On Reality Asserts Itself, Mr. Pollin says no-GDP growth is unrealistic and unnecessary as the way to achieve carbon emission targets – green economists must be advocates of job creation

Story Transcript

PAUL JAY, SENIOR EDITOR, TRNN: Welcome back to Reality Asserts Itself on The Real News Network. I’m Paul Jay. We’re continuing our series of interviews about the green economy, how to get to one. And one of the ideas connected with the green economy is green growth. Well, not everybody agrees you can have growth and be green. And here’s one of those people. Professor Tim Jackson, the author of Prosperity without Growth, quoted in The Guardian newspaper, said,

“The ‘G’ word [growth] is a signifier for not changing the system. It is synonymous with western consumerism which we are locked into. Green growth is the emperor’s new clothes, it is an empty concept. There is nothing there apart from aspiration and some of the modelling is vaguely supportive of getting a growth based economy more efficient in resource terms but there is no single piece of modelling anywhere really that shows you can have sustained growth, even in the richest economies, and get the poorest up to the level of the west and meet you [sic] CO2 targets.” Now joining us is someone who has done the modeling and disagrees with all this. And we’re continuing our series with Bob Pollin. Thanks for joining us. PROF. ROBERT POLLIN, PERI CODIRECTOR: Thank you, Paul. JAY: So, one more time, Bob is the distinguished professor of economics at the Political Economy Research Institute at the University of Massachusetts Amherst and recently did some studies. Global Green Growth he did with the United Nations. And he has in fact what he thinks has modeled exactly that, green growth that actually meets CO2 emission targets. So thanks for joining us again. POLLIN: Thank you. JAY: So what do you make of that quote? You can’t have growth, meet those targets, be green, and deal with poorer countries getting up to a Western standard of living. Like, you can’t accomplish all of that growth. POLLIN: I think it’s wrong. I think that, as we’ve discussed in our previous sessions on this, the key is transforming the energy system so it’s based on renewable energy and high efficiency. If you do that, poor countries–India, for example, Indonesia–my models show that they can grow as long as you’re substituting, you’re not using fossil fuels, you’re using green energy as opposed fossil fuel energy. Now, if we want to talk about things that are vague and poorly thought out, I think the notion of an economy contracting in order to achieve emission reduction really takes the prize. And let me just mention a few reasons why. As we’ve discussed in previous sessions, the globe, the world today, emissions are at 40 billion tons of CO2, and we need to get to 20 billion tons in 20 years. Now, let’s say we say, okay, the solution is to stop growing and actually even to shrink. So let’s say we shrink by 5 percent, which would be double the global GDP contraction that we experienced in the Great Recession, a 5 percent contraction. It would be a massive depression. Now, maybe it’s worth it ’cause there’s no other way to fight climate change. But what would that achieve? It would get us from 40 billion tons of emissions to 38 billion tons of emissions–no solution at all. If we are not going to invest in renewables and energy efficiency to a massive extent, there’s no way we’re going to get to 20. JAY: But wouldn’t most of the people making this argument before investment in renewables and alternative energy–I don’t think I’ve ever heard this argument from someone who’s against that–they just think you have to do that and not try to have any GDP growth. And I assume they–I have to say, Bob has agreed to debate Tim Jackson, who I quoted off the top, or any of the other kind of leading proponents of this slow to no growth. And I am not the best proponent of this argument, but I would assume their argument is, yes, invest in renewables and alternative energy, but in terms of you don’t need more growth to have more equalized well-being of people, what you need is more equal distribution of existing wealth, that so much wealth is concentrated in one end, so it’s more an issue of massive taxation, changing who owns stuff, redistributing income, both within countries and globally, and green, but you don’t have to keep growing the economies. POLLIN: Okay. Now, if we say that climate change really is a dire situation and that we have to make massive reductions in emissions within 20 years, within ten years, and within 50 to 60 years, we’re going to have to eliminate burning oil, coal, and natural gas altogether. That is a huge political project. Now, the proponents of no growth are saying, and on top of that, we’re going to stop GDP from growing. Now, they’d never say how you actually get the GDP to stop growing. And if we’re going to redistribute income, we’re going to stop GDP from growing and we’re going to take significant shares of GDP from rich people in rich countries and redistribute that to poor people in poor countries. All of this is happening while we’re also shutting down the fossil fuel industry, all of this within the next ten to 20 years. It’s completely unrealistic. I mean, the project that I have, green growth, global green growth, the studies that I’ve done, are premised on the idea that we want job opportunities to expand, not contract. We want progressive environmentalists to be pro-employment opportunities. And my models show that if you invest in the green economy, even while the fossil fuel economy is contracting, there are going to be net gains in jobs, millions. And that is a positive. And that’s something I think we can honestly sell to people in rich countries and poor countries, to working-class people, that supporting a green economy overall will promote job opportunities. There is no way you can tell me a realistic story through which a contraction of GDP in any country is going to lead to an expansion of job opportunities. JAY: Well, there’s a scenario. Whether it’s politically possible is a separate question. But if wages went up significantly and there was that–essentially, some of that income that’s at the top one percentile, although in truth it’s more at the top 20 percentile, gets distributed throughout the economy, there’ll be a lot more demand, and a lot more demand would mean more jobs. POLLIN: And more growth. JAY: More growth because you’re going to create more products for these people. POLLIN: Yeah. If we’re going to be–those things are all positive. But on top of that, if we’re going to say, oh, by the way, we stop growth, now–and how do we even stop growth? JAY: Yeah, ’cause more demand’s–unless you’re–you can’t have more demand with the same amount of products [crosstalk] POLLIN: Yeah. So what we’re talking about: talking about things that are vaguely constructive. We don’t really even know what it means to stop growth. What I’m talking about: I am stopping, I’m saying something very specific. The fossil fuel industry has to contract by 40 percent. Coal has to contract by 60 percent. And the green economy–solar, wind, geothermal, hydro, small-scale hydro, clean bioenergy–they’re going to have to grow. That is something very specific. That’s going to grow big-time. Fossil fuels are going to contract big time. The rest of GDP, we can’t handle all those things at the same time. And if we’re going to succeed in controlling emissions, we have to limit ourselves to a set of goals that are actually achievable and well defined. They’re talking about the equivalent of imposing something like a Great Recession in order to benefit the environment. JAY: Well, they’re talking about–I mean, again, I don’t know the argument very well. Bob is going to debate one of the leading proponents of this when we can arrange it. But I assume their argument is–and from what I’ve seen–is there will be some kind of minimum wage at much higher than it is. So, through taxation you create a floor within which people can’t go below, which doesn’t have–in other words, you wouldn’t have the same consequences of a Great Recession. POLLIN: Why wouldn’t you? JAY: Well, in theory you’d have a social safety net and, well, you would redistribute the income that exists. But I agree with you. Once you do that, there’s more demand for products. POLLIN: And therefore the economy grows,– JAY: Right. POLLIN: –the nonfossil fuel part of the economy grows. I mean, take the case of Indonesia. Indonesia expects to grow, wants to grow 5, 6 percent a year, like China. That’s where they want to go. Am I to tell them they can’t do it? I mean, if we’re talking about fairness issues, in the U.S., where we’re emitting ten times more per person than Indonesia, we’re going to tell them they can’t grow. Well, the proponents of no growth, they say, well, Indonesia can grow; we just can’t grow. Now, how do you stop that? I mean, the global economy is integrated. So now we’re going to also break down the degree of integration of the global economy and were going to cut emissions by 50, 60, 70 percent in a matter of ten years. It’s utterly impossible. JAY: And these countries depend on the northern countries as markets. POLLIN: Of course they do. JAY: So if you’re [getting (?)] big slowdowns there, you’re going to– POLLIN: Yeah, imports and exports. JAY: Right. Okay. In the next segment of our interview, we’re going to talk about the politics of this, particularly in the United States. Where are we at with trying to get to dealing with the challenge of carbon emissions and green economy? So please join us on Reality Asserts Itself on The Real News Network.


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Robert Pollin

Robert Pollin is Professor of Economics at the University of Massachusetts in Amherst. He is the founding co-Director of the Political Economy Research Institute (PERI). His research centers on macroeconomics, conditions for low-wage workers in the US and globally, the analysis of financial markets, and the economics of building a clean-energy economy in the US. His latest book is Back to Full Employment. Other books include: A Measure of Fairness: the Economics of Living Wages and Minimum Wages in the United States, and Contours of Descent: US Economic Fractures and the Landscape of Global Austerity.