It’s rare that you can spot a massive economic change coming well in advance.
These are the sorts of things that make fortunes. When John Paulson made a series of bets against the housing market right before the recession hit a decade ago, he wound up earning billions of dollars. Predicting or forecasting big shifts means being able to prepare for them, investing with an eye toward maximizing your future position.
There is a big economic shift that appears to be looming in the United States, one that’s either on the near horizon or practically on top of us, depending on how optimistic you’re feeling. That’s the shift that will result from the increasing effects of the warming climate, including flooded cities, increased wildfires, changes in agricultural production and shifts in rainfall patterns. It’s a shift with a still-uncertain scale, in part because we don’t know how bad things will be. The extent of the effects of global warming depends to a large part on how warm the world gets, which, in turn, depends on how warm we allow it to get.
One of the central political debates of the past two decades has been the extent to which we try to shift our behavior to try to influence that warming. Scientists argue that urgent action is needed in order to hold warming to a level where the damage that’s inflicted is more manageable, but that means taking action in the short term which conflicts with the immediate goals of a number of powerful interests. Republicans argue that existing economic interests should be protected at the likely -- they’d say “possible” -- expense of future interests, and Republicans have controlled the White House for 10 years this century and controlled the House for six of the other eight.
Democrats and environmental activists have argued that there is an economic opportunity in halting the current warming trend (the five hottest years on record have been the last five years) as well as an opportunity in preparing for the effects that will accompany the warming we can already expect. There’s an opportunity, that is, in making investments into renewable energy to curtail warming and in revamping infrastructure to prepare for increased flooding and heat.
On Thursday, Rep. Alexandria Ocasio-Cortez (D-N.Y.) and Sen. Edward J. Markey (D-Mass.) released a document outlining what they call a “Green New Deal." The document is a resolution, not a piece of legislation, meant to offer a set of guiding principles for the government moving forward. Central to the document, as you might guess, is attention to the changing environment and taking legislative actions that bolster both increased preparation for warming and, to a bold degree, halting the emissions that will contribute to an increase in that warming.
But what also emerges in reading the document is how central an overhaul of the economy itself is to the plan. This is an economic document at its heart, one that forecasts how the economy is going to need to change and establishing a path for fixing many of the problems that have accompanied past economic transitions. There’s a focus on communities that were intentionally sidelined in economic overhauls like the New Deal that followed the Great Depression: indigenous people, communities of color and the poor -- groups that also often bear more of the risk from the warming world and the infrastructure that produce significant greenhouse gas emissions. It’s about how to remake the economy now that the economy needs to be remade thanks to the threat of climate change.
It is, essentially, an intersectionalist delineation of a new U.S. economy, predicated on the existent threats of a warming world.
The timing of the document is interesting. Eight years ago this month, Congress, during that two-year period when Democrats had unified control of Washington, passed the American Recovery and Reinvestment Act, a stimulus bill meant to address the economic crisis from which the country was still emerging. It was signed into law by President Barack Obama, who’d focused on the environment during his 2008 campaign.
More specifically, he focused on what he called “green jobs,” using the economic crisis -- another moment of economic change -- to rebuild the economy to include a focus on addressing climate change. By pouring money into retrofits of buildings to reduce their energy consumption and fostering the wind and solar industries, the thinking went, the millions of people put out of work could be reintroduced to the economy in jobs that also focused on improving the country’s energy use and carbon dioxide emissions. The ARRA allocated $100 million to reduce emissions in public transportation and $250 million to retrofit assisted housing. It spurred a mini-economy of green companies focused on that sort of work.
During his first address to Congress later that month, Obama made the public case for a focus on the green economy. He argued that renewable energy would be a booming market as countries moved to address global warming, but that the U.S. was falling behind Germany and China as drivers of the clean-energy sector.
“I do not accept a future where the jobs and industries of tomorrow take root beyond our borders – and I know you don’t either,” he said. “It is time for America to lead again.”
He asked for Congress to go further than it had in the ARRA.
“I ask this Congress to send me legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy in America,” he said. “And to support that innovation, we will invest fifteen billion dollars a year to develop technologies like wind power and solar power; advanced biofuels, clean coal, and more fuel-efficient cars and trucks built right here in America.”
Obama appointed Van Jones, who in 2008 had written a book called “The Green Collar Economy,” to serve as point person for his green jobs effort.
Then it all stopped.
Jones resigned from the White House after controversial comments he’d made in the past were made public and became a staple of conservative media outrage. A “cap and trade” bill co-authored by Markey, in which carbon dioxide emissions would be limited but a market would be created to allow companies to pay to emit more than allowed, was passed by the House but never considered by the Democratic Senate. Climate change got increasingly wrapped into partisan politics, in part as Republicans increasingly stood obstinately against Obama and his policy goals. Obama and his White House turned their political capital to health care. And in 2010, Republicans retook the House.
Obama’s green-jobs plan was, true to form, a piecemeal approach toward bolstering clean-energy production and providing quality employment by fostering new markets focused on addressing the problem of global warming. The Green New Deal proposal is not that; it is, instead, a sweeping vision of how an economy seemingly already poised for significant change should be formed. Obama’s efforts included attention paid to job quality; the Green New Deal predicates its efforts on universal, quality, unionized employment.
It’s a vision of what the economy should look like, predicated on the changes that global warming will necessitate. It’s framed as being about the environment. It’s much, much more than that.