The Climate Crisis, Degrowth and a Global Green New Deal (part 1)
As we move toward the COP26 UN meetings on climate change in Glasgow in November, debate is intensifying over the political coalitions and policy mechanisms to address the mounting climate emergency. The 6th Report of the Intergovernmental Panel on Climate Change released earlier this year, (Climate Change 2021: The Physical Science Basis) documented the global rise in temperature of the land, oceans, and atmosphere from concentrations of greenhouse gases produced by human activities from 1750. Since 2011, concentrations have continued to increase in the atmosphere and are now pushing past 410 ppm for carbon dioxide (CO2) annually alone (not including the rise in methane and nitrous oxide). Compared to any other decade since 1850, “each of the last four decades has been successfully warmer.”
The consequences have been many and alarming – the norming of extreme weather events, the melting of the polar ice shields, mass numbers of climate refugees, endless droughts, and more. The strategies being put forward by states and the ruling classes have been targeted at just coping and limiting the impacts through market mechanisms that will not merely maintain capitalist social property relations but, in fact, extend them through various mechanisms of ‘market ecology’ – incentives and subsidies for capitalists and consumers to move to alternate energy sources, shifts in relative prices, carbon taxes, commodifying more of the planet and the like, creating more markets to manage with the ecological problems that capitalism itself produced.
Debates on alternatives that would move beyond neoliberal and market measures vary. One set tended toward strategies for increased state-led transformations that would lead to greater controls over markets as part of a more egalitarian growth process. Others call for ‘degrowth’ to more radically break with economies centred on the endless accumulation of capital and commodification of life. A third group are proposing a more radical anti-capitalist rupture with capitalism to democratize and remake the social-production system and place a social ecology at the centre of decision-making.
In cooperation with Green Social Thought, Znet and Truthout, we present in three parts an exchange between Robert Pollin, C.J. Polychroniou, and Don Fitz. Part 1 is a discussion between Pollin and Polychroniou, the former being the progressive economist that is perhaps most central to strategies for a Green New Deal in the US, and the latter a leading journalist and researcher, both in the US and Greece, on the policy regimes of contemporary capitalism (fuller biographies below). Don Fitz is a university lecturer, and editor with Green Social Thought, and a past candidate for the US Green Party.
Perspectives on the Green New Deal and Degrowth
C.J. Polychroniou (CJP): Since the idea of a Green New Deal entered into public consciousness, the debate about climate emergency is becoming increasingly polarized between those advocating ‘green growth’ and those arguing in support of ‘degrowth’. What exactly does ‘degrowth’ mean, and is this at the end of the day an economic or an ideological debate?
Robert Pollin (RP): Let me first say that I don’t think that the debate on the climate emergency between advocates of degrowth versus the Green New Deal is becoming increasingly polarized, certainly not as a broad generalization. Rather, as an advocate of the Green New Deal and critic of degrowth, I would still say that there are large areas of agreement along, with some significant differences. For example, I agree that uncontrolled economic growth produces serious environmental damage along with increases in the supply of goods and services that households, businesses, and governments consume. I also agree that a significant share of what is produced and consumed in the current global capitalist economy is wasteful, especially much, if not most, of what high-income people throughout the world consume. It is also obvious that growth, per se, as an economic category makes no reference to the distribution of the costs and benefits of an expanding economy. I think it is good to keep in mind both the areas of agreement as well as the differences.
But what about definitions: what do we actually mean by the Green New Deal and degrowth?
Starting with the Green New Deal – the Intergovernmental Panel on Climate Change (IPCC) estimates that for the global economy to move onto a viable climate stabilization path, global emissions of carbon dioxide (CO2) will have to fall by about 45 percent as of 2030 and reach net zero emissions by 2050. As such, by my definition, the core of the global Green New Deal is to advance a global project to hit these IPCC targets, and to accomplish this in a way that also expands decent job opportunities and raises mass living standards for working people and the poor throughout the world. The single most important project within the Green New Deal entails phasing out the consumption of oil, coal, and natural gas to produce energy, since burning fossil fuels is responsible for about 70 – 75 percent of all global CO2 emissions. We then have to build an entirely new global energy infrastructure, whose centerpieces are high efficiency and clean renewable energy sources – primarily solar and wind power. The investments required to dramatically increase energy efficiency standards and to equally dramatically expand the global supply of clean energy sources will also be a huge source of new job creation, in all regions of the world. These are the basics of the Green New Deal as I see it. It is that simple in concept, while also providing specific pathways for achieving its overarching goals.
Now on degrowth: since I am not a supporter, it would be unfair for me to be the one explaining what it means. So here is how some of the leading degrowth proponents themselves describe the concept and movement. For example, in a 2015 edited volume titled Degrowth: A Vocabulary for a New Era, the volume’s editors Giacomo D’Alisa, Frederico Demaria and Giorgos Kallis, Degrowth: A Vocabulary for a New Era write that “The foundational theses of degrowth are that growth is uneconomic and unjust, that it is ecologically unsustainable and that it will never be enough (2015, p. 6).” More recently, a 2021 paper by Riccardo Mastini, Giorgos Kallis, and Jason Hickel titled “A Green New Deal without Growth?” write that “ecological economists have defined degrowth as an equitable downscaling of throughput, with a concomitant securing of wellbeing.”
It is instructive here that, in this 2021 paper, Mastini, Kallis, and Hickel do also acknowledge that degrowth has not advanced into developing a specific set of economic programs, writing that “degrowth is not a political platform, but rather an ‘umbrella concept’ that brings together a wide variety of ideas and social struggles.” This acknowledgement reflects, in my view, a major ongoing weakness with the degrowth literature, which is that, in concerning itself primarily with very broad themes, it actually gives almost no detailed attention to developing an effective climate stabilization project, or any other specific ecological project. Indeed, this deficiency was reflected in a 2017 interview with the leading ecological economist Herman Daly himself, without question a major intellectual progenitor of the degrowth movement. Daly says in the interview that he is “favorably inclined” toward degrowth, but nevertheless demurs that he is “still waiting for them to get beyond the slogan and develop something a little more concrete,” (p. 102).
This lack of specificity among degrowth proponents leads to further problems. For example, degrowth supporters, such as Mastini et al. in their 2021 paper, are clear that they support the transformation of the global energy system along the lines that I have described above, from our current fossil fuel-dominant system to one whose core features are high efficiency and clean renewable energy sources. Yet, in fact, building out this new energy system will obviously entail massive growth of the global clean energy system, just as it will equally entail the phasing out – or degrowth, if you prefer – of the global fossil fuel energy system. In my view, it is more useful to be specific about which sectors of the global economy will certainly need to grow – e.g., the clean energy system – while others, like fossil fuels, contract, as opposed to invoking sweeping generalities about degrowth. We can extend this point. For example, I am sure degrowth proponents would favor major expansions in access to public education, universal healthcare, high-quality affordable housing, regenerative agriculture, and the share of the earth’s surface covered by forests.
In focusing on some critical specifics, I would also add that there is no way that a general project of degrowth can put the global economy onto a viable climate stabilization path. With the COVID-19 recession, the global economy just went through a powerful natural experiment to demonstrate this point. That is, during the pandemic in 2020, the global economy contracted by 3.5 percent, which the International Monetary Fund described as a “severe collapse … that has had acute adverse impacts on women, youth, the poor, the informally employed and those who work in contact-intensive sectors.” In other words, the pandemic produced an intense period of global ‘degrowth.’ This recession did also produce a decline in emissions, as entire sections of the global economy were forced into lockdown mode. But the emissions decline amounted to only 6.4 percent over 2020. Remember, the IPCC tells us that we need to cut emissions by 45 percent as of 2030 and be at zero emissions by 2050. If the COVID recession only yields a 6.4 percent emissions reduction despite the enormous levels of economic pain inflicted, clearly ‘degrowth’ cannot come close, on its own, to delivering a 45 percent emissions cut by 2030, much less a zero emissions global economy by 2050.
CJP: Those who see the Green New Deal not only as the most effective strategy to tackle global warming but also as an engine growth, such as yourself, rely on the concept of ‘decoupling’. However, ‘degrowth’ advocates seem to be arguing that there is no empirical evidence for absolute ‘decoupling’, and that it’s highly unlikely that it will ever happen. How do you respond to such claims?
RP: Let’s recognize, to begin with, that people are still going to need to consume energy to light, heat, and cool buildings, to power cars, buses, trains, and airplanes, and to operate computers and industrial machinery, among other uses. As one critical example here, in low-income economies, delivering adequate supplies of affordable electricity becomes transformative for people’s lives, enabling them, for example, to adequately light their homes at night rather than relying on kerosine lanterns. As such, it should be our goal to greatly expand access to electricity to low-income communities throughout the world, while we are also driving down CO2 emissions to zero. The solution is for energy consumption and economic activity more generally to be absolutely decoupled from the generation of CO2 emissions. That is, the consumption of fossil fuel energy will need to fall steadily and dramatically in absolute terms, even while people will still be able to consume energy resources to meet their various demands. The more modest goal of relative decoupling – through which fossil fuel energy consumption and CO2 emissions continue to increase, but at a slower rate than overall economic activity – is therefore not a solution. Economies can still continue to grow while still advancing a viable climate stabilization project as long as the growth process is absolutely decoupled from fossil fuel consumption.
Is absolute decoupling impossible to accomplish within the context of economic growth? To date, we have seen some modest evidence – and I do stress the evidence is modest – of absolute decoupling taking place. For example, between 2000 and 2014, 21 countries, including the US, Germany, the U.K., Spain, and Sweden, all managed to absolutely decouple GDP growth from CO2 emissions – i.e., GDP in these countries expanded over this 14-year period while CO2 emissions fell. This is a positive development, but only a small step in the right direction.
The way to deliver a much more rapid pattern of absolute decoupling is, of course, to build out the global clean energy economy, and to do so quickly. This is a feasible project. By my own estimates, it requires that the global economy spend approximately 2.5 percent of global GDP per year on investments in energy efficiency and clean renewable energy supplies, while the global economy grows at an average rate of about 3 percent per year between now and 2050. The International Renewable Energy Agency and International Energy Agency recently published studies that reached similar results for the global economy. Focused on the US economy, the energy economists Jim Williams and Ryan Jones also reached a similar result, as part of the Zero Carbon Action Plan (ZCAP) project.
From this and related evidence, I conclude that absolute decoupling is certainly a feasible, though also obviously a hugely challenging project. But we can’t just talk about it, pro or con. We have to make the investments, at 2.5 percent of global GDP per year or thereabouts, every year until 2050, to build the global clean energy economy. If we do that, absolute decoupling will happen. If we don’t make those investments, then of course, absolute decoupling becomes an impossibility.
CJP: Various ecologically-minded activists are also arguing that the Green New Deal relies on the use of massive energy resources, including extensive use of the steel industry, in order to make the transition to a clean, renewable, and net- zero emissions economy, and that what is really needed instead is a green revolution of the mind whereby zero energy living is the ultimate goal. My question is this: can the Green New Deal deliver 100 percent clean energy?
RP: There are several industries in which energy is consumed intensively. They include steel, cement, and paper, along with, obviously, all forms of transportation. But note that these industries are energy intensive. They are not necessarily fossil fuel energy intensive. If we succeed, through the Green New Deal, in increasing the efficiency at which these industries consume energy and we also deliver abundant supplies of clean renewable energy, then the problems of dealing with energy-intensive industries can be solved. It’s true that there will be some specific areas which will present more difficult challenges. For example, some parts of steel production rely on furnaces that are operating at very high temperatures. Reaching these high temperatures is, to date, difficult to achieve through electricity as opposed to burning coal in a furnace. This problem will need to be solved over time. One likely solution could be to rely on laser technology through which the required high temperatures can be reached with electricity, with the electricity, in turn, being produced through renewable energy.
Another more difficult area is long-distance aviation. To date, we cannot rely on electric batteries to fly planes across the Atlantic Ocean, for example, as we can to drive cars from New York to California. One likely solution here will be to fuel the planes’ engines with low-emissions liquid bioenergy, such as ethanol produced from agricultural wastes as the raw material. Battery storage capacities are also likely to be improving significantly with more people focusing on solving exactly this problem. Let’s remember that the costs of producing electricity from solar photovoltaic panels have fallen by over 80 percent within the past nine years, and the US Energy Department itself projects further major declines in just the next five years. Moreover, the International Renewable Agency reported just a week ago that, for the first time, 62 percent of all renewable energy sources produced energy at lower costs than the cheapest sources of fossil fuel energy.
All of this tells me that achieving absolute decoupling is a feasible project within the framework of a global Green New Deal. The Green New Deal, in turn, is, in my view, the only way through which climate stabilization can become fully consistent with expanding decent work opportunities, raising mass living standards, and fighting poverty in all regions of the world. •
Originally published in Truthout, July 3, 2021. Reprinted with permission.
A Green New Deal Program for California
CJP: California has been at the forefront of the climate fight for years now, but the truth of the matter is that its efforts have been falling short. Now, you and some colleagues of yours at the Political Economy Research Institute (PERI) of the University of Massachusetts at Amherst have just completed a commissioned climate stabilization project for California that can also serve as an engine for economic recovery as well as expanding economic opportunities across the state. In a nutshell, how does the project envision the clean energy transition to take place in a manner consistent with the emission targets set out by the Intergovernmental Panel on Climate Change (IPCC) in 2018, and how will it be financed?
RP: This study presents a recovery program for California that will also build a durable foundation for an economically robust and ecologically sustainable longer-term growth trajectory. California has long been a national and global leader in implementing robust climate stabilization policies. This includes the 2018 Executive Order B-55-18 by then Governor Jerry Brown. This measure committed the state to cut CO2 emissions in the state by 50 percent as of 2030, to become carbon neutral no later than 2045, and to produce net negative emissions thereafter. These goals are somewhat more ambitious than those set out by the IPCC in 2018. Our study outlines a program through which the state can achieve its own established goals.
Our study shows how these 2030 and 2045 emissions reduction targets can be accomplished in California through phasing out the consumption of oil, coal, and natural gas to generate energy in the state, since burning fossil fuels to produce energy is, by far, the primary source of CO2 emissions, and thereby, the single greatest factor causing climate change. The project we propose is to build a clean energy infrastructure to replace the existing fossil fuel-dominant infrastructure. The clean energy infrastructure will require large-scale investments to, first, dramatically raise energy efficiency standards in the state and, second, to equally dramatically expand the supply of clean renewable energy supplies, including solar and wind primarily, with supplemental supplies from low-emissions bioenergy, geothermal, and small-scale hydro power. We show how this climate stabilization program for California can also serve as a major new engine of job creation and economic well-being throughout the state, both in the short- and longer run.
We have scaled the clean energy investment project at about $76-billion per year on average between 2021 and 2030. This would equal roughly 2 percent of what we estimate will be the state’s average GDP between 2021 and 2030. In other words, California can hit its emissions reduction targets through maintaining clean energy investment spending levels at about 2 percent of overall economic activity in the state. That means that roughly 98 percent of the state’s annual economic activity can still be focused on anything other than clean energy investments. But the state must maintain this 2 percent of GDP investment level in clean energy for the program to work.
We estimate this level of investment will generate roughly 420,000 jobs throughout the state’s economy. New job opportunities will open for, among other occupations, carpenters, machinists, welders, electronic equipment assemblers, environmental scientists, administrative assistants, accountants, truck drivers, roofers, and agricultural laborers. Investments in public transportation – a major component of the energy efficiency investment program – will produce public-sector jobs for drivers and managerial staff. The quality of these jobs – including wages, benefits, and levels of unionization – vary by sector. In general, it will be critical to raise job quality standards as the number of jobs available expands. Raising unionization rates, as well as expanding job training programs, will all be crucial for raising overall job quality levels. Local hire provisions and related measures will also need to be implemented to ensure equitable access by race and gender to the expanding job opportunities.
While focusing on the clean energy investment to reduce California’s CO2 emissions by 50 percent as of 2030, our study does also examine how the state can achieve its longer-term goal of becoming a zero-emissions economy by 2045. The basic features of the investment program between 2031 and 2045 can be extended from the 2021 and 2030 framework. But, in fact, the scale of the investment spending required to achieve the 2045 zero-emissions target can be somewhat more modest, averaging about 1.3 percent of the state’s GDP between 2031 and 2045.
Our study also examines a complementary investment project to upgrade California’s economy base through manufacturing, infrastructure, land restoration and agriculture investments. We budgeted this program at about $62-billion per year, or 1.7 percent of the state’s GDP – in these areas. This investment program is based on the proposed national THRIVE Agenda, a bill introduced into the US Congress in February 2021 by Senator Edward Markey and Congresswoman Debbie Dingell to “Transform, Heal, and Renew by Investing in a Vibrant Economy.” To date, the THRIVE Agenda has been endorsed by more than 100 members of Congress and hundreds of major union, racial justice, and climate organizations. We estimate that these investments will generate about 626,000 jobs throughout the state, in a wide range of occupations.
When we bring together the combined investment programs in the areas of energy efficiency and renewable energy, along with public infrastructure/manufacturing and land restoration/agriculture, total spending in California comes to an average of about $140-billion per year, equal to a bit less than 4 percent of California’s average annual GDP between 2021 and 2030. This level of job creation would generate about 1 million jobs within California. This higher level of job creation will then be sustained through the full decade, as long as the budgetary levels for the range of investment programs are maintained. The expansion in job opportunities will equal more than 5 percent of California’s 2019 labor force. This means that if California’s unemployment rate was, say, 7 percent without this combined investment program, these investments could drive unemployment to something in the range of 2 percent – i.e., to reach something close to full employment in the state.
An absolute front-and-center feature of our proposal is the just transition program for the state’s fossil fuel-dependent workers and communities. About 112,000 people are employed in California in fossil fuel-based industries, amounting to about 0.6 percent the state’s total workforce in 2019. Workers in the state’s fossil fuel-based industries will, of course, experience job losses as the state dramatically reduces consumption of these CO2-generating energy sources. We estimate that about 3,200 workers per year will be displaced in these industries in California between 2021 and 2030 while another roughly 2,500 will voluntarily retire each year. It is critical that all of these workers receive pension guarantees, healthcare coverage, re-employment guarantees, along with wage subsidies to ensure they will not experience income losses, along with retraining and relocation support, as needed. Enacting a generous just transition program for the displaced fossil fuel-based industry workers is especially important. We estimate that the costs of a generous just transition package for all fossil fuel industry-based workers experiencing layoffs would come to about $470-million per year. This is equal to about 0.02 percent (two one-hundredths of one percent) of the state’s average GDP between 2021 and 2030.
Three counties in California – Kern, Contra Costa, and Los Angeles – account for roughly half of all employment in the state’s fossil fuel-based industries. Kern County, in particular, will face the most significant proportional impacts from the phase-down of the state’s fossil fuel industries. We therefore present a focused discussion on providing community transition support for Kern County. In fact, we found that some initial-stage activities are already underway in Kern to move the area away from its current level of fossil fuel-based industry dependency and to build there a clean energy production infrastructure.
How do you pay for the whole thing? It’s actually straightforward, especially as we keep in mind that, overall, we are talking about devoting less than 4 percent of the state’s overall economic activity to these investment projects, and the most critical purpose of these projects is, after all, just to achieve the state’s own CO2 emissions reduction targets. Of the roughly $140-billion per year in combined investments and the just transition program, we assume that roughly half of total spending, about $70-billion per year, will be provided by private investors, while the other half is supplied by public spending. Private investments in the clean energy areas in particular will be incentivized by the federal and statewide regulatory environment. A significant share, if not the majority of the approximately $70-billion per year in public spending is likely to come from a version of the Biden Administration’s proposed American Jobs Plan, which is focused on infrastructure and clean energy investments. The State of California could then provide the additional funding, as needed. The fact that the state can borrow at very low interest rates now is critical. As an example, we show that if the state government issues $30-billion in bonds in the current low-interest rate environment, the debt servicing burden will also be low, i.e., in the range of 0.3 percent of the state’s annual general revenues. It follows that even if the federal government’s funding through the final version of the Biden American Jobs Plan comes in at a relatively low figure, the State of California could still provide the additional financing through issuing bonds in the current low-interest rate environment without imposing a major burden on the state’s overall budget.
CJP: The project has already been endorsed by 19 unions across the state of California, and more are expected to join. This is undoubtedly a highly significant development, but, given that only around 16 percent of the total workforce is unionized, isn’t there a need to reach out to the rest of the population for support?
RP: For decades now, wide majorities of people in California have already been taking strong measures to protect the environment and combat climate change. Increasingly also, the state is suffering disproportionately from the effects of climate change and, more generally, from burning fossil fuels to produce energy, including wildfires, droughts, floods, heat waves, and air pollution that are all becoming more severe over time. The National Oceanic and Atmospheric Administration estimates that, just since 2013, California has experienced roughly 16 “billion-dollar disaster events,” generating economic losses of over $100-billion in total. Beyond these climate-specific considerations, it also the case that the clean energy investment program will deliver lower energy costs to all consumers in California. This is, first, because raising energy efficiency standards will enable consumers to spend less money for a given amount of energy services – e.g., to heat, cool, and light homes, or to drive from Riverside to LA. In addition, the costs of wind, solar, and geothermal power are all roughly equal to or lower than those for fossil fuels and nuclear energy, and are falling significantly. As such, the average California household should be able to save nearly 40 percent on their overall annual energy bill relative to what they spend now in the current fossil-fuel dominant system. In short, everyone in the state has a personal stake in solving the climate crisis, even those who aren’t particularly concerned with the most fundamental matter of saving the planet.
CJP: Can you also speak about the national implications set by the union support in California for the climate stabilization project you and your colleagues have designed?
RP: The union movement has increasingly embraced a major leadership role in advancing green transition programs. I have worked with the leadership of the AFL-CIO on these issues in multiple states. The level at which California unions have supported our study is one major step forward, and I am, of course, extremely pleased by this support. But it is also part of a growing trend that has been advancing due to the work of outstanding, committed organizers throughout the country. When I first started working on these issues 14 years ago, the prevailing view in mainstream circles – not the labor movement, but in the circles of high-powered policymakers, academia and the mainstream press – was that there is a huge and unavoidable tradeoff between jobs and the environment. You could have one or the other – more jobs or a cleaner environment. But you can’t have both, so choose one. Over the last decade, lots of very effective labor movement activists – from the grassroots levels to many top officials – have pounded home the reality that this is a false trade-off. Due to their efforts, this message has now penetrated all the way up to the Biden Administration. Note that Biden is calling his clean energy program an “American Jobs Plan.”
CJP: This is really highly encouraging news in the battle to tame global warming, so I must ask: What’s next in line in terms of your climate stabilization projects?
RP: My co-workers and I at PERI are continuing to work with different groups to advance robust climate programs at the national, state, as well as county and community levels. Separately, I am working on green transition studies for other countries, Greece being one of them. In the case of Greece, I am looking forward to working more on the issue of land-use requirements in building a green energy infrastructure, building from the outstanding work on this question by the Harvard physicist Mara Prentiss. The issues here are: do we really have to locate wind turbines on top of the most beautiful pristine mountain cites in Greece in order to build a green economy? This is another one of the false trade-offs that lots of people in power want us to believe. I am also working on issues of financing the global Green New Deal in developing and middle-income countries, especially in Asia, in conjunction with the United Nations Conference on Trade and Development (UNCTAD). That, in addition to trying to maintain the solar panels at my house and office reasonably well. •
Originally published in Truthout, June, 2021. Reprinted with permission.