Donald Trump wanted to go down in history. He has — as the third president in the country’s history to be impeached. But will this neuter him and his energy policies? The answer does not hinge the U.S. Senate’s verdict. It is contingent on whether he gets a second term: his policies would have an indelible affect on climate policies, U.S.-Chinese relations and how America is viewed in the world — whether the rule-of-law and constitutional principles apply or whether the nation mirrors itself after autocratic countries and the Ukraine of old.
The Top Three energy and environmental stories for 2019 and going into 2020 are based on this reporter’s assignments and my global coverage. That includes spending the fall of 2019 in Ukraine, Thailand, China and Japan. It also involves spending time in Latin America as well as deep dives into African issues and long stints in California and Appalachia.
Number Three: Climate Change and Coal’s Downfall
While the country has long debated the right fuel mix to keep electricity rates stable and energy supplies reliable, the issue took a sudden leap forward this year: The nation was introduced to the Green New Deal at the same time that major coal companies went under and most notably, the bankruptcy of Murray Energy that had been the industry’s benchmark, and Trump’s guiding light.
At its core, the Green New Deal aims to dramatically cut greenhouse gas emissions tied to global warming over the next decade — the time frame in which climate scientists have warned of a “point of no return.” It would achieve its goal by relying on sustainable energies that would require public investments. Already, wind and solar energy have become major players and cost-competitive in their own right. When combined with battery storage and microgrids, renewables are creating a whole new energy paradigm.
Murray’s bankruptcy filing is significant: it is symbolic of the shift to green energy and it signals that the working class may be disillusioned with Trump along with his dying promises. According to the 2019 Clean Jobs America Analysis that is authored by the business group E2, nearly every state saw an increase in green jobs in 2018: 110,000 new jobs and a growth rate of 3.6%. There were 3.26 million such jobs in all that year compared to 1.17 million for all fossil fuel-related jobs.
Trump’s vow to revitalize coal has come up empty: Since his election to the presidency, coal plants continue to retire en masse and multiple bankruptcies have occurred. Coal’s share of the electricity portfolio has fallen to just 25% and it is expected to drop even further.
The peer-reviewed experts agree that humans have a hand in rising temperatures: The Intergovernmental Panel on Climate Change wants to reverse the current trajectory. Thirteen U.S. government agencies agreed with its findings — that the without change, conditions worsen. And therein is the premise behind the Green New Deal — to act now to avert the worst possible environmental catastrophes. The practical questions for those who agree with such conclusions are just how much they are willing to spend and over what time frame.
U.S. businesses are on board, led in part by Microsoft Corp., Intel Corp., Google, Apple and Bank of America. Yet, Trump continues to deride climate change as a “hoax” — something that is belied by the burning of the Amazon Rain Forest and the droughts in Southern Africa. To that end, 19 of the G20 members are reaffirming the “irreversibility” of the Paris climate agreement’s goals.
That may be part of the reason why Time magazine named Greta Thunberg its Person of the Year — a young lady who represents millions of millennials who are preparing for the jobs of tomorrow and who are committed to tackling climate change. Enlightened leaders know that the most fertile jobs are those tied to green energies and not the smokestack industries.
Number Two: The U.S.-China Trade War and the potential toll it could take on American Energy companies.
China’s leverage in world markets is because it has been willing to engage developing countries that are desperate for new infrastructure under its so-called Belt and Road Initiative. It is a strategy made even more compelling because the United States is becoming more isolationist under Trump. But China also has bargaining power because it is a country of 1.4 billion of which, at least 400 million of those have middle-class incomes. To feed its growth, China needs oil and natural gas.
Under ordinary circumstances, the United States is poised to play that role. But the trade war has caused China to reconsider from where it gets its energy supplies. China, for example, hopes to replace its entire coal-fired fleet with natural gas and renewables. And while it had previously promised to get a lot of that natural gas from the United States, the tariffs war has caused it look more closely to Australia and Qatar that are far easier to reach.
True, China has been accused of favoring domestic suppliers over foreign companies and of stealing trade secrets. But the question is how to address these disputes: through tariffs or multilateral negotiations. China has responded to Trump’s tariffs by applying its own and by buying such things as soybeans from other countries, all of which has hurt the U.S. Trade treaties as the Trans Pacific Partnership were designed to leverage the power of other countries against those accused of breaking trade rules.
By way of background, Trump announced $200 billion worth of tariffs on Chinese goods entering the United States in September 2018. China then responded in-kind, tagging $60 billion in tariffs on U.S. products headed to China, including on frozen natural gas, or LNG. The battle rages back-and-forth. A truce may be in the offing. But the damage has been done.
The implication on energy producers? Only two tankers loaded with LNG left the United States for China this year, notes the shipping data firm, Refinitiv Eikon. That compares to 14 the year before. China is thus looking for new suppliers that include Russia, Qatar and Australia.
If the U.S. is not engaging China, other countries will be. Consider: The World Economic Forum says that China sold about 1.3 million electric vehicles or hybrids in 2017 — 4% of all the cars sold in that country. It expects that number to be 1.6 million in 2019. To add some context, China is home to about a quarter of the world’s electric vehicles and it wants to increase sales to 12% of the car market by 2020. Tesla, which hopes to sell into that market, has a giga-factory in Shanghai that will make 500,000 electric vehicles a year.
The International Monetary Fund said earlier this year that, globally, U.S.-China tariffs would subtract about 0.3% of global GDP in the short term, with half of that stemming from a loss of business and market confidence. Furthermore, U.S. exports fell by 5% for the second quarter of 2019, hurting the 900,000 jobs that are tied to our exports to China, says the U.S. Department of Commerce. The Tax Foundation adds that the tariffs combined would reduce the U.S. gross domestic product by $30 billion and eliminate nearly 95,000 jobs.
China has more negotiating power given Trump’s current predicament. And if the U.S. economy falters, so too does Trump’s future.
Number One: Ukraine and Burisma and how it led to Impeachment
Traveling through Ukraine, the natives say that, in the past, everything has been “for sale” — that the need to prosper has superseded all other principles, including the rule-of-law. Add into that mix that under President Putin, Russia has wanted to reassert itself onto the world stage and to remake the old Soviet Union — with Ukraine being the first of the old satellites that it wants to bring back into the fold.
Tired of the corruption and sick of Russia’s oversized influence there, citizens rose up and kicked out its leader, causing him to flee to Moscow. Russia responded by entering Ukraine and taking Crimea. But at this point, Ukraine had reasserted its independence and made clear it wanted to identify with the West and not with Russia and its autocratic ways. And this year, Ukrainians elected Volodymry Zelensky as its president — a man who vowed to clean up Ukrainian politics to prepare the country for a new era as a soulmate of the West.
Zelenky, though, has had his hand’s full: his army is fighting with Russian soldiers in Crimea, which has resulted in the deaths of thousands of Ukrainians. As a result of this conflict, the U.S. Congress voted overwhelmingly to arm the Ukrainians — a way to say that America stands up for democracy wherever it attempts to sprout. At the same time, the U.S. stands up to those who bully our allies.
Enter Donald Trump, who realizes that Ukraine is desperate and who wants to use the $400 million in military aid as leverage so that Zelenky could “do us a favor, though” by announcing an investigation into his principle presidential opponent, Vice President Joe Biden. In this case, his son was a board member of the natural gas company, Burisma, which explores in Crimea.
The U.S House of Representatives deemed that deliberate strategy “a high crime,” or attempted bribery — an obvious attempt to fix an election. The Ukrainian government has found no evidence of any wrongdoing by either Biden. The timing of the request is odd, given that it occurred at the tail-end of the Mueller investigation and right when the president had to pay $2 million to settle claims he snookered a children’s cancer charity.
Was the president really interested in corruption? President Zelensky has refused to talk with reporters about this issue, including this writer, saying that neither he nor his country has any desire to get involved the 2020 U.S. election. Ukrainian citizens, however, don’t feel so constrained: the collective viewpoint among the many with whom this writer spoke is that they can smell corruption from 100 kilometers away and that Trump’s actions stink to high-heaven. They know, they said, because they have lived it.
The fear now is the United States will become everything that Ukraine has been. And that is why the U.S. House voted to impeach — to make a bold statement that the United States is a place in which the constitution reigns supreme.
“One of the most disturbing things, is the idea you can do whatever you need to do so long as you don’t get punished by the legal system,” says Todd Haugh, professor of business ethics at Indiana University’s Kelley School of Business “We have seen echoes of that ever since the 2016 election. It is how this president is said to have acted in his business and many of us consider this conduct morally wrong. It is difficult to have an ethical culture when the leader does not follow what most people consider to be moral actions.”
This is from an April 2019 story authored by this reporter, probably the most significant one I wrote this year. It questions not just the current durability of American energy policy but more significantly, that of American democracy. The ultimate question is whether the country can internalize what is now happening and whether it will eventually resurrect itself.
“If a highly-placed public official ask you to lie, then you must consider the broader public interest — not the immediate cause to which you belong,” adds Brian Berkey, a business ethics professor at the Wharton School at the University of Pennsylvania. “If protecting the president or his administration doesn’t serve the public, the official is violating their obligations and oaths.”
By extension, Berkey says that those who elevate their causes while subverting their moral obligations are contributing to the erosion of the American ideal. Regardless of the political party, elected officials are obliged to seek the truth. To do otherwise, defiles the essence of democracy.
At issue now is just how and when we stop the bleeding, if ever.