The Green New Deal: a bold plan to save the planet

Alexandria Ocasio-Cortez © Rex Features
Ocasio-Cortez: the talk of the town

The Green New Deal proposed by a group of US politicians would be expensive and unworkable, says Matthew Partridge.

American political history is a long story of “waves of progressive enthusiasm breaking on the rocky shores of Washington DC, to no lasting effect”, says David Roberts on Vox. A group of Democrats, including Congresswoman Alexandria Ocasio-Cortez, aim to change that. They have launched a “radical environmental plan” that has become the “talk of the town”. Their “Green New Deal” is “a massive programme of investments in clean-energy jobs and infrastructure”, meant “to transform not just the energy sector, but the entire economy”. It aims to make the US economy carbon- free by 2030 and to “make it fairer and more just”.

Is it workable?

The plan has many “good ideas”, but it is simply too expensive, says Noah Smith on Bloomberg. It would cost $1.4trn a year over a decade to retrofit every home in America so that it produces zero emissions, for example. That’s just for starters.

The “vast programme for economic egalitarianism” proposed – which includes a universal basic income for those “unable or unwilling to work” – makes the deal even more “unworkable”. Adding the cost of the environmental and social programmes together suggests that government spending would have to rise by $6.6trn a year – or by 34% of GDP.

Still, it would be a mistake to ignore the plan completely, says Robert Hockett in the Financial Times. True, the environmental aspects alone make for a larger undertaking than that of any American government since Franklin D Roosevelt’s original New Deal and the US mobilisation for the World War II. But the problems the plan addresses “require solutions where bigger is better, imperative and, paradoxically, more affordable” than the alternatives. Economies of scale and the snowball effect (where rising temperatures increase carbon emissions) mean that, where climate is concerned, “acting faster will yield greater impact than acting sluggishly”.

Shifting the Overton window

Even if the Green New Deal is impossible to implement, that doesn’t mean those pushing it are wasting their time, says Christine Emba in The Washington Post. Like Alexandria Ocasio-Cortez’s proposals on immigration and tax, the idea is to “shift the Overton window” – that is, widen the range of ideas and policy considered acceptable in public discourse. So while supporters of the Green New Deal seem now to be “at the extremes”, by making less ambitious plans seem more moderate they are “speeding the movement toward change”. After all, “whether we like it or not, provocation is how we conduct business today”.

Nonsense, says Niall Ferguson in The Sunday Times. Floating wild schemes that have no chance of being implemented in order to shift the debate is “what you get when you recruit your legislators more or less directly from college”. This isn’t just some fringe plan – it has been “endorsed by (thus far) five of the leading candidates for the Democratic nomination in 2020”. The whole kerfuffle shows that the Democrats “are not one party, but two: a liberal and a socialist”. The reality is that the former can beat Trump, “but not if it is associated with the latter”.

EU makes a welcome stand for markets

Brussels’ decision to block the merger of Siemens and Alstom provides “a rare opportunity to congratulate the European Commission on a decision well taken”, says Jeremy Warner in The Sunday Telegraph.

The justification offered – that Europe needs “a national champion in train and signalling manufacture to compete with the likes of China’s CRRC” – is “nonsense”. CRRC does not yet provide any meaningful competition to Siemens and Alstom in non-Chinese markets. And in any case “there are better ways of competing against the cheating, stealing Chinese behemoths than creating a matching monopoly”.

It may be a pyrrhic victory, says Ben Hall in the Financial Times. France has decided the EU merger rules are “obsolete”; Germany has demanded changes to “better take into account the demands of international competition”. This is a mistake – competition policy is there to serve customers, not just two countries with big corporate interests.

Still, if anyone is prepared to make the case for competition and markets it’s Margrethe Vestager, the European Commissioner for Competition, says The Economist. During her time in the job, she “has taken on mighty corporate interests where others would have wavered”, including Apple, Google, German carmakers, and even bond traders. Indeed, she has even been tipped as the next president of the European Commission. “Europe’s liberals talk much about the need to rebuild confidence in the EU in populist times. In Vestager they have a chance to pick a head of the European Commission who actually believes in enforcing the rules.”