Green, lean and substantially mean — Joe Biden’s Plan to Reimagine the American Economy
Just like FDR did before, Joe Biden has taken on the task of reimagining the American economy with a “New Deal” of sorts. This time relying on green innovations to do so, and it might (if successful) become one of the most consequential pieces of legislation passed this century.
The term Green New Deal was first coined by Pulitzer Prize-winner Thomas Friedman in 2007 but only rose to prominence more than a decade later in American politics. One might recall the Green New Deal, a piece of legislation, proposed by New York Rep. AOC, Senator Ed Markey and other progressive democrats in early 2019. The purpose of the bill, as outlined in the official submission to congress, is to “[Recognize] the duty of the Federal Government to create a Green New Deal”. More broadly speaking the bill aims to provide a framework needed to confront intersecting crises by battling climate change and providing new Union backed jobs. The bill has three core components: jobs, justice and climate. It includes prioritizing frontline and vulnerable communities disproportionately affected by climate change, such as communities of color, indigenous land, deindustrialized communities, and fossil fuel hubs; pledging to create good-paying union jobs; and pledging to reduce greenhouse gas emissions from human sources by 40 to 60 percent within ten years and to zero by 2050.
It has however, faced its critics both from the left and right. Left wing critics have argued that the GND failed to tackle the real cause of climate change. That being the concept of unending growth and consumption inherent in capitalism and critics on the right argue that it could cost a whopping $93 trillion dollars over the next decade, or $600k per household. So, it is fair to say that the concept became extremely polarizing in America and within the party from which it originated, the Democrats. This made it a hard topic to dance around for many democrats during the 2020 Democratic Presidential Primaries. It was even harder for compromise candidate and moderate Joe Biden to dance around with those to his right and left all demanding a seat at the table.
Fast forward to the beginning of February this year and the US now has the most generous package of climate incentives, inspired by Joe Biden’s “Build Back Better” plan, with a $370bn package that goes under the misnomer of the inflation reduction act. Included are handouts and tax breaks for investment in electric vehicles and solar panels as well as industry. What sets the package aside from the rest, however, is the fact that these subsidies are only available to products “Made in America”, beating anything on offer in Europe. A further $2 trillion has been planned in investments for infrastructure and 10 million jobs in green endeavors in the full Build Back Better package. Since the IRA (Inflation Reduction Act) was passed into law last August, at least 20 new or expanded clean energy manufacturing plants have been announced in the US. While some are not satisfied with the package most feel as though it is a step in the right direction for allowing a greener agenda to set out by the White House in the future and now with the resignation of World Bank CEO David Malpass, who stood against a greener agenda at the bank, this could full well happen.
For the first time since FDR’s New Deal America has to get to terms with the idea that they may have to relook at how they structure their economy. What exactly do they value when it comes to aspects of their economy? Can they continue to overlook climate policy in the name of perpetual growth? Or can we find new opportunities in the face of a crisis?
Now I have most likely proposed more questions than answers in this week’s edition, as usual. But as America grapples with the idea of restructuring its economy, these are important things that are necessary to consider when we talk about the values and priorities of the country and the opportunities that may emerge in the face of a crisis.
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