Reactions to Withdrawal from the Paris Climate Agreement
June 02, 2017
States and municipalities, led by California, are committing to fighting climate change as the U.S. has announced its withdrawal from the Paris Climate Accord. Gov. Jerry Brown has created a coalition with the intention of meeting the goals previously agreed upon. Further, Elon Musk and Robert Iger have left President Trump’s business advisory council over his decision. Additionally, unemployment is at its lowest levels since 2001, although labor force participation is also down. The U.S. trade deficit also widened in April.
- States commit to Paris climate agreement. President Trump announced the U.S. would withdraw from the climate agreement yesterday, and today, California, New York, and Washington announced they would create a coalition of states committed to reaching the targets of the agreement. They plan to bring other states into the coalition to push for decreased carbon emissions. Twenty states and the District of Columbia have already established greenhouse gas emission targets and would be likely to sign on to the coalition. California has been leading efforts to reduce carbon emissions for decades and looks to continue those efforts, with Governor Brown attending national and international conferences on climate. California has a waiver from the EPA to pursue more aggressive standards than the national government, and nine other states follow California’s standards. California also has a working cap and trade program, which has been emulated around the world. Further, Governor Brown has recruited ten states, eight cities, and Canada and Mexico to join his Under2 Coalition, which seeks to keep global temperatures from rising 2 degrees Celsius. [WSJ]
- Musk and Iger leave White House advisory councils. Both business leaders decided to leave the President’s advisory councils over his decision to withdraw the United States from the Paris climate agreement. Elon Musk is the CEO of Tesla and SpaceX and Robert Iger is the CEO of Walt Disney Company. Both leaders stated that their positions on climate change were behind the decision to leave. Other members of the council, including the heads of BlackRock and General Motors, voiced their support for addressing climate change but stated that they did not intend to leave the advisory councils. [Reuters]
Economic Indicators & News
- Unemployment lowest since 2001, at 4.3% for May. With this jobs report, many analysts are expecting the Federal Reserve to raise rates at their next meeting. The report also showed that hourly wages grew by .2% and the labor force participation rate dropped to 62.7%. These are both below expectations, but not so bad that they could affect Fed policy. [NYT]
- Trade deficit expanded in April by 5.2%. The gap stood at $47.6 billion in April, up from $45.3 billion in March. The change is due to both a drop of .3% in exports and an increase of .8% in imports. Trade is pulling down GDP growth by up to half a percentage point, according to some analysts. [Bloomberg]