WASHINGTON – As he campaigned for the U.S. presidency in 1952, Republican candidate Dwight D. Eisenhower argued that he would seek to bring “security with solvency” to the American people.  Eisenhower realized that the challenges posed by the Soviet Union could too easily stress America’s finite resources and a strategy to face that threat consider the economic roots of America’s military power and influence in the world. For Eisenhower, economic power was the indispensable source of American global leadership.

In his State of the Union address Tuesday evening, U.S. President Barack Obama seemed to recognize Eisenhower’s insight.  Obama focused largely on the economic challenges still facing the United States — but framed those challenges in the context of recent national security victories and the achievements of the World War II generation.  While Obama did focus on domestic affairs, he both opened and closed his address by praising America’s men and women in uniform — one of the few points drawing bi-partisan applause – and took stock of a broad set of foreign policy and security challenges that face the United States today. He also made clear that the new U.S. defense strategy would also balance security with solvency — saving nearly half a trillion dollars but maintaining the type of first-rate military required to deal with current and emerging threats.

Obama’s address included a call to learn from the shared sacrifice, partnership, and teamwork that the U.S. military demonstrates day after day, to include that shown in the mission to kill Osama bin Laden in May of last year — clearly the most significant national security event of the past twelve months.

Obama was assertive in his description of his vision of America’s role in the world but realistic when considering the complexity of the challenges ahead. In stark contrast to much of the isolationist rhetoric of the Republican primary debates, he argued that America continues to be a strong, ascendant world leader with a “steadfast” commitment to allies around the globe.

Of course, Obama noted the end of the war in Iraq and the determination to transition to Afghan leadership.  He also acknowledged the “wave of change” brought about by the Arab Spring and issued a sharp rebuke to the Assad regime — noting that they would soon discover “that the forces of change can’t be reversed and that human dignity can’t be denied.”   He praised the power of partnerships that have enabled a unified approach to counter the Iranian quest for nuclear weapons but was realistic in his assessment of whether this in and of itself would provide the solution.  Coming a day after U.S., British, and French warships entered the Persian Gulf despite threats from Iran; Obama reiterated that while he hoped for a peaceful resolution, “no options” were off the table.

It is telling that while facing a tough re-election in a poor economy, Obama has chosen to frame domestic problems within the context of foreign policy successes.  It is a clear indication that even while Washington focuses on a Presidential election campaign, the administration will not abdicate the responsibilities the United States has as a global leader.

Mark R. Jacobson is a Senior Transatlantic Fellow at the German Marshall Fund. He has formerly served at the Department of Defense and on the staff of the Senate Armed Services Committee. The views expressed are his own.

WASHINGTON—Slowly but surely, climate change is opening up the Arctic. Greenland’s glaciers and ice fields are melting, sea ice around the North Pole is decreasing each year, and the huge permafrost areas of Russia and Canada are beginning to thaw. This has led to widespread speculation of a Great Game-style scramble for the region’s abundant resources. Many studies, including those by the private sector and the U.S. Geological Survey, confirm that there are vast treasure-troves of oil, gas, and minerals in the Arctic. Yet, with the exception of iron ore in Greenland, these resources have not yet been exploited. In fact, despite rising temperatures, the impediments to extracting and transporting most resources from the Arctic will remain formidable for the foreseeable future.

One factor facing developers is that, despite global warming, the Arctic remains largely inhospitable, and there are innumerable obstacles to cashing in on its riches. Oil rigs require airstrips, roads, electricity generation, and pipelines; mining operations require port facilities and technology to withstand the bitterest winters; and all resource extraction requires a specialized labor force. For the private sector to develop any part of the Arctic, enormous investments of capital and labor would be necessary.

While there is a possibility that the Arctic seaways – running through Canada and along the northern Russian coast – will become open to transportation for most of the year, large container ships are unlikely to use these routes. The Arctic will remain a dangerous trade route for commercial shipping, and neither Canadian nor Russian authorities can offer much in the way of support and rescue facilities in the event of emergencies along their northern borders. The dangers are further evidenced by recent investments in traditional sea routes and facilities, such as the Panama Canal. By contrast, the port of Reykjavik in Iceland, which would be ideally positioned to serve as a future hub for northern sea routes, has seen no such investment.

In the long run, permafrost thawing may prove to be the greatest obstacle to Arctic developers. It has made the construction of roadways and airfields much more difficult, and in some cases has caused extractive projects to be abandoned. This process has already caused enormous problems in Russia, where large cities such as Yakutsk and several large river ports, pipelines, conventional hydro electricity plants, and even a nuclear power station lie in permafrost areas. Yakutsk in particular has seen severe damage to its infrastructure and the closure of a runway of its airport as a result of the land below melting.

Despite these continuing challenges to development, there is no question that, for better or worse, relations between the countries of the region are gradually changing. One view of the Arctic’s future stability is that governance of the region is evolving peacefully and will likely continue to do so. An Arctic Council was established in 1996, building on the momentum of a 1987 speech by Soviet leader Mikhail Gorbachev calling for the Arctic to be a “zone of peace.” The Council, which includes not only the five Arctic Ocean countries – Russia, the United States, Canada, Denmark, and Norway – but also Finland, Iceland, and Sweden, has reached agreements that advance cooperation on oil spills and drilling disasters. Most geographical boundaries in the region have also now been agreed upon, with questions about the international status of the Canadian Northwest Passages marking the rare exception.

A second view is that growing nationalism over the Arctic and its resources, particularly in Canada and Russia, paints a far bleaker picture. The current Canadian Prime Minister, Stephen Harper, has asserted Canada’s rights in the region, with some critics labeling him a “purveyor of polar peril.” Meanwhile, the Russians have made dramatic and provocative gestures, such as sending a submarine to the North Pole to plant a Russian flag on the seabed. With mutual suspicions on the rise, Russia, Canada, and Norway are all investing in maritime reconnaissance and long-range strike capabilities. And for the first time, Canada is building Arctic-capable offshore patrol vessels.

But despite such saber rattling, it is still premature to describe the competition over resources and northern sea routes as a race for the Arctic. There are encouraging signs of cooperation and wise, if limited, development of resources. However this is a region where isolated incidents can quickly turn nasty. Moreover climate change and permafrost thawing are already changing the game on the ground, and there is little reason to hope that any of these processes can be reversed in the near future. While there may be little real cause for competition over remote and costly Arctic resources, there is always the chance that the purveyors of polar peril might yet have their way in the end.

Geoffrey Kemp and Tim Boersma are fellows and Nicholas Siegel is program officer at the Transatlantic Academy in Washington DC. 

EU Climate Action Commissioner Connie Hedegaard and Indian environment minister Jayanthi Natarajan at the center of the “huddle” on the last night of the COP17 negotiations in Durban, South Africa; Todd Stern, US Special Envoy for Climate Change, looks on. Photo: IISD

The enduring image from last week’s UN conference on climate change in Durban, South Africa, was of negotiators “huddling” in full view on the plenary floor to come up with the form of words that allowed the final deal to be reached. The negotiators are in shirtsleeves, visibly tied at the end of talks that had run 36 hours past the deadline, and surrounded by hundreds of observers straining to hear the back-and-forth. At the center are the two protagonists (obscured in this picture): Connie Hedegaard, the EU Commissioner for Climate Action, and Jayanthi Natarajan, the Indian Environment Minister. Todd Stern, the U.S. Special Envoy for Climate Change, is offering suggestions and Maite Nkoana-Mashabane, South Africa’s foreign minister and host-president of the conference, is looking on. She made the extraordinary decision to interrupt the plenary negotiations and invite the main players to take ten minutes to come up with an acceptable wording on the legal form of a new treaty, to be negotiated by 2015. The ten minutes stretched to almost an hour but resulted in the breakthrough that carried the conference to a conclusion.

The picture stands in contrast to the iconic photograph from the talks in Copenhagen two years ago. Those negotiations took place in an even brighter glare of international attention because an unprecedented number of heads of state and government attended. The main outcome of the Copenhagen conference was hammered out in an impromptu summit of the leaders of the United States, Brazil, South Africa, India, and China; the EU was not in the room and was acutely embarrassed by its absence and by its failure to achieve a deal on emission reductions that was sufficiently ambitious.

United States President Barack Obama sits with South Africa’s President Jacob Zuma, Brazil's President Luiz Inacio Lula da Silva, Chinese Premier Wen Jiabao, Indian Prime Minister Manmohan Singh, and other world leaders during a multilateral meeting at the Bella Center in Copenhagen, Denmark, on 18 December 2009. The European Union was not in the room. Photo: Jewel Samad

These pictures present contrasting images that are both informative and incomplete. In fact, Europe had much greater influence in Copenhagen than many of the media appreciated at the time – the final outcome of the Copenhagen conference contained much of what the EU had been pushing for. Its exclusion from the room was not deliberate but due to happenstance in the chaos of that final evening. Nevertheless, the denting of Europe’s pride was real, and EU negotiators, led by Hedegaard, invested every ounce of diplomatic capital they possessed to position themselves for a stronger, EU-led outcome in Durban. And the strategy paid off: The agreement in Durban marks the EU’s return to its accustomed place at the front of international leadership on climate diplomacy. It is also a welcome rapprochement between Europe and the United States on climate change.

At the outset of the talks there was a fear that divisions between Europe and the United States on climate policy could sour transatlantic relations. The EU combines ambitious domestic targets with calls for strong international cooperation and has made no secret of its frustration with the lack of U.S. reciprocal action. The 2001 withdrawal of the United States under President George W. Bush from the Kyoto Protocol (which the United States never ratified) was one of the low points of transatlantic relations last decade. The Obama administration is more favorably disposed toward action on climate change but it is constrained by the lack of domestic political support for strong measures to reduce greenhouse gas emissions.

The EU and the United States went into the talks with different agendas and expectations. Europe wanted to win agreement on a new international treaty to replace the Kyoto Protocol, the only international agreement with teeth, whose provisions only run until the end of 2012. The United States approached this issue from what it regarded as a pragmatic position, which is that international treaties are really only a reflection of what countries are doing anyway and the emphasis should be on encouraging national policies. Nevertheless, the United States was not opposed to talking about future commitments, as long as big emerging economies like China and India were included. But the U.S. priority was to focus agreement on the creation of a Green Climate Fund and the other issues on the agenda since the Copenhagen conference in 2009.

At the beginning of the conference there were some predictions that China could seek to isolate the United States by keeping the conversation on the future of the Kyoto Protocol. But the U.S. delegation surprised many observers by lending its support, in the Thursday of the second week of talks, to the EU demand for a “roadmap” that would lead to a new international treaty. For all the expectations that these talks would not bring any progress on a central EU demand, the United States decided that it was not, this time, going to be the country seen as blocking progress. That role fell instead to India, which (with some historical justice) complained bitterly that it was being bound to constrain its emissions thanks to the profligacy of the developed countries. But India eventually acquiesced to a form of words (“a protocol, legal instrument, or an agreed outcome with legal force applicable to all Parties”) suggested by Stern in the late-night huddle.

Even if the “Durban Platform” is not as ambitious as it would have liked or as the science of climate change requires, the EU successfully pressed the need for some kind of continuing international legal process that applies to all countries. This is the most important long-term result of the Durban outcome: the fracturing of the long-standing and artificial divide between “developed” and “developing” nations that obliges only the developed countries to reduce their emissions.

But the United States helped effect this outcome. By ceding to the EU the role of climate champion, the United States allowed this outcome to happen simply by not standing in its way. By the same token, however, the United States insisted on, and won, the point that developing countries must be included in any global approach. On both tracks, the Obama administration managed to avoid drawing fire from the conservative opposition back home, which sees political opportunity in anything that implies constraining U.S. economic growth or diminishing its competiveness with China. The EU negotiators know the Obama administration’s political constraints well and are sympathetic to them.

The result was a victory for the EU in its insistence for a renewed international recognition of the urgency of climate change. It is probably correct to say that a “legally binding” treaty on climate change is never more than a reflection of what is happening anyway. But the EU feared, rightly, that a commitment to do nothing before 2020 – which was the effective Indian and Chinese position – would have sent a disastrous signal to the world. In the mere fact of forcing an international recognition of a new regime by 2015 (which is tomorrow by the glacial pace of international talks), the EU vindicated its position on the talks in opposition to those who thought that such gestures were irrelevant.

BRUSSELS — Expectations are low at the beginning of the 17th annual United Nations conference on climate change that began this week in Durban, South Africa. The European Union and the United States have assumed contrary positions and even disagree over what would constitute a successful outcome. But, behind the talks, and despite that standoff, the threat of global warming continues to cry out for transatlantic leadership.

The talks themselves – which will culminate next week in three days of ministerial talks – are intended to add definition to the political agreements that were reached at last year’s talks in Cancun, Mexico, such as on a new fund to help developing countries reduce their greenhouse gas emissions. But what will attract the biggest attention in Durban is the Kyoto Protocol, the 1997 treaty that binds industrialized countries to reduce their emissions by a certain amount by 2012. There is no provision for a second “commitment period” beyond next year, so the EU is calling for a sequence of actions to lead to a new treaty by 2015. The United States rules out a new treaty before 2020 and only if large emerging economies like China are similarly bound; Japan, Canada, and Russia have aligned themselves with this view. There seems to be no way to reconcile these two positions.

But Europe and the United States are divided even on the significance of this divide. Among the U.S. negotiators, and echoed in many Washington, DC, think tanks, the Kyoto Protocol (or any successor treaty) is seen as irrelevant to the climate talks. Instead, an effective response to climate change lies in vigorous domestic action by the big emitters. Many U.S. commentators consider the Kyoto Protocol an obstacle to progress because of its outmoded distinction between developed and developing countries and its zero-sum emphasis on legally binding emission caps. The EU counters that a legally binding treaty is the only way to bring clarity and to drive domestic action, and points to a growing chorus of international bodies – from the UN to the Organisation for Economic Co-operation and Development – that warn that we have no more time to delay action to reduce global emissions if the Earth is to have a hope of avoiding temperature increases that would change the face of the planet.

While the United States may think that the EU has tied itself to a sinking ship, Europeans visiting the United States express exasperation at the U.S. failure to grapple with climate change and at the prominence afforded to pundits who dispute the scientific consensus on climate change. It is common to hear European officials suggest that it is time for Europe to look elsewhere and focus on building cooperation with developing countries. But it would be a grave mistake to give up on the United States. The two continents, working together, have the political and financial capacity to drive global change through policy leadership and the market effect of their domestic policies. Disagreement threatens to hinder international action when there is no time left for delay, and to sour transatlantic relations, as seen in the brewing dispute over the inclusion of U.S. airlines in the EU Emissions Trading System beginning in 2012.

In Durban, the EU and the United States will probably manage to avoid an acrimonious falling-out. Memories of the rift in transatlantic relations following George W. Bush’s decision to withdraw from the Kyoto Protocol in early 2001 are still raw. The EU is sympathetic to the domestic political constraints that U.S. President Barack Obama faces and the real actions that his administration is advancing, such as new regulations to control pollution from power stations and to improve efficiency standards in automobiles. Whatever deal is struck in Durban, it will probably be enough to allow the Kyoto Protocol to continue in some form without forcing the United States to denounce the agreement.

But outside the negotiations, Europe has a good story to tell about its response to climate change, and it needs to do a better job at persuading the United States to partner with it on this enterprise. In European capitals, policymakers are busy with plans to build new renewable electricity generating capacity, transform the electricity grid to carry the power, and train a whole generation of new engineers who can operate it all. The European Commission is preparing to publish a new “roadmap” for a low-carbon energy system by 2050, the latest in a series of policy statements and regulations since 2008 that are slowly accumulating momentum that could take the EU on a low-carbon trajectory. No conversation on anything like this scale is happening in the United States, nor is one expected until at least after next year’s presidential election.

The United States holds that international treaties like the Kyoto Protocol are less relevant than action on the ground. The EU thinks that such action on the ground is a result of the downward pressure of international commitments. Surely there is room to agree here on the outcomes, if not the cause? If the United States were to embark on an ambitious plan of reducing its emissions, and to lead international efforts to imitate it, the EU would be quick to agree that a treaty would be superfluous to this end.

Thomas Legge, based in Brussels, is a senior program officer for the German Marshall Fund’s Climate & Energy Program.

Image by Meraj Chhaya

The avalanche of media coverage of the Department of Energy’s roughly half million dollar loan guarantee to Solyndra, a solar technology company that ultimately went bankrupt, has distorted what urgently needs to be a healthy debate on policy options to dramatically increase private sector investments in clean-energy technologies.  The real question is not aboutwhether governments should provide these incentives, but rather how they can do so most effectively.

There is clear scientific evidence that rising fossil energy use will lead to irreversible climate change that poses serious risks to public health, safety and the global economy.  To reduce these risks, we need governments to quickly adopt smart policies that will create the stable and predictable environment that the private sector needs to invest in clean-energy technologies so that we can reduce our dependency on fossil fuels over the long term.

Government support for energy companies is not new.  According to the International Energy Agency’s 2011 World Energy Outlook, governments around the world provided subsidies to fossil fuel industries that totaled more than $400 billion in 2010. These subsidies create an uneven playing field for renewable and other clean-energy technologies.

Given the long-term economic lifetime of energy-related capital stocks globally, there is little room to delay the transition from fossil fuels to cleaner energy sources.  Even if countries commit to emissions limits that would prevent global temperatures from rising above 2 degrees Celsius or 3.6 Fahrenheit—the threshold for avoiding costly and dangerous climate impacts agreed by scientists worldwide—the IEA estimates that 80% of cumulative global CO2 emitted worldwide between 2009 and 2035 would already be “locked-in” by power stations, buildings and factories that either exist now or are under construction.

The IEA also calculates that without coordinated international action to dramatically shift away from fossil fuels toward low or zero carbon energy sources between now and 2017, the only way nations can avoid temperatures from exceeding 2 degrees Celsius would be to either ensure that all new infrastructure built between 2017 and 2035 is zero carbon or to phase out existing infrastructure before the end of its economic lifetime—a solution that is neither cost effective or politically viable.

The public has a right to understand the process behind DOE’s decision to provide a $535 million loan gaurantee to Solyndra.  Fortunately, as Secretary Chu notes in his testimony before the House Energy and Commerce Committee’s Subcommittee on Oversight and Investigations, DOE has provided more than 186,000 pages of documents to cooperate with the Committees’ investigation. President Obama has also asked for a review of the Department’s loan portfolio.

Secretary Chu noted in his testimony to the subcommittee that “Solyndra was poised to compete in the marketplace”.  If Solyndra was indeed commercially viable and in a position to attract private capital on its own, then Congress and the public are right to question whether a DOE loan guarantee to this company was the best use of tax payers’ money.

Nonetheless, the unrelenting focus on Solyndra is distracting policy makers and the public from the much bigger and more pressing problem of finding and implementing the right mix of policies to remove market distortions that place clean-energy technologies at a disadvantage–including fossil fuel subsidies and trade barriers—and to rapidly mobilize investments in low or zero carbon energy sources.

Cathleen Kelly is the Director of the Climate and Energy program at the German Marshall Fund of the United States in Washington DC.

Image by Solyndra.

WASHINGTON—Earlier this week, according to the U.N. Population Fund, the world’s population surpassed 7 billion. With the global economy in recession and the impacts of a warming climate increasingly apparent, this new milestone comes at a time of enormous strain and has significant implications for the world’s natural resources, its economy, and of course, its urban areas. More than half of the world’s population lives in urban areas, and the upward trend is continuing unabated. It has been suggested that by 2050, approximately three-quarters of the world’s population will be urbanized. At this rate, one thing is very clear: cities must be part of the solution to the economic, environmental, and social challenges of our time.

But as asked in the recent U.N. State of the World Population report, “what, exactly, is a ‘city’ in 2011?” Traditional city government structures and boundaries generally do not match the web of economic and social activities among urban residents, businesses, and other institutions. Are cities then the right geography for responding to today’s tough challenges? And if not, at what scale can the pressing economic, environmental, and economic challenges of our times best be addressed?

Urban experts have long called for a more regional approach that reaches beyond city boundaries to include the residents of entire metropolitan areas. In a recent article for Atlantic Cities, for example, Bruce Katz of the Brookings Institution wrote that “metropolitan communities, here and abroad, represent the true economic geography…they are also the undisputed vehicles for environmental sustainability and social inclusion.”

But another trend is also emerging in the drive toward sustainable urban development: a greater focus on neighborhood efforts to integrate environmental, economic, and social responses to our current crises. Last week, the Portland Sustainability Institute (PoSI) hosted its third annual Ecodistricts Summit, bringing together practitioners around the globe who are pioneering neighborhood-level sustainability projects. Participants highlighted both new development and redevelopment efforts – projects that, in the words of Rob Bennett, PoSI’s Director, are “small enough to go fast and large enough to make a difference.” Among the projects presented were the Seattle 2030 project, which engages downtown property owners and businesses in an effort to minimize the environmental impact of building construction and operation; the Hammarby Sjöstad project in Stockholm, which converted an old industrial area into a modern, mixed-use, low-emissions neighborhood with state-of-the-art environmental infrastructure; and pilot projects spanning the globe from Portland, Oregon, to New Orleans, Louisiana, Sao Paolo, Brazil, and Nagoya, Japan.

So what types of innovation can best be supported at the neighborhood level? Clearly, there are technologies and strategies, such as district energy systems, that are highly relevant and effective at this scale, while other policy interventions, including those related to transportation, are more effectively implemented at a larger scale. Perhaps the strongest argument for working at the district level is that all of us live in, do business in, and identify with neighborhoods. The personal relevance of neighborhood interventions can drive community engagement and help build new coalitions. EcoVillage Cleveland, a project launched in the 1990s, for example, built new partnerships among environmental and community development advocates and the public sector around a plan that combined environmental sustainability and affordability goals, all with the aim of supporting neighborhood revitalization. Among the project’s many achievements are the construction of homes that are both permanently affordable and energy efficient, the creation of community gardens, bike trails, and other recreational spaces, the rehabilitation of the local transit station with passive solar heating and other green elements. Indeed, the district scale may be the ideal geography for effectively integrating the multiple approaches — environmental, social, and economic — that truly make a neighborhood sustainable.

Metropolitan and neighborhood approaches to sustainable urban development are not in conflict. Nor does either approach diminish the role of the city with its formal authority and urban development tools. But as we reflect on the size of our population and the enormity of the challenges we face, it is important to remember that we will only be able to resolve our current economic, social, and environmental challenges if we engage as many of the world’s 7 billion residents as possible in developing new, more sustainable forms of development and growth. This will require focusing not only on regional visions and strategies, but on making these strategies come to life through neighborhood projects and design decisions shaped by the very people who live with them every day.

Tamar Shapiro is the senior director of urban and social policy at The German Marshall Fund of the United States in Washington, DC.

Image by SkyScraperCity.com

WASHINGTON—Beltway insiders always love a scandal, and the bankruptcy of solar power cell manufacturer Solyndra Inc. makes for a good one. Solyndra received over $500 million in loan guarantees from the U.S. Department of Energy under a scheme to provide financing to promising companies in the renewable energy sector, before going bankrupt last month. President Obama, visiting Solyndra’s factory floor in 2010, had pointed to the company as an example of how the renewable energy sector could provide the next wave of innovation and economic growth in the United States. But Solyndra was already in financial difficulties. Its business model depended on an experimental and ultimately uncompetitive technology. The company nevertheless supplied upbeat assurances to the White House and members of Congress.

Republicans, smelling blood, have published a 15-page report linking Solyndra’s success in gaining federal backing to its political campaign contributions and lobbying efforts, and have used the episode to make a case against efforts to promote renewable energy in general. This line of argument is opportunistic — Republican members of Congress have been just as energetic in requesting government support for renewable energy companies in their own districts — but it is true that governments are not very good at picking winners. They risk embarrassment when they tie their fortunes to the success of any particular company. The problem is that the Obama administration is running out of tools to promote renewable energy.

The surest way to send a signal to the market to invest in renewable energy is to impose a price on carbon emissions through taxation or a cap-and-trade system, both distant prospects since the U.S. Congress failed to adopt a comprehensive climate bill last year. The administration has therefore relied on narrower or indirect mechanisms at its disposal to put a price on carbon, such as regulating greenhouse gases through the Clean Air Act. This approach is now under threat as the administration, vulnerable on the economy, softens or postpones measures that may be seen as hurting business

The other way to promote renewable energy is to support innovation directly, such as through the loan guarantee program that benefited Solyndra. There are good reasons why governments support innovation in the renewable energy sector. The private sector tends to under-invest in research and design because firms do not capture all of the profits that their innovations (quickly imitated by competitors) generate. It is also reasonable to expect some failures. Public subsidies for innovation are a kind of venture capital and the chance of developing breakthrough technologies is worth the risk of some duds. Subsidizing innovation and predictable policies like renewable energy targets could have a net effect of reducing risk in the renewable energy sector for private investment. In the European Union, legislation from 2008 requires one-fifth of energy to come from renewable sources by 2020, and complementary measures like the “feed-in tariff” (which guarantees a minimum price for electricity produced by certain technologies) reassure companies that they will achieve a return on their investment. The United States lacks such overall measures but its direct support for research and design — analogous to EU instruments like the Intelligent Energy – Europe Program and the Strategic Energy Technology Plan — provide a minimum level of certainty to companies.

The problem is that poorly designed policies on both sides of the Atlantic engender a different, political, risk. The Spanish government set an over-generous feed-in tariff for solar power in 2008, which caused a boom and bust in the sector and damaged investor confidence in feed-in tariffs as a policy. In fact, by temporarily driving up the price of silicon, the Spanish boom may have indirectly contributed to the demise of Solyndra, which depended on high prices of silicon to be competitive because its unique technology did not use silicon. The U.S. loan guarantee program required government officials to evaluate project proposals and determine which ones would work in the market. This may have made the process vulnerable to lobbying: Solyndra, unlike some other successful applicants for loan guarantees, spent heavily to petition support in Washington

Bad investments like Solyndra do not alter the need for governments to promote green innovation. Climate change is too urgent a problem to wait for innovation to happen on its own, and the hidden subsidies for fossil fuels and inertia of the existing energy system mean that green technologies will always be at an inherent disadvantage. But it is exactly this urgency that imposes a higher standard of performance on the renewable energy sector. Renewable energy will — and must — displace fossil energy, so criticism from powerful incumbents is inevitable. But at the same time, renewable energy company executives have an obligation to be cleaner than most because the perception of impropriety is so potentially damaging and government programs that support them must be seen to be beyond reproach.

Thomas Legge is a Senior Program Officer with the German Marshall Fund of the United States in Washington DC.

Photo by jurvetson

By Mark Allegrini and Kate Ritterspach

This summer, the issue of food security in sub-Saharan Africa has been thrown into cruelly sharp focus. The United Nations reports that over 3 million Somalis (almost half the country’s population) are in need of food aid, and the U.S. Agency for International Development claims that over 12 million people in the eastern Horn of Africa are in need of immediate food, water or medical assistance. Last month the U.N. declared an official famine in two regions of Somalia, and recent U.S. statistics indicate that nearly 30,000 children under the age of five have already died.

Hunger in Africa is a daily reality for many across the continent, though it rarely makes headlines. The current situation in the Horn of Africa is, to be sure, a particularly dramatic case, with several of its own peculiarities. The current famine was triggered by a severe drought that affected the whole of eastern Africa. Somalia, where the official famine has been declared, is essentially a failed state, and long-standing armed conflict and militant control over some areas of the country exacerbate the effects of the drought and make delivery of essential food aid much more difficult.

However, some of the food crisis’ other contributing factors are more structural, and are not unique to one region or one dry season. Drought, while potentially devastating to farmers around the world, does not automatically produce food shortages or famine. But a basic and crippling problem in many parts of Africa is the lack of reliable, fully functioning food systems. This includes the lack of technology required to protect crops and maximize yields, and, just as crucially, the lack of infrastructure necessary to harvest, store, process, transport, and ship food locally, regionally, and internationally.

Since 2009, major donors have devoted significant attention and funds to agriculture and food security. Encouragingly, there is widespread recognition that real food security requires a holistic, value chain approach. Ultimately, for donors this means a shift away from business as usual, where large sums of money are allocated and spent largely by the donors themselves on isolated projects. The imperative of transatlantic budget austerity has added to the urgency of doing things differently. Donors must leverage the skills and financial resources of other donors, host countries, regional institutions, civil society and businesses. They can no longer go it alone.

Actually implementing this new approach, however, has proven to be a difficult task.  While high-level donor dialogues have produced commitments to coordination and a more holistic approach, there remain large gaps on the ground.  In many cases, donors’ focus on decreasing the number of countries and sectors receiving funds and attention for the sake of efficiency and specialization (“selectivity,” in the development vernacular) has not been accompanied by the necessary increase in coordination.  In order to achieve development goals in a time of smaller budgets and greater need, a focus on partnerships is a good place to start.

While one could characterize most donor programs as partnerships between the donor and host country, it has become essential to look beyond this traditional dyad toward ways to leverage other funding sources.  Generally speaking, the private sector is best suited to create economic growth. Functioning food systems are, of course, ultimately built and operated by business. Therefore, a key part of a donors’ role in ensuring food security should be helping to create a friendly and stable investment climate.  In the context of food security, donors need to bring in both the private sector and civil society to determine where investment can have the most catalytic effect. Once this is determined (for example, in Tanzania a study found that investments in food processing have a higher multiplier effect than those in any other sector), donors and businesses must come to an agreement about the right balance of resources and roles to make investments scalable and sustainable.

While partnerships with the private sector and coordination amongst donors are not new concepts, they have become increasingly important given today’s political and economic realities. To be successful, donors need to find better ways to coordinate and leverage existing sources of funding at all levels.  Country-led plans such as the Comprehensive Africa Agriculture Development Program (CAADP) and the Feed the Future Initiative represent a good first step toward this approach.  Coordinating directly with a country on its own priorities, as in CAADP, and having a clear set of goals and mechanisms, as outlined in the Feed the Future Initiative, create a transparent platform for high-level donor dialogues.  The United States and European Union have gone so far as to identify priority countries that will be the focus of increased efforts at coordination.  However, while much of this work has begun at the highest levels, these are two programs where change will require a renewed focus on ground-level action and partnerships.

There are many instances where ground-level focus has yielded real development results.  Much of the work left to be done lies in identifying, scaling, and duplicating the successes that have already been achieved while getting past those projects that have failed to achieve real results.  It is all too apparent that some partnerships exist more on paper than in reality, and in a time of increased constraints, donors should not shy away from distinguishing success from failure and concentrating resources. Successful partnerships with host countries, civil society, and business need to be recognized and repeated; those that have not been successful need to be honestly acknowledged and left behind.

The German Marshall Fund is supporting a Transatlantic Experts Group to examine successful and failed food security partnerships in east Africa, with the goal of transmitting best practices and policy recommendations to transatlantic and African policymakers and other stakeholders in early 2012. The group will look beyond high-level commitments to partnerships in practice on the ground, and will work to provide an honest view of what works and what doesn’t.

Even aggressive action to increase coordination and focus on successful partnership models will not relieve the current crisis in the Horn of Africa. The current situation calls for intensive and immediate humanitarian relief. However, in order to minimize the likelihood of future famines and food emergencies, much remains to be done in creating the robust, functioning food value chains that so many in the developed world take for granted.

Mark Allegrini is a Program Officer and Kate Ritterspach a Research Assistant for GMF’s Economic Policy Program.

WASHINGTON — Germany’s decision last week to phase out nuclear power has sharpened the differences between Europe and the United States on energy policy. Democratic Senator Jeff Bingaman, a senior voice on energy policy in the U.S. Congress, led the chorus decrying that removing nuclear power from the energy mix would undermine global efforts to combat climate change because the technology emits much fewer greenhouse gases than coal or natural gas, the other main fuels used to generate electricity. The decision highlights an apparent contradiction: Europe is committing itself to a low-carbon future while it moves away from nuclear power, whereas the United States, a laggard on climate action, insists that nuclear power is essential to avoid climate change.

German Chancellor Angela Merkel reacted to the crippling of the Fukushima nuclear reactor in Japan by immediately ordering the temporary closure of seven older nuclear power plants. She has since expanded what appeared to be a panicky sop to public opinion into a revised energy policy that will see all nuclear power stations in Germany closed by 2022.

In reality, the decision is a return to the status quo ante — a decision to phase out nuclear power by 2021 was adopted in 2001 by the then-coalition government of the Green Party and the Social Democrats. Merkel’s government went against the grain of public opinion (and the well-known views of her own environment minister, Norbert Röttgen) last September by prolonging the life of many of Germany’s existing nuclear power stations for up to 14 years. What many forget is that her about-turn brings her, and her Christian Democratic Union, into Europe’s political mainstream on this issue. The German public has largely opposed nuclear power since fallout from Chernobyl reached the country in 1986. And the trend across Europe is against nuclear power, notwithstanding official support in a minority of countries (France and the United Kingdom being foremost among them). At the same time, the EU is solidifying its plans to reduce its greenhouse gas emissions by 80-95 percent by 2050.

So if Senator Bingaman is right, and nuclear power is an essential part of the low-carbon future, why is one of the most pro-climate action countries in the world, one with a big industrial sector and heavy energy needs, ready to foresake it? The short-term answer is that it will make no difference. Germany’s emissions may rise as the country turns to power generated from burning fossil fuels, some of it imported from other EU countries. But greenhouse gas emissions from the EU’s power sector as a whole will not rise because they are limited by the EU Emissions Trading System, which sets a declining annual cap. The flexibility that allows one country’s emissions to rise while reducing the emissions of the EU region as a whole is one of the clever design features of the EU’s flagship climate policy. Germany’s decision could drive up the price of emission permits, but there is so much oversupply in the market already (the 2009 recession has meant that EU emissions are still down more than projected) that the impact on prices will be modest.

The longer-term answer highlights the differences between EU and U.S. ambitions and constraints on energy policy. Merkel’s justification — that the decision would make Germany “the first major industrialized country that achieves the transition to renewable energy” — is a bet on the ability of governments to force technological change. Germany hopes that the decision will send a market signal sufficiently strong to attract enough investments to make renewable energy technologies competitive. This might make sense. Innovation is essential to drive down costs, but it is often forgotten that costs begin to fall only when technologies are deployed at scale. The German feed-in tariff provides a recent example. It removed the risk of investing in renewable energy technologies like wind turbines by offering a minimum price for the power they generated; investors rushed to deploy more generating units than expected, and costs fell quickly, although they are still higher than fossil-fuel energy in most cases. The promise of the big German market for renewable energy could help new technologies pass from the design phase to market acceptance. Removing nuclear power from the options further strengthens the signal to the private sector to invest in renewables.

The United States is much less likely to forsake nuclear power. Nuclear power will be an essential part of any political deal on climate and energy policy in the United States. Unlike in Europe, there is still generally strong support among the American public for nuclear power. This fact, coupled with the strength of the nuclear lobby and the precariousness of any political coalition that could muster the votes to pass a climate bill, means that nuclear power will be part of that coalition.

Europe, led by Germany, seems to be choosing a political future around the promise of renewable energy and hopes to push innovation in that direction; it sees nuclear power as a distraction from that goal. The United States, for reasons of domestic political economy as much as faith in the technology, will not make a similar choice.

Thomas Legge is Senior Program Officer in the German Marshall Fund’s Climate & Energy Program.

By Tamar Shapiro and Thomas Legge

WASHINGTON — On May 15, Richard M. Daley stepped down as mayor of Chicago. With his retirement, his city lost its chief executive of 22 years, but America also lost one of its most environment-friendly local leaders.  With the failure of the U.S. Congress to pass comprehensive climate and energy legislation, it is local and state governments in the United States, such as Daley’s city hall, that can play a pivotal role in fighting global warming. Europeans need to look to such local officials if transatlantic cooperation on climate change is to make progress in the years ahead.

Daley transformed Chicago from its industrial roots to a green city with more than 7 million square feet of rooftop gardens and green roofs, more than 1300 new acres of open space, more than half a million new trees planted since 1998, and 88 buildings that are LEED certified as meeting high standards for energy savings, water efficiency, and CO₂ emissions reduction. In recognition of these achievements, Daley was awarded the 2010 Climate Protection Award from the U.S. Conference of Mayors.

Much of the local climate agenda in the United States has been driven by committed state or city leaders, such as Daley, who have made fighting global warming a goal for their administrations. Many of these local leaders have taken steps to strengthen and leverage their own efforts through bilateral and multilateral partnerships. Mayor Michael Bloomberg of New York chairs C40, a group of 18 large cities working together to combat climate change. Former Mayor Greg Nickels of Seattle was instrumental in launching the Climate Protection Agreement, pursuant to which more than 1000 mayors have pledged to meet the standards of the Kyoto Protocol despite lack of action at the federal level. In large part due to the personal engagement of then-Governor Arnold Schwarzenegger, California has led state-level action with its 2006 Global Warming Solutions Act, which commits the state to return its greenhouse gas emissions to 1990 levels by 2020 and to reduce them to 80 percent below 1990 levels by 2050, Currently, more than half of the U.S. states have adopted climate action plans, although none with California’s level of ambition so far, and they are joined by a large number of local governments.

Europe’s climate champions are also to be found at the local level. Mayors like Mayor Bertrand Delanoë of Paris and former Mayor Ken Livingstone of London made green urban development a main plank of their political platforms. Some smaller cities have gone further, adopting targets that far exceed national ambition. Växjö, Sweden, decided in 1996 to become free of fossil fuels and is on track to reduce its greenhouse gas emissions by 55 percent below 1993 levels by 2015.

Even though such efforts depend on political entrepreneurs, they are supported and sustained by a national or EU-wide infrastructure. The EU has legally binding targets for greenhouse gas emissions, renewable energy, and energy efficiency by 2020, which often translate into legislative action at the city level. The EU has also set up a highly successful “Covenant of Mayors,” under which 1,900 local authorities have committed to exceed the EU-wide target of reducing CO₂ emissions by more than 20 percent by 2020. The Covenant provides targets, baselines, methodologies, and a structure of peer support to drive implementation. Campaigns like the annual European Green Capital award (won by Hamburg in 2011 for its energy savings and smart development of its industrial docklands) can build public awareness and a race to the top among municipalities.

Many European policymakers are encouraging equivalent actions at the city and state levels in the United States in lieu of federal action. Unfortunately, city and state leaders move on eventually, and even the best climate action plan and the most well-intentioned pledge, if not implemented by investment or regulation, can easily be ignored after a political transition. In the absence of a federal framework that drives local investments and regulatory changes, the U.S. climate strategy will inevitably consist of a patchwork of state and local actions — all important, but some with a longer-lasting impact than others. Large-scale investments in transit or in open space and greening — as were made by Daley’s administration — will have an impact that long outlasts the leader who championed them. Similarly, regulatory changes that promote more compact and energy-efficient development, while not irrevocable, are more difficult to undo than a plan.

With the U.S. federal government’s current retreat from the climate policy arena, European policymakers are facing a new challenge: working with many eager but diverse partners instead of one recalcitrant one. European policymakers, especially at the local level, can exchange best practices with their American counterparts. While the United States will still be left with a patchwork of climate change actions for the foreseeable future, such cooperation can help to overcome the unpredictability of political change by encouraging the implementation of measures whose success has been proven elsewhere and which will outlast their champions.

Tamar Shapiro is director of the Urban & Regional Policy Program at the German Marshall Fund in Washington. Thomas Legge is a program officer in the Climate & Energy Program at the German Marshall Fund in Washington