A bold policy for Europe: Why climate and social policy are inseparable

"Capitalism is at a dead end", according to French Minister of Finance Bruno Le Maire. And he is right: Our way of doing business and our understanding of growth needs fundamental overhaul. From a trade union perspective, a crucial task will be ensuring that climate and social policies are not played off against each other, and are instead formed and moulded together.

The current debate on climate targets is not about whether we need a more serious climate policy in the wake of the corona recession, but rather how we can shape this policy. For European trade unions, two things are plain and clear:

On the one hand, we need to be bolder in the fight against climate change: The European Trade Union Confederation (ETUC) has been calling for more ambitious climate targets for years: Instead of a 40 percent reduction in EU-wide CO2 emissions by 2050, as envisaged by the European Commission, the ETUC is advocating a 55 percent reduction by 2030—provided that the Member States create the preconditions for this through proactive industrial, structural and employment policies. This will only succeed if the economy is radically revamped to ensure sustainable production and responsible consumption.

Above and beyond this, we must also understand the climate issue for what it is: a social issue. The fight against climate change will only be successful if it is supported by a broad majority of the population. That is why it is imperative that we create new prospects for employees in sectors that will be declining or even disappearing as a result of this restructuring within the framework of a "just transition". The German "coal compromise" is a prime example of how the social partners, together with the government, can ensure that structural change is a gain for everyone—for the climate, for companies that are preparing for the future as well as for employees.

A new struggle over distribution

Both the transformation of the economy and a stronger focus on the social dimension of the climate crisis make it clear that we are facing a struggle over distribution in the fight against climate change. Since we will be producing and consuming less in the future in order to meet climate targets, conventional economic growth will no longer be able to serve as a substitute for more justice in the distribution of wealth and goods. This does not mean that we are heading for an "end to growth" per se. Rather, as economist Mariana Mazzucato shows, the task is to rethink our definition of "growth": instead of ignoring the collateral damage caused by energy production harmful to the climate when calculating gross domestic product, the consequences of our economic actions must be made part of the equation. On the other hand, public goods—education, social security, but also our natural resources—need to be grasped for what they always have been: forms of value-creation and hence another component of collective wealth.

So, if we want to continue to "grow" in the future, we face the daunting challenge of distributing what we have more fairly, rather than trivialising climate change and exploiting the environment. This economic transformation calls for bold policies, i.e. cutbacks for the rich and wealthy, a roll-back of growing income inequality and decent rather than precarious work.

A bold policy for Europe

As the Corona pandemic has impressively demonstrated, the crises of the future - including the climate crisis - will be European crises. No Member State will be able to surmount these crises alone. And what is more, inadequate crisis management in one Member State will always have negative spill-over effect on the rest of the Union due to the interdependence characterising the internal market.

A muscular EU budget based on Europe's own resources can go a long way in reconciling climate and social issues: this will not only make possible indirect transfers between Member States, but also investments in Europe's future reducing inequalities within Member States. This would align three central concerns of the European trade union movement: strengthening the European Community through greater solidarity; an ambitious and solidly financed programme to combat climate change; and effective measures rolling back social inequalities in the Member States. This would turn the Green Deal into a Social Deal - and a blessing for Europe. 


About the Authors

Susanne Wixforth is Head of the Department for European and International Trade Union Policy at the National Executive Committee of the German Trade Union Confederation (DGB).

Lukas Hochscheidt is a research assistant in the Department for European and International Trade Union Policy at the National Executive Committee of the German Trade Union Confederation (DGB).

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