Is the EU Green Deal at risk or adaptable enough to survive the recent political shifts?

The European Union's path to sustainability has been a complicated journey. The region must balance protecting the environment, keeping the economy strong, and treating all people fairly. This has created intense debates and polarized opinions on what to prioritize. The Green Party, a powerful advocate for sustainability, has lost some of its influence, raising questions about the future of Europe's green agenda.

Who are "The EU Greens" and what happened?

The European Greens, formally known as the European Green Party, is a political group in Europe that focuses on environmental issues, social justice, and human rights. They push for policies to fight climate change, promote renewable energy, and ensure sustainable development. Recently, this group lost some of its seats in the EU Parliament, which means they have less power to influence legislation and push for their environmental agenda. The reduction in their influence can be attributed to several factors:

1. Economic Concerns: Some voters showed concerns that the Green Party's policies might negatively impact the economy, leading to job losses and higher costs for businesses and consumers.
2. Political Shifts: There has been a rise in support for other political parties that focus on different issues, such as immigration, national sovereignty, and economic growth.
3. Public Perception: While many people support environmental initiatives, there are also concerns about the speed and extent of the proposed changes, which some see as too disruptive.

Significant external shocks since the last election on 2019, such the COVID-19 pandemic and the war in Ukraine, have created trade-offs between meeting short-term objectives and staying on track to achieve the EU Green Deal’s medium and long-term goals. Fears of short-term costs have been used by lobbying groups and far-right political parties to argue against ambitious climate action. The recent decision to withdraw an EU bill on pesticide reduction and opposition to the 2035 ban on new petrol and diesel cars are examples of this.

Legislative Actions During the Green Party's Peak

In previous years, the Green Party had seen a significant spike in support, which allowed them to influence and drive several key legislative actions. These initiatives played a crucial role in shaping the EU's sustainability policies such as:

This extensive list of regulations show EU's commitment to the sustainability, but also raise concerns for businesses and citizens as they need to adapt to rapid changes. The ongoing protests across Europe highlights this division of opinions. Some demand immediate, aggressive action against climate change, highlighting that incremental steps won't address the crisis. Others express concerns about the economic and social disruption rapid changes could bring, advocating for a balanced approach that considers impacts on businesses, jobs, and daily life.

This shows that not everyone agrees on how fast or how big the changes should be, which affects how policies get made and how effective they are in the end.

Is the EU Green Deal at Risk?

While abandoning or weakening the ambition of the EU Green Deal may seem appealing to some, it would undoubtedly be an economic and geopolitical mistake for the EU, particularly at a time of increased geoeconomic fragmentation.

In a world where other global players are taking the lead on clean technologies, not participating in this technological race would mean accepting reduced competitiveness in the global economy. For example, as Chinese electric vehicles are gaining ground in EU markets, the EU car industry's reluctance to transition to low-carbon technology could result in the EU becoming a minor player in the low-carbon economy, making it more vulnerable to supply chains and technologies controlled by other countries.

Previous mistakes and steps for policy makers / sustainability advocates address moving forward.

Sticking to the EU's environmental goals can only be achieved through significant institutional changes, including addressing current weaknesses of the existing policies, such as:

1. Fragmented Approach: Previous efforts on legislation were sometimes fragmented, with policies being launched while excluding various sectors or containing highly ambiguous requirements. This has led to implementation inefficiencies and missed opportunities for creating synergies across sectors.
2. Inadequate Implementation and Enforcement: Even when policies were robust on paper, inconsistent implementation and enforcement at the national level undermined their effectiveness. Some member states lagged in adopting necessary measures, weakening the overall impact of EU-wide initiatives; teaching us that good policies are meaningless without follow-through.
3. Lack of Financial Mechanisms: And the most important, there was often a lack of adequate funding and financial incentives to support the transition to sustainability. This has hindered the ability of businesses and local governments to invest in green technologies and infrastructure. Money talks, and the green transition needs a budget.

Addressing these issues will require to embrace bold, even controversial, solutions. This may involve the cooperation between governments, central banks, and businesses. Cross-sectoral synergies could allow central banks to support overall borrowing needs while maintaining price stability. For example, strategies like adjusting the holdings of government and corporate bonds based on each entity's commitment to sustainability, incentivizing a shift towards a greener economy.

Beyond economics, a fundamental shift in our values as society is critical. This could involve prioritizing "sufficiency policies" - practices that reduce our demands on resources while ensuring well-being for all. These policies are not about deprivation, but about finding smarter ways to meet our needs.

Additionally, instead of just urging action, politicians need to shift the conversation towards the "how" of achieving net zero. Citizens and business likely understand the urgency of climate change, but they may be unsure about the practicalities. For example, people want to see a fair distribution of the costs involved. Citizens favor carbon taxes that target polluters directly, rather than general tax increases on everything. This aligns with the "polluter pays" principle, ensuring those who contribute more to the problem shoulder a greater responsibility.

Last but not least, climate action shouldn't exist in a silo. To gain public support, the Green Deal needs to be connected to the issues that matter most to Europeans – cost of living, jobs, and healthcare. The focus should be on creating positive change through incentives ("carrots") rather than just relying on punishment ("sticks").

Conclusion

In conclusion, the reevaluation of this framework is necessary, even if it challenges current ideologies and power structures. By now, we all know business as usual is simply not an option, as it forces the EU to choose between unrealistic goals and a rise in authoritarianism – both, not viable. This, in turn, leads to environmental disasters, geopolitical instability, and economic and social crises.

We need to have open, honest, and difficult conversations. The time for decisive action is now, for the sake of both the environment and the future of a united region.