This is the third in a series of commentaries proposing an Emergency Green New Deal. The first, “As Workers Fight Coronavirus, They Are Laying the Basis for an Emergency Green New Deal”, describes the need for emergency employment to meet the Coronavirus crisis and the economic devastation it is bringing to American workers; tells how worker action on the job, in the community, and in the political arena is already addressing that need; and explains how their action can be the start of an Emergency Green New Deal. The second, “An Emergency Jobs Program for an Emergency Green New Deal” lays out a practical plan for a Green New Deal Jobs Program that can start right now addressing the emergency needs of the Coronavirus era and can develop into a program to provide jobs for all who want them helping fix the damage done by the Coronavirus and creating a just transition to a climate-safe economy. This, the third in the series, describes a cascade of new Green-New-Deal-style proposals for not only recovering from the Coronavirus recession, but using that recovery to address our longstanding problems of climate catastrophe and economic inequality.
While the economic future is a bit unpredictable even in normal times, there are plenty of indications that American workers will be facing unemployment at historic levels for many months or even years to come. US Treasury Secretary Steve Mnuchin warned (before taking it back) that the unemployment rate could reach above 20%. Goldman Sachs projects gross domestic product (GDP) will fall at a 24 percent rate in the second quarter of 2020. According to James Bullard, president of the Federal Reserve Bank of St. Louis, unemployment could reach 30 percent, and GDP could drop by 50 percent.
The week of March 21 saw 3.3 million workers apply for unemployment benefits, the biggest jump in claims in history. That excludes self-employed workers, gig workers, undocumented workers, students, and people who worked fewer than six months last year who are typically not eligible for unemployment insurance. The Washington Post wrote, “Many economists say this is the beginning of a massive spike in unemployment that could result in over 40 million Americans losing their jobs by April.”
There is no way to tell how long mass unemployment will persist because there is no way to know how long the pandemic will persist or how effective policies to counter the crisis will be. Chief economist Mark Zandi of Moody’s Analytics says it will go through “four waves”: the sudden stop, the loss of jobs, the wiping out of nest eggs and the reticence of consumers to spend, followed by a cut in business investment. The only two economic crises of this scale in American history were the Great Depression and the Great Recession. The Great Depression started in 1929, and by 1933 15 million people were unemployed. An apparent recovery started in 1933, but by 1937 depression conditions returned. Only the advent of production for World War II brought the Great Depression to an end. In the Great Recession that started in 2007 massive economic stimulus prevented a complete collapse of the financial system, but official unemployment reached 10 percent and did not rebound to its pre-recession level of 4.7% until May 2016 – nine years later.
The economic stimulus legislation just passed includes much-needed support for healthcare measures, unemployment insurance, and other immediate necessities. However, it is composed mostly of massive subsidies to businesses that may or may not keep their workers employed. In any case it is only a temporary stopgap. According to the Washington Post, “The sweeping economic package is designed to last for 10 to 12 weeks, after which the administration could revisit whether it would seek additional assistance from Congress.”
So what happens after that? Will it be entirely up to the Trump administration, or will it depend on what the rest of us say and do?
Last week I proposed an An Emergency Jobs Program for an Emergency Green New Deal to provide emergency employment for millions of workers, especially for low-wage workers hardest hit by the Coronavirus Recession. I am happy to report that several other proposals have just appeared, focused on longer-range responses not just to the current economic crisis but the longer-run crises of climate change and inequality.
Just Recovery Principles
The “People’s Bailout,” a statement by more than 700 progressive organizations, defined five principles for relief and stimulus packages. Principle Four laid out an initial vision for a “just recovery,” calling for “a down payment on a regenerative economy, while preventing future crises.” It would start with “a large, medium-term stimulus to counteract the economic downturn and ensure a just recovery.”
This would include “public investments to rebuild our infrastructure, replace lead pipes, expand wind and solar power, build clean and affordable public transit, weatherize our buildings, build and repair public housing, manufacture more clean energy goods, restore our wetlands and forests, expand public services that support climate resilience, and support regenerative agriculture led by family farmers.
This stimulus should “create millions of good, family-sustaining jobs with high-road labor standards; counter systemic inequities by directing investments to the working families, communities of color, and Indigenous communities who face the most economic insecurity; and tackle the climate crisis that is compounding threats to our economy and health.”
What would it mean to spell out this “Just Recovery” principle as a set of detailed policies? A just-released letter to Congress from a group of climate and social policy experts spells out in much greater detail a “Green Stimulus to Rebuild Our Economy that is “aligned with the “5 Principles for Just COVID-19 Relief and Stimulus.” The “Green Stimulus” proposal draws on ideas from the Democratic primary campaigns of Corey Booker, Julian Castro, Kirsten Gillibrand, Kamala Harris, Jay Inslee, Bernie Sanders, Tom Steyer, and Elizabeth Warren. Many of the co-authors were associated with those campaigns; more than half are associated with the think tank Data for Progress.
The letter identifies three converging crises: the COVID19 pandemic and resulting economic recession; the climate emergency; and extreme inequality. While noting the need for an emergency response to the pandemic, the letter addresses the “longer-term challenge of jumpstarting economic recovery and transitioning to a more sustainable economy.” It calls for a recovery that “accelerates the creation of a 21st century green economy.”
The letter calls for a Green Stimulus of at least $2 trillion, automatically renewed annually at 4% of GDP (roughly $850 billion). This will create millions of jobs in “clean energy expansion, building retrofits and sustainable homebuilding, local food economies, public transit maintenance and operations, electric appliance and vehicle manufacturing, green infrastructure construction and management, local and sustainable textiles and apparel.” The program will partner with “existing pre-approved apprenticeship programs” to “bring more low-income and workers of color into good union jobs.” It will make strategic investments in frontline communities hard hit by pollution and climate harm. It will expand public and employee ownership through public agencies, cooperatives, and worker self-determination requirements. It will cut carbon pollution to keep global warming as close as possible to 1.5 degrees Celsius while protecting salaries, benefits, and retirements of fossil fuel workers.
“Green Stimulus” includes well over 100 policy recommendations divided into eight categories. For purposes of illustration, we will give one job-related example for each category.
- Housing, buildings, civic infrastructure, and communities. “Massively expand the federal Weatherization Assistance Program to cut utility costs and eliminate homes’ carbon emissions, fund state-level equivalent programs, and provide grants to community-based weatherization programs to scale up local efforts, creating hundreds of thousands of jobs.”
- Transportation workers, systems, and infrastructure. “Provide grants and loans to local transit agencies and school boards to fund the purchase of electric railcars and engines and electric buses and electric school buses, with the goal of ending all diesel bus purchases by 2025. This must also include targeted investment to support electric bus and railcar manufacturing capacity within the automobile industry in the United States.”
- Labor, manufacturing, and just transition for workers and communities. “Implement a Green Durable Goods policy to ensure continued production of essential green products, via massive infusion of federal funds into electric appliance, vehicle, etc. manufacturing. Use direct government purchase of high volumes of green goods to drive increases of green capacity during economic slowdown, as done during the second world war. Give priority to manufacturers who partner with pre-approved union apprenticeship programs.”
- Energy system workers and infrastructure. “Require a rapid phaseout of fracking and offshore and onshore oil and gas drilling, end new extraction, and end fossil fuel exports, in conjunction with the rapid expansion and unionization of clean energy generation.”
- Farmers, food systems, and rural communities. “Prevent food shortages and surpluses by establishing supply management programs and a parity pricing system for farmers that both ensures farmers, farm workers, and every worker along the food chain a living wage and ensures consumers a high-quality, stable, and ensures local supply of agricultural goods.”
- Green infrastructure, public lands, and the environment. “Create a Clean Water Corps that provides no-interest loans for municipalities and counties to invest in repairing/replacing combined and sanitary sewer systems, building out alternative stormwater management systems (green infrastructure), and performing other abatement measures (replacing lead pipes and upgrading treatment facilities).”
- Regulations, innovation, and public investment. “Require that any bailouts or bridge loans to large corporations, like airlines and cruise ships, be contingent on economic, social, and ecological conditions: 10-year plan to substantially cut majority of carbon pollution with targets every two years; use funds to maintain payroll; government gaining long-term preferred shares or other equity in bailed out firms; provide $15 minimum wage within one year; no share buy-backs or dividends; set asides seats on corporate boards for labor representatives; maintain collective bargaining agreements.”
- Green foreign policy. “Support local and sustainable farming systems in the US and internationally by removing agriculture from the purview of the World Trade Organization, investing new resources in sustainable timber and forest management cooperatives and companies through the USDA’s Climate Smart Forestry and Agriculture Initiative, and creating new markets in the building industry for sustainably harvested cross laminated timber and other sustainable wood products.”
Covid-19 Federal Response & Economic Stimulus
Another set of more than 100 recommendations comes from a statement of legislative priorities for the “COVID-19 Federal Response & Economic Stimulus” from the BlueGreen Alliance, an organization that includes some of the country’s largest unions and environmental organizations. The recommendations begin with a series of “Overarching Standards/Principles” for an “economic stimulus package focused on working people and the public good.” They include “Buy America” standards, Davis-Bacon act provisions, project labor agreements, and “Buy Clean” and “Buy Fair” procurement standards. The policy priorities include six “pillars.” Again, we will focus on one example from each.
- Address working people and families’ immediate needs. “Ensuring hospitals and healthcare professionals and emergency workers (doctors, nurses, caregivers, custodial staff, etc.) have the equipment they need right now, including adequate personal protective equipment (PPE).”
- Rebuild the public sector and services. “Reduce air pollution in schools, especially those with child care operations by passing the Clean Air, Sharp Minds Act (S. 3364).”
- Invest in our nation’s infrastructure. “Establish a National Infrastructure Bank that would serve to identify transportation, energy, and water infrastructure projects in need of funding and match private sector investments or money from local governments with loans made by the bank.”
- Jumpstart domestic manufacturing. “Capitalize an industrial bank or revolving loan fund to provide loans to manufacturers for producing clean energy, transportation, and infrastructure technology and energy efficient products and for reducing greenhouse gas emissions from manufacturing facilities.”
- Provide critical long-term support and protections for workers. “Permanently modify laws to allow immediate access to unemployment insurance, increase benefit size, expand work-sharing eligibility, allow for extensions, and expand coverage to self-employed and gig workers.”
- Prioritize investments in those communities most in need. “Reclaim abandoned coal mines and spur economic development opportunities in hard hit communities in need of an economic boost: Expedite the use of existing funds in the AML [Abandoned Mine Land] fund to reclaim abandoned mines and stimulate economic development on reclaimed land (RECLAIM Act – H.R. 2156).”
Other proposals are appearing almost daily. The business magazine Forbes recently published a piece by Senior Contributor Ken Silverstein titled, “Want to Jump-Start The Economy? Include a Green New Deal in the Stimulus Package.” The environmental publication Grist recently interviewed experts in finance, policy, and grassroots activism on what they would include in a stimulus package. Their proposals included renewable energy tax credits, community cleanups, and an end to bailouts for gas and oil companies. No doubt other proposals are on the way.
Let the Green New Deal Begin!
The original New Deal was famous for its “alphabet soup” of new agencies and programs designed to recover from the Great Depression and reconstruct the American economy on a reformed basis. But few of these agencies and programs were even mentioned in Franklin D. Roosevelt’s 1932 campaign for president – indeed, he campaigned on the promise to balance the federal budget!
Nonetheless, from the outset of the Great Depression there were movements, programs, and policy proposals at local, state, and national levels that helped lay the groundwork for the New Deal. They ranged from local municipal public works programs to the mutual aid self-help of the unemployed, and from New York State’s pioneering labor standards legislation to the supply management proposals developed by agricultural economists. These initiatives laid the groundwork for the public works, labor, and farm programs of the New Deal. They might be called “The New Deal Before the New Deal.”
Given the depth of the current crisis and the size of the stimulus proposals on the table, many of the recent “Just Recovery” programs could be started in the time between now and the election. As “Green Stimulus” points out, “Many of these interventions could be implemented by state and local governments and would benefit from immediate, purposeful planning and preparation, nearly all of which could be done remotely (including mass public procurement, targeted bridge loans and other emergency financial instruments, and expanded tax credits and rebates for high-priority sectors).” New York Governor Cuomo is already hiring thousands of construction workers to build emergency hospitals. In Canada laid-off oil workers are being rehired to remediate contaminated oil fields. Unemployed Uber drivers who volunteered to deliver necessities to impoverished New Yorkers just were hired to continue doing so as paid drivers – initiating what one supporter calls the “first public works program of the platform economy.”
While green stimulus investment programs were not included in the most recent stimulus legislation, they could be part of the next one. They could even be funded under the half-a-trillion dollar “slush fund” Congress just provided – with few strings attached – to the Federal Reserve. You could call it “The Green New Deal before the Green New Deal.”
 Ezra Klein, “How the Covid-19 recession could become a depression,” Vox, March 23, 2020. https://www.vox.com/2020/3/23/21188900/coronavirus-stock-market-recession-depression-trump-jobs-unemployment
 Heather Long and Alyssa Fowers, “A record 3.3 million Americans filed for jobless claims as coronavirus puts economy into recession,” Washington Post, March 26, 2020. https://www.washingtonpost.com/business/2020/03/26/unemployment-claims-coronavirus-3-million/
 Ezra Klein, “How the Covid-19 recession could become a depression,” March 23, 2020. https://www.vox.com/2020/3/23/21188900/coronavirus-stock-market-recession-depression-trump-jobs-unemployment
 Jacqueline Alemany, “Power Up: What to know about the two massive coronavirus stimulus proposals,” Washington Post, March 24, 2020. https://www.washingtonpost.com/news/powerpost/paloma/powerup/2020/03/24/powerup-what-to-know-about-the-two-massive-coronavirus-stimulus-proposals/5e790f9988e0fa101a75030e/
 “COVID-19 Federal Response & Economic Stimulus – BlueGreen Alliance Legislative Priorities,” https://www.bluegreenalliance.org/wp-content/uploads/2020/03/BlueGreen-Alliance-Priorities-for-Robust-Stimulus-Package_Final.pdf
 Ken Silverstein, “Want To Jump-Start The Economy? Include a Green New Deal in the Stimulus Package,” Forbes, March 19, 20210. https://www.forbes.com/sites/kensilverstein/2020/03/19/want-to-stimulate-the-economy-include-a-green-new-deal-in-the-coronavirus-bill/#d9f7b7f43861
 “The coronavirus stimulus will inject trillions into the economy. Here’s how it could also help the planet.” Grist March 24, 2020. https://grist.org/politics/how-a-coronavirus-stimulus-package-could-bolster-the-economy-and-save-the-planet/