The often repeated narrative of “either climate action or social protection” is a false dilemma that benefits those most responsible for emissions while hurting those least able to pay.
The myth that climate action must come at the expense of pensions, healthcare, unemployment benefits and social services is simply untrue. What is true is that the EU has untapped and can further untap fiscal tools that can finance climate protection without touching social security. The actual limitation is political will, not economic feasibility.
At present, the responsibility for climate change is unequally distributed. Data from the European Environment Agency and global studies show that the top 10% of income earners in the EU have a per-capita carbon footprint several times higher than the EU average. High-income lifestyles and corporate supply chains drive the bulk of emissions. The poorest Europeans contribute least to climate change but face the greatest climate risks.
Therefore, financing climate protection should follow the polluter pays principle enshrined in EU law, targeting those who have contributed most to the problem. Therefore, the EU should
- Tax extreme wealth and luxury emissions
- Levy windfall profits on energy and resource companies.
- Expand the Carbon Border Adjustment Mechanism to reflect true environmental costs of imports.
- Introduce a Financial Transaction Tax for climate and just transition funds.
- Issue Green Bonds via the European Investment Bank, repaid through progressive revenues.
Social policies foster climate resilience by ensuring that citizens can adapt to changing economies, by maintaining trust in democratic climate action and by reducing inequality, which is essential for a stable, long-term transition.
Therefore, the EU should
- Legally protect core social policy budgets from climate funding reallocations.
- Finance climate action through progressive, polluter-focused measures.
- Make social justice central to all Green Deal policies.
- Boost EU borrowing for green investment with fair repayment mechanisms.
- Bottom Line:
Europe can — and must — protect both its people and its planet. Climate protection and social protection are not rivals; they are mutually reinforcing pillars of a fair, sustainable, and united EU.