Falling Off Fiscal Cliff: Good for the Environment?

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Tumbling from the fiscal cliff would likely be a disaster for the United States. Some economists fear it could send the country back into recession with repercussions shaking the global economy.

But the effects of a renewed recession could have some positive (and negative) effects on the environment.

Austerity and Emissions

The painful drop in employment during the last recession was a

torment for those left without means to support their families. Many

more were forced to scale back on consumption and do more with less.

Although it was for an unpleasant reason, the drop in productivity and

increased thrift that accompanied lean times also resulted in a drop in

natural resource use in sectors such as transportation and electricity

generation.

"Transportation sector fuel use had been rising since 2001 and

reached a peak in 2007," Stacy Davis, energy data analyst and co-author

of the latest edition of the Oak Ridge National Laboratory's Transportation Energy Data Book, told Discovery News. "In 2009, transportation energy use was 7 percent lower than in 2007."

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At the same time people were traveling less, they were also using

less electricity.  Reduced travel and electricity demand accounted for

some of the reduced carbon dioxide pollution pumped put by Europeans and

Americans. Emissions from the European Union's power sector fell by an

estimated 150 megatons, according to study in Energy Policy. In the

United States, an 8.18 percent drop in emissions accompanied the

recession, according to U.S. Energy Information Administration (EIA) data from 2009 compared to 2006.

However, emissions planet-wide increased by 5.2 percent. Recessionary

reductions in the U.S. and Europe were more than offset by a 32.5

percent increase in China and a 24.9 percent rise in India, according to

the EIA.

China and India's increasing contribution to climate change came

despite crippled economies in other world powers and reduced trade.

International trade fell by 30 percent between 2008 and 2009 in the

United States. More than 80 percent of that drop was made up by

consumers moving away from purchasing manufactured goods, according to

research by the National Bureau of Economic Research.

Employment vs. Environment? Not Necessarily

While some people may be forced to consume less, they may also start to care less about the environmental repercussions. Research on the recent recession found that public concern for environmental issues tends to drop during a recession.

"In general, people become more focused on economic issues during tough times — especially on employment," Ben Spies-Butcher, a sociologist at Macquarie University in Sydney, Australia, told Discovery News. "This can increase political resistance to environmental plans that might be seen to have a negative impact on employment or on people's cost of living."

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Reduced public interest in the environment may reduce the incentive for politicians to support green programs and could put pressure on governments to allow projects that trade environmental protection for economic growth, noted Spies-Butcher, who co-authored a study examining how the recession affected climate change policy.

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"Some state governments have used austerity politics to justify reductions in funding to environment groups," said Spies-Butcher. "However, whether it was the recession that caused this, or whether governments already hostile to environmental groups used this as a justification for actions they may have otherwise taken is difficult to say."

The jobs vs. Earth trade-off predicament can be avoided by developing strategies that promote the long-term sustainability of both the environment and the economy, he said.

"The experience in a number of countries in 2008/09 suggests that recessions also opens up opportunities for forms of 'Green Keynesianism,' where employment schemes are created that also have an environmental objective," said Spies-Butcher.

"There are different economic instruments that might be used to promote a more sustainable industrial base," he said. "This includes programs to invest in renewable energy capacity or energy savings measures like insulation…These kinds of schemes can play a dual role -– preventing unemployment and reducing emissions."

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If the United States goes off the fiscal cliff, it may be hard to know how other economies will react. The effects on the environment are even harder to predict.

"There are many complex factors at work," said Davis.

Image: Corbis