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Bailed-out banks should fund the Green New Deal
17th August, 2009
They emptied the public purse to fund their continuing largesse. Now it's time for the banks to pay us back. At phenomenally good rates...
Summer time, and the living is easy. The sun is out and the City, Britain’s financial heart, is emptying as Britain’s bankers head for the beach.
As they kick back, many will be feeling pretty pleased with the way the world is playing out. France and Germany are out of recession (the French finance minister interrupted her holiday to announce that 'France is finally coming out of the red’), share prices are up, oil and other commodities are booming, and bonuses are back. It all seems a long, long time since last winter.
Which is worrying.
Back then, in the teeth of recession, we saw the launch of the Green New Deal, a brave proposal to stimulate the world economy by spending billions on saving the environment: in effect, to pick an inappropriate metaphor, killing two birds with one stone.
Back then, governments loved the idea. South Korea, then Japan, then Gordon Brown threw themselves behind it. UNEP head Achim Steiner said, 'The opportunity must not be lost'.
But now, with the sun shining on a raft of economic graphs that are starting to point up, we hear very little about the Green New Deal. With national debt soaring, the Government is also under pressure from both business and the civil service to cut its own spending – and, if you believe the rumours, the Green New Deal is a likely target for the slice.
Time, I thought, to go back to one of the report’s authors, Ann Pettifor (also the driving force behind Jubilee 2000). I caught her just as she, too, was heading off on her hols.
Refreshingly, Ann isn’t going quietly. Not only, she says, are all the optimists wrong about the economy (particularly about unemployment and debt, both of which are heading the wrong way) but the Green New Deal is still right, and still relevant.
More importantly, Ann has also worked out where we can get the money from: she wants the government to be given it by the banks.
Specifically, a new Green New Deal report to be published this autumn will argue that the money should be loaned – and here’s the crucial point – at very, very low rates of interest, far below what the banks might usually expect to receive.
Just last year the idea wouldn’t have stood a chance but now, of course, many banks exist only because the government bailed them out; as a result, those banks are now part-owned by the state.
'These state-owned banks who have been bailed out and are now paying bonuses, we’re saying, "Now mate, the terms are that you’re providing credit at these rates otherwise you’re getting taken over completely",' Ann says.
It’s a bold message, and likely to be couched in much less emotive terms by the time the report is made public. But that doesn’t mean the argument behind it is wrong and I, for one, wish Ann all the rest she can get on her holiday. Because she has a fight on her hands when she gets back.
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