The Green New Deal\nrecognises that we live in a world of massive insecurity. The UK\u2019s neoliberal economic\nmodel has over the last forty years reduced the security of employment,\nyoung people, savings, pensioners, the vulnerable, those needing access to\nhousing and so much more. What we now also know is that the economic model that\ncreated this insecurity has also been harming our planet. Almost everyone now\nagrees that the climate science argument is settled: global heating is our\nfault. As a result, we have to beat human-created global warning unless we want\nto become extinct. The consequence of neoliberalism is, then twofold: we must\nbuild a new society in which we can both survive and prosper within the\nconstraints our planet imposes. We are nowhere near this position now. <\/p>\n\n\n\n
The Green New Deal <\/strong><\/p>\n\n\n\n The Green New Deal,\nin almost every iteration I have seen, is a variation on the plan produced by\nthe London-based Green New Deal Group that first reported in July 2008, shortly\nbefore the crash of Lehman Brothers and the onset of the Global Financial\nCrisis. Those objectives might be summarised, in my view, as seeking to provide:\n<\/p>\n\n\n\n How will we do this? <\/strong><\/p>\n\n\n\n The Green New Deal has an ambitious programme to achieve these aims. It will, for example, seek to transform the UK\u2019s 30 million buildings so that they are all energy efficient by 2030, creating hundreds of thousands of jobs on the way right across the UK. It will also supply the training and support services that this will require. In the process it will turn as many of those buildings as possible into power stations by fitting solar panels and other generating capacity, and it will fund the building of the new social housing required to end our housing crisis whilst investing in renewable energy of all sorts, on and offshore, that will guarantee that they can be net-zero, carbon neutral. <\/p>\n\n\n\n The Green New Deal\nwill also fund significant investment in local public transport, with an emphasis\non reducing dependency on fossil fueled cars. Investment in research and\ndevelopment that will seek to address the problems of a green transition for\nfreight, sea and air transport will also take place. And whilst all this is\nhappening business will be required to transform itself to become zero net\ncarbon: the Green New Deal and its associated National Investment Bank will\nhelp provide the capital to assist business to do that if they cannot find it\nthemselves. <\/p>\n\n\n\n Throughout this the\nGreen New Deal will seek to provide security for people\u2019s jobs and long-term\nprospects, as well as providing secure opportunities for their savings, which\nwill be used to fund this innovation at better rates of return than most savers\nenjoy now. As a result, the Green New Deal will also deliver pensions that will\nwork. <\/p>\n\n\n\n How much will this cost?<\/strong><\/p>\n\n\n\n Current best\nestimates suggest that the Green New Deal will in itself cost at least \u00a350\nbillion a year. On top of that requiring that businesses be net-zero carbon –\nas it is going to have to be – will create additional costs and that business\nwill need help to fund this transition. The need may then be for \u00a3100 billion a\nyear of investment for at least a decade. <\/p>\n\n\n\n This sum does,\nhowever, need to be put in context. \u00a3100 billion is just 5% of the UK\u2019s annual\nincome, which is a small price to pay for a secure future. And in addition, it\nis only about 8% – or less than a twelfth – of total UK private wealth. It is\neasy to get carried away with thinking that programmes costing multiple billions\nof pounds are unaffordable. In the case of the Green New Deal there is,\nfirstly, no option but invest if we are to survive. And second, the sums\ninvolved are completely affordable. <\/p>\n\n\n\n How do we pay for this?<\/strong><\/p>\n\n\n\n It is very likely\nthat the transition that the Green New Deal requires can be paid for without\nincreasing taxes, at all. That is because the tax reliefs that direct the way\nthat the wealth of the UK is saved should instead be used to redirect funds to\nthe Green New Deal. <\/p>\n\n\n\n About \u00a3100 billion a year\nis paid into UK pension funds and all of that money gets tax relief from the\ngovernment. The total tax subsidy costs \u00a354 billion a year. If 25% of those\ncontributions were required to go into Green New Deal Investments in exchange\nfor that tax relief that would supply about \u00a325 billion a year to the Green New\nDeal. <\/p>\n\n\n\n In addition, about\n\u00a370 billion is saved in Individual Savings Accounts (ISAs) each year. If ISA\ntax relief was dependent on these funds being invested in the Green New Deal in\nfuture through GND related gilts and other bonds of the types noted below, with\na government guaranteed rate of 1.5% on all bonds issued by government related\nor backed institutions, it might be that all this money would be available to\nthe Green New Deal.<\/p>\n\n\n\n In that case these two sources of funds should, by themselves, fund the whole cost of the Green New Deal. It is important to add though that all this new economic activity undertaken by people in secure and well paid employments would create significant additional tax revenues that would help pay for a lot of the Green New Deal as well, or other measures to relieve the impact of austerity. In that case it is likely that the suggested funding is more than adequate to fund the whole Green New Deal programme. <\/p>\n\n\n\n What are Green New Deal Investments?<\/strong><\/p>\n\n\n\n Green New Deal\ninvestments that ISAs and pension funds might invest in will take the form of a\nwhole range of products, including:<\/p>\n\n\n\n