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Stimulus Is an Environmental Disaster Waiting to Happen

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Wind power generators are enveloped in a smoky sky near the Millard fire on July 15, 2006 near Cabazon, California. David McNew/Getty Images

In the wake of the coronavirus pandemic, countries around the world face an extraordinary conundrum. Unemployment is at record levels, and poverty is on the rise. Most governments believe the only tool they have at their disposal to address this crisis is to do everything possible to rev up the engines of economic growth in desperate hope of creating new jobs and restoring livelihoods.

This might seem reasonable enough at face value; after all, we’ve become accustomed to believing that growth is the cure to virtually every economic woe we encounter. But in attempting to solve one crisis, this approach makes it much more difficult to address another, more pressing emergency—the crisis of climate breakdown.

We are seeing this happen already. In their efforts to stimulate growth, many governments are slashing the very regulations that we need to be strengthening to reduce detrimental environmental impact. More conscientious governments are proposing stimulus packages that aim to be green. But even in those cases, we run up against a deeper, more fundamental problem: The more we grow the economy, the more energy it requires, and as energy use rises, it becomes much more difficult to accomplish a sufficiently rapid transition to renewables.

To keep global warming under 1.5 degrees Celsius without relying on speculative negative emissions technologies, high-income nations need to be cutting emissions by at least 10 percent per year. There is no scenario in which this is feasible to achieve while growing the economy at usual rates, given the relationship between growth and energy. For this reason, scientists—thousands of them—have called on the world’s governments to abandon GDP growth as an objective and focus on human well-being and ecological stability instead.

But this leaves us with a hard question: What about jobs? How can we possibly hope to address mass unemployment without economic growth? Fortunately, there’s a straightforward solution. We can fix the problem directly without needing additional growth by introducing a progressive, public job guarantee program, as proposed by economists like Stephanie Kelton, Pavlina Tcherneva, and a growing chorus of others. The idea is that anyone who signs up can train to do dignified, socially useful work (the opposite of “bullshit jobs”) and be paid at a living wage.

This would end unemployment and ensure good livelihoods for all, thus solving the immediate social crisis; but it would also allow us to mobilize the labor that’s needed for an ecological transition. There’s a lot of work to be done toward this end, and it needs to be done quickly. We need to ramp up renewable energy capacity by installing solar panels, wind turbines, and batteries. We need to retrofit houses to improve insulation and replace gas boilers. We need to restore degraded ecosystems, plant forests, and rewild land. We need to expand public transportation networks. And we need to shift to regenerative farming methods to restore soils and biodiversity, sequester carbon, and provide healthy, local food. All of this requires labor, and it’s not going to happen on its own. We need a public program run both at a national level (for big projects like railways, power lines, and national forests) as well as at a decentralized community level (to meet specific local needs).

With a public job guarantee program, we can transform existing unemployment centers from grim places that are designed to humiliate people into hopeful, life-changing places that give people real skills and empower them to contribute to the most important collective projects of our generation. By paying a living wage, we can not only put an end to poverty, but we can also set a standard that the rest of the economy will have to follow. Private firms would have to pay living wages too—and would have to offer equally enriching work—if they want to retain staff. Why would anyone agree to flip burgers at McDonald’s for poverty wages when they could make a real living doing something more meaningful and important?

We can also use the job guarantee program to shorten the working week. If we set hours at 30 instead of the usual 40, private employers would be under pressure to follow suit. Research has shown that shortening working hours is a powerful way to reduce emissions and has a positive impact on people’s health and quality of life.

This approach would also strengthen the bargaining power of labor and therefore go a long way to reducing inequality—another major crisis of our age. And reducing inequality helps us further reduce the need for perpetual economic growth. Politicians say we need growth to improve people’s lives; but the problem isn’t that there’s a deficit of income, but that it’s all captured at the top. By distributing existing wealth more fairly, high-income nations can improve people’s lives right now—without any growth at all. A job guarantee program can help us get there.

This is a much more rational, ecologically coherent way to address the present economic crisis. Trying to grow the economy to create jobs is effectively busywork. Almost by definition, jobs created this way are in industries we don’t really need to expand, and expanding them, in turn, creates pressures for needless consumption. A job guarantee program does the opposite: It mobilizes labor and resources around things that our communities—and ecology—actually need and which the private sector is unlikely or unable to provide.

For those who support the idea of a basic income, there’s no reason such a policy could not be integrated in some form alongside a job guarantee program. But the latter enables us to mobilize labor for an ecological transition, and it has the benefit of being resoundingly popular. A YouGov survey found that 72 percent of people in Britain support a job guarantee program and even in the United States, it polls as high as 69 percent. Better yet, it’s not expensive to implement because it partly pays for itself. Drawing on data from the Levy Economics Institute of Bard College, Tcherneva reported that rolling out a job guarantee program in the United States would cost only about 1 to 2 percent of its GDP, and it could be funded with the very same mechanism that governments are presently using to bail out corporations and prop up stock markets: quantitative easing but this time for people and planet.

Having a job guarantee program would transform how we think about the economy. For too long, we’ve been locked into believing that all sectors of the economy must grow all the time, regardless of whether or not we actually need them and how much destruction they might cause. Why? Because jobs. We even find it difficult to contemplate closing down things like coal mines because of the impact it might have on employment. Indeed, this is why governments have come under pressure to bail out oil companies and airlines in the middle of a climate emergency—to prevent the chaos of mass layoffs.

The job guarantee program takes this question off the table. It cuts through the Gordian knot. We know that if we want to achieve a rapid transition to renewables, high-income nations need to reduce aggregate energy use. This means having an open, democratic conversation about scaling down ecologically destructive and socially expendable parts of the economy (things like fossil fuels, SUVs, McMansions, private jets, personal arms, advertising, and planned obsolescence). The job guarantee program allows us to do this without worrying about the specter of unemployment and ensures affected workers can retrain for jobs in a better, cleaner, fairer economy without skipping a beat.

In this sense, the job guarantee program is one of the single most transformative policies that a government could implement. It would liberate us from the straitjacket of growthism and free us to build an economy that’s organized around human well-being and ecological regeneration rather than around perpetual expansion.

This is not a CAPTIS article. Originally, it was published here.