How the Green New Deal Can Save Joe Biden and America

Sunrise Movement campaigners call on Democratic House members to back a Green New Deal. (Photo: Michael Brochstein/SOPA Images/LightRocket via Getty Images)

How the Green New Deal Can Save Joe Biden and America

There is no other policy construct on the horizon that has any chance of delivering so many salutary outcomes. 

Joe Biden's win did not translate into Democratic party wins. The party lost seats in the House, failed to take back the Senate, did not turn a single governorship, and lost massively in down-ballot races across the country. That leaves a majority of statehouses in Republican hands for the all-important, once-a-decade redrawing of Congressional districts. Save for Biden's win, itself an isolated event, a more comprehensive failure would be hard to conceive.

Without the noxious, corrupt, and catastrophically failed Donald Trump to run against, Democrats do not have a compelling story or a compelling set of economic policies to run on. If they did, they wouldn't have lost so massively down ballot. This bodes poorly--or worse--for their prospects in the 2022 midterms.

Fortunately, the Green New Deal, or something equivalent, can revive Democratic chances in the next election and over future decades. It can do that by directly addressing the impetus that gave rise to Trump and Trumpism. In the bargain, GND can restore the competitiveness of the U.S. economy and secure a major advance in the fight against climate change. There is no other policy construct on the horizon that has any chance of delivering so many salutary outcomes.

Trumpism is not an accidental phenomenon. It has been in gestation for over four decades. It began in the 1980s, with Reagan, when the U.S. made the explicit policy decision to transfer massive shares of national income and wealth from the working and middle classes to those who were already the most-wealthy. This was the notorious "Supply Side Economics."

Supply Side Economics lowered tax rates on the highest income earners from 71% to 35%. It did this without any requirement that the Titans of Capitalism invest their new-found gains in the U.S. economy. So, they didn't. They invested them in the Asian Tigers: Japan, Taiwan, Korea, Singapore, and China. Over the next four decades, U.S. financiers and industrialists moved trillions of dollars, tens of thousands of factories, and tens of millions of high-paying working-class jobs out of the country, mainly to Asia.

The consequence was that tens of millions of poorly educated working-class whites lost their high-paying jobs and their affluent livelihoods. It is their rage at the system that inflicted this life-loss on them which forms the core of Trumpism. That rage is amplified by the ascent of minorities over the same period, with poorly-educated whites seeing not just their incomes and economic security devastated, but their relative social standing undermined as well. It is social humiliation compounding economic devastation and its effect is all too real.

Unless Biden and the Democratic party reverse this dynamic, by restoring high-paying jobs to tens of millions of working-class citizens, Trumpism will only grow. Whether Trump is around or not, Trumpism will elevate a new demagogue to lead the hate parade, and there are many wannabe Donabees slithering in the wings.

Fortunately, the Green New Deal comes at a moment of tectonic, once-in-a-century shift in industrial civilization. It is that shift that makes the GND both necessary and possible.

Every civilization operates on an energy "substrate," the energy source that complements human labor to raise the level of possible consumption. For millennia, that energy source was wood. Wood contains the compressed energy of dozens of years of solar rays hitting the planet. Burning it releases that energy for human consumption.

In the late 1700s, the British learned how to substitute coal for wood. Coal contains the compressed energy of millions of years of solar light hitting the planet, so delivers dozens of times more energy per unit of fuel compared to wood. The result was the Industrial Revolution and British domination of global affairs for the whole of the nineteenth century.

In the late 1800s, U.S. inventors learned how to substitute oil for coal. Oil contains about four times the available energy of coal, per unit of volume. It's also liquid, so easier to handle and move around, in pipes. It was U.S. mastery of oil, incarnated in the automobile industry, that allowed the U.S. to dominate global economic production in the twentieth century, much as Britain, based on its mastery of coal, had dominated in the nineteenth century.

In the twenty-first century it is already clear that renewable energy will displace fossil fuels as the dominant source of energy powering industrial civilization. This is partly due to economics: electricity from renewables is already comparable in cost to electricity from fossil fuels. As volumes increase, costs for renewables will continue to decrease, possibly by orders of magnitude, making the economic case for conversion more and more attractive. The drive for conversion is also a matter of compulsion.

Burning fossil fuels dumps some 12 billion tons of carbon into the atmosphere every year. This creates the "greenhouse effect" where heat from the planet is no longer radiated out into space, but is reflected back and contained by the atmosphere. The resultant "global warming," unless reversed, threatens to destroy much of life on the planet. So, the planetary imperative to move off of fossil fuels is of the highest order.

The Green New Deal operationalizes both the economic motive and the ecological imperative to move to a new energy substrate to power industrial civilization across the globe. This means that massive sectors of the U.S. economy will be rebuilt to use renewable energy.

Automobiles will rapidly move from being powered by oil to being powered by electricity. The implications for batteries, machine tooling, and manufacturing, to say nothing of "gas" stations and repair shops will be epochal. If automobiles were integral to U.S. culture and economic dominance in the 1900s, their new incarnation will be pivotal to transformation and survival in the 2000s.

Energy generation and distribution will be similarly revolutionized. If you drive north from Indianapolis or east from San Francisco or south from Abilene, you encounter thousands of industrial-scale windmills spanning hundreds of square miles. Wind generation in the U.S. doubled between 2008 and 2017 and its pace of growth is accelerating. It is telling that three of the five largest wind farms in the U.S. are located in Texas, the largest oil-producing state.

Tens of millions of buildings, from homes to commercial structures, will have to be retrofitted to utilize energy more efficiently. This will require the employment of millions of skilled tradesmen. Local energy production, through solar collectors, will also grow exponentially, again, employing millions of skilled workers.

All manner of common and civic structures generally lumped under the heading of "infrastructure" will need to be modernized. This includes everything from the national electricity distribution grid to transit systems, public buildings, water and gas distribution networks, highways, and more. Once again, this will require the retraining and employment of millions of skilled tradesmen.

The question necessarily arises: how will this once-in-a-century transformation be paid for? There are several sources, some direct, some indirect. Their totality more than pays for the GND, indeed, makes it a net income and wealth generator over coming decades.

Most importantly, leadership by the government and targeted investment incentives will incent private capital to fund the bulk of the transition. This is how the government helped midwife the transition to oil and automobiles in the twentieth century. It built millions of miles of modern roads and interstate highways without which high-powered automobiles would have been useless. One of the second-order effects was the vast panoply of culture that we know of as suburbia, almost all of it built from private capital.

The first round of "seed money" from the government can come from taxing the income of the top 10% of income earners. In the 40 years between 1977 and 2007, their share of national income grew from 34% to 47%, a staggering increase over a relatively short period of time, much of it unearned but "gifted" to them by the sole artifice of lower income taxes. If all we did was to increase taxes on this class even a little bit, it would yield trillions of dollars of funding to underwrite the tens of millions of high-paying jobs needed to carry out the buildout.

Much of the funding would come from increased tax revenues generated from millions of skilled tradesmen being re-employed in high-earning jobs across the entire spectrum of the U.S. economy. Their higher incomes and spending would also generate greater economic activity in its own right. This is what occurred in the 1950s and 1960s, often known of as "the golden age of capitalism." Government investments in the foundations of the economy led to many times more private investment and many multiples more, again, of private spending.

Much of the funding will be secured by reducing military spending, now clocking in at nearly a trillion dollars a year. This would be possible by reducing the need for oil, and, therefore, the need for the U.S. to garrison the Middle East. In the past two decades, the U.S. has spent more than $6 trillion on ill-conceived, failed, and counterproductive wars in the Middle East. This amount, alone, would be enough to pay for the whole of the GND and would make the world, and, therefore, the U.S., safer from international terror.

With lower-cost energy powering more and more economic activity, the economy as a whole would become increasingly competitive in global markets. Right now, the U.S. runs trade deficits in excess of $600 billion a year. That is $600 billion a year that is shipped directly out of the U.S. to other countries. The cost of funding those deficits raises the cost of borrowed money, and therefore the cost of everything in the economy that is bought or operated on borrowed money, which is to say almost everything.

A more efficient and productive economy would also mean that the U.S. government itself would have to borrow less to keep the economy working. Over the past 40 years, the government has borrowed $26 trillion, the cumulative increase in the national debt over that period. It is an almost inconceivable and definitely unsustainable sum, a sign of just how much damage Supply Side Economics has inflicted on the economy. As with trade deficits, lowered annual budget deficits would result in lower interest rates in the economy as a whole, making everything bought on borrowed money cheaper.

A final, indirect source of funding would come from reduced damage incurred from climate change. The fires afflicting the west, the floods in the Midwest, the hurricanes in the south, Hundred Year Freezes in the northeast, crop damage throughout the country; these have real economic costs that are not less because they are not explicitly tallied to climate change. They cost hundreds of billions of dollars a year and are growing wildly. Simply reducing their incidence would effectively free up hundreds of billions of dollars a year for use in the private economy.

Making the U.S. economy more competitive in global markets would help maintain its status as one of the leading countries of the world. Not making this transition and keeping the economy dependent on a twentieth century energy substrate while the rest of the world--including our greatest adversary, China--is moving onto future energy systems, is an ironclad prescription for technological stagnation, economic atrophy, and national decline. It is far less a choice of whether, than the choice of how to, and how quickly.

We started this essay on the premise that Democrats needed to do something to stave off catastrophic defeat in the 2022 midterms. Actually, the political consequences of this decision are much greater than that.

The U.S. is losing coherence. It is losing those common values, narratives, ideals, and norms that have historically bound it together as a successful society. Take, for example, the simple yet profound value of a belief in democracy. That belief is one of the bedrocks of American identity and has been since the country's founding. Yet, it is one of the beliefs and institutions that have suffered the most from the conviction of almost half the country that "the system" doesn't work for them anymore.

In the run-up to the elections, Donald Trump repeatedly refused to endorse a peaceful transfer of power, one of the hallmarks of a functioning democracy. He routinely lied about the incidence of voter fraud, casting doubt on the viability of democracy. He filed lawsuit after lawsuit, in state after state, to try to suppress access to voting. All of this was done in broad daylight, and still, 72 million Americans voted for him. This is perilous for the functioning of American society.

Since the election, Trump has continued his assaults on democracy, lying still more about how the election was rigged, and stolen. This lying, and its acceptance by almost half of the electorate, is itself the greatest threat to the integrity--the coherence--of the nation. If it is allowed to fester and to grow, we will almost certainly devolve into some kind of civic seizure, a breakdown of institutions and order that will require authoritarian imposition of power to contain. That is what Trump has been aiming for all along.

That is what happened to Weimar Germany in 1933 when the Great Depression caused a similar collapse of faith in democratic institutions. Germany's recourse was to elevate Adolph Hitler to power to "restore order." We know how that worked out, but that does not have to be the recourse for the U.S. However, it will almost certainly be so if we do not address the betrayal that tens of millions of citizens feel they have suffered at the hands of a government that has delivered in spades for the wealthy, but failed to deliver basic economic security for them.

The Green New Deal can avert that catastrophe, improve life chances for hundreds of millions of citizens, keep the U.S. competitive and vital in international affairs, and help save the planet from ecological apocalypse. As mentioned above, there is nothing else on the policy horizon that begins to come close to delivering those blessings. The Biden administration must choose the only economic policy available to save itself. In the bargain, it will save the country, and the planet, as well. It's a worthy legacy to work for.

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