green new deal
Updated November 13, 2020

Everything You Need to Know about the Green New Deal

Election 2020

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Hey guys, Logan here, election season is obviously in full swing at this point, and one thing I’ve heard a lot about on both sides is the Green New Deal. Now on this topic I’ve seen a lot of rumors, conflicting statements, and even outright misinformation, so I thought it would be helpful to kind of walk through what the Green New Deal really is and whether everything you’ve heard about it is true. So again I’m not trying to promote a particular viewpoint here, I just want to make sure that everyone has the facts straight so you know what the Green New Deal is and isn’t.

Background

OK the first thing I want to get out of the way is where the idea of a Green New Deal comes from, or even the idea of a New Deal. And I’m sure some of you remember this from American history, but the New Deal itself started with FDR during the Depression. So Herbert Hoover took office in 1929, obviously with a little thing called the Great Depression we didn’t have hot economic prospects under his administration to say the least, so by 1932 people were really ready for change.

Hoover vs. FDR

In the election of 1932, FDR, Franklin Delano Roosevelt, won forty-two out of forty-eight states because Alaska and Hawaii were mere territories at the time. And in contrast to Hoover’s hands-off approach, you might say laissez-faire, FDR’s view was that the government needed to get involved in the economy in order to reduce unemployment and make sure people had what they needed during the Depression.

The New Deal

The New Deal wasn’t necessarily just one policy or one program, it was more the attitude of the FDR administration that the government isn’t just doing to let the economy function on its own. You could think of this almost like a stimulus bill, again it isn’t one thing but for example FDR started Social Security, he expanded farming subsidies and unemployment, and he created the Works Project Administration to get people jobs in public service. So not only building infrastructure but also funding artistic and academic pursuits.

And again this kind of activity from the federal government was basically unheard of at this time, at least in the United States, and that’s what made it a New Deal compared to what we had before. So things like Social Security and unemployment benefits might seem obvious now as part of a modern society, but of course they had to be created and it was really under FDR that the government started to move in that direction.

The Green New Deal

OK that’s the New Deal, obviously it’s very different from what we’re looking at with the Green New Deal in 2020, but I think the original New Deal is an important starting point because it’s really what backers of the Green New Deal try to evoke images of.

That idea can be traced back to Thomas Friedman, who’s actually closer to the center than the left in many ways, but he’s much more progressive with respect to the environment, at least compared to a lot of the mainstream positions on these issues. And so the origin of the phrase “Green New Deal” is actually a Friedman article in the New York Times from 2007 where he wrote:

The right rallying call is for a “Green New Deal.” The New Deal was not built on a 

magic bullet, but on a broad range of programs and industrial programs to revitalize America. Ditto for an energy New Deal. If we are to turn the tide on climate change and end our oil addiction, we need more of everything: solar, wind, hydro, ethanol, biodiesel, clean coal and nuclear power—and conservation.

It takes a Green New Deal because to nurture all of these technologies to a point that they really scale would be a huge industrial project. If you have put a windmill in your yard or some solar panels on your roof, bless your heart. But we will only green the world when we change the very nature of the electricity grid — moving it away from dirty coal or oil to clean coal and renewables. And that is a huge industrial project — much bigger than anyone has told you.

As you can see from that, the idea of the Green New Deal isn’t that we need some particular policy, it’s that we need to shift our entire economy away from oil and toward these renewable sources of energy. And this is part of what makes the Green New Deal a little unclear, it’s more of an idea or even an ideal than a specific set of policies. So people will campaign on a “Green New Deal” and that could mean something different to each candidate. I want to talk a little about the main proposals that are going around right now, but at the same time I don’t want to say that there’s any one Green New Deal or anything like that. And I think Thomas Friedman had something very different in mind from what, say, Alexandria Ocasio-Cortez is thinking when she talks about the Green New Deal.

Contemporary Proposals

When people talk about the Green New Deal in 2020, they’re usually thinking about Ocasio-Cortez and Bernie Sanders, and maybe a few other liberal politicians like Jeff Merkley, Elizabeth Warren, and Ed Markey, who wrote the Green New Deal proposal for the Senate in a joint resolution in February 2019. And that laid out a lot of the concerns and policy ideas that have come to be associated with the Green New Deal in the United States.

The Green New Deal Senate Proposal

So in this resolution, they start by saying that global warming of two degrees Celsius or higher is on pace to cause some really challenging problems including more severe weather patterns, mass migration out of hard-hit regions, hundreds of billions of dollars in lost economic output, the destruction of coral reefs, et cetera.  I’m not a scientist, I’m not saying they’re right or wrong here, this is just what they’re saying.

Now they also link their ideas to some other phenomena that you might not associate with climate change, things like stagnant wages, a decreasing life expectancy, lower levels of access to healthcare, education, and other services, and a massive increase in income inequality. So yes the Green New Deal is an environmental proposal, but it’s also very explicitly an economic one, and it’s intended to address both of those problems through the kind of large-scale change that we haven’t seen since the Great Depression. And that’s reflected in the three goals they listed in this proposal:

  • To create millions of good, high-wage jobs in the United States
  • To provide unprecedented levels of prosperity and economic security for all people of the United States
  • To counteract systemic injustices

Obviously there’s a lot of political speech there, everyone wants to “provide unprecedented levels of prosperity,” but they go on to list some more specific targets and ideas. So they want to achieve net-zero emissions, conserve clean air and water, upgrade our infrastructure, and even beyond that they want to quote “guarantee a job with a family-sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all people of the United States.”

So obviously the Green New Deal is envisioned by its backers as a more involved plan than just implementing carbon credits or something like that. And the proposal also references some other popular left-wing policies such as honoring all treaties made with indigenous peoples, which we’ve historically been pretty selective about enforcing, so this is why I say the Green New Deal is kind of like an ideal for many people rather than just a select set of specific policies. So if the Green New Deal ever came into existence it wouldn’t just be this one bill, but also all the other legislation that would have to be passed in order to achieve the ambitious goals they’re laying out here.

The Green New Deal for Public Housing Act

Now there was another joint proposal called the Green New Deal for Public Housing Act from Alexandria Ocasio-Cortez and Bernie Sanders that was released in November 2019. Basically they laid out some of their key priorities in terms of public housing over the next years and decades.

Their proposal included an investment of $180 billion over a period of ten years, mostly focusing on improving public housing by funding repairs, solar panels, etc. and getting to a point where our federal housing isn’t dependent on carbon emissions. So with that $180 billion they expect to make improvements on around one million homes with around two million residents. And like the one I mentioned earlier, this bill was also co-sponsored by both Elizabeth Warren and Jeff Merkley.

Trump, Biden, and the Green New Deal

OK so again the point here is that the Green New Deal isn’t any particular piece of legislation, and that’s part of what makes it so hard to nail down on both sides. For example if you watched the final presidential debate you might have heard Trump talk about windows, here’s what he said, he said: “They want to take buildings down because they want to make bigger windows into smaller windows. As far as they’re concerned, if you had no window, it would be a lovely thing.” And he goes on to say that “they want to knock down buildings and build new buildings with little, tiny, small windows and many other things.”

Presumably he’s talking about the fact that some activists and legislators want to start moving toward windows that are more energy-efficient, but there’s no reason that they would need to be smaller than a regular window, and that definitely isn’t something I’ve heard from any of the major politicians who are on board with the Green New Deal. So again, regardless of what you think about the Green New Deal as an idea, it’s important to get the facts right when you’re talking about environmental policy in general, and Trump hasn’t always given accurate descriptions of what these legislators actually want from a Green New Deal.

Now I think it’s true that Trump isn’t really fair in his criticism of the Green New Deal, but on the other hand Biden hasn’t necessarily made his own environmental plans clear either. And at this point Biden is actually getting attacked from both the left and the right. The progressive wing of the party is concerned that he doesn’t go far enough, and that he’s gone back on some campaign promises, and of course most people on the right, or at least most people in Trump’s camp think that the drastic climate measures of a Green New Deal or even of the more moderate Biden plan would undo a lot of the economic progress that was made during the first three years of Trump’s administration.

Unlike Trump, Biden had to get through a competitive primary in order to even get to the general election. So in my view he used the pretty conventional strategy of moving toward his party’s base for the primary and then coming back to the center for the general election when you need to connect with undecided voters in the middle. Most politicians do this to an extent, and we could go back and forth all day on failed promises, but still if you were on the left and hoping that Biden would push for progressive climate legislation, well that’s true to an extent, and it’s definitely true in comparison to Trump, but what he’s saying now isn’t quite as dramatic as what I heard him saying in February and March.

Trump has brought this up on fracking, he says that Biden said he wants to eliminate fracking, and Biden has made had some pretty unclear statements on this issue. So at one point he said he wanted to eliminate subsidies for fracking and coal, and later on he said that he was against “new fracking,” but his actual written plan doesn’t say anything about ending fracking entirely or  even preventing new fracking.

Similarly, Biden’s website calls the Green New Deal a “crucial framework” for climate policy, but his own plan is missing some of the more progressive elements of the proposals we’ve seen in the Senate and House. For example, the Green New Deal talks about guaranteeing a job for every American, and that’s a little further than Biden wants to go in terms of involving the government in the economy.

So if Biden’s elected I would expect some back and forth, if not hostility, between the center and the left wing of the Democratic party, but ultimately I don’t think we would get a full Green New Deal like AOC or Bernie or Jeff Merkley are pushing for under Kamala Harris (Joe Biden). But obviously that’s just my opinion and I don’t know how those negotiations would go in a Biden administration.

All right everyone that’s all I have for you right now. The Green New Deal has already picked up a lot of momentum among the progressive wing of the Democratic party, so I wanted to acknowledge it here on the channel, you’re not going to hear me get into the science of it all because, again, especially in a public sphere, I am not a scientist, that is not my realm of expertise.  But bottom line, as of right now it’s hard to say what exactly the Green New Deal is in terms of policy, even if Alexandria Ocasio-Cortez or Bernie were president there would be a lot of compromises and in the end we would probably be left with something that would be more in the middle.

But the idea of a Green New Deal connects environmental concerns with a lot of progressive issues like racial discrimination and income inequality. So as more young people enter the electorate I think these will start to become more mainstream proposals, in fact the Green New Deal actually has a lot of support among young Republicans as well as young Democrats. Now again I want to emphasize that this is just my perspective, personally I don’t think anyone is an expert on everything you would have to be an expert in to fully understand the pros and cons of the Green New Deal. So if you have any feelings about these policies then make sure to leave your thoughts in the comments. As always, thank you so much for reading, and I will see you next time.

Logan Allec, CPA

Logan is a practicing CPA, Certified Student Loan Professional, and founder of Money Done Right, which he launched in July 2017. After spending nearly a decade in the corporate world helping big businesses save money, he launched his blog with the goal of helping everyday Americans earn, save, and invest more money. Learn more about Logan.

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