This is what the Green New Deal needs to actually work – John Reilly

MIT Sloan Sr. Lecturer John Reilly

From Fortune Magazine

Is the Green New Deal (GND) a liberal pipe dream, or is it an opening for an economically viable, bipartisan climate change solution?

The program put forward by Rep. Alexandria Ocasio-Cortez (D-N.Y.) and her team reimagines the U.S. as a nation with no carbon emissions, full employment, a fair and equal economy, and justice for all. ThisĀ GND proposal pairs massive government spending with quantitative easing by the Federal Reserve to achieve these aims. Since we can just print money, the argument goes, it would cost nothing.

Not so fast. Whereas deficit spending and a Fed stimulus package are good policies in a deep recession, we are now near full employment. For a Green New Deal to work now, we will need to pay for any federal investment with higher taxes. Moreover, that investment should be rolled out gradually.

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