The Global Green Financial Divide Is Growing
Howard Davies LONDON – Earlier this month, US President Donald Trump’s administration drew a flurry of condemnations for its decision to repeal the Environmental Protection Agency’s “endangerment finding”: a formal, evidence-based acknowledgement that greenhouse-gas emissions pose a threat to public health. Although the change may seem minor, it is anything but. Since 2009, the endangerment finding has underpinned much of the climate-related policymaking at the EPA and other agencies. For the financial world, the implications are more significant than they may initially seem. True, the change does not directly affect the US Federal Reserve’s policymaking. But as Trump suggests, it could reduce short-term cost pressures in high-emissions industries, which may in turn lower inflation by some very small amount. Moreover, the repeal could make the Fed even more cautious in how it weighs the impact of climate change on the economy and the financial sector. Although Fed Chair Jerome Pow...