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The European green wave and its Folly

The European green wave and its Folly

European policymakers refuse to allow the free market to develop and innovate the solutions needed for solving the energy and environmental problems of today.

In the last European Parliament elections, millions of electors voted for pro-environment green parties resulting in a record number of seats in the parliament. They have increased their number of seats by nearly 40%, giving them 69 MEPs and making them the fourth biggest bloc in the European parliament. The Greens are seen now as pivotal political allies for passing EU legislation.

Furthermore, in 2020, the European Greens achieved great wins in local elections throughout Europe. Green mayors are gaining ground in important cities across Europe, such as Amsterdam, Dublin, Bordeaux, and Budapest. Their presence in national governments is also something unusual, being junior coalition parties in many EU countries’ governments, such as Austria, Belgium, Germany, Finland, and Ireland.

Despite their gains, they are not a dominant force yet. Nevertheless, they can still be influential in policy formulation in the future. Thus, in the next five years of policymaking in the European Parliament, things are going to become very green.

In previous years traditional political parties in Europe were concerned with the rise of right-wing and populist parties locally, regionally, and globally. Therefore, the last European elections were a surprise for almost everyone. Hardly anyone expected the green wave to spread across Europe. After these unexpected results, the mainstream political parties and the other political players in the EU will search for a way to ride on this green wave. They will start competing for a share of the public’s interest in all things green. They will seek to win the votes of the electoral that environmental issues matter to them by adopting policies related to climate change and environmental issues. This European green wave will influence the Commission President’s future policy plans. And climate problems will soon become key to EU decision-making.

Green is the new red

The green parties are like a watermelon; green on the outside, red on the inside.

The Green party platforms typically embrace social-democratic economic policies and form coalitions with other left-of-center parties. In the European Parliament, they have often collaborated with other left-wing forces to pass legislation, including the Socialists or the far-left GUE-NGL group. As social democratic movements across Europe retreat, the greens are reshaping old socialist beliefs. It is less about environmental issues and more about creating a new image of socialism for young voters.

When you have a look at the Green Party’s policies and programs, it won’t take much to see their resemblance to socialist and social democratic parties’ policies. Their policies range in the circle of spending on social welfare, debt-free and tuition-free education, higher minimum wages, nationalization of some essentials sectors, such as energy and transportation, and demand for 100% renewable energy while at the same time phasing out nuclear power and considering universal health care and education as a human right. They want to suffocate the economy by raising taxes on the wealthy and increasing welfare and government spending. And this will only exacerbate the region’s economic woes, particularly in the post-pandemic era.

Issues that had once been considered insignificant, such as imposing a fuel tax on aviation to reduce demand for flying, or agreeing to make the EU climate neutral by 2050, enforce carbon taxes, greening agriculture, and revise trade policies received a boost as a result of the last election. All these policies reveal that environmentalists and green parties hate the market economy and prefer government control and central planning.

The green and the economic costs of the energy transition

At the beginning of the 21st century, natural gas was the fastest-growing fuel, both in Europe and globally. Gas was in high demand because of its low emissions and, until recently, competitive price. Switching from coal to natural gas was also the quickest and least expensive way to reduce carbon emissions. And when the shale gas revolution happened, green activists welcomed it with an open hand because it was a remarkable opportunity for an energy economy based on efficiency, renewable sources, and low-carbon fossil fuels like natural gas. As a result of the shale gas revolution, the United States reduced its carbon footprint rapidly and without the need for government intervention.

Renewable energy promoters panicked at the thought of cheap and abundant gas. Their business model was predicated on the alleged certainty that prices would rise as fossil fuels ran out, making subsidized wind and solar power look comparatively cheap. Under pressure from activists and green parties, many EU member states, such as Germany, Belgium, Austria, Sweden, Bulgaria, Croatia, Czech, Poland, and Portugal reduced domestic fossil fuel production and restricted imports. Also, despite an impeccable safety record, Germany and several other countries chose to phase out carbon-free nuclear power.

Today, Europe is experiencing its worst energy crisis since World War II. The EU policies introduced to face this energy crisis do not represent a notable deviation from the approaches that got the EU into this energy problem in the first place. The EU tried to accuse external forces of the crisis. However, Europe’s energy trap has been years in the making. Due to the unfriendly market and interventionist policies, Europe encountered a considerable rise in electricity and gas costs and shortages in the previous years.

The EU has also refused long-term import agreements, thinking that it would soon be able to survive without gas, resulting in being gas-starved while being surrounded by some of the world’s largest gas reserves, not just in Russia but also in North Africa, and Central Asia.

Top-down is not the way

European policymakers’ plans to accelerate the shift from fossil and nuclear power to renewable power have pushed deep transformations in the energy supply. Simultaneously, they ignored projections for continued demand for oil and natural gas and the need for a reliable base load fuel source to supplement intermittent solar and wind. Choosing between different forms of energy typically involves tradeoffs between competing objectives, such as affordability, environmental impacts, and energy security.

Every proposal to save the planet is based on power concentration, rigorous regulatory implementation, and enforcement. Policymakers refuse to allow the free market to develop innovative solutions to environmental problems, effectively admitting that the planet is too important to be left to its inhabitants. Unfortunately, Europe’s ruin will be hastened by this reckless abandonment of innovation and industry, which is all too common in the region. The energy transition is unstoppable, and interventionist policies are unnecessary. Renewable and green investments are already thriving without the need for government intervention.

Author

  • Mohamed Moutii

    Mohamed Moutii is a research assistant with the Arab Center for Research and a research fellow with the Institute for Research in Economic and Fiscal Issues. Co-founder of Wonderlustmag, an Arab electronic magazine that advocates and promotes classical liberal thoughts in the Arab world. Mohamed is the automn 2022 intern with the Austrian Economics Center

The views expressed on austriancenter.com are not necessarily those of the Austrian Economics Center.

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