Does Australia need a Green New Deal?
Does Australia need a Green New Deal? And if we do, is the Greens’ Green New Deal the Green New Deal we need? Sophie Weiner investigates.
By the time Franklin D. Roosevelt was inaugurated as president of the United States in 1933, it was clear that the fix for the devastation wrought by the Great Depression needed to be as dramatic as the problem itself had been. Something had to be done—not just to correct the lack of financial regulation that had led to the crash, but also to help the millions of people who had lost their homes and jobs in the crisis.
Over the coming years, Roosevelt would push through a series of policies known as the New Deal, encompassing massive employment programs, the birth of Social Security Insurance for the elderly, banking reform, investment in public art, and ambitious infrastructure projects like electrifying rural communities. But the program went beyond simply addressing the causes and results of the Great Depression. The New Deal fundamentally reshaped the US, creating a country with stronger infrastructure and the beginnings of a social safety net to protect the most vulnerable. The result was a reinvigorated society, kickstarting what would become the most prosperous period in US history.
Today, the world is again facing overwhelming crises. Climate change is foremost among these—but as this year has shown, our global society is vulnerable to many other threats as well. The issues that we face are complex and interconnected: rising inequality; irresponsible, polluting corporations; and a lack of workers with the skills we need to build a renewable future.
The concept of a Green New Deal—a combination of economic stimulus and massive green infrastructure investment aimed at tackling both inequality and the climate crisis—has emerged globally as a potential solution that is on par with these uniquely urgent problems.
Amid the economic destruction of the pandemic, the Australian Greens have proposed their own Green New Deal, and it has already received cross-party support in the Victorian parliament. Could this ambitious plan be exactly what Australia needs to address our climate crisis and dig ourselves out of the recession?
Where did the idea come from?
When people refer to the “Green New Deal” in the US context, they are most often talking about a Congressional resolution sponsored by Rep. Alexandria Ocasio-Cortez and Senator Ed Markey, swiftly voted down by Republicans in 2018. But the history of the idea goes back much further.
For decades, progressives around the world have pushed for combining economic policies to alleviate inequality with massive infrastructure spending to stop climate change. The first “Green New Deal” proposal was workshopped by the marginal US Green
Party way back in 2006, around the same time similar ideas began gaining attention globally.
In 2018, the Green New Deal shot into the mainstream when the youth-led climate activist group Sunrise Movement staged a sit- in at House Speaker Rep. Nancy Pelosi’s office in Washington, D.C., joined by Ocasio-Cortez.
Ocasio-Cortez and Markey’s Green New Deal resolution followed, proposing that the US take a leading role in reaching the goal of net-zero emissions by 2050. The proposal for doing so included enacting a ten-year plan of massive investment in infrastructure spending to build renewables, a jobs guarantee, investment in high speed rail and electric vehicles, a carbon tax, the implementation of a higher minimum wage, universal health care and more.
While there’s polling indicating broad public support for an American Green New Deal, the proposal has unsurprisingly spurred controversy in the USA’s hopelessly polarised political environment: Republicans, displaying their usual commitment to good faith and reality-based politics, have falsely accused the resolution of including everything from “banning cows” to ending all air travel. But the backlash at home hasn’t stopped the idea from gaining traction in many countries around the world—including Australia, where the Greens have proposed their own Green New Deal plan in response to the economic recession caused by COVID-19.
The Green(s) New Deal
Australian politicians from across the political spectrum agree that a massive stimulus of some kind will be necessary in order for the economy to recover from the recession caused by the pandemic. But while the federal government has proposed a recovery that is “gas-led”, proponents of the Green New Deal, including the Australian Greens, argue that we can use this necessary stimulus to address both the recession and encroaching climate catastrophe in one fell swoop.
“If you go to the doctor and they say, ‘You have three things wrong with you, I can give you a medicine that fixes one thing or a medication that fixes all three,’ you take the one that fixes all three,” says Greens leader and Melbourne MP Adam Bandt. “[The Green New Deal] responds to the situation we’re in by investing in nation-building, planet-saving projects that will create jobs, bring down pollution and tackle the inequality crisis.”
The Greens’ Green New Deal plan would mandate that 100% of Australian energy come from renewables by 2030, and that we reach zero-net emissions by 2035 or sooner. On this level, at least, the plan is more in line with what science tells us needs to happen to avert climate catastrophe than those put forward by the major parties. The Australian Labor Party’s current proposal sets a goal of 50% of Australian energy coming from renewables by 2030 and to get to net zero emissions by 2050.
The Labor plan’s target doesn’t even match the current trajectory of market-led transition without further intervention, which would see renewables producing around 75% of Australian energy by 2030. It’s also a significantly less ambitious goal than those put forward by most Australian state governments. The Coalition, on the other hand, initially resisted even this modest goal, though they have since come around to relying on the market-led embrace of renewables to meet their emissions reductions quota. The Greens say their aggressive targets are the only way for Australia to meet the goals of the Paris Agreement without using controversial carryover credits.
But although ambitious climate targets are a major part of the Greens’ plan, the heart of the Green New Deal is in how it goes about achieving these goals. Rather than using incentives, the Greens’ government-led approach would see the government directly hiring people to work on infrastructure projects like expanding the electricity grid to areas where large scale renewable projects could be created, and building high speed rail.
The Greens’ position is that public control over key parts of the economy is needed to avert climate catastrophe in the dwindling time we have left.
“Incentivising companies to do things is not going to be enough,” says Renew’s senior energy analyst Damien Moyse. “That’s what we’ve been doing with renewable energy policy for years and the changes are not happening fast enough from a climate imperative perspective.”
Moyse says some direction of the market by government will be necessary, including “setting time frames for the major coal generators to close and setting goals both in terms of renewables and storage.” Directives on closing coal generators by 2030 are included in the Green New Deal proposal.
Former Renew energy analyst Andrew Reddaway also promotes market intervention in his 2020 report Transition Delayed, which examines the forces holding up Australia’s energy transition.
“Current efforts to improve the transition of the electricity system focus on greater intervention in the competitive market. Based on the experience to date, Renew is highly concerned that such incremental reform may take too long to achieve the rapid transition of the sector that is required under climate imperatives,” Andrew wrote. “Stronger measures may be required in the form of a more coordinated, planned approach.”
One New Deal to rule them all
There are aspects of the Australian Green New Deal that at first glance seem to have little to do with fighting climate change, including proposals for free university education, free childcare and a massive investment in public housing. Many of these are long-time Greens policies wrapped in Green New Deal packaging, but they are part of the ethos of putting forward a plan that addresses inequality, rather than solely focusing on the climate.
These policies are also a way to get climate skeptics on board with taking decisive action. Adam Bandt points out that the short-lived carbon tax put in place by Julia Gillard’s government was killed in part by Tony Abbott’s appeal to the working class’s economic concerns.
“It’s vital that we bring everyone along in the push for a better future,” he says. “When conservatives turn climate into a cost, then they can be incredibly potent. One of the ways we will all succeed in tackling the climate crisis is by demonstrating that [doing so] has benefits for everyone.”
“By solving multiple problems in society at once, not only do we make life better for everyone, but we entrench support for strong action on climate,” Adam adds. “If we can demonstrate that there’s a benefit for everyone in it, no matter how much they earn, we can get Australia closer to [sustainable climate action].”
One way to address both of these problems is to build energy efficient public housing, another key plank of the Greens’ plan, which Renew has supported.
“A key reason to invest in public housing is that it is often the poorest people in Australia who have the highest energy bills, and they can’t afford the upfront costs to make their homes energy efficient,” Adam says. “This doesn’t only bring down pollution but also brings down power bills for people on the lowest income. That’s the epitome of what the Green New Deal is about: tackling multiple crises—like the income pressures faced by low income people and rising emissions—with one plan.”
Conservatives who oppose public spending may also wince at the cost of a Green New Deal, but the Greens believe it’s doable, especially in the context of the pandemic, when borrowing costs are low and new jobs will mean less spending by the government on programs like JobKeeper.
“Australia’s net debt would need to grow $25 billion a year [with this plan], and we’d still end up with a national debt about half that of other advanced economies,” he says. “The current government has just passed a millionaires tax cut that will cost us $30 billion a year. The money is clearly there, it just is what you spend it on, and we think it should be spent on a Green New Deal.”
Converting policy into action
It could be easy to dismiss the Green New Deal as naïve idealism, but the pandemic has spurred many diverse groups to consider how we could harness a green recovery to address climate change. Even neoliberal stalwarts like the OECD and International Monetary Fund have backed a green recovery from COVID-19.
In their Million Jobs Plan, released in 2020, the Australian think tank Beyond Zero Emissions (BZE) developed a list of existing proposals that, if funded, would create millions of jobs building a more sustainable society. While some of these projects would be funded privately, BZE advocates for significant government spending on projects like building new grid lines to areas with potential for large scale renewables projects, energy efficient social housing and electrifying transport—in other words, a similar set of goals to those put forward by the Greens in their plan.
“Such projects represent excellent value for taxpayers,” BZE’s report says. “New transmission infrastructure will unlock billions of private investment in renewable energy. More social housing means less homelessness and fewer resources expended on dealing with the problems of homelessness. Electric public transport leads to better air quality, and fewer health problems linked to pollution.” Advisers on the report included former Liberal Prime Minister Malcolm Turnbull, demonstrating the appeal of green recovery across the political aisle.
Kate Crowley, an associate professor of politics and policy at the University of Tasmania who researches environmental policy, says it’s possible that some of the ideas from the Greens’ plan could be lifted into policy through these kinds of channels, even if the plan in full is unlikely ever to see the light of day.
“If you use the phrase Green New Deal it’s not going to happen, given how politicised and partisan it’s going to be,” Kate says. “But you might have ideas taken out of their plan by others using different language. You can come at it through stimulus and end up with a Green New Deal.”
On the other hand, Kate says, the international cachet of the Green New Deal could also help popularise the ideas it espouses: “People might think, ‘If South Korea can have a Green New Deal, why can’t Australia?’”
And while the Green New Deal may seem difficult to achieve politically, it has already had some success at a state level. In November 2020, the Victorian parliament’s upper house approved a non-binding motion supporting a Green New Deal with the support of Labor MPs. In the budget that followed, Daniel Andrews’ government announced big investments in energy efficient public housing, community support programs and renewables—policies that could have come out of the Green New Deal playbook.
Shaking off the invisible hand
Given the widespread acceptance of green recovery (outside of the Coalition, at least), a green stimulus without all the moon-shot conditions of the Greens’ plan may seem like a win-win for Green New Deal supporters. But aspects of the Green New Deal that may be lost through this kind of watering down shouldn’t be ignored.
As the Transition Delayed report points out, government direction of the market will be crucial if we are to meet the timetables required to prevent warming of more than 1.5 °C in the coming decades. We can’t achieve that through simply incentivising the market.
“We find ourselves in a situation now where we have a decade at most to tackle the climate crisis before global heating passes the point of no return,” Adam says. “It’s going to need government and business working together, but given the global recession, the government must take the lead and invest money.”
Amid a recession, as precarious employment continues to rise while the social safety net is cut, it feels as if without a major shift in direction, we may be reaching the point of no return on inequality as well. A Green New Deal may be our last real chance to address both crises.