The "Green New Deal" Debunked - Part 2 Of 2

One of the hottest topics in policy wonk circles is the “Green New Deal,” spearheaded by the rising star of the progressive Left, Alexandria Ocasio-Cortez.

In my previous post, I explained that the entire premise of a current New Deal—whether green, red, or blue—was flawed. Even on standard Keynesian terms, it makes no sense to embark on a $1 trillion government spending program with official unemployment below 4 percent and the Fed raising rates to rein in price inflation. Worse, historically the actual New Deal under Franklin Roosevelt prolonged the nation’s suffering, making the Great Depression linger for a decade. Finally, I pointed out that the supporters of a Green New Deal weren’t merely interested in mitigating climate change: they quite openly announce that they will use the plan as a vehicle for transforming society according to the standard progressive wish list.

In the present post, I’ll critically analyze some of the specific policy goals listed in the draft text calling for a creation of a select committee to craft a Green New Deal. The various proposals would waste enormous sums of money in pursuit of impossible goals that would raise energy prices and hurt consumers. Even if one believes that carbon dioxide emissions constitute a “negative externality,” the measures in the proposed Green New Deal would achieve emission reductions at a much higher cost than necessary. And we see once again that the progressive Left does not think a simple “price on carbon” is enough to achieve their agenda. Conservatives and libertarians should therefore be under no illusions when the idea of a “carbon tax deal” is floated.
A Carbon Tax Won’t Satisfy the Green New Dealers

Regarding this last point, consider the following excerpt from the Green New Deal draft text’s Frequently Asked Questions:

[Question:] Why do we need a sweeping Green New Deal investment program? Why can’t we just rely on regulations and taxes alone, such as a carbon tax or an eventual ban on fossil fuels?

Regulations and taxes can, indeed, change some behavior. It’s certainly possible to argue that, if we had put in place targeted regulations and progressively increasing carbon and similar taxes several decades ago, the economy could have transformed itself by now. But whether or not that is true, we did not do that, and now time has run out.

Given the magnitude of the current challenge, the tools of regulation and taxation, used in isolation, will not be enough to quickly and smoothly accomplish the transformation that we need to see.

Simply put, we don’t need to just stop doing some things we are doing (like using fossil fuels for energy needs); we also need to start doing new things (like overhauling whole industries or retrofitting all buildings to be energy efficient). Starting to do new things requires some upfront investment…

We’re not saying that there is no place for regulation and taxes (and these will continue to be important tools); we’re saying we need to add some new tools to the toolkit. [Green New Deal “draft text’]

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