QE for environmental technology: a political imperative in the run-up to the next election

In the Guardian last week, Simon Jenkins observed that there is too little money around and so a chronic shortage of demand. He adds that Britain and the US addressed this challenge by “printing money”, by quantitative easing (QE).

But QE just channelled billions into bank vaults and boosted reserves, went to stockmarket inflation and into ‘obscene bonuses’.

Jenkins notes that the commentator Anatole Kaletsky has pointed out that if the £375bn of QE had gone to private bank accounts rather than to buying bonds from banks, it would have meant £24,000 per British family and that this would have ‘transformed the demand economy’.

In a letter signed by a number of experienced people, instead of this indiscriminate shower of cash, the advantages of well-targeted “green infrastructure QE” were set down. It would stimulate the economy, boost employment and tackle climate change countrywide by:

  • making the UK’s 30m buildings super-energy-efficient
  • dramatically reducing energy bills,
  • fuel poverty and
  • greenhouse gas emissions.
  • tackling the housing crisis by building affordable, highly insulated new homes, predominantly on brownfield sites
  • providing job security and
  • local business opportunities and
  • rebalancing the economy.

The letter ends by pointing out that the “jobs in every constituency” element inherent in green infrastructure QE means that it should become a political imperative for all parties in the run-up to next May’s election.

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Posted on December 6, 2014, in Banking and finance, Economy, Environment, Finance, Government, MPs, Planning and tagged , , , , . Bookmark the permalink. 1 Comment.

  1. John, from Balsall Heath, by email:

    The ‘proposed green infrastructure QE’ would not just be a one off boost to demand, but would act over decades to reduce the amount of household income that is going on heating the air, so making people better off and giving them more to spend on goods and services that they actually want.

    It would disproportionally benefit the poor, who tend to live in the worst housing and spend the greatest proportion of their income on fuel. This is an economics that is about being more economical, not just about boosts versus cuts.

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