Green New Deal

Last Updated:
July 22, 2021
The Issues

Green stimulus

Many proposals for delivering a green recovery argue for a significant increase in government spending and investment.

This could be done through direct stimulus of key sectors critical to environmental and climate action, such as improving the energy efficiency of buildings or repairing local ecosystems. Record low interest rates and the high social, economic and environmental return from these investments mean any increased borrowing could be money well spent.

Measures can also be taken to unlock investment from the private sector, including by creating a green national investment bank.

Green New Deal

The Green New Deal is a broad term that describes a concerted, state-led programme of green economic stimulus with a specific focus on social justice.

Originally proposed in 2008 as a response to the looming financial crash, today's version stems from its 2018 adoption by the Sunrise Movement in the USA. Backing from influential USA Congresswoman Alexandra Ocasio-Cortez has brought it to a global audience.

There are different conceptions of the Green New Deal, but common to all are commitments to ambitious decarbonisation, a significantly enhanced role for the state, and a focus on the just transition for those particularly affected.

Just transition

Responding to the environmental emergency requires changes in many aspects of everyday life, such as how we eat, with concerns growing over the high environmental impact of meat and dairy.

It can be politically challenging to increase environmental ambition without growing inequalities or negatively impacting people who depend on environmentally unsustainable work.

A particular concern is the fate of workers in high carbon industries. Trade unions call for a just transition for these workers to avoid the lasting impacts on people and places resulting from the closure of coal mines in the 1980s.

Net zero ambition

The UK Government has legislated for net zero carbon emissions by the year 2050, upping the ambition of the existing 2008 Climate Change Act’s target of an 80% reduction.

Britain is not on course to meet even its previous commitments, and many believe that a 2050 net zero date is too late. Meeting net zero will require more concerted action in all of the main areas critical to decarbonisation: energy generation, transport, industry, buildings, and land use and agriculture. This is a challenge facing all countries.

Many local authorities have declared “climate emergencies” and are pushing ahead with their own ambitious plans for meeting them, although there are limits to how far they can go by themselves.  

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