U4 AOS2 Pt 2

Question 1

Define crisis diplomacy

Answer 1

Refers to negotiations between actors in the global political arena in response to an immediate crisis. This most commonly concerns conflicts and natural disasters, but also economic and health crises.

Question 2

Define international cooperation

Answer 2

Refers to occasions when global actors work together to achieve common ideals and goals.

Question 3

Define globalisation

Answer 3

Refers to the acceleration and intensification of exchanges of goods, services, labour and capital, which promote global interdependence. These have facilitated rapid changes in communication and technology.

Question 4

Define unilateralism

Answer 4

Refers to the policy of a state acting alone, with little regard for the views or interests of other global actors, in pursuit of their own foreign policy objectives.

Question 5

How does burning fossil fuels cause climate change?

Answer 5

Intrinsic cause - core reason for crisis

• 85% all E bought comes from burning FF → 9.5bn tonnes from ground to atm per yr
• burning releases CO2 → enhanced GHG effect → gl warming
• gl temp inc 1.1C since pre-ind + 0.8C since early C20

T/f bc FF trap heat in atm + subsequently cause gl warming, it is the core reason for the CC crisis.

Question 6

How does deforestation cause climate change?

Answer 6

Key contributing factor bc depletes GHG emission mitigation mechanism + contributes to gl warming in process itself
- UNFAO est 18mil acres lost per yr → less C sinks
- 2010 Gl For Resources Assess report defor release 1bn tonnes C into atm/yr → WWF est defor = #2 anthropogenic source of C (contributes 6-17%)

T/f Defor = cause bc exacerbates harm already caused by burning FF by depleting C sinks + emit more GHG in process bc a) trees release C when die + b) wood burning = releases CO2

Question 7

How is capitalism a cause of climate change?

Answer 7

Cap mindset is cause bc success is measured by econ growth → voters judge govt based on if personal wealth is inc → incentivises consumer + govt behaviour that is linked to inc GHG emissions

• pursuit of personal $ dir linked GHG emissions - st w income <$4000 GDP/cap emit 0-1.25tn GHG/pp/yr vs st w income >$32000 avg 10tn/pp/yr
• problem bc research → GHG emissions must be lim to <2tn/pp/yr for 1.5C to be poss

T/f cap mindset creates perp cycle of environ harm bc inc personal wealth → inc consumption → priv sector = $ incentivised to cont emitting GHG/depleting C sinks

Question 8

Actions by the UN on climate change + why

Answer 8

• 2015 PCA bc world needed common obj govts could aim for + be judged on
• 2021 Glasgow COP26 (led to Glasgow Climate Pact) bc 5 yr check up on PCA → expected inc ambition

Question 9

Outcomes of PCA

Answer 9

• 195 UNFCCC members signed + 191 + EU ratified → 95% gl emission
• A7 = defined adaptation goal + encourage all st to make NAPs
• A9 = finance → 50/50 adapt/mit + $100bn to LDCs by 2020
• est Intl Co-Op Initiatives = mechanism to bypass challenge posed by NIs → prov NSAs w framework to contribute to CC response → Gl Covenant of Mayors = 9K cities, 127st + 770mil residents

Question 10

Outcomes of COP26

Answer 10

• est Glasgow Climate Pact → agreed “phase-down coal” by 2040s
• 130st (85% gl forests) promise X defor by 2030
• Finance = 450 financial instit responsible for $130tr assets promise align portfolios w 2030 net zero i.e. divesting from FF
• Climate finance = promise $500bn in 5 yrs + x2 proportion to adaptation
• Agree to meet again in 2022 + 2023 w expectation states have inc ambition
• Coal = 40 st agree phase out coal in 2030s incl Pol, Viet, Chile, Sth Afr

Question 11

Evaluate the effectiveness of the PCA

Answer 11

A/t PCA made progress towards mitigating CC crisis, X responding to crisis at rate req to eff solve issue + failing to prop support LDCs adapt
- since PCA 1/3 reduction in GHG emission growth rate → pre-PCA end C21 est 4-5C → now 2.4C
- also adaptation financing $52bn 2013 → $79bn 2019
BUT
- Oct 2021 UNEP Emissions Gap Report - updated NDCs only dec predicted 2030 emissions 7.5% when 55% is needed reduction amt
- 2017-18 only $22/72bn climate aid prov by OECD st to LDCs = grants
- 2019 only ¼ climate finance → adaption = X 50/50 bw mitigation/adaptation

T/f action X happening at rate needed + this is impacting those who contributed least the most

Question 12

Actions of the EU on climate change + why

Answer 12

• submitted 2nd NDCs → need to dec 55% by 2030 + following PCA by ramping up ambition
• 2020 climate package (enacted 2009) bc climate crisis
  aims = 20% dec in GHG emissions below 1990 levels by 2020 (thru ETS, Effort Sharing Dec + car regulations) // 20% E from renewables (binding bc Renewable E Dir) // 20% improve E Efficiency (binding thru E Eff Dir)
• 2030 climate package → enacted 2014 bc 2020 X ambition enough + need to dec 55% (2022)
  aims = 55% GHG below 1990 by 2040, net 0 2050, 27% renewables, 27% improve E eff
  how = Eur Climate Law = 55% GHG emission reduction by 2030 = binding // Sep 2020 Climate Target Plan = blueprint for reaching 55% + pledge spend 30% EU budget on CC // EU Renovation Wave = envisages overhaul of 220mil buildings by 2020 to improve eff/dec reliance on FF

Question 13

Evaluate effectiveness of EU’s response to climate change

Answer 13

2020: a/t X ambitious enough to solve crisis, it achieved aims + created good framework for EU for future
- achieved GHG reduction goal by 2016
- ETS X incl shipping + aviation = major loophole
BUT
- GDP grew 53% over same period + ETS generate 15.8bn EUR for member st = demos effectiveness of binding/financially incentivising GHG reduction scheme
→ influ 2030 agenda bc extended ETS to shipping/aviation + intro CBAM
t/f while X outright resolve crisis, it was eff in kickstarting progress that is becoming exponentially more ambitious/appropriate for size of crisis by proving interventions actually work

Question 14

Actions of UK on COVID + why

Answer 14

• 19 Mar 2020 BoEng cut IR rates to 0.1% → disincentivise saving + encourage spending → GDP growth
• $575.5bn across 6 stim packs - mainly targeted at sml bus + paying bus toe.g. tax cuts + program offering to pay 80% of salaries for otherwise laid off workers → keep unemp low
• $8.5bn tax credits for poor + unemp → $1200/yr more in pockets
• 6mo VAT cut from 20% to 5%
  → inc liquidity encourages spending → inc GDP + prod → inc emp

Question 15

Evaluate effectiveness of UK’s response to COVID

Answer 15

A/t UK addressed symptoms of crisis effectively, overall effectiveness to resolve crisis lim bc inc LT vulnerability
- unemp X exceed 5.2%
- 10% GDP dec 2020 but recovered 4.2% of it in Q2 2021
BUT
- govt debt skyrocketed = 2019 89.4% → 144% end 2020 → 143% end 2021
- low IR
→ lim UK govt capacity to respond eff to current crisis

Question 16

Actions of US on COVID + why

Answer 16

• Total $5.4tr govt spending
• Initial response = CARES Act = $2.2tr stim package = covers all econ sectors (hospitals, sml bus, corperations, welfare, hospitals)
  → inc liquidity → inc spending → inc prod → in GDP + emp
  → $ to businesses so X default on loans → domino effect
• Fed Reserve dec IR to bw 0-0.25% + inc lending
  → disincentivise saving + encourage spending → inc prod → in GDP + emp

Question 17

Effectiveness of US’s response to COVID

Answer 17

A/t US response effectively supported V shape recovery, LT counter-prod bc inc pop + govt vulnerability to future crisises
- GDP dec 19.2% 1st ½ 2020 → GDP inc 15.3% 2nd ½ 2020
- Unemp 14.7% Apr 2020 → 6% Apr 2021 → 3.5% Aug 2022
BUT
- Pop reliant on temp social safety nets e.g. unemp benefits, rent relief
- Debt skyrocketed = 2019 108.8% → end 2020 160% → end 2021 150% (well above healthy 60%)

t/f → govt have less levers to pull for next crisis + ppl are more vulnerable

Question 18

Details of COVID crisis

Answer 18

• restrictions apply to 93% workers
• 8.8% work hrs lost
• gl econ growth dec 3.4-7.6%
• Jan 2022 IMF report cost to gl econ = $12.5tr thru 2024
• huge econ growth loss in major econs e.g. Ch lost $650bn + Ind lost $950bn + EU lost $2tr

Question 19

Details of the ‘Great Divide’

Answer 19

• HICs made $36.4bn from debt repayments in 2020
• Namibia only have 6 Drs/10,000 ppl when COVID started
• 24 Aug 2022 63% gl pop x2 vax vs 30st <20% (mostly in Afr)
• 2022 GDP growth projected gl = 4.9% vs Afr = 3.8% + Central Am = 3%
• adv econ = only income grp expected to return to pre-pandemic trends by 2022
• WB report debt burden of 70+ LICs inc by record 12% in 2020 = inc vulnerability for future crisis
• 2021 income/person inc 5% in HDCs vs 0.5% in LDCs
• Econ stim measures in response to COVID = 25% of gl GDP but LICs only 1-2% GDP
• 43 st spend more on debt repayments than healthcare

Question 20

Details of PMI’s response to climate change

Answer 20

1 Created the Good Agri Program aligned w SDGS

o Triple bottom line standards applied before all purchases from growers + suppliers
o Specific + time-bound aims:
→ 70% dec overall GHG emissions from 2010 levels by 2020
→ 0% coal use for tobacco curing by 2020
→ 0% defor from cultivation by 2020

o Monetary rewards for all empl for meeting emission reduction targets
o Set internal price on carbon $17/tn = low vs EU 90-130 eur/tn but high on business scale = typically $5-20/tn → updated every 1-2yrs

o Partner w Swiss Red Cr → promo sus/resilience-building farming techniques (e.g. irrigation systems) in Mozambique to ensure food sec

Question 21

Larry Elliot (The Guardian)

Unilateralism

Answer 21

“unilateralism could mean short-term gains but long term pain”

Question 22

Kevin Watkins (The Guardian)

Debts

Answer 22

“there is an urgent need to convert unpayable debts into investments in health, edu and social safety nets”

Question 23

Martin Muhleisen (former IMF dir)

SDRs from IMF

Answer 23

“important lifeline”

Question 24

Catholic Church

Capitalism as a cause

Answer 24

“unlimited appetites of consumerism”

Question 25

Christina Figueres

Pope’s Laudato Si

Answer 25

“PF’s encyclical underscores the moral imperative for urgent action on CC… this clarion call should guide the world towards a strong + durable univ climate agreement in Paris”

Question 26

Catholic Church actions on climate change

Answer 26

• June 2015 PF issue papal encyclical ‘Laudato Si’ → earth = “immense pile of filth”
• Jan 2019 PF addressed 180 dips – complains current response = “remains v weak + a source of grave concern”
• divest from FF
• June 2019 PF declare “climate emergency” + meet w top oil execs + FF investors → call on govts to put price on C to encourage low-C innovation BUT X take action themselves

Question 27

Adam Bandt

Aus 2022 Climate Deal

Answer 27

“this govt is bringing a bucket of water to a house fire”

Question 28

Brookings Institute

Complexity of CC crisis itself

Answer 28

o “Complexity is the death knoll of many modern pub pol problems and solutions”
o “We have trouble imagining the potential devestation of CC”

Question 29

Aus public opinion of CC

Answer 29

• 2019 only 1/3 Lib voters view CC as imp issue when voting + only 3% view it as #1 issue
o 40% conservative unwilling to incur any cost for CC action
o Only 26% prog + 5% conserve willing to incur sig cost

Question 30

Impact of Aus public opinion on CC action

Answer 30

• 2013 election Lib claims C tax will cost Aus households $550 extra/yr → 2014 Lib repeal C tax
• 2018 Turnbull proposed NEG incl emissions dec target + reintro C tax = “woefull inadequate” (Climate Council) → w/draw emission aspect → lose pos as PM
• Scomo propose ‘gas-led recovery’
• Aus NDC @ COP26 = 28% → dip iso from regular allies
• 2022 Climate Deal = 43%

Question 31

Aus CC action as an example of unilateralism

Answer 31

• Repealing C tax stopped response that was working – June 2013-June 2014 Aus emissions dec 1.4% = largest recorded dec
• Lib party X willing to consider any inc of ambition w NDCs + gas-led COVID recovery – Scomo relying on tech X taxes
• Lab 2022 Climate Bill seeks 43% by 2030 = X ambitious enough/X prevent new FF proj/X stop issue of mining to sell overseas

Question 32

US public opinion of CC

Answer 32

• divided along party lines → 2022 Pew 82% Rep believe wrong dir vs 79% Dem believe right dir
• less supportive of costly interventions → 53% view stricter environ laws as worth the $ - dec from 65% in 2019 VS 90% support planting 1tr trees to absorb CO2

Question 33

Impact of US public opinion on CC action

Answer 33

• Inflation Reduction Act= approved Aug 2022 = 1.5mil jobs → creates clean E econ = reduced reliance on FF(+inc trust in CC policy for econ benefit?)
  BUT WV Sen Joe Manchin (owns coal co) waters down IRA → enables cont FF exploitation
• July 2022 SCOTUS WV vs EPA decision lims scope of reg B planning to intro in 2023

Trump:
- Erased/loosed nearly 100 rules/regulation abt environ incl 1.8bn metric tons of GHG by 2035 in CO2 emissions for vehicles/power plants/methane leaks from oil + gas well
- 2017 announced US w/drawal from PCA
- Approved FF exploration (e.g. Anwar in AK)
- Appt 3 conservative SCOTUS judges - July 2022 lim B’s exec power to act on CC thru EPA (‘WV vs EPA’)

Question 34

Evaluate effectiveness of US’s unilat CC action

Answer 34

POSITIVE
• US 2050 net zero pledge → all G7 follow + strengthen 2030 targets/139 other st also pledge 2050/poss of B election 2020 motivated Ch’s 2060 target
• Inflation Reduction Act - Could dec GHG emission 40% below 2005 levels by 2030

NEGATIVE
- US = 13% gl emissions → delaying action during T admin = more damaging than ever
- FF exploration → locking in cont reliance on FF in LT
• US inaction used as excuse by other st (e.g. Br + Aus) to X take action
• Discredits PCA = most comprehensive gl climate framework available

Question 35

IMF actions on EI

Answer 35

• X2 Rapid Credit Facility funds → 85st received
• Grants for debt relief – 29st receive
• Call for bilat debt relief → G20 Debt Service Suspension until end 2021= impact 73st →
  $10.3bn delayed + $300mil cancelled
• Add $650bn in Special Drawing Rights
• May 2021 $50bn proposal to vax 40% pop in every st by end 2021 + 60% by mid-2022
• 2020 87/100+ programs financed = X cond BUT Oxfam found 13/15 loans neg in 2021 req new austerity measures

Question 36

Details of US’s failure to reg Ch’s behaviour (cause of US-Ch TW)

Answer 36

• Ch = 1/36 IP violators listed → Comm of Theft of Am IP est cost US econ $600bn/yr
• perception of currency manipulation (2011 Mattoo + Subramanian study show 17/18 studies conclude Ch yen = underval + avg est of underval = 19%) → US claim Ch action violate commitment to refrain from comp deval when joined G20

BUT
- T, J + SK = regular violators of IP rights until reached GDP per cap bw $20-25K (Ch is $10.5K)
- Aug 2019 IMF report Ch yuan = in line w econ fundamentals

Question 37

Details of US trade deficit (cause of US-Ch TW)

Answer 37

• 2018 defecit = $419.2bn
• Manu jobs in US dec 30% since 1998
  BUT
• Am unemp = record lows
• Most manu jobs = lost bc automation = natural unemp

Question 38

Details of Geopolitical tensions (cause of US-Ch TW)

Answer 38

• Ch #1 commodity exports since 2015, #2 GDP behind US, #1 GDP PPP
• Nat Review (conservative Am think tank) pinpoints Ch’s “neo-colonial FP” + “LT goal of global hegemony” as part of “Ch’s growth strategy” which “reps a dir threat to the US”
  → to min damage of Ch’s inevitable rise, “tariffs are one piece of an emerging anti-Ch strategy”

Question 39

Details of Phase 1 Agreement (response to US-Ch TW)

Answer 39

Jan 2020
Provisions
o Ch will inc imports by $200bn above 2017 levels by Dec 2021 (1/2 trade def)
o Ch will strengthen IP rules
o US will ½ some new tariffs

Question 40

Evaluate the effectiveness of the US-CH TW

Answer 40

A/t achieved goal of dec trade deficit, X address US’s concerns abt Ch in any meaningful way bc Ch was willing to agree to P1 provisions anyway → worsened US econ + gl econ at X gain

• US exports to Ch inc 16.9% 2020 = highest since 2017
• P1 prov Am banks/credit card/insurance cos access to Ch market w/out having to partner w local bank
  BUT
• ‘really didn’t address in many ways the fundamental concerns we have with China’
• P1 met X agreement abt subs/SOE/Ch ind policy that was giving Ch cos comp adv
• Ch X meet P1 targets
• Lost 0.3% projected GDP growth = $65bn
• 300K less jobs available in June 2019 than Nov 2018
• Sep 2019 = worst mo for US manuf since GFC
• Bloomberg media report US tariffs cost Am cos $46bn

Question 41

Foreign Policy

US-China Trade War

Answer 41

‘Tariff hikes haven’t forced Beijing to capitulate’

‘A/t Ch’s econ growth slowed, the tariffs have hit US consumers harder than their Ch counterparts’

Question 42

Janet Yellen 2021

US-China Trade War/Phase 1 Agreement

Answer 42

‘really didn’t address in many ways the fundamental concerns we have with China’

Question 43

Evaluate the effectiveness of the P1 Agreement

Answer 43

A/t dec trade deficit, X address US’s concerns abt Ch in any meaningful way bc Ch was willing to agree to P1 provisions anyway → worsened US econ + gl econ at X gain

US goals:
- US exports to Ch inc 16.9% 2020 = highest since 2017 → trade def = $310bn 2020
- P1 prov Am banks/credit card/insurance cos access to Ch market w/out having to partner w local bank
BUT
- ‘really didn’t address in many ways the fundamental concerns we have with China’
- P1 met X agreement abt subs/SOE/Ch ind policy that was giving Ch cos comp adv
- Ch X meet P1 targets - $310bn trade def ≠ $200bn

Question 44

Details of interest rates

Answer 44

COVID
- 2020 US Fed Reserve dec IR to bw 0-0.25% + inc lending → inflation 8.5% (sep 2022)
- 19 Mar 2020 BoEng cut IR to 0.1% → inflation 8.8% (july 2022)

INFLATION CRISIS
- 75 central banks inc interest rates in past yr – avg 3.8 times each
- US inc IR 4 times
- UK inc IR 7 times
- July 2022 EU inc IR for 1st time in 11yrs/inc again in Sep after infl hit 10% = all-time high in EZ’s existence

Question 45

Antonio Guterrez

UNGA meeting Sep 2022

Answer 45

“Geostrategic divides are the widest they have been since at least the Cold War. They are paralyzing the global response to the dramatic challenges we face.”

Question 46

Rebeca Grynspan

Sec-General for UN Conference on Trade and Development

Answer 46

“the current course of action [tightening monetary + fiscal policy] is hurting the most vulnerable, especially in developing countries, and risks tipping the world into a global recession”

Question 47

GDP growth forecasts

Answer 47

IMF (Oct 2022)
- st acct for 1/3 of gl econ poised to contract 2022/23
- gl inflation expec peak 9.5% 2022 + still be at 4.1% in 2024
- 1/4 chance gl growth 2023 could <2% = all-time low

Question 48

US response to inflation

Answer 48

x4 IR inc
Sep = 15yr high IR
Inflation Reduction Act = create 1.5mil jobs + expec to dec GHG emissions 43% by 2030

Effectiveness:
- 9% inflation (highest in 40 yrs) – 3% of which is in services sector = suggests domestic crisis caused by ‘overheated econ’ (excess demand)
t/f US Fed Res
erve bank took unilat action to dec demand but neg impact on gl econ b/c for maj world inflation caused by supply crisis, esp for LDCs
- UN warn IR inc from US Fed Reserve Bank could cut est $3.6tn of future income for developing st (excl Ch) b/c inc value of USD
→ imports of basic necessities = more $$$
→ inc cost of servicing debts (made bigger by COVID)

Question 49

Geopolitical effectiveness of US-China Trade War for US

Answer 49

a/t marginally slowed Ch econ rise, LT inc econ influ + damage US IS

• 2019 Ch econ growth lowest rate since 1992 = 6%
  BUT
• Made trade def worse w EU/Mex/J/SK/T
• IMF condemned tariffs as making the world ‘a poorer + more dangerous place’
• Sep 2020 WTO rule in Ch’s favour that US tariffs = violation of intl trade law = bad for IS/rep as ‘global policeman’