The think tank Common Wealth has published a report by Common Wealth US Programme Director Melanie Brusseler and political economist Stefan Zylinski critique the Wall Street Consensus for failing to finance global decarbonization and arguing that democratic economic planning will be required to coordinate global decarbonization.
A summary of the report can be found below:
Key Points
- Global decarbonization is a development problem. The structure of the global financial system constrains green development through dollar hegemony, volatile capital flows, punishing borrowing costs, and predatory trade and IP regimes.
- The dominant international climate finance policy response, the Wall Street Consensus (WSC), attempts to mobilize private capital through derisking and assetization of green infrastructure. This is a political choice; one that treats a question of public capacity and global wealth redistribution as a technical problem of producing “bankable” projects.
- Despite a decade of WSC-framed initiatives — JETPs, GFANZ, country platforms, the World Bank Billions to Trillions agenda, the $100 billion pledge — private climate finance to the Global South remains a fraction of what is needed. Further, the WSC compounds the vulnerabilities it claims to address.
- The GPC’s starting premise is that policy design should have the goal of building a global architecture of public coordination. US global green economic diplomacy should aim to build a multi-scalar system of public institutions capable of directing investment toward development needs rather than investor returns, disciplining private capital, and supporting Global South states in developing their own green industrial capacity on their own terms.
You can read the report here.