An eco injection
30th April, 2009
Barack Obama and Ban Ki Moon, Labour and the Conservatives, green groups and trade unionists, Nicholas Stern and even Peter Mandelson - everybody is talking about a 'Green New Deal'. Faced with an economic downturn, climate breakdown and an energy system in need of billions of new investment anyway, the idea is simple and attractive.
You pour billions into efficiency and a smart new energy grid based on clean, renewable technologies, and in doing so stimulate a sustainable economic recovery and millions of new green jobs.
By embracing this sort of ‘new energy economy’, the thinking goes, we can also secure our power supplies, reduce our dependence on fossil fuel imports, cut our climate change emissions, reduce rates of fuel poverty and shift the country’s economic dependence away from an increasingly irrelevant ‘financial services’ industry. It’s no wonder everyone likes the idea. The business secretary himself said, ‘This transition to low-carbon is an environmental and economic imperative. It is also inevitable’.
With so many prominent voices talking up this plan, and with so much popular support, you could be mistaken for believing it really is as ‘inevitable’ as Mandelson suggests. After all, it was our Prime Minister who said, just a few weeks ago, ‘I admire what President Obama has announced for America and I think it is true that about 10 per cent of this fiscal stimulus will go to environmentally important technologies and potentially jobs in green industries. I think you will fi nd that the percentage of our expenditure is as high, that we are investing a great deal in environmental technologies’. Oh really? What new and additional investment has actually been promised?
HSBC’s Climate Change Centre of Excellence attracted a lot of attention when it published a score-card analysis comparing how different countries’ packages matched up from a ‘climate-energy’ perspective. According to HSBC, Britain has committed just 6.9 per cent of its stimulus to ‘sustainability measures’, compared with around 38 per cent for China. Take out some of the dodgier numbers HSBC includes, such as money that was already set aside for green spending in 2010 that’s simply been brought forward to 2009, and the British figure looks even less impressive.
In fact, according to a new report from the New Economics Foundation (NEF), Labour ministers are committed to spending seven times more on bonuses for failed Royal Bank of Scotland bankers than on green projects. One seventh of the RBS bonuses. With this single statistic, you learn all you need to know about Gordon Brown and the prevailing ideology. Labour will spend £775 million of our money on those infamous bonuses, whereas just £100 million of new money will go towards green schemes. It’s unforgiveable. Set this against the £11 billion Stern estimates we need, and the more realistic £50 billion green economists such as Larry Elliott and Andrew Simms agree we need, and the gap between Labour’s rhetoric and what it is actually doing is stark.
At least half of all the new money being invested should be going into the sustainable industries of the future, not the unsustainable industries of the past. After all, it will be the workers of the future who pay for this spending spree via taxes they have yet to pay. Instead what we see is Big Carbon special interests prevailing. The car industry alone is expected to receive about 20 times as much money as all of the sustainability projects combined.
Consider that Labour has just decided to spend £4 billion on two new aircraft carriers and £5 billion on the controversial new ID card scheme and you begin to see that when Lord Mandelson says ‘Lowcarbon is not a sector of an economy – it is an economy’, he is lying through his teeth. NEF has calculated that the minuscule sum Labour has dedicated to green projects can only be expected to delay Britain’s emissions by about half a day in about three years’ time. With just 0.6 per cent of the UK’s £20 billion recovery plan being new and additional environmental spending, Labour’s stimulus package isn’t so much green as a sort of coal-shade of black.
With plans to inject more money into the financial system in coming months, the opportunity and potential remains for a transformation of our economy into something that would simultaneously rescue millions of people from unemployment and millions of species from extinction; something that would leave behind cleaner air, a more stable climate and smaller energy bills. We can’t afford for that opportunity to be squandered from a lack of imagination or for the sake of Big Carbon.
Joss Garman is an environmental campaigner and journalist
This article first appeared in the Ecologist May 2009
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