President Donald Trump has made significant progress in fixing America’s broken economy. After inheriting a total mess with rampant inflation, expensive groceries, and home ownership becoming out of reach, most Americans can now see that the economic nightmare of the Biden Administration is coming to an end.
This year, the average American family has already gained $1,000 in household income despite losing over $3,000 in the previous four years. Gas prices are also down, holding steady below $3 a gallon in over 40 states. There are more economic benefits on the horizon as a result of massive tax cuts for working families and slashing unnecessary red tape that has hindered job growth and innovation.
This massive shift has been the result of drastic policy changes that started on Day One of the Trump Administration. Of note is the president’s focus on energy policy. President Trump ended the Biden-era “green new scam,” from banning gas stoves to forcing electric vehicles on the roads, the Biden Administration imposed a climate agenda that harmed families, businesses, and the national economy.
While America is breathing a collective sigh of cost relief, many other countries continue to follow economic plans that prioritize climate activism over the needs of local citizens. In particular, the European Union’s (EU) adherence to climate ideology stands to undermine U.S. economic momentum.
For instance, the EU’s Corporate Sustainability Reporting Directive is pitched as a noble form of investing in people and ideas instead of maximizing value, but in reality, this reporting is a measure for how well a company or investment aligns with the Left’s views on virtue and social good. For energy, this means how well a company embraces extreme climate policies that make life more expensive. Companies engaging in the EU market must prove adherence to their climate policies using a carbon accounting program called the GHG Protocol.
Use of the GHG protocol entails substantial and wide-ranging economic costs and has had very little impact on curbing related emissions. It also empowered unelected environmental activists to oversee costly compliance burdens that inhibit U.S. opportunities abroad. The GHG Protocol is designed and managed by the World Resources Institute (WRI). WRI is a left-wing climate organization that pushes the very ideology that’s crushed European innovation and limited growth for decades. Even now, amidst an affordability crisis, the WRI is working to impose additional climate mandates that could increase home electricity rates 26%.
The EU recently voted to “simplify” its climate reporting by exempting companies with fewer than 1,750 employees or less than €450 million in annual revenue from the mandatory social and environmental disclosures. This has been portrayed as lifting burdensome reporting requirements from 90% of companies but as some might say though, not so fast.
The overwhelming number of companies impacted by this relief are European companies while the vast majority of American exports to the EU are still subject to the reporting requirements. To put the €450 million floor in perspective, the smallest company listed on the Fortune 500 has a total revenue of more than $7.4 billion. As their own studies have shown, no EU company with a market capitalization over €100 billion ($115 billion) has been founded in the last 50 years. In contrast the U.S. market created six U.S. companies with a valuation above €1 trillion during the same period. Since that report came out a year ago, there are now nine American companies valued over $1 trillion with five companies over $2 trillion.
In effect, the EU is exempting its own stagnation while retaining burdensome regulations on high-growth American firms that engage in their market. These reporting requirements also come with catastrophic fines (up to 5% of global revenue) for companies that fail to comply. Shockingly, these provisions would even apply to actions outside the EU. As the United States frees itself from the anti-growth climate policies of the last administration, the EU seems dead set on imposing them abroad.
There is significant opportunity in European markets, especially after Trump and the EU announced a historic trade deal earlier this year. As Trump explained at the time, the deal would rebalance the economic relationship between the world’s two largest economies, and rightfully so. Aspects of the deal include boosting U.S. exports and removing related non-tariff barriers.
If we empower climate activists over American businesses and workers, we know the result: they will regulate U.S. companies out of Europe. That means fewer markets for American products, threatening American companies, jobs, and livelihoods.
Mandy Gunasekara is an environmental attorney and served as the Chief of Staff of the U.S. Environmental Protection Agency in President Trump’s first term.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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