A green recovery needs new politics

Europe is moving on to green and social-democratic terrain. But German Christian democracy and French centrism are taking it there.

It has been a golden autumn for the high politics of climate change. In September, the Chinese president, Xi Jinping, announced that his country would be carbon-neutral before 2060. The following month, the new Japanese prime minister, Yoshihide Suga, pledged to make the world’s third largest economy carbon-neutral by 2050, a commitment echoed by South Korea. And in one of his first actions as United States president-elect, Joe Biden promised to return the country to the Paris climate agreement of 2015.

Less visible in the glare of the global spotlight—yet essential to the realisation of these ambitions—are innovative policies to promote a ‘green recovery’ in a post-pandemic world. The European Union has led the way with its €750 billion green recovery fund, which individual countries will complement with specific national programmes.

These policies are informed by new, ‘green deal’ thinking, which blends the hitherto separate domains of environment, industry and economy around the sustainable transformation of society’s core systems: energy, food, mobility and buildings. This is accompanied by an overdue rediscovery of the virtues of active government and social inclusion.

European politics is moving on to a new green and social-democratic terrain—even if German Christian democracy and French centrism are taking it there. The broader context favours such an approach.

Powerful business voices are urging governments to pursue green recovery pathways. Reversing four decades of neoliberal ‘Washington consensus’, the International Monetary Fund has given its seal of approval to public investment strategies, irrespective of the rising debt consequence. Green New Deal ideas failed to shape recovery after the 2008 financial crisis, in Europe or the US, but the pandemic offers a second chance. There is greater consensus this time around—within the business community and against the backdrop of a global youth movement—on the need for public investment and redistributive measures.

Industrial modernism

In the United Kingdom the debate is slowly getting under way. Promises by the prime minister, Boris Johnson, to ‘build back better’—including powering every home with offshore wind energy within a decade—were described as inadequate by Ed Miliband, introducing Labour’s Green Recovery initiative.

Labour offers persuasive, if familiar, proposals for investment on a grander scale and a socially just transition. Its tradition of industrial modernism is still visible in its list of low-carbon technology winners, with over-optimistic promises of ‘build it in Britain’ associated with reshoring and renewed global leadership. The more innovative and enticing offers are substantial proposals to ‘green the built environment’ and a ‘nature service’ job creation and training initiative inspired by the Rooseveltian New Deal.

As with many of its European counterparts, Labour retains a supply-side fixation on long-heralded, economically-unproven technologies, such as carbon capture and storage. Research and development and pilot experiments in potential safe technologies, such as hydrogen and tidal power, are all very well but social democracy should not simply endorse powerful corporate lobbies.

Rather, green-deal politics should firmly embrace a radical, yet realistic, transformation of energy use in housing and transport, based on established know-how and applied digital technologies. This reorientation to end use offers a virtuous combination of significant short-term emission reductions and high job-creation potential. It justifies the advocacy of deliberate, employment-intensive transition pathways by Joseph Stiglitz, in contrast with Dieter Helm’s hyper-anxiety  around short-term job creation as ‘a playground’ for energy policy.

Building refurbishment

The advantages of focusing on one of these key areas—building refurbishment—are refreshingly laid out in a recent European Commission document, ‘A Renovation Wave for Europe—greening our buildings, creating jobs, improving lives’. The report highlights three areas for attention: tackling energy poverty and worst-performing housing stock, renovating public buildings, such as schools and hospitals, and decarbonising heating and cooling. 

These offer huge potential for elevating renovation while delivering large energy savings and healthier, more comfortable housing and buildings for citizens. They not only have high carbon-saving merit but fit absolutely into any inclusive social agenda.

Renovation works are labour-intensive and create jobs. Associated investments are rooted in local supply chains, since more than 90 per cent of the operators are small companies. The design, installation and operation of low-carbon solutions often require good levels of technical knowledge, thereby creating skilled jobs within local economies—in turn stimulating apprenticeships and other forms of work-based learning to help young people into the labour market, with green vocational-training courses geared to the renovation agenda. 

Central to green recovery should be transition programmes which set national sustainability targets but where budgets are devolved to municipalities to design initiatives appropriate to their needs, in partnership with local stakeholders. That means looking to develop neighbourhood schemes so that entire streets are renovated together.

Such a community approach would bring economies of scale, permit accredited programmes with approved contractors, enable retrofit along with boiler replacement and renewable-energy installation, introduce smart digital appliances and establish on-street vehicle charging. It would also win buy-in from citizens.

More social than technical

Climate change is more a social than a technical challenge. As the French president, Emmanuel Macron, recently put it, acknowledging his previous mistakes on carbon taxes, ‘We have to involve our societies in this change, which I believe is an absolutely fundamental change to our societies. We have to bring everyone on board.’

A choice thus faces all countries as they draft their green recovery programmes: is their model of innovation narrow and technical or broad and social? Are their recovery plans just about spending big money on high-tech, capital-intensive investments or do they concentrate more on the labour-intensive, geographically spread initiatives which will promote resilience and jobs? Do they recognise the need for social innovations as well as new products—from heat pumps to micro-mobility?

There’s a balance to be struck, not a binary choice. But in a post-pandemic world, with growing inequality and accelerating unemployment, the need for large-scale, publicly-led programmes of the New Deal type is overwhelming.

In the UK, Labour still hesitates to commit itself to renovation and housing investment on the scale required. The time is over for the fiscal caution social democracy across Europe displayed in Tony Blair’s ‘third way’ heyday. Neighbourhood retrofit and renovation offers millions of new jobs across the whole of Europe, with warmer homes, lower fuel bills and plenty of opportunities across the building supply chain, plus a chance to engage local people in the revitalisation of their own streets and communities.

Ahead of COP26 next November in Glasgow, the depth and direction of all European green recovery programme is up for grabs. Across Europe broad political coalitions, working with the environmental movement, need to set out their vision and bring governments on to this ground. Success for COP26 would not only be a strengthened global climate accord but its accompaniment by thriving, job-intensive, green recovery programmes across Europe. It’s time to be bold.