Are Biden’s Unrealistic Climate Goals Useful?

Are Biden’s Unrealistic Climate Goals Useful?

You might love or hate Franklin Delano Roosevelt, but I wish that everyone would forget about his ‘100 days’ program which was intended to be an emergency action addressing the Great Depression. It has left at least some of his successors feeling they need to show similar verve in designing policies to address the most salient problems of the day. Most such have not been a success, with the Clinton effort to quickly fashion and enact a health care plan one of the most obvious failures.

It also reminds me of one of the management fads in the 1990s, when ‘stretch’ goals were advocated as a way to encourage better performance from employees. The idea was that setting unrealistic goals for improvement would at the least produce greater effort, even if the goal was not met. Unfortunately, this was a cookie cutter approach to the goulash of business circumstances: I attended one corporate strategy session where executives encouraged a group that had outperformed to do even better in the coming year, but their subordinates had to explain the outsized success couldn’t be duplicated because their high profits had attracted competitors who had pushed returns down. (It’s what capitalism is for, actually.)

And the fall of Enron has been attributed, at least in part, to the concept that setting ever more ambitious goals for business departments would yield greater success, but made unreasonable demands on employees, especially when good results were followed by demands for even better results. As one business school study described, “The lauding of “creative risk-taking” and “revolution” led to not only stretching, but also circumventing and breaking legal and ethical boundaries.”


The Biden Administration has come up with a goal of reducing American greenhouse gas emissions by 50% by 2030, and it has met with the usual degree of praise, scorn and skepticism, validating the old maxim ‘where you stand depends on where you sit.’ Skeptics, in particular, note that he uses 2005 as the base year in measuring reductions, which reduces the challenge—but not much. The figure below shows the (interpolated) trend of CO2 emissions under either the Biden goal of hitting 50% of 2005 levels or a more ‘transparent’ goal of 50% of 2019 emissions. (Note the data is from BP Statistical Review of World Energy and does not include all GHG emissions.)

This goal will require enormous effort (translation: money) in part because of the short time frame. The plan necessitates rapid deployment of existing technology, even though there are numerous areas where, by 2030, the technology should be much improved. New battery types, such as lithium-air or supercapacitors, will not be available on a commercial scale for years to come. Achieving a 50% share of vehicle stock by 2030 is a near impossibility: if BEV sales make up 100% of the market by 2030, the persistence of older vehicles means that only about 40% of the existing stock would be BEV, as the figure below shows. (This figure is based on global data, but the U.S. market is similar.)

Of course, the Biden goal could be a bargaining tactic, as in the bride’s maxim, ‘Ask for May, settle for June.’ A consultant once explained to me that, if two sides in a case gave opposing views on, for example, the appropriate discount rate, judges often took the average, encouraging both sides to adopt extreme positions rather than defend the actual best estimate. Similarly, Biden’s Administration could be thinking to ask for 50% and intending to settle for 25%, which would be much more achievable as the figure below suggests.

Ultimately, there is the conundrum of whether setting an ambitious goal helps the cause by encouraging emitters (translation: mostly consumers) to make a more concerted effort to reduce emissions, or whether a failure to achieve the goals would make the public more cynical and less likely to support new regulations and spending. Given that the Kyoto goals were only partly met—and much of that not by government efforts—without leading to advocates moderating their positions, the answer would seem to be ‘no.’ But as the publics around the world are asked to accept much greater spending and the accompanying debt, a different view could surface.

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