A Swiss "No"
The Swiss people rejected a new climate law by a majority vote of 51.6%. The meaning of this result is clear – but apparently, to Swiss eyes only. International observers got it completely wrong.
Start with the facts: Switzerland is one of the world’s most climate-friendly developed economies. According to the World Bank’s data for 2016, Switzerland emits 4.12 tons of greenhouse gases per inhabitant per year. Compare this number with the United Kingdom’s 5.8, Germany’s 8.8, or the U.S.’s 15.5.
The same dataset informs us about the carbon intensity of the national economic activity. It is defined as kilos of greenhouse-gas emissions per one U.S. dollar of gross domestic product GDP. Switzerland emits 0.062 kilos per dollar. For comparison’s sake: the number is 0.1 kilo per dollar in the U.K., 0.2 in Germany, and 0.3 in the U.S.
Switzerland has a long series of climate-related laws. Since the early 2000s, the country formulated and achieved several climate-action goals. As a party to the Kyoto Protocol, the alpine nation participated in the first and second commitment periods. In addition to that, the nation’s law on CO2 ambitiously established a domestic reduction goal: By 2020, Switzerland domestically was to reduce 20% of its emissions in comparison to the year 1990. Another achievement added to the list.
Always forward-looking, the Alpine Confederacy ratified the Paris Agreement. Since no popular vote was called against it, the Swiss people accepted it, along with a new goal: a reduction by 50% of greenhouse-gas emissions by the year 2030 in comparison to 1990. The popular vote of June 13 did not reject this goal, nor the Swiss ratification of the Paris Agreement. What was defeated at the ballot box was the manner of implementation of these goals.
A Law – not The Law
The Swiss people rejected what was perceived as an unbalanced law. Elements of this imbalance were, among others, a levy of 12 cents per liter of gas, a new levy on air tickets, and a steep increase of the general levy on CO2 from today’s 101 U.S. dollars per ton to around 220 U.S. dollars per ton. Additionally, the law would have effectively introduced a legal duty to renovate buildings following strict climate standards. Finally, a new subsidization mechanism, the climate fund, would have been introduced.
In sum, these measures would have burdened the middle class, in which around 85% of Swiss count themselves. The fiscal measures imposed by the bill would have affected younger people, suburban and agrarian regions, and tourism and industry – traditionally important sectors of the economy – the most. A contributing factor in the verdict was the long-running skepticism among the Swiss about subsidies.
There was also a more general problem with this law. It was perceived as too narrow and inflexible. The Paris Agreement foresees a combination of different instruments and programs – most would have been excluded for Switzerland by the proposed law. It was these elements that led the Swiss to vote no. However, to Swiss eyes, it is equally clear that this rejection is not a rejection of climate action as such.
The International Reaction
Granted, it is difficult to understand Swiss direct democracy. The country votes every three months on two types of issues. The people can vote to accept or reject a law that has been decided by the Parliament. Or the people and the cantons (states) can vote to change the Constitution on a proposal put forward by a group of citizens. The Swiss know how to navigate this system, voting on specific bills and not on general issues.
Without this prior knowledge, the Swiss vote of June 13 might look to outsiders like a protest or a sudden change of direction. Indeed, many international newspapers ran headlines declaring “Swiss people disavow government” or “Switzerland turns its back to climate action.” This just shows their lack of familiarity with the system. The government regularly loses such votes, and so does the Parliament. But neither situation is a problem. Rather, it is the sign of a strong democracy that understands political differentiation and discourse.
What happens now? To begin with, Switzerland already has a law on CO2 that remains in place. Also, the Swiss commitment to Paris continues. The question now is whether this commitment can be achieved with the instruments of the applicable law. Should this not be the case, the executive and the legislative branches will have to amend the law or pass a new one, which can, again, be called for a popular vote. This is nothing out of the ordinary in the Alpine Confederacy.
In the meantime, Switzerland will most likely continue to increase its climate efficiency, decreasing its per capita and per dollar emissions of greenhouse gases. Even after the June 13 vote, then, it’s business as usual in Switzerland.
Henrique Schneider is chief economist, Swiss Federation of Small and Medium Enterprises.