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Externality pricing is coming to New York City in a big, barrier-busting form known as congestion pricing. Judging from how it’s unfolding, it might just be bold enough to give a much-needed boost to the cause of U.S. carbon pricing.

In a long-awaited step, New York’s Metropolitan Transportation Authority this week unveiled its prospective tolls to drive a car or truck into Manhattan’s central business district. Barring a last-minute reversal, the Western hemisphere’s first congestion pricing program, and the world’s biggest by far in terms of revenue, will begin next June, just six months from now.

NY Gov. Kathy Hochul (top) and CTC director Charles Komanoff (below) speaking at Dec. 5 Union Square rally celebrating the march toward congestion pricing in NYC.

The plan took half-a-century to legislate and another four-and-a-half years to flesh out, culminating, for now, in its formal approval by the MTA board on Wednesday. Autos will be charged $15 to drive into Manhattan south of 60th Street between 5am-9pm weekdays and 9am-9pm weekends and holidays. Night-time tolls will be 75 percent lower, at $3.75. Trucks will pay more than cars, and for-hire vehicle trips that touch any part of the 8-square-mile congestion zone will be surcharged $1.25 (for yellow cabs) and $2.50 (for “ride-hail” vehicles, largely Ubers). Peak-period car trips to the zone via tunnels under the Hudson and East Rivers, which already pay double-digit round-trip tolls, will get $5 off, but other exemptions or discounts will be few except for low-income residents of the zone and commuters to it. (Many details here, by the author; and here, by the MTA’s toll-setting panel.)

The 2019 state legislation authorizing the tolls requires that they generate $1 billion a year net of administrative costs — a revenue stream sufficient to bond $15 billion in transit investments. Eighty percent of that, $12 billion, is earmarked for subway improvements such as station elevators to increase accessibility and fully digital signals to allow more frequent train service; the other $3 billion will be invested in expanding commuter rail service between the suburbs and Manhattan.

[Click here to watch/hear Gov. Hochul’s remarks depicted above. Click here for Komanoff’s.]

Revenue Most Visible

The billion-dollar a year take from New York congestion pricing puts it in the same league as the Northeast states’ Regional Greenhouse Gas Initiative, which currently reaps $1.2 billion a year from sales of carbon emission permits for burning fossil fuels to make electricity. Yet “RGGI” is largely invisible to the public. So too are California’s economy-wide carbon cap-and-trade program, which started in 2013, and British Columbia’s 2008 carbon tax as well as subsequent cap-and-trade schemes elsewhere in Canada, .

Those other mechanisms rest on what former CTC staffer James Handley habitually derided as “hide the price” subterfuges. Congestion pricing, in contrast, hides nothing. Motorists know full well what they’ll soon have to pay to drive into the nation’s most gridlocked (and transit-rich) district. True, the surcharges on for-vehicle trips can be tricky to track — they add to rather than replace incumbent FHV surcharges of $2.50 and $2.75 for “taxi zone” trips in yellows and ride-hails, respectively. But congestion pricing’s main event is the fees for private car trips.

And “main event” is putting it mildly. Though the $15 peak car toll is many times less than the socially optimal toll (per Paul Krugman, whose July encomium to congestion program relied indirectly on my traffic-cost modeling) or the congestion costs imposed by a single car trip, which is nearly the same thing, it’s still a gut-punch for diehard drivers. Not only that, imposing a hefty price on car travel to capture externality costs rather than merely to pay for infrastructure provision is, let us say, deliciously transgressive in the USA. Kind of like taxing carbon emissions.

The point being: successfully implementing congestion pricing in New York — not simply putting it in place but having it deliver tangible benefits like more-reliable travel, more-livable streets and re-invigorated public transportation — conceivably could burnish carbon pricing not just in New York but nationwide.

Enacting Carbon Taxes Remains Devilishly Difficult

Let’s be clear, though. As if getting New York congestion pricing within inches of the goal line hasn’t been hard enough, enacting a national, i.e., federal carbon tax worthy of the name — one that hits triple digits within a half-dozen years or less — will be devilishly more difficult. Consider these differences between New York congestion pricing and national carbon taxing:

    1. The economic incidence of NY congestion pricing is far more income-progressive than national carbon pricing. A bulwark of CP advocacy here has been unstinting support from the Community Service Society — the city’s and nation’s oldest antipoverty NGO. It’s hard to picture comparable support for nationwide carbon pricing. Not even “dividending” carbon revenues, which CTC strongly supports, can guarantee that millions of U.S. households won’t pay more in higher fuel costs than they’ll get back in monthly carbon dividends. Inevitably and unfortunately, some will slip through the dividend’s safety net, allowing opponents to cast even the most judicious revenue treatment for carbon taxing as insufficient to protect the poor.
    2. NY congestion pricing comes with a natural route for managing the congestion revenues: investing them in long-term mass transit improvements. It was this facet, more than the promise of lessened auto traffic, that brought the city’s rich tapestry of transit advocates into the fore of the congestion pricing campaign. Even motorists — some of them, anyway — grasp improved transit’s value to them as a means of dissuading others to invade “their” road space. National carbon pricing has no such obvious path for distributing or investing its revenues. Sure, spending carbon revenues on renewables and efficiency, particularly in historically disadvantaged communities, has a nice ring, but in practice there’s no clear carbon revenue spending path that won’t disaffect vast numbers of stakeholders. Now factor in the orders-of-magnitude difference in annual dollars — a billion or so in the case of NY congestion pricing vs. half-a-trillion for a comprehensive triple-digit U.S. carbon tax. Talk about a donnybrook gap!
    3. America’s geographic vastness and cultural separateness make it nearly impossible for citizens to consistently find common ground, as evidenced by our red-vs.-blue and urban-vs.-rural polarization. Even as New York City’s sense of conjoined fate has frayed somewhat, many residents still manage to cultivate a sense of connectedness to each other. Nationally, that ship has sailed. Woody Guthrie’s “This Land Is Your Land” anthem is 80 years old. Fond hopes from the 1990s or early 2000s that combating climate change might re-invigorate Americans’ shared humanity seem almost as distant.

Antidotes

To these three difficulties we have three antidotes.

Over the prior decade, the wealthiest U.S. household quintile spent 3.3 times as much on gasoline as the poorest — evidence of the power of carbon dividends to more than offset the natural regressivity of higher energy prices.

The first is the power of carbon dividends. Even if they can’t keep whole every single low-income U.S. household — there are, after all, 65 million below-median-income families, each with its own consumption profile — the vast majority of those households will reap more in dividends than they’ll pay with the carbon tax. Not just that, the dividend approach bypasses political fights over where and how to invest the revenues.

A second possible antidote is the exigency of the climate crisis itself. Unlike NYC traffic congestion or failing transit, which public policies like congestion pricing can vanquish going forward, climate collapse can’t be reversed. This ineluctable fact could, or should, motivate climate advocates to re-evaluate their largely ideological objections to robust carbon pricing (which we discuss elsewhere in terms of climate justice campaigners and self-identified progressives). Given that people of color, whether in the U.S. or the Global South, are disproportionately vulnerable to climate chaos, hope remains that carbon-pricing opponents may reconsider their antipathy to the most efficacious policy for slashing emissions and actually protecting the populations they profess to care about.

The third, as always is organizing. Carbon-taxing proponents need to keep up the pressure. We also need to expand our tent, as we wrote about last month in Gainsharing: Carbon Taxes Can Put Clean Energy Back in the Black. We’ll have more to say soon on that score.

Exxon’s $59 Billion Spike Through Divestment’s Heart

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The impossibility of throttling Big Oil through fossil fuel divestment campaigns was laid bare last week when ExxonMobil announced it was acquiring Pioneer Natural Resources, the #1 driller in the #1 producing U.S. oilfield, the Permian Basin.

Chart from macrotrends.net shows ExxonMobil’s market capitalization (stock price x shares outstanding) last week near an all-time high.

In a transaction priced at $59.5 billion, Pioneer shareholders will receive slightly more than 2.3 shares of ExxonMobil stock for each Pioneer share. No banks are involved, no debt, no third parties; and, most noteworthy, no cash. Pioneer’s management evidently holds Exxon’s current and future financial strength in such high regard that it was willing to sign on to an all-stock deal.

Had it been necessary, though, Exxon could have bankrolled the entire acquisition using cash generated by its sales of petroleum products to U.S. and world motorists, truckers, air travelers and shippers. Last year alone, Exxon generated more than enough cash flow, $76.8 billion, to buy Pioneer outright. Its market capitalization stands at $450 billion, triple the lows during the 2020 pandemic year and higher than the $400 billion in 2012, when climate author-activist Bill McKibben kicked off the divestment movement with his Rolling Stone manifesto, Global Warming’s Terrifying New Math.

Photos by Johnny Silvercloud (L, 2015) and Herb Keeney (R, 2016). Thousands of similar images and hundreds of divestments haven’t crimped the coffers of Exxon and its oil brethren.

McKibben was admirably candid about wanting to “make clear who the real [climate] enemy is”: the fossil-fuel industry, led and epitomized by the oil-and-gas giant ExxonMobil. The eleven intervening years have cemented Exxon’s standing as Big Oil incarnate. Not only is Exxon the industry’s most technologically proficient and politically connected member, it’s the one that for decades sowed disinformation about climate change even as its own scientists advised management to fortify the company’s drilling platforms against rising seas.

Unsurprisingly, “Exxon Knew” ranks high among contemporary climate-protest slogans. And the company certainly merits every ounce of opprobrium directed at it. Divestment was a righteous idea, but it has proven futile.

Wake-Up Call

The Pioneer acquisition should be a wake-up call. If the wave of divestments over the past decade by universities, philanthropies and pension funds had genuinely dented oil industry prospects, Exxon’s stock wouldn’t have had the cachet to lure Pioneer into an all-stock purchase. Nor would Exxon have been able to pull off a Plan B of forking over $60 billion in cash. The ease of the acquisition puts the lie to divestment’s starve-and-shame paradigm intended to dry up dollars and discredit industry brands.

Permian Basin map from ExxonMobil Oct 11 news release.

Pressuring institutions to divest from fossil fuels never made much sense as a pro-climate strategy. Targeting any one oil company was never going to be able to restrain carbon emissions. No single company supplies more than a small slice of the world’s petroleum.

Indeed, as Bloomberg News reported last week, even with Pioneer, Exxon will account for only 15 percent of Permian Basin extraction and a far smaller share of world oil production — three or four percent, according to my calculations. At that modest scale, a hole in any one company’s finances would simply make room for others.

Divestment’s futility actually went deeper, though. In the oil business, access to capital markets matters hardly at all. Most of the time the industry is flush with cash. Just about everything it does — exploration, extraction, pipelining, refining, selling — is self-financing, paid for by the ceaseless ka-ching from sales of gasoline, diesel, jet fuel, bunker fuel and other petroleum products, not to mention natural (methane) gas, which in 2022 provided nearly three-fourths as much primary energy worldwide as petrol, according to BP’s 2023 Statistical Review of World Energy (covering 2022).

To be fair, divestment campaigning did appear to penetrate Exxon’s inner sanctum in 2021, when the activist hedge fund Engine No. 1 succeeded in electing three directors to ExxonMobil’s 13-person board. “Exxon’s Board Defeat Signals the Rise of Social-Good Activists,” trumpeted the New York Times headline reporting the surprise incursion. Yet the ideological impact, if there was one, was short-lived. All three insurgent members backed the Pioneer acquisition, the Wall Street Journal reported last week.

WSJ Oct 14 headline canonizing Exxon CEO Woods for his $60B Permian Basin play.

Indeed, in the Journal story, Charles Penner, architect of the Engine No. 1 campaign, says the Pioneer deal “shows Exxon had heard some of the campaign’s critiques and changed its approach to focus on returns instead of costly megaprojects more dependent on long-term demand.” Oof. The story has nothing from Engine No. 1 on Exxon’s present or future complicity in climate-damaging emissions generated from its products. And nothing in its detailed portrait of CEO Darren Woods suggests that worries about divestment ever cost him a moment’s sleep.

What To Do?

There are so many climate campaigns needing and deserving of the energies now squandered pursuing fossil-fuel divestment. I suggested a few of them in The Climate Movement In Its Own Way, my April 2022 article in The Nation (reposted here at CTC). Here’s a top-10 list (in no particular order):

  1. Policy campaigns to curb motor vehicle size and weight
  2. Organizing to expedite up-zoning in cities and suburbs and otherwise promote housing density
  3. Advancing walkable, bikeable and transit-oriented communities
  4. Restricting and overcoming NIMBY power to block wind farms and solar arrays
  5. Supporting the operability of existing, well-functioning nuclear power plants
  6. Advancing congestion pricing and other road-pricing / traffic-pricing proposals (valuable for themselves and as templates for broad carbon-emission pricing)
  7. Taxing extreme wealth, to both attack luxury emissions and promote social solidarity needed to tackle carbon consumption
  8. Shrinking the local, state and national reach of the world’s sole major climate-denying political party (whose dysfunction is currently in especially plain sight, as NY Times columnist Jamelle Bouie trenchantly documented this week)
  9. Reducing animal agriculture through both culture and policy change
  10. Advancing or at least keeping alive the idea of robust carbon pricing at the state and especially national level

Note that all of the above measures, except perhaps #8, attack carbon and other greenhouse gas emissions from the demand side, insulating them from the all-too-real whack-a-mole syndrome that undermines most supply-side climate campaigns due to global substitutability by which increased drilling “there” offsets halts to drilling “here.”

Missing from the list: abetting the electrification of cars, trucks, cooking, heating and industry. Why not? For one thing, “electrify everything” has no shortage of NGO advocates like Rewiring America, and, thanks to President Biden’s Inflation Reduction Act, it enjoys generous federal subsidies. For another, decarbonization of U.S. grids is far from complete and, in many states and regions, painfully slow.

Graphic and data curated by Isuru Seneviratne, Nuclear NY, Oct 2023.

Here in New York City, CTC’s home territory, fossil fuel burning today generates more than 90 percent of all electricity (see graphic from Nuclear NY), down from 70 percent since the 2020-2021 closure of the downstate grid’s only large-scale non-carbon generator, the Indian Point nuclear plant.

As a result, rarely if ever is the incremental electricity that my grid calls on to recharge EV’s or energize electric heat pumps generated from a non-carbon source. The same is true at present in much of the United States. Electrification, an essential long-term program, is not yet a carbon-eliminating panacea .

Want to hurt Exxon AND fight climate change? Work to bring robust carbon pricing back into the national policy conversation. A meaningful carbon price — one that quickly ramps up to triple digits per ton of CO2 — will crimp the oil business, the coal business and the fossil-gas business, harming the fossil fuel industry’s shareholder value and political power, while effectuating steady and significant reductions in combustion. And, when considering the to-do list above, keep in mind that robust carbon pricing (#10) enhances all of the others.

Addendum: Two days after posting, we learned that Chevron is acquiring oil giant Hess Corp. in another all-stock deal, this one valued at $53 billion.

NYC Climate March: Unsettling but Inspiring

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Sunday’s March to End Fossil Fuels in midtown Manhattan was big, loud and vibrant. The organizers put the tally at 75,000. While that may have been over-generous, the march was far and away the largest U.S. climate assemblage in some time.

It was also an occasion to ponder the goals and tactics of the climate movement.

The customary signs and chants denouncing Big Oil and its funder banks were out in force. What felt new, and unsettling, was the vitriol directed at President Biden. Last year’s passage of the Inflation Reduction Act, with its promise to hasten the transition from fossil fuels by accelerating wind and solar and electrification, might as well have been an hallucination.

This photo by Sarah Blesener ran above the fold in the New York Times’ print edition the next day. The paper’s online caption caught the focus of the march: “Protest organizers used Sunday’s event to send a message to President Biden as he begins his push for re-election: Do more if you want our votes.”

Ganging Up On Joe

The signs and chants castigating the president flowed like a river. Biden: Declare a climate emergency … Cancel Willow … I didn’t vote for fires and floods.

Yikes. Whatever happened to the Inflation Reduction Act’s nearly half-a-trillion dollars worth of tax credits and other subsidies paying down the cost of renewable electricity from solar and wind farms while also cutting consumer costs to purchase electric vehicles, electric heat pumps, and home and commercial electric battery storage?

The intent of the IRA’s myriad and synergistic incentives isn’t just to grow the U.S. green manufacturing base with good-paying green jobs. It’s to displace fossil-fuel use by retiring petrol-fueled engines and furnaces and simultaneously “greening the grid” by speeding the rate at which wind and solar power usurp electricity generation from coal and methane gas.

As the IRA was snaking through Congress last August, energy analysts were scoping the potential carbon and methane reductions from those displacements, along with estimates of increased emissions from new federal oil and gas leasing that Biden committed to expedite to win the tie-breaking Yes vote from West Virginia Senator Joe Manchin. One leading think tank, Energy Innovation, concluded that “The bill’s clean energy measures will yield 24 times more emissions reductions than its fossil fuel provisions will increase emissions.” (The firm subsequently raised its 24-to-1 emissions ratio to 28-to-1.)

Seven months later, Biden held up his end of the deal, issuing a permit okaying ConocoPhillips’ $6 billion Willow oil-and-gas drilling venture on Alaska’s North Slope — and threw away the climate good will due him from the IRA. Never mind that the additional carbon emissions from the Biden-Willow “hydrocarbon bomb” will only negate a fraction of the emission reductions from his legislation’s clean electricity and end-use electrification, as I pointed out back in March. Even more poignantly, those additional emissions are more properly estimated to be close to zero. Why? Because what actually burns the carbon fuels and puts the CO2 into the atmosphere is fossil fuel consumption, not supply. If Biden had rejected Willow, the same supply would have been called forth from Nigeria, or Kuwait or some other oil region or state to fill U.S. cars, planes and trucks.

In other words, Willow or any new U.S. drilling activity is nearly irrelevant from a climate standpoint because, as we wrote then, “demand finds a way to create supply,” rather than the reverse.

As we marched, I asked a smattering of anti-Biden sign-holders if the president merited praise for the green energy unleashed by his IRA, rather than criticism for okaying Willow or the other contentious project, the Mountain Valley Pipeline through West Virginia. The typical response was No, we’re in a climate emergency. Any new fossil-fuel infrastructure is too much.

To be sure, trade-offs are hard to wrestle with even in calm moments, much less among a big crowd on the move. But the blank stares about the IRA and occasional flashes of venom against Biden were disquieting, nonetheless. The Times‘ headline for its print report on the march was all too accurate: “Fingers Pointed at President, Protesters Demand End to Fossil Fuels.” Left unsaid is whether protesting Biden climate bombs will seed electoral bombs in 2024, placing our democracy as well as climate in irredeemable peril.

Who’s Really Funding Fossil Fuels?

If the anti-Biden sentiment was novel, the anti-big banks rhetoric was old hat. Blaming the climate crisis on Big Oil and demanding that universities, pension funds and the like “divest” by dumping fossil fuel securities from their holdings, has been a staple of climate organizing for nearly a dozen years, as I decried a year-and-a-half ago, in Exxon doesn’t care if you divest. Neither does climate:

When the writer and climate activist Bill McKibben kicked off the [divestment] campaign in a July 2012 Rolling Stone article, Global Warming’s Terrifying New Math, the rationale was three-fold: (1) dry up capital and make it harder for the fossil fuel industry to create new mines, wells, pipelines and terminals; (2) weaken the industry’s social and political standing so it couldn’t easily block pro-climate policy; and (3) by hanging a “Dump Me” sign around Big Oil, amp up climate organizing. Not for nothing did McKibben subtitle his Rolling Stone article, “Make clear who the real enemy is.” It was Exxon and its brethren.

A climate marcher with Third Act helpfully displayed the biggest U.S. banks’ fossil-fuel financing over the past seven years.

That path has proven to be a dead-end, I concluded in my post. One piece of evidence was a simple graph showing that Exxon-Mobil’s share price had outperformed the stock market as a whole since the onset of the Covid pandemic. More evidence, if any were needed, was available in the wonderfully wonky signboard at left that was borne by one of yesterday’s marchers, a vibrant senior citizen affiliated with the McKibben-inspired Third Act.

The amounts that the four banks — Chase, Citi, Bank of America, and Wells Fargo — have funneled into fossil fuels since the start of 2016 sum to an impressive-seeming $1.27 trillion ($1,270,000,000,000). Yet over the same period, consumption of petroleum products by U.S. families and businesses earned the oil companies a revenue haul nearly three-and-a-half times as great: an estimated $4.29 trillion ($4,290,000,000,000).

[I calculated that figure from the average 19.9 million barrels per day of gasoline, diesel fuel, jet fuel and other petroleum products  kerosene and so forth consumed per day over the same seven years, 2016-2022. (See Energy Information Administration, Monthly Energy Review, Table 3.5 Petroleum Products Supplied by Type.) Factoring in (1) there are 42 gallons of petrol per barrel, (2) the seven years total 2,555 days (365 x 7), and 3) an average retail price per gallon sold of $2.00 — a conservative markdown from the actual $2.82 average retail price of gasoline over that period — yields $4.29 trillion.]

Who’s really funding fossil fuels? American households, businesses and institutions, locked into grotesque consumption levels that U.S. climate activists studiously ignore.

To be sure, my dollar comparison has apples-and-oranges elements. Only some of the $4 trillion or more in petrol sales is available for investment in exploration and other petroleum infrastructure. And other banks beyond the Big Four also fund oil investment. On the other hand, U.S. consumption of methane gas and coal fossil fuels now exceeds consumption of petroleum on a Btu basis by 20 percent, suggesting that total fossil fuel revenues over the past six years was probably in the vicinity of $8 billion rather than the $4.3 billion from petroleum products alone.

My point is that bank financing is a much weaker linchpin for creating new fossil fuel infrastructure than most climate activists suppose. What really makes fossil supply possible is the lock-in of consumption of fossil fuels themselves, in billions of routine purchases that, day in and day out, fork over many more dollars to the fossil fuel industry than do the banks.

(Owens was responding to a Cameron Murray, PhD, who was decrying the idea of asking Americans to take some responsibility for their personal carbon footprint.)

Or, as Darrell Owens, an analyst with CA YIMBY (Yes In My Back Yard), the pro-housing group that has spearheaded the recent revolution of expansionary zoning in California, put it recently on Twitter, “Oil drilling [and such] isn’t for fun, it’s in service of carbon intensive demand that can be stopped.” Stopped how? By undoing automobile dependence, incentivizing smaller vehicles, densifying suburbia, introducing congestion and road pricing, and of course, federal-level carbon taxing, as I detailed last year for The Nation magazine (The Climate Movement In Its Own Way).

Uprooting the Source: Carbon Consumption

Happily, some at Sunday’s march saw past Biden and the banks and critiqued the structures of consumption that enforce dependence on fossil fuels, whether directly at the gas pump or the furnace or stove, or indirectly in purchases of products whose manufacture and transportation entail massive quantities of fuel, or in inefficient or indulgent use of electricity, most of which is still made by burning coal or methane gas.

These included stalwarts from Citizens Climate Lobby, including an enthusiastic contingent from Pittsburgh as well as folks from across the Northeast; and individuals whose handcrafted signs called out U.S. car culture not only for its gasoline profligacy but for its stifling of human life and health.

Some marchers saw beyond Biden and bankers to demand enduring solutions: carbon fee-and-dividend and liberation from automobiles.

“Tax Pollution, Pay People” packs so much into four words, I said to the sign-holder, a CCL member from Pittsburgh,  who told me his name, which I failed to write down. When I told him mine, he nearly jumped out of his shoes and shouted it to his fellow CCL’ers as if I was Greta Thunberg and Steelers legend Franco Harris rolled into one.

I started to apologize for CTC’s relative quiescence over the past year or two and to explain that I’ve been consumed with helping get NYC’s congestion pricing plan across the goal line. He stopped me short, thanking me for CTC’s work and insisting that, together, we’ll win a nationwide price on carbon before it’s too late.

So there’s my take. Singling out Biden for attack felt excessive and worrisome, since any falloff in enthusiasm will crimp the chances of small-d democratic, climate-aware outcomes in the elections next year. Similarly, more than a decade’s worth of targeting Big Oil and the banks doesn’t appear to have moved the needle for effective climate policy. Going after “luxury carbon,” as Extinction Rebellion did in a small but resonant climate action last week that I helped organize, feels to me like a more empowering path, one that might capture both the populist moment and climate urgency in a single stroke.

But notwithstanding the mis-directions, it was uplifting to be amidst tens of thousands with a like mind: A better world is possible. A better world is necessary. I want a fossil-free president. Amen to that!