Europe’s ‘green dream’ hit the US wall
Recently, “green” has become a hot topic in Europe, largely as a result of the stimulus provided by the US Inflation Reduction Act (IRA). European capitals worry that the act will undermine their firms’ competitiveness in the global market.
Against the backdrop, French and German economy ministers protested US’ green subsidies on their Washington trip on Tuesday. Why does Europe attach so much importance to green industries? Will the US make any concessions? Or will Europe’s green ambitions run into a brick wall?
The reason why Europe favors green industry is with far-sightedness. On the one hand, there are economic considerations. Europe is a highly developed global economy, but it faces the problem of weak growth momentum. There are many reasons for this, such as deindustrialization, an aging population, declining labor productivity, insufficient technological innovation, etc., but the core problem is that no new growth point has been found.
Compared with India, China and the US, Europe neither has any advantage in traditional manufacturing fields, nor does it have been able to catch up with the new wave of digital technology. However, in the field of green environmental protection, Europe, which is short of energy, has been relatively ahead, with an early start and rich experience. Europe has always regarded green industry as a core pillar of future development, especially after the Russia-Ukraine conflict brought a huge energy crisis shock to Europe.
On the other hand, there are political considerations. Compared with hard power such as the military, Europe has always attached more importance to soft power, especially so-called normative power, that is, to influence and shape the behavior preferences of other international actors by formulating and guiding rules, so as to ensure its own global dominance.
Europe launched the EU Emissions Trading System (ETS) in 2005, and since 2012, carbon emissions from aviation have been included in the EU ETS. Ursula von der Leyen, President of the European Commission, said: “We have a once in a generation opportunity to show the way with speed, ambition and a sense of purpose to secure the EU’s industrial lead in the fast-growing net-zero technology sector.”
Obviously, it is not an exaggeration to say that green industries are the top priority of Europe’s development, because it involves not only Europe’s future economic and social development, but also its status and role in the world. Although the original intention of US President Biden’s IRA was not aimed at Europe, in fact, it caused European companies to be tempted to go to the US, resulting in Europe’s green plan suffering a serious setback.
Therefore, at the end of last year, French President Emmanuel Macron visited the US and met with Biden. In addition to highlighting so-called friendship and unity, one of the key points was to hope that Biden would give more consideration to the situation in Europe. This time the French and German economic ministers went to the US again with this important task.
The question is, will the US buy into Europe? That seems unlikely. The US only prioritizes its own interests. At this point, there is no essential difference between administrations of Trump and Biden; the difference is only in the specific methods adopted.
Europe is an ally of the US. The US also supports European integration in many cases, but the overarching purpose is to serve the hegemony of the US. A Europe under its control is the most satisfying to the US. Although the Ukraine crisis is complicated, there is no doubt that the military, energy, financial and other interest groups in the US have made a great deal of profit and it is Europe that has largely borne the economic cost of the crisis.
When the US sold energy to Europe at a price four times higher than its own, Macron had to sigh, “In a spirit of great friendship… [this] can’t go on for too long.” This reminds people of German Chancellor Angela Merkel who also said when the communication with Trump failed, “Europe can’t rely on ‘others.'”
Hence, no matter how eagerly Europe looks forwards to it, it seems unlikely that the US will change course. Even if Biden finally makes some kind of token compromise, it can only be an exchange of interests between the two parties, but the question is, what will Europe offer in exchange?
To get further involved in the Russia-Ukraine conflict and deal with Russia, or to follow the US and join forces against China? The costs seem to be too great for Europe to bear.
Of course, if we look beyond the competition between Europe and the US, we will find at least one problem, that is, the future will really be an era that values green, which is already the trend of the whole world. The competition will only become more and more fierce and complex, and all parties will be involved in it.
