The Green New Deal

Heritage Explains

The Green New Deal

What's in the resolution, how much would it cost, and would it even stop global warming?

 

MICHELLE CORDERO: From the Heritage Foundation, I'm Michelle Cordero and this is "Heritage Explains."

 

The Green New Deal. You've probably heard about it by now. It's the major climate and energy initiative spearheaded by New York's newest radical Alexandria Ocasio-Cortez. The plan aims to fundamentally transform how Americans produce energy, harvest crops, raise livestock, build homes, drive cars, and manufacturer goods. Essentially, the way we all live our lives, all within 10 years.

 

CORDERO: Ocasio-Cortez says that she and her liberal colleagues are calling for a "national industrial economic mobilization plan, not seen since World War II."

 

ALEXANDRIA OCASIO-CORTEZ: Even the solutions that we have considered big and bold are nowhere near the scale of the actual problem that climate change presents to us, to our country, and to the world.

 

CORDERO: The plan is ambitious, to say the least, and in the week or so that the text of the resolution has been available even the mainstream media has found it flawed. The Economist called the proposal "deeply unserious". The Washington Post editorial board labeled it as fantasy. New York Times columnist David Brooks wrote that "the Green New Deal represents the greatest centralization of power, in the hands of the Washington elite, in our history." The house speaker Nancy Pelosi dismissed the plan as, "The green dream or whatever they call it."

 

But guess what? Despite this, Ocasio-Cortez has still been successful at rallying the ultra left around this proposal. Support for the Green New Deal has even become somewhat of a Litmus test for the 2020 presidential candidates.

 

CORY BOOKER: Our planet is in peril and we need to be bold. It's one of the reasons why I signed onto the resolution and cosponsored the resolution for the Green New Deal. There's a lot of people now that are blowing back on the Green New Deal. They're like, "Oh, it's impractical. Oh, it's too expensive. Oh, it's all of this." If we used to govern our dreams that way we would've never gone to the moon. God, that's impractical. You see that ball in the sky?

 

KAMALA HARRIS: I support a Green New Deal, and I will tell you why. Climate change is an existential threat to us and we have got to deal with the reality of it.

 

KIRSTEN GILLIBRAND: We're for what we're for and we wanna see a green economy in the next decade. Not because it's easy, but because it's hard. We need a moonshot. Like John F. Kennedy said, "We're gonna put a man on the moon in the next 10 years, as a measure of American's innovation, entrepreneurial spirit." Why not make the same national call to action to say let's create a green economy in the next decade?

 

CORDERO: This week, Senator Mitch McConnell announced that he plans to allow everyone in the Senate to participate in the just how radical are you Litmus test.
 

MITCH MCCONNELL: I've noted, with great interest, the Green New Deal and we're gonna be voting on that in the Senate. It'll give everybody an opportunity to go on record and see how they feel about the Green New Deal.

 

CORDERO: To be clear, that's all this is right now. No one is voting to make this a law. A nonbinding resolution is essentially an opinion.

So what's in this resolution? How much would it cost? Would it actually work? And is that even the intention of the left?

 

Today, Nick Loris, an economist and Heritage's Herbert and Joyce Morgan Fellow in Energy and Environmental Policy, explains.

 

CORDERO: Nick, one of the targeted outcomes of the Green New Deal would be that the government will step in and force elimination of greenhouse gas emissions from transportation and other infrastructure. What does that mean exactly? Does that mean electric cars for everyone?

 

NICK LORIS: Hard to say. They say the devil's in the details, and the devil is kinda scarcely present in this proposal because there's not a lot of details or policy substance into how they want to accomplish these goals, but essentially that's what people took it as is that 92% of our transportation needs are met through petroleum products. If you want to eliminate greenhouse gas emissions you are essentially banning the internal combustion engine and transitioning to electric vehicles, high-speed rail, all of these things that are economically costly right now and will be for a very long time. The reason that 92% of our transportation needs are met through petroleum products is because they're affordable and reliable. This proposal even insinuated that we were going to switch over from air travel to high-speed rail, which, again, is another one of the attention-grabbing segments of the frequently asked questions document saying that, "Yeah, we don't need airplanes anymore." No, let's just focus on high-speed rail and let's just electrify the entire transportation sector, which, again, would come at huge, huge costs to the economy and is technologically even questionable if we could even do something like that.

 

CORDERO: Yeah, overseas travel.

 

LORIS: Yeah, especially in 10 years.

 

CORDERO: How does that work? Painting this picture, again, another one of their outcomes would be to eliminate greenhouse gas emissions from manufacturing, agriculture, and other industry sectors. What would that look like? Solar panels everywhere?

 

LORIS: Yeah. Essentially solar panels everywhere, eliminating the consumption of beef products because methane emissions are one of the bigger, if you wanna call it an alleged climate challenge is methane emissions from the agricultural sector as well as land use conversions. Effectively, what they would want to do is, and this is not all that new of a surprise. This is something the left has been talking about for years is to radically reduce the amount of beef that is consumed in the United States and around the world because of those methane emissions, not to mention how people farm and those land use conversions.

 

LORIS: The manufacturing sector, there's so much energy that goes into producing goods. I mean that's why a lot of businesses have come to the United States over the past 10 years is because natural gas is such a critical component and input for a lot of manufactured goods, chemicals, and plastic in the United States, and they've invested over $200 billion dollars in the United States over the past 10 years and cited cheap natural gas as a reason why they're coming to the United States. This would devastate and essentially eradicate all of those jobs in those industries because of this alleged notion that we need to transition away from cheap natural gas and go towards more expensive renewables.

 

CORDERO: They're also proposing that we build a smart grid to replace our current electric grid, upgrade water infrastructure, and way more. How much will this cost? Can you kind of put that in perspective for us? I have a feeling this number's gonna be so large that it'll be hard for us to even really wrap our minds around it.

 

LORIS: It is. Yeah, for sure. One of the problems is because the plan is so radical it's hard to actually get a credible cost estimate of what this would actually do. I mean even just looking at the transition away from coal, oil, and natural gas, and nuclear to 100% renewables. If you try to boil that down into what that would like from a consumer standpoint, I mean you're talking about potentially hundreds of dollars per month in your electricity bill, of an increase. Those costs spread throughout the economy. That's such a critical component that people haven't really been able to get their hands around because, yes, you pay more at the gasoline station or pay more for your electricity, but because energy is such a necessary component for all of the goods and services we have here in the United States you're paying more at the grocery store, you're paying more when you buy clothes at Walmart, when you go out to eat, whether you go to the movies.

 

LORIS: It has these huge, huge ripple effects throughout the economy where you're talking about potentially millions of jobs lost and millions or trillions of dollars lost in gross domestic product and then tens of thousands of dollars lost in household income. Those are costs that are just a small snapshot of what could happen. Again, that's just looking at one tiny component of this resolution, not talking about eliminating greenhouse gas emissions from the manufacturing and agricultural sectors and the transportation sectors. That's just looking at the electricity sector. It would be economically cataclysmic and really for no meaningful climate benefit.

 

LORIS: I think we would essentially go back to the stone age, reduce our emissions to net zero, and assuming you believe the climate models that they used to estimate what CO2 does and its impact on warming, even if we were to get net zero GHG emissions you're talking about mitigating global temperatures a few tenths of a degree Celsius by the turn of the century because other countries like China and India, where a lot of the GHG emissions are coming from, they're not going to change the way they behave.

 

CORDERO: Right. Yeah, and that's in the plan, too, right? I think that's one of their last bullet points is kinda like, "Oh yeah, also in the plan to get everybody else to do this, too."

 

LORIS: Yeah. Good luck. It's gonna be challenging when there's a billion and a half people without access to reliable electricity to say, "Hey, we're going to forgo all of this cheap energy in coal and in natural gas, and in some instances nuclear, in favor of living a life where we're less prosperous, where we don't have access to electricity or clean drinking water", and where economic growth is such a critical priority for these developing countries and they're just going to choose to forgo inexpensive electricity. It's a dream. As the Washington Post called it, it's an absolute fantasy.

 

CORDERO: The other aspect of this plan, it also says it include provisions that "offer economic security for those unable or unwilling to work and promise to create millions of good, high-wage jobs for willing Americans." Does it say how it's going to provide those jobs?

 

LORIS: It kind of does and kind of doesn't. Again, it's lacking a lot of policy substance. What they're planning is a massive government spending program and spending trillions of dollars, which means the taxpayers are spending trillions of dollars. They call it, in this plan, investment multiple times over, but it's not investment. It's just government spending and taxation to create these green jobs. We saw just a small microcosm of that in the stimulus bill under the Obama administration with weatherization programs and huge grants going go crony companies. Yes, it created some of those jobs in some of those sectors, but at cost to the rest of the economy because when you're taxing and spending you're taking money out of the economy and that money could've been invested elsewhere by the private sector to create even more jobs.

 

LORIS: Time and time again, we've seen that these green jobs programs create some jobs in those green economies, building windmills and building solar panels, but it's at the expense of the rest of the economy and at the expense of families who are better suited to spend their money the way that they see fit.

 

CORDERO: We'll be right back after a short break.

 

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CORDERO: Nick, how much of this do you think is just a crazy grand gesture, a strategic move by the left to push everyone farther left than they've been comfortable to go when it comes to climate change legislation?

 

LORIS: I do think that's a part of the strategy is to throw the most aggressive, egregious plan at the wall and make any type of policy that is still economically bad and that wouldn't impact climate, a little more feasible politically, but even those policies tend to not be very popular with the American public and with a large sector of the legislature because of the cost of those policies, whether it's a carbon tax or a cap and trade program, or even some of the regulations under the Obama administration like the Clean Power Plan. These may have support on the surface and they may sound like great ideas, but at the same time Americans just aren't willing to pay for them.

 

LORIS: There was a recent poll done by the AP that said Americans wouldn't even be willing to pay more than $10 a month in additional energy bills to combat climate change, 68% of Americans said they wouldn't be willing to pay an additional $10 a month. I think they understand what's happening in France when these green policies continue to exact money out of their wallets and out of their bank accounts and they're not seeing any climate benefit. You get to see people who are struggling to make ends meet and they're diverting more money that they could be spending on food and in healthcare and in education on their energy bills and for no environmental return. People get frustrated by these policies.

 

LORIS: I think even the less extreme versions of the Green New Deal are still going to be very politically challenging because of their economic costs and because you don't see any real climate benefit from them.

 

CORDERO: Instead of plans like the New Green Deal, what does the Heritage Foundation think we could be doing instead?

 

LORIS: Yeah, I think there's a number of productive policies that we should be looking at regardless of whether you think climate change is a problem or not. There are certainly regulatory barriers that we need to reduce for new nuclear power plants in the United States, for renewable energy technologies. Energy trade is a critical component of what we can do moving forward to help provide other countries with cleaner sources of energy, whether that's fracking and more natural gas in some of these developing countries or helping to build new nuclear power plants. Energy trade and knowledge sharing could be really a critical component moving forward to provide the world's increasing energy needs. Also, looking at our national labs.

 

LORIS: There's a lot of great research being done at the Department of Energy's national labs, basic research, and there should be better pathways for the private sector to come in and, using their own money, tap into that research and see if there's any commercial viable products that they can spin out into the energy sector or any broad manufacturing technology sectors as well. It doesn't necessarily have to just be energy, but it shouldn't be done at the Department of Energy. They shouldn't be spending money to commercialize specific technologies. They should be doing very basic research that the private sector wouldn't undertake to meet a national objective and then allow the private sector to come in and spin that research into commercially viable products. That's what we've seen work in the United States. I mean the reason that we got the Internet and GPS out of government research is because they were researching things for national security objectives and then entrepreneurs saw interesting, innovative ways to take that research and spin it off into the private sector. We need to be doing more of that at the Department of Energy.

 

CORDERO: Thank you so much for joining us today.

 

LORIS: Absolutely. Thanks again for having me.