Climate and Environment

From Vivek Murthy’s lucrative consulting work with Netflix and Carnival Cruise Lines to Brian Deese’s “greenwashing” of fossil fuel investments at BlackRock, the revolving door between corporate industry and government continues to undermine public trust in the Biden Administration, writes our Elias Alsbergas.

On President Biden’s first day in office, he made clear that, after the Trump administration’s fantastically corrupt reign, restoring trust in the federal government’s senior leadership would be a priority. His executive order on ethics, signed within hours of his inauguration, went further than any other towards slowing the revolving door and limiting conflicts of interest while in office. Subsequent appointments make clear, however, that these elevated standards are still not enough. Simply following the letter of the order will leave significant room for conflicts of interest to poison the administration’s actions and public trust.

Lael Brainard and Janet Yellen have been talking the talk about climate risk, but not translating that into meaningful action. Our Dorothy Slater takes a closer look at what strong climate action from financial regulators would look like.

John Kerry, President Biden’s international “Climate Envoy”, appears to want bold climate change policy. Kerry was a leader in developing the framework for the first UN climate talks in 1992, co-authored cap-and-trade legislation back in 2009 when it could have possibly been useful, and was a major driver of the 2015 Paris Agreement.

Wall Street executives are digging in their heels against the prospect of divesting from fossil fuel investments. At a February event, they peddled the extremely dangerous and false theory that modern society can “rely on the power of markets” to decarbonize our climate-destroying economy.

The fossil fuel industry is one of the most notoriously profit-hungry and planet-destroying sets of corporations to exist today. The “fossil fuel industry” includes oil, gas, (yes, even the “natural” kind), and coal companies, as well as subsidiary companies involved in the extraction processes for these materials: land and off-shore drilling, fracking, and underground and surface mining.

President Biden has promised to take a “whole-of-government” approach to tackling the climate crisis, and so far his appointees appear to be following suit. The National Climate Task Force met for the first time in a crowded zoom room last week, and Treasury Secretary Janet Yellen and International Climate Envoy John Kerry met earlier this month to discuss their “climate finance plan” to shift capital towards investments in line with a low-carbon economy.

As grinding as the cabinet fights have been, they’re only the first wave of the Biden administration’s personnel. Now comes a new stage of the transition, in which the newly-named secretaries choose their own undersecretaries and senior advisers. Although occupants of these positions typically operate outside the national spotlight, they still wield enormous power.

It is no longer tolerable to confirm nominees who lack awareness of the scale of our climate emergency and the immense work needed to address it across all aspects of American life.

During Janet Yellen’s confirmation hearing to become Secretary of the Treasury, she promised to “look to appoint someone at a very senior level” to lead the Treasury’s efforts on climate action.

Initially created to regulate futures derivatives on crops that had yet to be harvested, the Commodity Futures Trading Commission (CFTC) holds newfound possibility in the coming decade. It is absolutely crucial that a modern-day CFTC taps into the power it already holds to lead on climate action. Naturally, this necessitates a leader with a proven record of taking on corporate power. Any appointee should be prepared to advocate for the public interest, acknowledge the current reality of climate decay we find ourselves in, and creatively apply tools of the government to take immediate action.

The OCC could also update the Comptroller’s Handbook to guide bank examiners to measure climate risk in their assessments, which would force banks to measure climate risk in their own internal stress tests. This would also push banks to make environmentally sound decisions, because they would be recontextualized as financially savvy decisions.

These personnel additions should leave climate activists cautiously optimistic, and many of these individuals are examples of people we would like to see staffed in every department and agency throughout the federal government.

Gensler’s first order of business at the SEC will be to reverse Trump’s deregulatory agenda and rebuild the agency’s capacity to police American stock-trading. But this should only be a starting point: SEC activity was insufficient even under Obama, and issues linked to the financial system, from climate change to inequality, have worsened in the four intervening years.

One role that remains unfilled will be vital to enacting Biden’s policy agenda: the administrator of the Office of Information and Regulatory Affairs (OIRA). Although many Americans have never heard of OIRA, the office is well known among corporate lobbyists, who take full advantage of its ability to stop regulations in their tracks. Since the Reagan administration, OIRA has earned a reputation as “the death row of well-meaning legislation.”