Spending a fortune to prop up the banks but only small change on the urgent transition to a dynamic, low-carbon economy, is like building a crystal palace on sand, then shoving a few bricks under it as an afterthought for foundations.
New investment to match the Government’s rhetoric on climate change amounts to a tiny fraction of 1 per cent of the public support given to the finance sector. Such lack of ambition is counterproductive and a missed opportunity if Alistair Darling wants to pay down the public debt. As the Green New Deal Group point out in their report, The Cuts Won’t Work, productive investment in renewable energy, efficiency and green transport both pays for itself through the economic multiplier effect of spending, and ensures that more people are in work to pay taxes.
That’s without counting the additional benefits of cutting carbon emissions, increasing energy security and tackling fuel poverty. It’s odd that such basic economics is so hard for the Government and the opposition to grasp. History told us that it was when Roosevelt stopped spending three years into his New Deal that things went wrong and plunged the country back into depression. More than with the banks, the biosphere really is too big to fail and we should invest what is needed to maintain it, not small random amounts. Around £50 billion a year on a Green New Deal to create jobs and make the UK fit for a low-carbon future is needed to get us on track. The PBR prescription is more like medieval bloodletting, it is more likely to kill than cure the patient.