Newly passed climate regulations from the European Union have pushed more than 30,000 Dutch farmers from their fields to the streets to protest new rules that would adversely affect their livelihoods and ability to provide food. The protests offer yet another reminder for policymakers around the globe that if climate policy is to be effective and durable, it needs to be good for people.
The EU’s regulations would require farmers to curb nitrogen emissions by up to 70 percent in some regions, forcing farmers to use less fertilizer and reduce livestock counts. Holland is the world’s second-largest agricultural exporter, but the regulations would likely put many generational family farms out of business and increase food prices for families that are already suffering from elevated levels of inflation.
The Dutch are the latest example of working-class frustration with climate policy. French President Emmanuel Macron’s green fuel taxes instigated the “yellow vest” protests in Paris four years ago. Households and businesses are incurring costs without seeing any environmental returns. Energy taxes and regulations implemented by political elites have real economic consequences for families.
Unsurprisingly, consumers in the United States are also not willing to pay a lot to combat climate change. A recent poll in three battleground states from C3 Action found that 76 percent of Republicans and Democrats are not willing to pay more than $10 a month to fight climate change. In 2019, when energy was cheaper, an AP-NORC survey found that 43 percent of respondents wouldn’t pay an extra dollar a month on their utility bill to combat climate change.
Today, American families are dealing with energy prices that are 40 percent higher than they were a year ago, according to the latest Consumer Price Index. Gas prices are 60 percent higher, gas utilities are up 38.5 percent, and electric bills are 13.7 percent higher. Fuel oil has almost doubled from 12 months ago. Demanding Americans pay more is disconnected from political reality, particularly when unilateral action yields little climate benefit.
The fact that Americans are mostly concerned about higher prices, energy security, and the overall health of the economy is not an excuse to do nothing on climate change. Instead, Congress and the administration should seize the opportunity and fold those concerns into impactful policy solutions.
Achieving these goals requires flipping climate policy on its head. Rather than imposing top-down, centrally planned regulations, policymakers should empower innovators to drive bottom-up solutions. Policies that unleash human ingenuity will provide affordable energy for American families, build a stronger economy, and reduce the risks and costs of climate change.
Stifling innovation will have the opposite effect. Dutch farmer protests illustrate the promise of innovation and the peril of regulating those farmers out of existence. In 2017, National Geographic profiled the Dutch agricultural sector as the future of farms and sustainable production. The article details how family farms collaborate with scientists and research universities to continually innovate and produce more food with fewer inputs. By significantly reducing the use of water, pesticides, and antibiotics, Dutch farmers are making good on the Netherlands’ goal of “twice as much food using half as many resources.”
Overburdensome regulations would likely throw a wrench into the gears of technological progress. As Ralph Schoellhammer, professor at Webster University in Vienna, commented, “Closing down farms in the Netherlands is like closing down start-ups in Silicon Valley.”
To reduce the harm pollution imposes and the risk climate change presents, we need more Silicon Valleys. Hubs of innovation can drive transformative changes across different sectors of the economy in a cost-effective, politically acceptable manner. Congress and the administration should provide the regulatory certainty to innovate, invest, and build.
Climate change and pollution are problems. Left unchecked, they are bad for people. Polluters should be responsible for the environmental damage they inflict; however, policymakers should be mindful of the unintended economic and environmental consequences of their actions. Those unintended consequences include offshoring emissions or disrupting the ability of researchers and firms to work together to deliver solutions that work for consumers, the economy, and the environment.
Global decarbonization will only occur when we have affordable technologies that the private sector deploys rapidly and widely. Erasing the green premium and turning clean resources into an economic advantage is especially necessary for developing countries because they represent the overwhelming majority of the planet’s future emissions growth. Moreover, reducing energy, food, and economic poverty must remain a priority for developing nations.
Mob rule shouldn’t dictate policy, but the Dutch protests should be a wakeup call for policymakers to implement the necessary policy reforms to slash both prices and emissions.