Green New Deal

What is it?

The Green New Deal is an economic stimulus concept which aims to create jobs and infrastructure in the areas required to tackle climate change, such as energy efficiency, renewable energy and the built environment. Although the primary objective is employment and growth, it is also seen as a policy linked to social justice by guaranteeing work and putting the natural environment at the core of economic policy.

The background

There is some argument about who created the phrase ‘Green New Deal’, but it has its origins as a green re-boot of Franklin D Roosevelt’s financial stimulus package, which aimed to drive forward the American economy after the Great Depression in the 1930s. Despite its American tone, it a firmly Atlanticist policy, formulated and put forward by various groups in both the UK and the USA as a way of stimulating economical growth at the same time as mitigating the damage of climate change.

The phrase gained widespread usage in the run-up to the creation of the Climate Change Act 2008, the Copenhagen Accord in 2009, and the emerging global financial crisis. It was referenced by Barack Obama during his first campaign for the presidency of the United States of America, who used the term to describe a $51bn green stimulus package and a $2.3bn tax credit to clean energy manufacturing - but he eventually shelved the policy initiative after the mid-term elections in 2010.

Interestingly, two competing groups claim to be the first to popularise the phrase. One is New York Times columnist Tom Friedman, who in 2007 started calling for a “Green New Deal” to end fossil fuel subsidies, tax carbon dioxide emissions, and deliver long term incentives for renewable energy infrastructure including solar and wind.  At almost the same time, and seemingly without knowledge of Friedman’s comments, The Guardian’s economic editor Larry Elliott, met with like-minded individuals who then developed the Green New Deal into a policy concept in the pub.

The first report

As a result of those initial conversations about the idea, a report called A Green New Deal: Joined-up policies to solve the triple crunch of the credit crisis, climate change and high oil prices was published by the New Economics Foundation. Also a Green New Deal Group was set up as part of the report’s publication, which included amongst its ranks Larry Elliott; Tony Juniper, the former Director of Friends of the Earth; Jeremy Leggett, founder of Solarcentury and SolarAid; Caroline Lucas, Green Party MP; Andrew Simms, Policy Director of the New Economics Foundation; tax academic Richard Murphy; and Colin Hines, co-director of Finance for the Future.

Proposals set out in the Group’s report include a mix of sustainability initiatives and financial policy:

  • A low-carbon energy system that will include making ‘every building a power station’.
  • A ‘carbon army’ of workers to provide the human resources for a vast environmental reconstruction programme.
  • An Oil Legacy Fund, paid for by a windfall tax on the profits of oil and gas companies
  • Fossil fuel prices include the cost to the environment
  • Minimising corporate tax evasion by clamping down on tax havens
  • Re-regulating the domestic financial system and changes in debt-management policy to enable reductions in interest rates across all government borrowing. This is designed to help those borrowing to build a new energy and transport infrastructure.
  • Breaking up the discredited financial institutions that have needed so much public money to prop them up in the latest credit crunch.

Following this initial report, the United Nations also drafted a report calling for a “Global Green New Deal” which called on governments to allocate a significant share of stimulus funding following the financial crisis of 2008-2009 to green sectors and sets out three objectives: economic recovery; poverty eradication; and reduced carbon emissions and ecosystem degradation; and proposed a framework for green stimulus programs as well as supportive domestic and international policies.

The lost decade

During the post-financial crash era, the Green New Deal was sidelined on both sides of the Atlantic by successive governments as various austerity packages and restrictive financial policies were put in place by northern American economies, Britain and the eurozone.

In 2013, the Green New Deal group put out a follow-up report A National Plan for the UK: From Austerity to the Green New Deal to try and regain interest in the concept, but to little avail. Some of its follow up recommendations were specific to the policy agenda in Westminster at the time, focusing on tax evasion, controls of banks that had been bailed out by the taxpayer in 2008, green ‘quantitative easing’, and encouraging pension funds to invest in green areas such as energy efficiency and building low carbon homes.

In 2015, the global United Nations Framework Convention on Climate Change’s Paris Agreement saw discussion around the Green New Deal resurface, but not in any specific context. But, in updating the original 1992 Earth Summit Rio Agreement and previous Kyoto protocol and Copenhagen Accords, it did reference some of the policy framework around public financing mechanisms for climate change.

But in 2016 following the dissolution of the Department for Energy and Climate Change in the UK, and the election of Donald Trump in the USA with his plans to withdraw the US from the Paris Agreement, the potential application of a Green New Deal on either side of the Atlantic perhaps reached a low point as we entered the end of the decade.

The resurrection of an idea

On February 7, 2019, the youngest women to ever sit in the United States Congress, Alexandria Ocasio-Cortez (AOC), submitted her first piece of legislation to the Senate. It was called the Green New Deal. Within hours of her delivering her speech introducing the legislation, it went viral across social media, providing significant coverage to both herself and the Sunrise Movement of youth climate activists who support AOC and the Green New Deal concept. Ever since this point, the concept has been a major topic for think-pieces and opinion articles in the UK, US, Europe and beyond.

The proposed legislation by AOC called for a “10-year national mobilization” across America and, in a similar way to a decade ago, it mixes an economic stimulus package with green policies and a focus on jobs. It specifically calls for:

  • 100% renewable energy
  • Guaranteed jobs with a ‘family-sustaining wage’ for all
  • Clean air and water
  • Biodiversity and access to nature
  • Upgrading green infrastructure
  • Smart power grids
  • Retrofitting existing buildings for energy efficiency
  • Growing zero emissions transport
  • Clean manufacturing
  • Working with agriculture to eliminate greenhouse gas emissions

Although unlikely to become legislation, especially with Republican and some Democrat opposition, as well as a failed vote already on the floor of the Senate, it has set a marker for Democrats looking to enter the White House in 2020. Prospective presidential candidates Bernie Sanders, Cory Booker, Kamala Harris, Elizabeth Warren, Amy Klobuchar and Kirsten Gillibrand have all signed as co-sponsors of the bill. One notable exception is Beto O’Rourke, who although saying he ‘hasn’t seen anything better’ than the Green New Deal, has produced his own climate change policy to deliver net-zero by 2050 and for the US to re-enter the Paris Agreement.

The UK response

Immediately following the take-up of the Green New Deal concept by AOC and US Democrats, the UK based politicians and activists who had originally sounded the starting gun on the concept a decade ago quickly re-edited and re-freshed the idea for a post-Brexit Britain.

Ahead of AOC’s boost this year, The Green New Deal Group had produced a report in September 2018, as awareness of the concept began to grow again on either side of the Atlantic among progressive politicians and think-tanks. The report, called Jobs in Every Constituency – the promise of the Green New Deal, focused specifically on how sustainability measures could be driven by a localist approach with green jobs delivered in each constituency. The core aim of this potential jobs programme was still to retrofit buildings and deliver greater energy efficiency. This is a point that The Guardian’s Larry Elliott has been keen to stress: the Green New Deal as a concept was originally tied to employment.

One significant difference between 2007 and now is that the Labour Party is no longer the governing party of the UK. The Conservative Party have not shown any desire to engage with the concept at present. The Conservative Environment Network (CEN), which includes environment secretary Michael Gove and who supported the young climate strikers, are philosophically against the GND. The director of the CEN, Sam Richards, called the US version of the GND “a divisive and counterproductive socialist platform”, and told think tank the Green Alliance that bringing such a concept to the UK would damage consensus politics on the environment.

There are also some conservatives who are willing to follow the Green New Deal route, such as Laura Sandys, the Tory ex-MP of South Thanet, who will sit alongside the former minister at the Department for Energy and Climate Change and former leader of the opposition, Ed Miliband, Caroline Lucas and other experts on the Institute for Public Policy Research’s Environmental Justice Commission, which has the specific remit of researching the policy framework and concepts that could formulate a Green New Deal in the UK.

But the Green New Deal policy is still very much an opposition concept rather than government policy, and the chance of it becoming legislation in the near future are slim. However, legislative work has already begun, and a Private Member’s Bill has been presented by the Green Party’s Caroline Lucas and Labour’s Clive Lewis to the House of Commons in March, under the guise of a Decarbonisation and Economic Strategy Bill. It is currently awaiting its second hearing. The bill calls for government to:

  • Decarbonise the United Kingdom economy and to eradicate inequality
  • Establish a ten-year economic and public investment strategy that prioritises decarbonisation
  • Community and employee-led transition from high-carbon to low and zero-carbon industry
  • Government to report on its adherence to the strategy
  • To establish higher environmental standards for air, water and green spaces
  • To make provision to protect and restore natural habitats; and for connected purposes

Party-political groupings focusing on the concept are also emerging, such as the Labour for a Green New Deal group, which specially aims to “transform energy systems from fossil fuels to clean renewables” and to “democratise industry and social infrastructure through powerful unions, democratic control and expanded public ownership”.

The next steps

The Youth Climate Strikes have also put the Green New Deal centre stage, and one of the big slogans of the global movement has been a call to governments to adopt the strategy.

The biggest barrier to entry will be creating a set of clear, identifiable objectives which can be turned into policy and then into action. At present, the Green New Deal is merely a ‘headline’ concept, and neither AOC’s legislation in the USA or the Green Party/Labour Party’s Bill in the UK have detail behind them – nor widespread representative or parliamentary support. Part of the problem has been the relative financial security of the nation states where the idea is being proposed, as the project is tied to a

However, the appetite and public awareness is now there. A search of Google now delivers more than 2 million results for “Green New Deal” (April 2019) and the spikes in Google Trends are a telling sign that the concept is growing significant momentum.

Only time will tell if the Green New Deal will become mainstream, long term policy in the way the National Health Service has become, but at present it remains a pertinent, trending concept at the heart of climate change policy.