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Leading Off: The Void At COP 28

As you read this, thousands of people are preparing to descend on Expo City in Dubai for the the 2023 United Nations Climate Change Conference or Conference of the Parties of the UNFCCC, better known as COP28, which kicks off on November 30th.

Yours truly was credentialed to go to the summit—but, on reflection, the contribution to climate change damage from flying across a number of continents, not to mention the financial and time cost, made it not worthwhile. The reason: COP28, from a workers’ perspective, is a huge waste of time.

There has been a lot of rhetoric about “Just Transition” at past COP meetings. But, basically, very little bubbles up from the meetings that scratches the surface of what we define as a “high bar” Just Transition.

Just two of the principles from our Guiding Philosophy are critical:

• All workers effected by decarbonization must be made whole in overall income and benefits, and, at the same time, communities must be robustly financed to encourage job creation that will benefit men and women equally and spark economic development that makes up fully for any decline in losses to the tax base or other income that decarbonization-related activities contribute.
• Where new jobs are created, those jobs must offer at least 100 percent equivalent wages to disappearing good-paying, union-wage jobs and offer every worker full-time, good-paying work, not precarious, low-paying, irregular work.

We will report in our next edition what transpires at COP.

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Spotlight: Solar Isn’t So Bright & Shiny

There has been a lot of hand-wringing in many countries about the demise of the manufacturing side of the solar industry. Put bluntly, the solar industry took wings and ended up where labor costs were cheapest: China, in the main.

A reversal, it seems, is in the offing through the euphemism known as “reshoring”:

That is, until now. Last month, Suniva announced plans to reopen a Georgia plant, buoyed by tariffs, protective regulations and, crucially, lavish new tax breaks for Made-in-America solar manufacturing that President Biden’s signature climate law, the Inflation Reduction Act, created.

Solar companies have long been the beneficiaries of government subsidies and trade protections, but in the United States, they have never been the object of so many simultaneous efforts to support the industry — and so much money from the government to back them up.

But, a closer look at this apparent revival of solar manufacturing in the U.S. should be a warning sign for “high bar” just Transition advocates. The Suniva plant is located in a state hostile to unions. Moreover, in the entire article there is no mention of what wages will be paid at the plant.

It is almost certainly true that wages will be higher than slave wages paid in China. But, to the extent that so-called “green industry jobs including solar are identified as the next wave of jobs waiting for workers who are elbowed out of fossil fuel-related industries, it is also almost certainly true that wages paid to people in Georgia will not support an economy-wide lifting of standards to buttress “high bar” Just Transition.

We should not be blinded by the sun.

Ideas: A Tool For Just Transition—Pay Transparency Laws

We noted in the past that a major challenge to ensuring Just Transition for workers is a lack of knowledge about what wages are being offered in so-called “green industries” or, generally, jobs offered as replacement for fossil-fuel industry jobs. As a general matter, it’s almost impossible to get reliable broad information on a job salary to empower sweeping negotiations to cover tens of thousands of workers—even with the virtual job sites available.

Pay transparency laws are increasing in number motivated by the decades-long secrecy of pay that fed discrimination and exploitation of workers seeing a job.

Earlier this year, in the United States, the states of California, Rhode Island and Washington rolled out pay transparency laws. California’s law requires any employer with at least 15 employees to publish a pay scale that goes with any job advertisement.

In 2021, the European Commission proposed pay transparency rules. Those rules were then tentatively adopted in December 2022 after negotiations—if the EU ambassadors and the Parliament approve the rules, member states will have three years to translate the rules into legislative language in individual country’s constitutions. Though a main driver of the rules was gender pay inequity, there is also this:

Pay transparency for job-seekers – Employers will have to provide information about the initial pay level or its range in the job vacancy notice or before the job interview. Employers will not be allowed to ask prospective workers about their pay history.

Pay Transparency laws could be a good tool for Just Transition advocates to use to assess whether a future job promise is going to land a worker pay and benefits that equal a current job—and, at least, then, a known published salary level that pays less can be plugged into a conceptual framework that calculates a projected gap in future earnings that can be the basis for a demand for a “top up” with corporate and/or public money to achieve a “high bar” Just Transition for workers.

Three cautionary, inter-related points to note here.

First, enforcement of any wage laws is creaky, at best, and often absent.

Second, transparency laws might not cover everyone—as evidences by the U.S. experience to date. One runs the risk, then, of creating a “haves” and “have-nots” in terms of knowledge and the leverage that comes with that knowledge.

Lastly, without strong, enforceable, global pay transparency, very little will prevent movement of jobs to countries where wages are a mystery to workers, which are often the very countries will lower wages, weak unions rights and very little government enforcement.

Opinion: Total National Debt Forgiveness Is Crucial For Just Transition

As COP28 delegates meet, as we discussed in our lead item, it’s important to remember that absent financial relief flowing to deeply indebted countries, a “high bar” Just Transition for workers is not viable.

There have been a number of initiatives calling for rich countries to underwrite the climate change actions undertaken by poorer economies. At the previous United National climate summit (COP27) rich countries agreed to stand up a fund to pay for “loss and damage” to poorer countries from the polluting activities of the richer countries. That was a fine, quite limited initiative, especially because promises in the past to provide financial support always come up far short.

But, a bigger question is: assuming any fund comes to fruition, how will sending billions of dollars to deeply indebted countries help if, at the same time, the same countries are shelling out far more money every year to service crushing debt owed to a variety of rich country institutions and private investors?

Even the International Monetary Fund (IMF) conceded last year:

Governments are now struggling with rising import prices and debt bills in a highly uncertain environment of elevated inflation and a slowdown in growth. As monetary policy tightens to curb inflation, sovereign borrowing costs will rise, narrowing the scope for government spending and increasing debt vulnerabilities, especially in emerging market and developing economies. To complicate matters, the extent of liabilities and their terms are not fully known in many cases…With the end of debt relief, and interest rates set to increase, borrowing costs could rise significantly, placing pressure on national budgets and making it increasingly difficult for low-income countries to service their debt. About 60 percent of low-income developing countries are already at high risk of or in debt distress. The economic shocks from the war in Ukraine only add to their challenges. Continued support from the international community will be critical for these countries.

That situation has not shifted much in one year. It is simply inconceivable that, if the financial picture remains the same, a large array of countries will be able to finance a “high bar” Just Transition.

The only solution is a complete, 100 percent, global debt forgiveness effort, an idea that first surfaced decades ago among activists. Barring the back door outflows of money—money going into the coffers of rich countries and wealthy individuals—is both the moral path but also the smart economic strategy to ensure that workers have money in their pockets to pay for the basics that keep countries from sinking into bankruptcy.

Tasini is the founder and executive director of Just Transition For All

Links

United Nations Climate Change: The official home page for the COP 28 summit.