The World Needs a Post-Coronavirus Green Marshall Plan

By Sagatom Saha, Narayan Subramanian, and Arianna Menzelos

As the global economy heads toward the worst recession in nearly a century, the coronavirus’ rapid spread and associated economic despair have turned attention among developed countries inward. However, policymakers in these nations must understand that this pandemic disparately affects their developing-country counterparts and that they cannot prosper if they leave the Global South behind. In this way, the pandemic provides a cautionary tale for how the climate crisis will unfold. Developing countries shoulder much of the burden but must be a central part of the solution. The United States should learn from its own historical success and implement a 21st century Green Marshall Plan that will not only address climate change but also go a long way toward providing economic stimulus for developing countries in the aftermath of the coronavirus pandemic.

The pandemic exacerbates “pre-existing conditions” that ail the global economy that economist Adam Posen notes. Among them include the rising tide of economic nationalism and the growing gap in crisis resilience among nations. Countries that lack robust social safety nets and functional financial markets will fare as poorly amid the climate crisis as they are amid the coronavirus pandemic.

Carbon-intensive development should be considered among these preexisting conditions that the United States would ignore at its own peril. Washington has long embraced and benefited from tackling global development challenges. The original Marshall Plan was borne from another era marked by death and destruction. After World War II, the United States helped rebuild Europe, recognizing its global responsibility, as well as the opportunity to forge lasting alliances and foreign markets for American industry. The current moment calls for a green successor, a global infrastructure plan that marshals the world toward a zero-carbon future.

A Green Marshall Plan, as we outline in a Data for Progress report, responds to the reality that the planet faces an unequal economic and ecological crisis with three prongs: promoting international green development standards, providing financial assistance to developing nations for climate mitigation and adaptation, and investing in collaborative clean energy innovation. While the original Marshall Plan, in the process of rebuilding Europe, locked in oil dependency on the continent and throughout the world, the United States this time should prioritize sustainable, inclusive development to bridge the infrastructure gap that stymies global economic development.

Proposals abound that describe how the United States can return to global climate leadership. Among them, each Democratic presidential contender provided their own from Senator Elizabeth Warren’s explicit call for a $100-billion Green Marshall Plan to support the purchase of American-made clean energy technology to Senator Bernie Sanders’ and Vice President Joe Biden’s pledge to promote low-carbon development abroad through U.S. development finance institutions. Even with these proposals, the United States lacks a comprehensive green development plan that addresses the needs of both the American workforce and developing countries. 

A Green Marshall Plan would be a necessary counterweight to the Belt and Road Initiative (BRI), Beijing’s grand development initiative that has already fueled $200 billion of carbon-intensive development in developing countries. Although China leads in solar panel, wind turbine, and battery manufacturing, Chinese firms only innovate at incremental rates insufficient to tackle the climate crisis. Beijing instead seems more interested in funding fossil projects abroad that bring in its own workers rather than transferring technology and knowledge to emerging markets. In contrast, a Green Marshall Plan can deploy cleantech assistance complementary to local manufacturing and innovation rather than in lieu of it.

When the U.S. Congress shifts its focus from economic relief to economic recovery, it can create virtuous cycles that engage the U.S. scientific and industrial base while helping partners and allies inclusively develop. Such legislation could, for example, fund the disruptive innovations needed to limit global warming by dramatically increase funding for the Advanced Research Projects Agency-Energy to one hundred times its current budget. Additionally, Congress can prioritize the passage of the Climate Risk Disclosure Act, which would direct America’s capital markets away from carbon-intensive endeavors globally. 

Still, much will be left to the president in 2021. The White House should raise climate change to the top of the global development agenda. The Treasury Department can advocate climate concerns be mainstreamed into all UN and World Bank assistance in recognition that economic growth will be hard to sustain without climate adaptation and resilience. The State Department, leveraging America’s unparalleled convening power, should host an annual Climate Assistance Summit that would develop new roadmaps and funding vehicles to break climate finance logjams ahead of future UN climate meetings.

The Energy Department should also revitalize and expand bilateral energy partnerships that can help niche markets decarbonize. For example, the United States could collaborate with Southeast Asian countries to innovate efficient floating photovoltaics that take advantage of the myriad dams along the Mekong River. America has a long history of exporting critical technologies to emerging markets, such as semiconductors, partnering with them by providing technology and knowledge transfers, and leveraging their comparative advantage. Such an approach reduces costs and creates networks of economic alliances that reinforce American leadership.

Finally, the White House should create two new offices: a Bureau for Climate Security within the U.S. Agency for International Development and an Office for Cleantech Promotion within the Commerce Department. Both will spur new climate-friendly commerce and provide the bureaucratic infrastructure for the initiatives called upon by the Green Marshall Plan.

The skies above Los Angeles and Mumbai have rarely looked so clear, but the need for a return to business-as-usual among the greatest industry emitters could render these smogless views temporary silver linings. The coronavirus pandemic makes clear the global need for a sustainable direction in U.S. foreign policy. At the next UN climate meeting, countries are required to ratchet up the ambition of the climate plans they submitted five years ago under the historic Paris Agreement. The United States should take the opportunity to set the stage for a new decade defined by American climate leadership by arriving with a Green Marshall Plan in hand.