Top US and British economists, including Nobel laureate Joseph Stiglitz and Grantham Research Institute on Climate Change and the Environment chairman Lord Nicholas Stern, published a working paper on Tuesday that asserts that the most effective coronavirus stimulus packages will also focus on reducing carbon emissions.
The paper’s introduction states that the COVID-19 crisis could mark a turning point in progress to slow climate change, but emissions could also increase once economies start to recover unless governments intervene.
Stimulus package study results
That conclusion comes from a survey of more than 200 central bankers, G-20 finance ministers, and top academics from across 53 countries, conducted by a group of star economists that includes Nobel Laureate Joseph Stiglitz, among others. The results were released [on May 4] in the Oxford Review of Economic Policy.
Their task was to rank 25 different economic policies — many of which were used to boost recovery after the financial crisis of 2008-09 — on four characteristics: how quickly the policy could be deployed, what economic return would it bring for each $1 of public money spent, for how long would it provide returns, and how much it would contribute to lowering emissions.
The authors “looked at more than 700 economic stimulus policies launched during or since the 2008 financial crisis, and surveyed 231 experts from 53 countries, including senior officials from finance ministries and central banks,” according to Reuters.
Survey respondents called for green energy research and infrastructure, zero-carbon transport, and disaster preparedness. They concluded that boosting green energy would create more jobs, deliver more short-term returns, and save more in the long term.
Many survey respondents are able to directly influence where stimulus money is spent, such as people like Laurence Boone, chief economist at the Organization for Economic Co-operation, and Sandra Eickmeier, senior economist at Germany’s central bank.
Since respondents support green stimulus plans, will they actually implement them?
This is such a no-brainer, and if anything good comes out of the pandemic, this could be its greatest silver lining — saving the planet and preventing millions more deaths. And for those who still don’t see the point of curbing climate change (looking at you, current US administration and China), what on earth is it going to take?
Maybe the almighty “dollar” will sway them where catastrophe and evidence of clean air and water won’t. (Spain has been one of the hardest-hit countries in the world, and Barcelona has seen a pollution reduction of 62% and 58% across the whole country — its lowest levels in a decade. That’s called evidence.)
Hey, Donald Trump and Republican legislators — and Treasury Secretary Steven Mnuchin, you listening? (probably not) — trying to boost the fossil-fuel industry is throwing money in the garbage.
However, more than 40 US lawmakers are backing legislation to prevent fossil fuel companies from receiving aid in stimulus packages in a bill called the ReWIND Act. It will face resistance in the Senate. May sense prevail.
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