The environmental agenda of President-elect Trump and his transition team is deeply troubling. Plans include dismantling or defunding the Environmental Protection Agency, scrapping the Paris Climate Accord, repealing the Clean Power Plan, relaxing auto emissions standards, increasing coal production, weakening the Endangered Species Act, and on and on. While Trump claims to have an “open mind” on climate, the transition at the EPA is led by Myron Ebell, a science denier who believes that free, unregulated markets will solve our environmental problems.
Such a stance goes diametrically against basic economics, which has long realized that free markets need correction when pollution is present. It also goes against the preferences of the American people, who elected Trump despite disagreeing overwhelmingly with his environmental agenda. The Pew Research Center reports that three-quarters of Americans are particularly concerned about helping the environment, while 69 percent support policies to combat climate change. So do a majority of Republicans. There is strong public support for renewable energy, even in red states. Congress has been entirely on the wrong side of public opinion for a long time, and Trump is taking this to an extreme.
Who can stop Mr. Trump from ignoring the will of the people and siding with short-sighted business interests of a narrow group of companies? Who will speak up on behalf of the silent majority if congressional Democrats’ hands are mostly tied?
Well, first and foremost, corporate America itself.
Large corporations have the means, influence, and credibility to reach the White House. In recent years, they have spoken about their corporate social responsibilities at countless conferences, climate summits, and in their annual sustainability reports. We have heard repeatedly about the ability to do well by doing good, about the need to have a social license to operate, and other catchphrases. And companies such as BMW, Johnson & Johnson, Nike, and Unilever have moved beyond words and shown true and inspiring leadership. They, among several others, have put their money where their mouth is and invested heavily in green supply chains.
But now is corporate America’s ultimate test. If there was ever a time for corporations to speak up and prove that their commitment is real and not just window dressing, now would be it.
Some have taken steps in the right direction. Many banking and asset management giants, including JP Morgan Chase, Bank of America, and BlackRock, wrote to the United Nations that climate change is threatening prosperity and called for “policies that recognize the cost of carbon.”
The energy sector itself also claims to be on board. Exelon, the largest power company in the United States, backs the Clean Power Plan. Exxon, Shell, BP, and other oil majors write on their websites that climate science is clear and that effective policies need to put a price on greenhouse gas emissions. General Electric, which recently opened its new headquarters in Boston, has made the list of the “world’s most ethical companies” in each of the last 10 years and says it strongly supports the Paris Climate Agreement.
This is truly invigorating, but making statements on websites and in letters is not quite the same as exerting lobbying pressure and making appearances on prime-time television. The CEOs of all these companies should speak up now. They should go on the air to announce, loud and clear, that they want strong environmental regulations.
Publishing a flashy annual sustainability report will no longer suffice. Corporations that claim to be socially conscious and sustainability-minded must tell the incoming president that they want strict regulation and taxes on pollution, that this will help them become leaders in global green innovation. They must explain to him that the business case for sustainability checks out, and that the interests of coal companies are at odds with the rest of America’s corporations.
In the end, a few strong words about carbon taxes, renewable energy, and endangered species are worth a thousand shiny pictures of solar panels in a sustainability report.
Arthur van Benthem is an energy economist at the Wharton School of the University of Pennsylvania.