Читать книгу The Case for the Green New Deal - Ann Pettifor - Страница 9

Origins

‘A Green New Deal, with Justice for All. Practical. Possible. Inevitable.’

Those words formed the heading of a plain google doc that popped up on my screen in July 2018. They were to be the basis of a carefully crafted manifesto, tested with a range of Alexandria Ocasio-Cortez’s (AOC’s) friends and advisers as she prepared for the US mid-term Congressional elections. They helped her win a victory that was to electrify millions of young Americans and reinvigorate the youth wing of the Democratic Party.

Earlier that year members of the AOC campaign team had visited Britain to sound out a range of economists working with, and around, Jeremy Corbyn, and to prepare for Ms Cortez’s upcoming Primary campaign. I met with one, Zack Exley, in a coffee shop to discuss the thorny question of financing their ambitious plans. After that, apart from the odd email, I heard no more. Hardly surprising, as the New York Primary campaign was in full swing and, by all accounts, absorbed much energy. Plus, there was considerable doubt whether AOC could successfully challenge a powerful and well-funded sitting Democrat. In the event, she pulled off a stunning victory.

The day after that victory the think tank where I work, Policy Research in Macroeconomics (PRIME), was contacted again by her team. We agreed to convene a small, trusted group of British economists in my apartment to deepen and broaden the discussion of how to finance AOC’s programme. We had a lot in common, including a shared commitment to the Green New Deal (GND).

Ten years earlier, a group of British environmentalists and economists had spent many evenings in that same apartment, sustained by comfort food and the odd glass of wine, while furiously arguing, strategising and drafting a plan for transforming the economy to protect the ecosystem – a plan we called the Green New Deal. Our meetings took place at the height of the 2008 Great Financial Crisis and these events, the fall of Lehman Brothers, the debates on quantitative easing (QE) and bailing out the banks, injected a grave sense of urgency into our deliberations.

While we were early adopters in 2008, we were not the first to call for a GND. That call had been made on 19 January 2007 by Thomas L. Friedman, a New York Times journalist in a column titled ‘A Warning from the Garden’.¹ ‘The right rallying call is for a “Green New Deal”,’ Friedman wrote. ‘The New Deal was not built on a magic bullet, but on a broad range of programs and industrial projects to revitalize America … If we are to turn the tide on climate change and end our oil addiction, we need more of everything: solar, wind, hydro, ethanol, biodiesel, clean coal and nuclear power – and conservation.’ The call was taken up first by President Obama, who included the Green New Deal in his platform.

Later, in the autumn of 2007, Colin Hines, a onetime British Greenpeace staffer and campaigner, took up Friedman’s challenge and convened a group to draft an ambitious plan for a Green New Deal that might both transform the economy and safeguard the planet. Besides myself, the group included Britain’s only Green MP, Caroline Lucas; the macroeconomist and senior trade union economist, Dr Geoff Tily;² the Guardian’s economics editor, Larry Elliott; the environmental campaigner and author, Andrew Simms; Jeremy Leggett, director of an international solar solutions company, Solarcentury; the tax and accounting expert, Richard Murphy; and two recent directors of Friends of the Earth, Charles Secrett and Tony Juniper.

Our report, published in July 2008, called for ‘joined-up policies to solve the triple crunch of the credit crisis, climate change and high oil prices’. It argued that

the global economy is facing … a combination of a credit-fuelled financial crisis, accelerating climate change and soaring energy prices underpinned by an encroaching peak in oil production. These three overlapping events threaten to develop into a perfect storm, the like of which has not been seen since the Great Depression. To help prevent this from happening we are proposing a Green New Deal.

July 2008 was a strange time, a hiatus between that bleak day in August 2007 – when inter-bank lending froze and liquidity in capital markets evaporated – and the collapse of Lehman Brothers in September 2008. Central bankers had rushed to provide liquidity to investment banks in August 2007 when their bankruptcy threatened global systemic failure. The publicly financed and taxpayer-guaranteed bailouts of that month appeared to work. Regulators and politicians were lulled into believing the crisis had been managed.

The American and British public appeared to accept this view. By July 2008, people were going about their daily lives reassured that the worst had been averted, unaware that a huge global investment bank was about to implode and blow up the global financial system. It was during this strange lull in the crisis – a crisis that as I write, is still not over – that we tried to gain political traction for the Green New Deal.

Initially, the United Nations Environment Programme (UNEP) took up the call because of the GND’s ‘enormous economic, social and environmental benefits … ranging from new green jobs in clean tech and clean energy businesses up to ones in sustainable agriculture and conservation-based enterprises’.³ In 2009, Gordon Brown called for an international ‘green new deal’ to boost the environmental sector and help lift the global economy out of recession, while Green members of the European Parliament called for a European Green New Deal to tackle the continent’s economic problems in a sustainable manner. Despite this support, both in Europe and the United States (where the Green Party took up the call) our efforts were soon eclipsed by the chaotic aftermath of the Lehman Brothers bankruptcy.

Ten years later, Alexandria Ocasio-Cortez and her team came up with their own, ambitious Green New Deal – a ‘plan to solve three critical problems at once: the threat climate change poses to America’s security, poverty and inequality, and the racial wealth gap’. Central to the US GND is the Job Guarantee, to give ‘every unemployed American who wants one, a job building energy-efficient infrastructure’.

This is how a young woman of colour, the youngest person ever elected to the US Congress, ignited a political torch under a radical proposal for preventing the collapse of earth’s life support systems. Her plan went viral on 13 November 2018, when young people blocked the corridors of US Congressional power with the warning that climate breakdown threatened their futures. The Sunrise Movement corralled the newly elected Democrat into joining their sit-in outside the office of Nancy Pelosi, likely next Speaker of the House of Representatives. Together they demanded political backing for a Green New Deal.

At the time of writing, that political backing has not been forthcoming. Indeed, climate breakdown did not make it into the 2019 Democrat leadership’s list of priorities for the new Congress. Speaker Pelosi was dismissive, despite claiming on her Congressional website that she had ‘made the climate crisis her flagship issue’. Instead, she went on to disparage the Green New Deal as ‘one of several or maybe many suggestions that we receive. The green dream, or whatever they call it, nobody knows what it is, but they’re for it, right?’⁴

Yet a survey conducted by the Yale Program on Climate Communication in December 2018 found that the AOC’s Green New Deal had ‘strong bipartisan support’. Most Democrats and 64 per cent of Republicans backed the plan, without knowing it was promoted by a Democrat.⁵ Millennials (those aged between eighteen and thirty-seven) supported the Green New Deal by nearly a thirty-point margin, according to a poll conducted by the Nation.⁶ Evidence of its potential popularity did not prove sufficient to persuade the Democrat leadership, older American voters, mainstream Democrats or right-wing Republicans.

This worrying lack of support for a sound and rational programme for tackling climate breakdown and economic injustice was the spur that drove me to write this book. For, as the environmental journalist David Roberts argues, while there is immense potential energy in the GND, ‘converting that heat to power – to real results on the ground – will involve a great deal of political and policy engineering, almost all of which lies ahead.’⁷ If we are to convert that heat to power, supporters of a Green New Deal must explain how policy can be engineered so that their visionary programme can be financed – without transferring the burden of higher taxes on to the working class (often defined in the US as the ‘middle class’).

At the heart of the scepticism around the GND lie these questions: how, realistically, can such a radical transformation be brought about within ten years or so? How can today’s governments and their allies in the private sector afford to finance such a transformation? What will happen to workers in fossil fuel industries?⁸ This book will attempt to address those questions.

But first things first.

What Is the Green New Deal?

The Green New Deal demands major system change: both economic and ecological system change. It demands structural (governmental and inter-governmental) changes, not just behavioural, community or technological change, in our approach to the financialised, globalised economy and ecosystem. In addition, and as in the 1930s, such change must be driven by a radical structural transformation of the economy, particularly the financial sector.

The idea was developed in Britain in 2008 on the understanding that finance, the economy and the ecosystem are all tightly bound together. Protecting and restoring the ecosystem to balance cannot be undertaken effectively, we argued, without the transformation of the other sectors. Joined-up policies are needed. Financing the hugely costly overhaul of the economy away from its dependence on fossil fuels cannot be achieved without the subordination of the finance sector to the interests of society and the planet.

Environmental advocates tend to focus on individual (‘change your lightbulbs’) or community (‘recycle, reuse, reduce, localise’) action. We have been slow at understanding and promoting the need for radical systemic change across sectors and at a global and national level; that is, change that involves state action. And such structural change cannot just be undertaken at the level of international agreements on carbon budgets.

Its ambition is on a far grander scale than Roosevelt’s 1930s New Deal (even if his administration also faced an ecological catastrophe: the Dust Bowl). The climate threats we face are of a magnitude beyond the imagination of New Dealers. However, we can learn from Roosevelt’s administration. To tackle climate change we need simultaneously to tackle the root cause of growing toxic emissions: a self-regulating, globalised financial system that pours exponential quantities of unregulated credit into the hands of speculators and consumers. This credit is used in turn to inflate the prices of existing assets, while failing to finance the creation of new tangible and intangible assets. Further, it is used to accelerate the extraction and consumption of the earth’s finite assets. Only once we switch off the ‘tap’ of ‘easy money’ will it be possible to switch off the flow of oil and other fossil fuels.

These joined-up policies lie at the heart of the Green New Deal.

The demand for a Green New Deal is realistic in that it harks back to an era when the global economy was transformed almost overnight by the revolutionary Keynesian monetary policies of an American president. As Roosevelt began dismantling the globalised ‘gold standard’ on the night of his inauguration, on 4 March 1933, he freed up his administration to end austerity and unemployment, then running at 25 per cent, before deploying fiscal policy to create jobs and transform the domestic economy, but also to address the Dust Bowl crisis. He affirmed, as Keynes had done, that ‘we can afford what we can do.’ Because the financial system – as a system – exists to enable us to do what we can do, no more and no less. As then, now it must be returned to its role as the servant, not the master, of the economy and ecosystem.

The Green New Deal is, therefore, a plan. It is not an idea, nor a proposal, but a comprehensive plan for stemming the breakdown of earth’s life support systems. It is comprehensive in that its drafters understand that the earth, in all its diversity, needs a ‘new deal’, and so do the men, women and children who – in all their diversity – are the victims of ongoing global economic failure, and, now, of climate breakdown.

The GND recognises that in the future we must derive energy only from renewable sources. We also need to expand and support ecosystems that suck huge amounts of carbon dioxide out of the air and store that carbon in trees, soils and oceans. But societies also need to end their dependence on a globalised economic system that drives climate breakdown and encourages toxic emissions; an economic system that leads to ecological imbalances alongside economic, political and social inequality and injustice. Its name is globalised, financialised capitalism.

While there is widespread agreement on these essential elements of both the US and British Green New Deals, there are also differences.

The US Green New Deal (2018)

The US Green New Deal is ambitious. It is presented in impressive detail in the Resolution submitted to the US Congress by Rep. Alexandria Ocasio-Cortez, Democrat-N.Y., and Sen. Ed Markey, Democrat-Mass., on 5 February 2019.⁹ It is a comprehensive plan for achieving five major goals in the course of ‘a ten-year mobilisation’:

• to reach net-zero greenhouse gas emissions through a fair and just transition for all communities and workers;

• to create millions of good, high-wage jobs, and ensure prosperity and economic security for all people of the United States;

• to invest in the infrastructure and industry of the United States to sustainably meet the challenges of the twenty-first century;

• to secure clean air and water, climate and community resilience, healthy food, access to nature, and a sustainable environment for all;

• to promote justice and equity by stopping current, preventing future, and repairing the historic oppression of frontline and vulnerable communities.

The Resolution begins by acknowledging that ‘whereas the Federal Government-led mobilizations during World War II and the New Deal created the greatest middle class that the United States has ever seen … many members of frontline and vulnerable communities were excluded from many of the economic and societal benefits of those mobilizations.’

The Job Guarantee

The Resolution goes on to recognize ‘that a new national, social, industrial, and economic mobilization on a scale not seen since World War II and the New Deal is a historic opportunity to (1) create millions of good, high-wage jobs in the United States; (2) to provide unprecedented levels of prosperity and economic security for all people of the United States; and (3) to counteract systemic injustices.’

A key assumption within the Resolution is that the state will provide and leverage ‘adequate capital … including through community grants, public banks, and other public financing … for communities, organizations, Federal, State, and local government agencies, and businesses working on the Green New Deal mobilization’. The formulation is deliberately vague.

Research and policy development for the US Green New Deal is undertaken by scholars at the nonprofit think tank, ‘New Consensus’. Demond Drummer and Rhiana Gunn-Wright are leading the policy work including the proposal for the creation of a ‘green bank’. In an interview, they explained that this public bank ‘would be used to invest in zero-carbon technologies under development in the public and private sector that need to be commercialized. The bank would be designed to offer financial enhancements and support to communities that haven’t had access to clean energy and transportation.’¹⁰ But that is just the beginning. ‘Right now we’re focused on what needs to be done and how all the pieces fit together,’ Drummer explained in the same interview. ‘Then we will focus on how to pay for it. To be clear: It’s a question of how we will pay for it – not if we can afford to pay for it. America can afford what we decide to do.’

The UK Green New Deal (2008)

The British Green New Deal had a quite different orientation from the American version.¹¹ While the American GND is heavily focused on the domestic economy, the British version, written at the height of a globally contagious financial crisis, adopted a more internationalist perspective. We began by locating the breakdown of earth’s life support systems in the current model of financial globalisation, and argued that ‘a positive course of action can pull the world back from economic and environmental meltdown.’

We were ambitious, too. We wanted to combine stabilisation in the short term with longer-term restructuring of financial, taxation and energy systems of the global economy. We urged the UK to take action at the international level to help build the orderly, well-regulated and supportive policy and financial environment required to restore economic stability and nurture environmental sustainability.

‘Financial deregulation’ had in our view ‘facilitated the creation of almost limitless credit. With this credit boom have come irresponsible and often fraudulent patterns of lending, creating inflated bubbles in assets such as property, and powering environmentally unsustainable consumption.’ We were also clear that high, real rates of interest had driven the need for excessive rates of return on investment necessary to repay costly debt. Hence the compulsion to strip the forests, empty the seas and exploit labour in order to generate the returns needed to repay debts.

Our report therefore began with proposals for systemic change to the global economic model as an essential precondition for decelerating climate change. We understood that global transformation was necessary if we were to re-regulate the domestic financial system to ensure the creation of money at low rates of interest consistent with democratic aims, financial stability, social justice and environmental sustainability.

Fundamental to the British GND is the understanding that over the centuries advanced societies have developed monetary systems. The concept of money and a system of money evolved to enable us ‘to do what we can do’ (Keynes). Money is and always was a form of social technology, one that enables individuals, firms and governments to do business, to trade and exchange. To accomplish transactions smoothly and efficiently, both at home and across borders. A society’s monetary system, like its sanitation system, we argued, is a great public good.

However, we also recognised that the history of monetary systems is one of struggle for control over the system, between those that would exercise private authority over it and those that prefer public, accountable authority. In the 1960s and 70s, Western governments ceded effective control over the system to a private authority – ‘the market’. Or, to be more specific, private actors in financial markets. The latter are dominated by the capital bourses of Wall Street, the City of London and Frankfurt.

While a developed monetary system is a great public good, we Green New Dealers recognised that there are of course ecological, economic and political limitations to what society can ‘do’ within the framework of the monetary system. Nevertheless, provided they are managed by the visible hand of public authority, monetary systems could help finance the radical and costly transition from a fossil fuel-based economy to one based on renewable energy. Just as the monetary system helped finance transitions to war, or to recovery from financial crises.

Therefore the UK GND makes clear that one of the first tasks will be for society to regain public authority over the national and international monetary system. And next, to raise the finance to tackle climate change, not just in Britain but internationally. We called on the British government to support a transformation of the financial system that would:

• allow all nations far greater autonomy over domestic monetary policy (interest rates and money supply) and fiscal policy (government spending and taxation);

• set a formal international target for atmospheric greenhouse gas concentrations that keeps future temperature rises as far below 2°C as possible;

• deliver a fair and equitable international climate agreement to succeed the Kyoto Protocol in 2012;

• give poorer countries the opportunity to escape poverty without fuelling global warming by helping to finance massive investment in climate-change adaptation and renewable energy.

We drew our inspiration from Franklin D. Roosevelt’s ‘courageous programme’ launched in the wake of the Great Crash of 1929. We called for a sustained programme to invest in and deploy energy conservation and renewable energies, coupled with effective demand management.

A Carbon Army to Make Every Building a Power Station

Like the US GND, we placed considerable emphasis on the creation and training of what we termed a ‘carbon army’ of workers to provide the human resources for a vast environmental reconstruction programme. The production and distribution of clean energy will demand the skills, professionalism and experience of many that currently work in an industry that must contract until it finally shuts down – the fossil fuel industry. We called for hundreds of thousands of these new high- and lower-skilled jobs to be created in the UK, regarding this as part of a wider shift from an economy narrowly focused on financial services and shopping to one that might become an engine of environmental transformation. We supported the Trade Union Congress’s demand for strong policies to support workers through a just transition – one that will make sure that workers do not pay the price for the economy’s transformation away from dependence on carbon and other greenhouse gas emissions.

Focusing first on the specific needs of the UK, we called on the British government to introduce a decentralised, low-carbon energy system that included making ‘every building a power station’. Energy efficiency was to be maximised, as was the use of renewables to generate electricity. At the time we envisaged a £50 billion-plus per year crash programme to be implemented as widely and rapidly as possible. ‘A programme of investment and a call to action as urgent and far-reaching as the US New Deal in the 1930s and the mobilisation for war in 1939’.

We argued for realistic fossil fuel prices that included the cost to the environment, high enough to create the economic incentive to drive efficiency and bring alternative fuels to market. We advocated rapidly rising carbon taxes and revenue from carbon trading. We called for the establishment of an Oil Legacy Fund, paid for by a windfall tax on the profits of oil and gas companies. We wanted the focus to be on smart investments that would not only finance the development of new, efficient energy infrastructure but also help reduce the demand for and the cost of energy, particularly among low-income groups, by improving home insulation.

GNDs: How Do They Differ?

Both the US and UK GNDs are based on the understanding that because climate breakdown is a security threat to the nation as a whole, the state has a major role to play in the transformation – just as if the nation were facing the threat of war. The American Green New Deal is ‘a Federal Government-led mobilization’ working alongside, and integrating, the private sector within GND programmes. In drafting the GND the Justice Democrats drew heavily on the work of Professor Mariana Mazzucato, whose research has shown that contrary to myth, public organizations have played a critical role as ‘investor of first resort’ in the history of technological change and advance. From the iPhone to Google Search, the world’s most popular products were funded, she concludes, not by private companies but by the taxpayer.¹²

The British GND also has a major role for the state, not just in the transformation of the energy sector, but also the finance sector – and at international as well as domestic levels.

While the British GND is concerned to protect low-income individuals and families during the process of transformation, the AOC GND is more ambitious. In the words of the veteran climate campaigner Bill McKibben, it seeks to ‘remake not just a broken planet, but a broken society’.¹³ It puts members of ‘frontline and vulnerable communities’ front and centre as beneficiaries of the Green New Deal. The drafters of the Resolution are acutely conscious of the 1930s New Deal’s ‘intimate partnership with those in the South who preached white supremacy’, and of the deliberate and racist exclusion of many black people from the economic gains of that era. Hence

it is the duty of the Federal Government to create a Green New Deal … to promote justice and equity by stopping current, preventing future, and repairing historic oppression of indigenous communities, communities of color, migrant communities, deindustrialized communities, depopulated rural communities, the poor, low-income workers, women, the elderly, the unhoused, people with disabilities, and youth (referred to in this resolution as ‘frontline and vulnerable communities’).¹⁴

The British Green New Deal, as noted above, has adopted a more internationalist perspective than the American versions of the programme, calling on OECD governments to help finance massive investment in climate-change adaptation and clean energy for low-income countries.

Finally, the British Green New Deal (in both the first and subsequent reports) provides something absent from the US version in that it expands on the question of how the GND could be financed, deploying both monetary and fiscal policy, but with an emphasis on monetary policy.