The Green New Deal: The Answer to Rebuilding an Economy Ravaged By Austerity

Ben Rutt-Howard discusses how a Green New Deal can help to build the economy ravished by Covid-19.

Increasingly over the past five years the general population has been forced to acknowledge the concerns of climate activists and their incredibly damning predictions for the future of our planet. There is no doubt that on an individual level we can all do our bit, and this has been beneficial for our local economy by giving rise to small independent businesses who sell reusable and sustainable products. Yet this does not seem like enough. Admittedly, for people who have the resources, time, energy and knowhow, these are all fantastic ways to help ease our environmental problems and support local business. There is no shortage of ways for us to impart our message either. We live in a world in which information can be sent from one corner of the globe to the other in seconds, mobilising people who have not, and will never meet. Ideas can be reduced to pithy clickbait shared on social media, at once satiating our desire for connection but crucially imparting important messages. However, leaving it up to the individual will not yield the dramatic results we need, and furthermore is the wrong place to be directing our energy.

The Green New Deal, as proposed in the 2019 Labour Manifesto, takes its influence from both the radical bill made famous in recent years by Alexandria Ocasio-Cortez, and the principles of the New Deal, a series of social programmes, financial reforms and regulations introduced by President Franklin D. Roosevelt. Global warming annually costs the taxpayer billions in damages caused by environmental changes and this policy is predicated on the belief that we need to address the Climate Crisis in a radical way. The aims of Labour’s policy were as follows: ‘kick-start a Green Industrial Revolution that will create one million jobs in the UK to transform our industry, energy, transport, agriculture and our buildings, while restoring nature.’

We are presented with the perfect time to make this big choice, we are emerging from a life-changing experience, and this is the best time to alter our consumption habits and push ourselves out of our comfort zones when it comes to how we address the climate crisis. The Green New Deal will take time, investment, and money to make possible. However, there is sufficient evidence to suggest that a Green New Deal will provide up to one million high-paid sustainable jobs, create scope for 860,000 climate apprenticeships, and start a Green Industrial Revolution which will transform the way we produce and consume energy to be achieved by 2030. A commitment to this sort of policy will provide not only sustainable jobs, but by using evidence-based environmental science dramatically reduce the UK Carbon emissions by 2030, something that is critical if we are to try and curb the rate of global warming. Alongside the obvious environmental benefits there is huge scope to develop a sector of our economy that could become the cornerstone of post-Brexit trade negations, exports and also help make the UK a world-leader in green technological advances.

The main critique and anxiety caused by this policy, and a lot of policy in Labour’s manifesto, was the cost. Yet if we break down the estimated costs and compare against the country’s GDP, this policy is not only manageable but a fantastic investment opportunity. As of the 2016/17 financial year the UK’s public investment spending was around £73 billion, or equivalent of 4% of the GDP, if we allocated £40 billion per annum to tackling climate change and investing into the Green New Deal this would take public investment spending to around the £115 billion, only increasing spending to around 6% of the annual GDP, a percentage comparable to the 1984/85 financial year, which a lot of people will recognise as being in the middle of Margaret Thatcher’s premiership.[1] This money is not being thrown away at some utopian pipe-dream, this is an investment not only for our future, but for the continued existence of the human species.

There is also an equally transparent way in which we can raise the funds to finance it. In the same way the current government has raised funds for quantitative easing, through the selling of government gilts and bonds, we can utilise this method to help us raise the money for the Green New Deal. Using investment from publicly owned investment firms we would be able to make sure that the rewards of this profitable policy benefit the people. The Bank of England allows the government of the UK to sell off these sorts of assets to finance investment into public programs without having to resort to increasing taxes for the individual taxpayer.

However, what we cannot ignore is that in the wake of the Covid-19 pandemic we are preparing for a recession predicted to be worse than the financial crash of 2008. This is in part due to the weak foundations of our economic growth in the aftermath of this financial crisis. Seeking to stimulate our economy the coalition government offered a toxic melting pot of austerity, quantitative easing, and bailing out the banks responsible for this recession. It produced the desired effect in helping our economy grow more rapidly than many of our European neighbours, but this was made possible by stripping away welfare support, trimming off and privatising sections of our NHS, and making it easier for the accumulation of wealth by those who don’t need it. This has led to an economy that does not benefit a huge proportion of our society, furthermore it has seemingly instigated an increase of people in poverty. In-work poverty has seen the most dramatic increase as 56% of people in poverty now come from a working family,[2] but we have also seen an increase in poverty in the most vulnerable parts of our society. 31% of people with a registered disability in the UK live in poverty, this amounts to some 14 million people. The weakening of the welfare state, that millions of people are reliant on, has directly caused this increase in poverty. Selling off these assets may seem like an impossible task, especially when people will be more inclined to pinch their pennies than spend them. However, it is countries like Britain, with its robust taxation system and respected institutions, that still offer a very attractive prospect for investors.

This is one of the benefits of using an economic downturn as a catalyst to transform our economy and start to tackle the climate crisis, we can help lay the foundations of prosperity for all Britons and to help instigate a Green Industrial Revolution.[3] I firmly believe that this is a policy that could help us emerge from this crisis with a stronger economy with better protection for workers and businesses alike. The best part about this policy, aside from saving the planet for future generations, is that within a short space of time it will not only pay for itself but create revenue to bolster the treasury.

Our focus should primarily be on the impact these changes will have on our society, because there will always be ways for a government to fund such policy, it is more a case of are they prepared to invest in the future? The Green New Deal proposed by Labour would require the finance sector to give up some of its power, and reduce its sphere of influence, this is something that it will not want to do and will pay for their status quo to be maintained. Mainly by funding politicians and lobbying the government to pass bills that favour their current method of doing business, but if we are to succeed in our endeavours to save our planet, the finance sector will need to be muzzled. Part of the benefits of such a high profit policy is that it can be used to fund other social policies such as Universal Basic Income, or investment into the NHS and under no circumstances should it benefit anyone other than the British people. This policy needs to come from the people and be for the people, an investment not just in our future, but a governmental commitment into a redistribution of power and wealth. This should not be seen as a party-political policy, but one that is necessary to maintain the environmental integrity of our planet, a policy more alike to a moral duty than one used to win elections, yet I doubt it will be treated as such. Therefore, a policy designed so that the people would see their return of investment in a fairer society, in which we can share in the history of humanity and pave the way to building a new heritage for the next generation is the best way forward. The Green New Deal may almost seem too easy a win-win scenario to believe, yet all the evidence points to this being the case. This policy should have been introduced a long time ago, but we now have a plan, and a solution. One that would help those that have been neglected in our society for too long, and the continued existence of our way of life.

Ben Rutt-Howard plans on doing an MA in Russian Musicology at Bristol University this coming year (pandemic permitting). He first moved to become more physically active in the political sphere when he gained employment in Portsmouth for a year becoming involved with the team of volunteers that helped secure the re-election of Portsmouth South MP, Stephen Morgan. 

He tweets at @HowardRutt.


[1] Pettifor, Ann To Secure a Future, Britain Needs a Green New Deal.

[2] Jospeh Rowntree Foundation UK Poverty 2019-2020 (February 2020)

[3] Labour Party 2019 General Election Manifesto

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