The concept of a “green new deal” has recently achieved some political traction, but its exact content and policy feasibility is subject to considerable uncertainty. Aspects of what is referred to as a “green new deal” have been discussed by ecological economists for some time. In this discussion, there remains a tension between concepts of “green growth” and limits to growth or degrowth. Major stated goals of a green new deal include:
- Transformation to a low-carbon economy including renewable energy sources and energy efficiency;
- Protection and restoration of forests and wetlands;
- Sustainable farming and soil restoration;
- Expanding employment in renewable energy, energy efficiency, infrastructure investment, ecological resilience, and water management, among other areas
Results/Conclusions
There is a theoretical basis for this program. A “green Keynesian” approach combines a radical Keynesian analysis with ecological priorities such as drastic carbon emissions reduction. This approach delinks traditional economic growth, largely based on fossil energy and resource input-intensive techniques, from employment creation and expanding well-being. In part this is a technological issue of employing “green”, renewable, and resilient technological options, and in part it represents a shift in consumption from energy-intensive to energy-conserving and service-oriented forms of consumption.
The combination of changes on the supply and demand sides enables, for example, large scale reduction in carbon emissions through “lowering the ceiling” of total energy consumption while “raising the floor” of renewable energy supply. This provides an alternative to the assertion by proponents of “degrowth” that only radical reductions in consumption and economic growth can achieve ecological balance.
Despite this potential, popular presentations of the “green new deal” suffer from excessively broad aspirational rhetoric, making it difficult to discern which of the stated goals are feasible. The Congressional resolution proposes a ten-year time frame – insufficient to achieve many of the more ambitious goals. It is also vague on the question of costs as well as budget and deficit implications. But an application of green Keynesian analysis can offer some insight into how a green new deal can achieve both economic and ecological goals subject to both physical/ecological and economic constraints.