Donald Trump campaigned on a platform that emphasized economic growth and catalyzing U.S. business development and job opportunities. This continues to be a top priority for him, as evidenced by his proposed corporate tax cuts and push for U.S. companies to hire Americans. Unlike job growth and cutting unemployment, environmentalism and climate change do not seem to be priorities for the new president, demonstrating a failure to understand that climate change mitigation and economic success can go hand in hand.
It is ironic that a president who prides himself on his strong business agenda as well as his personal businesses successes refuses to listen to the concerns of the community he came from. In order to strengthen the U.S. economy, Trump must pay attention to the business arguments to staying in the Paris Agreement on climate change. Pulling out of the agreement will put U.S. businesses at risk and create a less stable U.S. and global economy.
Members of the U.S. business and investor community – which includes companies like Starbucks, Lyft, and Nike that are worth billions of dollars – have pledged their support for the Paris Agreement and published an open letter to Trump and Congress detailing why they support the treaty. These companies understand the importance of fostering sustainable and climate-friendly business models because climate changes can affect the development cycle of their products. For example, coffee beans may be at risk from increased flooding due to climate change, which could lead to a drop in sales for Starbucks. Companies also see potential to lead the consumer market clean energy movement, which could bolster profits over the long-term, grow global influence, and add jobs to the U.S. economy.
Remaining a party to the Paris Agreement will expand America’s capacity for technological innovation, which will make U.S. markets more competitive and economically prosperous. American-made green technology could be a significant export for the United States. The global clean energy market is predicted to be worth up to $60 trillion in the next twenty-five years; the United States must act now to be a part of that initiative. The costs of renewable energy technology, particularly solar panels, are already going down, and with new innovative technology, the United States could help drive those costs down further. As energy costs decrease, Americans will be able to invest more in other areas of the U.S. economy.
Even ExxonMobil, a global oil giant, wants the United States to remain a party to the Paris Agreement. ExxonMobil recognizes the threat of climate change and is challenging itself to create more innovative technology in order to lower carbon emissions in its operations. ExxonMobil has also noted that remaining in the Paris Agreement is important for a “level playing field” that contributes to free and competitive global markets, suggesting that the company may see it as a framework to exert influence over what policies are pushed forward or held back by the United States.
In addition, ExxonMobil, and many other fossil fuel companies, fear that a U.S. withdrawal from the treaty could produce tensions with workers and governments in countries that host fossil fuel factories and support the Paris deal. Pulling out of the treaty would set a precedent that the United States and its companies are not to be trusted with international accords. This could make countries less willing to work with U.S. companies. In the same vein, a U.S. departure from the agreement could spark a loss of trust between the United States and its major U.S. trading partners that have ratified the Agreement, like Mexico and Saudi Arabia. Already, leaders from Mexico, Canada, and France have suggested imposing a tax on American-made goods if the Trump Administration chooses to withdraw from the agreement. These trade blockades would ultimately slow the growth of the U.S. economy and make it more difficult for U.S. companies to expand internationally.
The rest of the world has committed to a low-carbon future through the Paris Agreement and is preparing to create and compete for the best green technologies. China in particular significantly invested in renewable technology and is outstripping many developed countries with its clean energy progress. U.S. businesses have noted the importance of keeping up with China’s new technology, and staying in the Paris Agreement would encourage U.S. companies to keep innovating and competing to best international competition. This is particularly important given Trump’s expressed prioritization of accelerating U.S. business growth. American companies working to create sustainable products are more likely to succeed and possibly overtake China in its renewable energy investment if the United States remains in the Paris Agreement.
Staying in the Paris Agreement is good business. If Trump is serious about running the United States like a company, he must listen to stakeholder voices, like those of major U.S. industries. However, until the United States elects leaders who believe in climate change, it may be up to American businesses to forge ahead on the path toward a clean energy and low emission future.
Emma O’Malley is the Environmental & Energy Politics Fellow at Young Professionals in Foreign Policy (YPFP). She also works at an environmental non-governmental organization that focuses on international ocean preservation. Prior to her current role, Emma worked for a DC think tank, specializing in energy politics. Emma earned her BS in environmental sciences and international relations from the University of Virginia.