CTU on Green economics
Following Sue B and Rod’s warm reception at their recent conference a couple of weeks back, the CTU has now taken a gander at Green economics.
In the CTU Economic Bulletin today, Peter Conway writes:
The Greens get a hard time from business about their policies - and Peters and Dunne made it a bottom line that the Greens were not given any Ministerial positions. Yet much of green economics makes a lot of sense. They constantly point out that the trade imbalance is damaging our economic base. They are strong supporters of the manufacturing sector. The Greens are the biggest advocates for a “buy New Zealand made” campaign. They have long warned about oil prices peaking as supply starts to reduce. They point out that our biggest export sector - tourism - relies on our clean, green image, which should therefore be protected and enhanced. They argue that water should not be treated as a private commodity, champion public transport and argue for the sustainable use of resources. They want the first $5,000 to be tax free (at a cost of over $1 billion) which makes the tax system more progressive. Their social policy focuses on income redistribution and eliminating child poverty. They push hard for increases in the minimum wage.
There are obvious points of tension that could arise for unions when confronted with the reality of green economics. The familiar difficulty usually involves a “jobs versus the environment” issue. But these need not be insurmountable. For instance, there was compensation of $120 million paid to the West Coast when the logging of native forests was prohibited. The $92 million share paid to the regional council has now grown to be worth $118 million and has funded numerous projects along the way. But the energy requirements to maintain growth in New Zealand pose a real challenge for green economics. We have a one thousand-year supply of coal. While some progress is being made on clean-burning technology, the difficulties in sequestrating carbon emissions may not be resolved for some time. New Zealand is such a small part of the world when it comes to climate change - and in any case 50% of our emissions are from methane and nitrous oxide from farming stock. Many of the solutions to problems posed by green economics appear therefore to be scientific ones. But Greens quite reasonably point out that although jobs are important, if we are destroying the planet because of the economic model being applied, then the stakes in the jobs versus environment debate are getting a lot bigger. Greens would however support just transition mechanisms for workers affected by environmental policies.
Fundamentally, green economics appears to be about sustainable development - thinking beyond tomorrow. For unions, this is a much better scenario than models that only have an economic bottom-line and ignore social, cultural and environmental issues. But the difficulties in applying regulatory or market-based (eg. tax) policy solutions often place the Greens at a political disadvantage. Many have a suspicion that the Greens are right about the problem but the solution appears to be impractical. But given the political realities of electing a genuinely centre-left government, unionists and Labour Party members could all benefit from spending some time and effort in the next two or three years seeking a better understanding of green economics.
