Decision Memo – Chetan Hebbale

MEMORANDUM TO THE NATIONAL SECURITY ADVISOR

FROM: Chetan Hebbale

SUBJECT: U.S. – China Disaster Response Cooperation After COVID-19

Executive Summary
COVID-19 has opened a window to understand the crisis management strategy of the modern Chinese Communist Party (CCP). As climate change exacerbates natural disasters as well as infectious diseases[1], China will likely deploy their successful pandemic response tactics of regional containment, mass mobilization, and population control to deal with these issues. However, the CCP will also likely continue a tactic that was unsuccessful – the suppression of information domestically and internationally about the severity of the crisis.

The U.S. has an opportunity to improve its relations with China with a package of policies that establish mutual support mechanisms for dealing with future emergencies. These policies could include establishing emergency hotlines to improve transparency, deepening institutional collaboration and best practices for developing health technologies and rapidly scaling up new infrastructure, and promoting public-private environmental stewardship.

Background

The first “unknown pneumonia case” was documented in Wuhan on December 8^th, 2019. On January 20^th, 2020, Chinese president Xi Jinping declared that China was experiencing a disease outbreak from a novel coronavirus[2]. In those intervening 43 days, the number of suspicious cases began increasing exponentially with doctors in Wuhan warning friends on social media about the emerging threat.

The authorities of Wuhan and Hubei Province attempted to suppress these reports and punished eight doctors for “rumor-mongering.” They deliberately provided the public with false information on the number of cases and that no human-to-human transmission was occurring[3]. It was only after the first case appeared outside of China in Thailand on January 13^th,2020, that leaders in Beijing were compelled to recognize that they may be dealing with a possible pandemic.

Once emergency measures were activated, the government quickly marshalled resources from the civilian and military sectors on a massive scale to dispatch medical equipment, construct overflow hospitals, and enforce lockdowns on nearly half a billion people[4]. In addition, state-owned enterprises like Sinopharm were given substantial resources to begin developing a vaccine. China’s aggressive measures were a global success with less than 5,000 deaths, the second lowest deaths per 100,000 people in the world[5], and producing half the vaccine doses delivered globally[6].

Discussion

Lesson #1: Information authoritarianism will be an enduring feature of the Chinese state. The U.S. should establish lines of transparency with Chinese citizens.

Local Chinese officials will continue to have an incentive to suppress negative information, not only regarding disease outbreaks, but natural disasters, financial frauds, and industrial accidents[7], because of the CCP’s performance evaluation and responsibility attribution pressures in the cadre management system[8]

Recognizing the vulnerabilities of this approach, the Chinese government has an incentive to prevent future disasters from affecting the global community. The U.S. could work with China to establish encrypted digital hotlines whereby Chinese citizens can anonymously report disasters and hot spot events to avoid retribution by local officials for revealing damaging information.

Lesson #2: The Chinese state is capable of quick mobilization on massive scales. The U.S. should conduct joint exercises with China to exchange best practices on rapidly standing up emergency infrastructure and scaling medical breakthroughs.

At the beginning of the response, China established a leadership small group (LSG) to be the nation’s top decision-making body for COVID-19 prevention and control[9]. The LSG enabled swift, decisive, and coordinated national action to deploy military and medical staff to quickly build makeshift hospitals and distribute medical supplies. While state-owned enterprises were directed to develop therapeutics, the Sinopharm vaccine has overall seen lower efficacy than the American-made vaccines[10].
The U.S. can learn from China’s organizational mobilization and China can learn from U.S. medical innovations. Joint exercises to prepare for rapidly building sea walls, flood shelters, and fire-proof infrastructure will be mutually beneficial for both countries to improve their disaster resilience. Facilitating more medical and academic collaboration on vaccine and therapeutics research from leading U.S. institutions will enhance the speed and efficacy of future medical treatments.

Lesson #3: China has a cooperative citizenry that’s willing to make shared sacrifices for the greater good. The U.S. should work with China to leverage this public cooperation into community environmental action to reduce carbon emissions

Most of the world faced severe challenges in enforcing social distancing and quarantine measures both due to civil resistance as well as weak administrative coercive capacity. In contrast, China faced little resistance to their rigid lockdown measures. The collectivist values and communist ideologies of the Chinese people have conferred a remarkable degree of social discipline as well exercising self-restraint when personal interests clash with collective ones[11].
Today, China is the world’s largest emitter of CO₂ emissions – more than all developed nations combined[12]. The U.S. could help establish public-private partnerships with civil societies in China to leverage the spirit of collectivist values to install solar panels on homes, conserve and protect ecosystems, and reduce household fossil fuel use.

[1] Renee Cho, “How Climate Change Is Exacerbating the Spread of Disease,” Columbia University Climate School, September 4^th, 2014, https://news.climate.columbia.edu/2014/09/04/how-climate-change-is-exacerbating-the-spread-of-disease/.

[2] Alex Jingwei He, Yuda Shi & Hongdou Liu, “Crisis governance, Chinese style: distinctive features of China’s response to the Covid-19 pandemic,” Policy Design and Practice, July 19^th, 2020, https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1799911.

[3] Chunyan Ding and Fen Lin, “Information Authoritarianism vs. Information Anarchy: A Comparison of Information Ecosystems in Mainland China and Hong Kong during the Early Stage of the COVID-19 Pandemic,” China Review, February 2021, https://www.jstor.org/stable/27005556.

[4] Emily Feng, “Restrictions And Rewards: How China Is Locking Down Half A Billion Citizens,” NPR, February 21^st, 2020, https://www.npr.org/sections/goatsandsoda/2020/02/21/806958341/restrictions-and-rewards-how-china-is-locking-down-half-a-billion-citizens.

[5] Johns Hopkins University Coronavirus Resource Center, “Mortality Analyses,” https://coronavirus.jhu.edu/data/mortality.

[6] Smriti Mallapaty, “China’s COVID vaccines have been crucial — now immunity is waning,” Nature, October 14^th, 2021, https://www.nature.com/articles/d41586-021-02796-w.

[7] Associated Press, “China exonerates doctor reprimanded for warning of virus,” March 19^th, 2020, https://apnews.com/article/virus-outbreak-accidents-ap-top-news-international-news-arrests-6f2e666485e9abae4bb112251eca77be.

[8] Ran Ran and Yan Jian, “When Transparency Meets Accountability: How the Fight against the COVID-19 Pandemic Became a Blame Game in Wuhan,” China Review, February 2021, https://muse.jhu.edu/article/784425.

[9]Alex Jingwei He, Yuda Shi & Hongdou Liu, “Crisis governance, Chinese style: distinctive features of China’s response to the Covid-19 pandemic,” Policy Design and Practice, July 19^th, 2020, https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1799911.

[10] Sui-Lee Wee, “They Relied on Chinese Vaccines. Now They’re Battling Outbreaks.” The New York Times, September 16^th, 2021, https://www.nytimes.com/2021/06/22/business/economy/china-vaccines-covid-outbreak.html.

[11] Alex Jingwei He, Yuda Shi & Hongdou Liu, “Crisis governance, Chinese style: distinctive features of China’s response to the Covid-19 pandemic,” Policy Design and Practice, July 19^th, 2020, https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1799911.

[12] BBC, “Report: China emissions exceed all developed nations combined,” May 7th, 2021, https://www.bbc.com/news/world-asia-57018837.

MEMORANDUM TO THE PRESIDENT

FROM: Chetan Hebbale

SUBJECT: Executive Actions on Climate Change

Issue for Decision:
What kind of take executive actions can the U.S. president take to reduce greenhouse gas emissions and prepare for climate change in the absence of meaningful Congressional action?

The Situation:

Time is running out to prevent a 2°C rise. The world has 29 years to make annual emissions 40 – 70% lower than they are today. Failure to do so will expose 190 million people to extreme droughts, flood more than 70 percent of Earth’s coastlines, and cost the U.S. $100 billion annually in damages.

Meeting the commitments under the Paris Climate Agreement will only bring the world one third of the way to avoiding the planet’s warming more than 2°C, meaning that further emission reductions will be necessary. As the world’s largest per capita emitter of greenhouse gases, the U.S. has a unique obligation and opportunity to take the lead on this issue.

Currently, the U.S. Congress is mired in gridlock and unable to advance the bold policies needed to decarbonize the economy. Presidential executive action provides a path to avoid catastrophe. A portfolio of executive actions which institute new energy performance standards, establish economic signals, and support R&D is the most effective and lowest-cost way to reduce the main sources of U.S. greenhouse emissions.

Objectives:

Every path to a low-carbon future is measured against advancing one or more of these five goals.

Reducing electricity demand in the building and industry sectors.
Reducing the carbon intensity of electricity generation.
Reducing transportation emissions.
Reducing process emissions needed to develop heavy industry products.
Reducing deforestation and forest degradation in tropical forest nations.

Options:

The president has some broad authority to take action on all of these objectives. Some of them face fewer legal and institutional constraints than others. But every action will fall into one of these three categories:

Performance Standards: setting quantitative targets at the device, fuel, or sector level which specify what level of performance certain businesses or equipment must achieve. Examples include:
- Instituting a national clean electricity or renewable portfolio standard.
- Requiring higher fuel efficiency standards.
- Establishing a framework for more sustainable building codes and appliance standards

Economic Signals: instituting fees that discourage pollution and/or subsidies that encourage cleaner alternatives. Examples include:
- Setting a market-price for the social cost of carbon.
- Establish long-term purchase guarantee contracts with clean energy providers, known as a feed-in-tariff (FIT)
- Subsidize the consumer purchase of electric vehicle through tax credits or cash payment.

Supporting R&D: strengthening the overall R&D environment for clean technology research at universities, national laboratories, and private companies. Including:
- Convening and funding public and private sector collaboration
- Strengthening intellectual property protections
- Ensuring access to STEM talent

Recommendations and Rationale:

Performance Standard: Expand the national renewable portfolio standard to require all utilities to generate 100% of their electricity through non fossil fuel-based sources by 2050.

An RPS is one of the most successful policies for promoting renewable energy by requiring a certain percentage of electricity generation coming from clean sources. On its own a 100% renewable standard would reduce nearly 21% of cumulative emissions.
Achieving such a high standard in 19 years may be difficult politically and technically as only 29 states currently have an RPS and at levels much lower than 100%. Additional incentives would be required to meet this target.
The other options like fuel efficiency standards or building codes are weaker in driving down emissions due to substitutes that still allow for fossil fuels to be burned for a longer period.

Economic Signal: Levy a carbon tax of $75 per-ton of CO₂emissions.

While this option is politically fraught, a carbon pricing scheme is the single most effective policy to influence energy use and investment decisions. On its own it can deliver at least 26% of the emission reductions necessary.
A $75 price recommendation was set by the International Monetary Fund but a range of options, both higher and lower, can be explored for specific industries including prices that scale over time ultimately to $75 by 2050.
The other economic signal options like feed-in-tariffs and electric vehicle subsidies would not be able to effectively radiate across all sectors of the economy like a carbon tax.

Supporting R&D: Establish “net-zero innovation hubs” with federal purchase agreements for the technology outputs.

Innovation on the scale of the Manhattan Project or landing humans on the moon is necessary to address climate change. Rather than funding numerous, disparate R&D efforts, the U.S. should concentrate all federal funding on a specific set of topics, technologies, and institutions.
The federal government can establish hubs in specific metro areas to bring together academic, private sector, and government researchers. From here, establishing purchase agreements to buy a certain quantity of clean technology output will incentivize researchers to participate and help scale the products globally.
Other R&D policies around intellectual property and STEM talent are complementary to this goal and can be instituted further down the line once the early infrastructure is established.

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About The Author

Chetan Hebbale is currently a graduate student at the Johns Hopkins School of Advanced International Studies (SAIS) in Washington, D.C. focused on international economics, climate change, and sustainability.

Prior to this, he spent over 4 years at Deloitte Consulting working on technology and strategy projects at the CDC and U.S. Treasury Department.

He is a native of Atlanta, GA and attended the University of Georgia.

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