Nobel laureate and economist Paul Krugman described on Tuesday how President Donald Trump's move to pursue the Iran war at the expense of Americans who now face rising oil prices has made China the real winner.
Krugman wrote in his Substack that Trump's decision could put potential oil and gas shortages on the horizon that ultimately benefit Chinese electrotech.
"Donald Trump wants to stop the renewable energy revolution. But he can’t — it will continue to advance around the world because the economics and the science are compelling," Krugman wrote. "Trump can, however, ensure that the revolution passes us by. And the big geopolitical winner from Trump’s hostility to the energy revolution will be China, which dominates the production of renewable-energy infrastructure."
Instead of pushing the U.S. closer to embracing renewable energy, Trump has done the opposite.
"Furthermore, the China-led energy future will arrive ahead of schedule thanks to the debacle in Iran," Krugman explained.
China has made major investments in renewables, and its notable "green industrial complex" outpaces the U.S. and the Trump administration's climate denialists who don't seem to see how much things have changed — even with March marking the hottest month on record. As the Strait of Hormuz remains closed, it leaves the U.S. particularly vulnerable to falling behind, with the "perception that relying on U.S. oil and LNG, which is what countries will have to do if they don’t turn to solar and wind, isn’t safe."
"So Trump’s adventurism in Iran has sparked a global rush to invest in solar power, wind power, and the batteries that make renewable energy work 24/7," Krugman added. "And where will the world procure most of the renewable energy equipment it seeks? From China. China is the workshop of the world. Its manufacturing sector is larger than those of the U.S., Japan, Germany and South Korea combined."
As the world shifts from fossil fuel use amid rapid climate change, the U.S. could fall further behind.
"Yet it’s sad to watch this country sabotage itself and cede the most important industry of the future to China," Krugman wrote. "In doing so, we make ourselves poorer, technologically backward, and less influential in a world that is speeding towards the energy revolution. In the end, we aren’t just burning fossil fuels; we’re also burning our future."