On Tuesday, the Institute for Public Policy Research launches its Environmental Justice Commission (EJC) and people are coming together across Conservative, Labour and Green parties to serve on it – leading figures from business, academia, civil society, trade unions, youth and climate activism.
Ed Miliband, Labour MP for Doncaster North and a former leader of the Labour party; Caroline Lucas, Green MP for Brighton Pavilion and Laura Sandys, a former Conservative MP for South Thanet, have written about this and many readers’ comments are well worth reading. Important points made are summarised below
Too often the issue of climate change seems marginal to the public’s concerns, when it is in fact central.
This will be done by committing to a Green New Deal (GND), with an unprecedented mobilisation and deployment of resources to tackle the accelerating climate crisis and transform our economy and society for all. Read more on the Green New Deal website.
Its aims are to:
- mobilise a carbon army of workers to retrofit and insulate homes, cutting bills, reducing emissions and making people’s lives better
- move to sustainable forms of transport and zero-carbon vehicles as quickly as possible, saving thousands of lives from air pollution
- end the opposition to onshore wind power and position ourselves as a global centre of excellence for renewable manufacturing
- protect and restore threatened habitats and
- secure major transitions in agriculture and diets that are essential if we are to meet our obligations.
People have been asking how we can revive communities that have been left out of prosperity. They ask whether they and their children will be able to get work and also what the quality of that work will be and what skills will be needed. ECJ believes GND has the potential to do this.
The areas of policy mentioned above answer the immediate economic concerns of people for jobs and hope. Green jobs must be secure and decently paid, with a central role for trade unions in a just transition for all workers and communities affected.
The commission will aim to help the UK to take a lead, believing that there is economic and societal advantage in doing so. An increasing number of people, young and old, see that the way we run our economy is damaging our climate, our environment and our society, but that, crucially, it is within our power to change it for the better. And change it we must.
On Wednesday the FT reported that the governor of the Bank of England wanted to inject more money into the economy and that the BoE has so far bought £375bn-worth of ‘gilts’ – gilt-edged securities – mainly held by insurance companies, banks and pension funds.
The Treasury spent many years abruptly dismissing any increase in government issued money as inflationary – sending its juniors to monitor the seminal parliamentary meetings sponsored by MP Austin Mitchell and organised by Sabine McNeill (Forum for Stable Currencies). At one of these the writer sat with a very sceptical young investment banker who afterwards admitted he was won over by a presentation by James Robertson.
QE? Sterling would collapse!
Below can be seen the now-sidelined argument that this would create inflation and sterling would collapse, committed to paper by Anthony Nelson, then Economic Secretary to the Treasury in John Major’s Government, who became Minister of State at the Treasury, Minister for Trade and Industry, before passing through the revolving door to become Vice Chairman of Citigroup.
Earlier this month, the voice of sanity, MP Caroline Lucas, wrote:
This week, the Bank of England is expected to announce a new batch of quantitative easing to the tune of £50bn or more. A new report from the Green New Deal Group and Southampton University economics professor Richard Werner, who coined the term quantitative easing, is calling for such cash to be injected into green investment to support badly needed renewable energy and energy efficiency projects. Rather than handing the money over to the banks, who then sit on it, green QE would put money into the wider economy – creating thousands of new jobs, improving energy security and tackling climate change at the same time.
In other words, as MP Austin Mitchell’s 2008 EDM also advocated, use this money to create real work in the real economy – the unproductive financial institutions can do without it!
The £275bn created by quantitative easing rebuilt banks’ balance sheets and funded commodity speculation, instead of being used for constructive purposes as advocated by Professor Richard Werner and Green MP, Caroline Lucas, in a recent post.
Another adverse consequence was highlighted yesterday, when the Financial Times reported that more than a million savers face further cuts to their pension income, following this week’s decision by the Bank of England to resume its “quantitative easing” [QE] programme.
Advisers warned that by driving up the price of the government bonds issued, the Bank would depress their yields – which determine how much income can be generated from a pension fund. Financial services group Saga estimates that since QE started in March 2009, the income paid by pension annuities has fallen by a quarter.
It would be socially and economically beneficial to ensure that interest on savings never falls below the inflation rate and that pension funds and other savings are used to build a modern, green economy and bring a fair return.
Bad decisions by government – 21: £275bn created by quantitative easing rebuilt banks’ balance sheets and funded commodity speculation
Professor Richard Werner advocates an economically, socially and environmentally beneficial use of quantitative easing
As the news breaks that the Bank of England is to extend its quantitative easing by £50bn this year to buy government-issued bonds, Professor Richard Werner, Director of the Centre for Banking, Finance and Sustainable Development at the University of Southampton, advocates a better use for the money.
Economist Richard Werner, who proposed the term “quantitative easing” in Japan in the 1990s, and Caroline Lucas MP, of the Green New Deal Group, are calling for a £70 billion programme of “Green Quantitative Easing” in order to create hundreds of thousands of jobs, and set the country on course for a transition to a genuinely green economy. In a report launched today, Professor Werner makes the case that Green QE can reach parts of the economy that traditional QE has failed to do, making a real difference in terms of jobs and the environment.
He said that the £200bn of QE1 announced in 2009 and the £75bn of QE2 largely ended up with the banks in the futile hope that it would result in a substantial increase in UK lending to business. Instead it was used to rebuild their balance sheets and invest in commodity speculation:
“To ensure that this does not happen again, we need a different kind of QE, to help the wider economy directly and to implement some badly needed green projects that would enhance the sustainability of the economy and improve the environment—as well as creating thousands of new jobs.”
The Green New Deal group has called for Green QE to initially spend up to £20 billion on fitting free solar PV for the occupants of the roughly 3 million south facing roofs, best suited to capture the maximum amount of energy. Based on last year’s figures when around 20,000 installation jobs were created putting PV on 150,000 dwellings, a million home a year programme would eventually create 140,000 jobs. If that were to be extended to all the potential 9 million homes that could benefit from PV installation at a cost of up to £55 billion, then the employment growth would be much larger still. The households involved would save up to £250 per annum in reduced electricity bills.
A further £16 billion of Green QE could be spent kick-starting the Government’s Green Deal energy efficiency programme for homes. The Government expects this to support at least 65,000 jobs in insulation and construction by 2015. Local authorities, many of whom are already involved in planning to make tens of thousands more local homes energy efficient, could access a QE Green Deal fund to initially finance such work.
Professor Richard Werner concluded:
“These are exceptional times and they call for exceptional action from the Bank of England.