Canada needs a Green New Deal for a Post-Pandemic Economic Recovery

July 23, 2020

An Op-ed

With a recession declared in April, and a million plus Canadians unemployed, it is time for Canada to consider an economic stimulus package to address our post-pandemic economic recovery, similar to that of Franklin D. Roosevelt’s New Deal during the Great Depression; the Green New Deal.

The start of what is now widely known as, the greatest global economic crisis in history began on October 24, 1929. Lasting four days, the Wall Street stock market crumbled within the United States. This was most likely caused by global commodity prices plummeting along with an abrupt drop in economic credit and demand. Thus, resulting in the swift depletion of global trade and the mass increase in unemployment.

Canada was one of the worst affected by the economic crash, with:

• Unemployment swiftly rising to 30 per cent (staying above 12 per cent until 1939)

• One in five Canadians relying on government support

• Millions hungry with no homes and,

•  Canada’s Gross National Expenditure (private and public spending) declining by 42 per cent between the years of 1929 to 1933

This led to a devastating draught that swept throughout the Prairies, and federal governments, both Liberal and Conservative, unwilling to assist in the vast number of Canadians who fell unemployed. No wonder the Great Depression was referred to as the “Dirty Thirties”.

As Canada’s economy and people continued to suffer, the United States was seeing a glimpse of hope in the election of the Democratic nominee Franklin D. Roosevelt (FDR) in 1933. FDR’s administration sought out a bold and social democratic economic relief, including extensive reforms throughout many sectors of the economy, that would bring the country out of the depression between 1933 -1939; the “New Deal”.

The New Deal contained a new approach to economics, then popularized by British economist John Maynard Keynes. In this, the government would deficit spend (invest in job creation, etc.) in order to bounce back the economy.

Keynes theorized that if the consumer had the monetary ability to spend within the private sector, via the purchase of product, the sector would grow allowing for the further production of goods and the ability for the employer to hire more workers who could, thus, afford to purchase their product, leading to the rebound of the economy.  

Some of the programs within the New Deal:

• · Workers Progress Administration (WPA): Implemented in 1935, lasting eight years, the WPA provided ≈8.5 million Americans with work, primarily “unskilled” workers. The WPA created the following in its time; 29,000 bridges, 280,000 miles of roading, 4,000 schools, 150 airfields, 130 hospitals, 24 million trees and 9,000 miles of storm drains/sewer lines; all new.   

• · Civilian Conservation Corps (CCC): Specializing on jobs within the environment, lasting nine years, the program provided millions of Americans with employment. The CCC created the following: planted three billion trees and constructed shelters and trails within 800 parks throughout the country.

• ·  National Recovery Administration (NRA): A government agency established to institute labour  reforms industry-wide, that included and established the following: minimum wage, maximum hours, decrease unemployment, remove unfair labour practises and provide labourers the right to collectively bargain; the reforms covered 22 million Americans.

The New Deal helped weather the storm of the Great Depression, providing many social programs, reforms, and job opportunities for many suffering Americans.

In 2020, 87 years later, Democratic Nominee Senator Bernie Sanders ran on a Green New Deal, an extensive plan originally proposed by Congress Women Alexandria Ocasio-Cortez and Senator Ed Markey in February of 2019.

This would help combat the threat of climate change while providing the American people with good paying public sector jobs; focusing on worker ownership, while fighting the corporate sector and mass wealth inequality within the country. The Green New Deal is a much bolder policy, that centers around a democratic socialist take of the New Deal.

Bernie Sanders Green New Deal Proposal was highly extensive, with some of the main goals including:

• Have 100 per cent renewable energy by 2030, for both transportation and electricity.

• A full decarbonized economy by 2050.

• Provide 20 million unionized, good paying jobs to combat the climate crisis, eradicating unemployment in the process.

• A “just transition”, focusing on fossil fuel workers who would be greatly affected the most, for workers into the newly established green economy.

The New Deal did nothing to stop segregation within the United States against the African American community, allowing white workers to receive higher wages and have first choice of jobs over their African American colleagues. Whereas Sander’s plan includes reconciliation with racialized communities, such as, “follow the Principles of Environmental Justice adopted at the First National People of Color Environmental Leadership Summit. The goals and outcomes of the Green New Deal should continue to be developed under the Jemez Principles for Democratic Organizing with strong and consistent consultation with the communities most affected by the currently unequal enforcement of environmental laws.” And, “extend civil rights protections to ensure full access to the courts for poor and minority communities to seek legal protections by overturning the Sandoval Supreme Court decision that set an unreasonable burden of proof of racism for claims of environmental racism, including disparate and cumulative exposure to environmental health risks.” 

Motion M-1: A Canadian Green New Deal proposed

The policy proposal for a Green New Deal went global, attracting the attention of the New Democratic Party (NDP) here in Canada, which was roughly used within their policy platform during the 2019 election. On December 5, 2019, after the election, the NDP’s Finance Critic Peter Julian proposed Motion M1 to establish a Green New Deal here in Canada.

Motion M1, for a Green New Deal, could have never come at a better time with unemployment reaching an all-time high, since 1976 when data became available.

This was 13.7 per cent (up 8.1 per cent, from 5.6 per cent in February), an 8.2 per cent drop within the economy this year (worst ever recorded), 11.3 per cent in decline within consumer spending, and a 57.5 per cent decline within Canada’s second quarter.

There is a $343.2 billion estimated deficit for this fiscal year, and a federal debt of $1.2 trillion plus this fiscal year; as a result of COVID-19. A Green New Deal could reshape and rebound our entire economy in post-pandemic Canada, making us a leading country in combating both climate change and the suffering economy.

Main points will be drawn form Motion M1, along with additions and a more vast break down of what should be implemented into the Motion and future legislation, all derived from Bernie Sanders proposal, in what should be Canada’s post-pandemic economic recovery for a Green New Deal;

1. “To achieve net-zero greenhouse gas emissions through a fair and just transition for all communities and workers.” – Motion M1.

a.  Canada should follow the same trajectory as Sanders’ plan, with attaining 100 per cent renewable energy within the transportation and electric sector by 2030, and total decarbonization of the Canadian economy by 2050. To ensure a just and fair transition for workers, the NDP should ensure a maximum 5-year wage guarantee, pension guarantee from previous salary, relocation and job placement support from the government, new training and education, as well as living expenses and housing, paid for by the government, and the ability to opt for their pension if applicable for retirement, all stated within Sanders proposal to support workers and their adjustment to their new job. For communities most vulnerable to the impact of an impending climate disaster, a fund should be made to supply monetary support to those communities to ensure climate disaster prevention, as recommended in Sanders proposal.

2. “To create millions of good, high-wage jobs and ensure prosperity and economic security for all Canadians.” – Motion M1.

a. The NDP should plan to create ≈5.1 million jobs (13.7 per cent of 37.5 million, Canada’s population) within the green energy sector, completely eradicating unemployment within the country, legislate solid labour standards that include a living wage, unionization, great benefits, etc.

3. “To invest in Canada’s infrastructure and industry to sustainably meet the challenges of the 21st century.” – Motion M1.

a. Canada should invest in constructing a smart grid, through public sector jobs, that has the ability to sustain and the resiliency/safety capacity to distribute large amounts of renewable energy efficiently and power electric vehicles in a timely fashion. Government grants should be provided to lower-middle class Canadians, as well as small businesses, to both retrofit and weatherize their business and homes, leading to a 30 per cent reduction in residential energy consumption. As well, the government should invest in a country wide vehicle charging infrastructure, via the construction of the public sector, while providing a vehicle-trade-in programs, a Sanders plan suggests, with grants for lower and middle class Canadians to purchase new electric cars for doing so. High regulations and sanctions must be put on the large industry sector in order to force them to move to the renewable energy sector, while fighting the fossil fuel industry in the process.

The NDP’s Motion M1 also includes reconciliation with racialized groups within Canada, such as, “obtaining the free, prior, and informed consent of First Nations, Métis, and Inuit people for all decisions that affect First Nations, Métis, and Inuit people and their traditional territories, honouring all treaties and agreements with First Nations, Métis, and Inuit people, and protecting and enforcing the sovereignty and land rights of First Nations, Métis, and Inuit people”.

Motion M1 is much more extensive than this slight glimpse into what is displayed here, drawing similarities to Bernie Sanders proposal.

Here is a quick excerpt form Peter Julian’s M1, “ensuring that the Green New Deal mobilization creates high-quality union jobs that pay prevailing wages, hires local workers, offers training and advancement opportunities, and guarantees wage and benefit parity for workers affected by the transition, guaranteeing a job with a family-sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all Canadians, strengthening and protecting the right of all workers to organize, unionize, and collectively bargain free of coercion, intimidation, and harassment…” etc.

It is highly recommended that you read through the entirety of the motion.

As Sanders states within his plan, the Green New Deal would pay for itself within 15 years through various modes which the NDP should consider, while mobilizing Canadians and our economy while coming out of the recession caused by COVID-19.

1.  Income tax collected from the ≈5.1 million new jobs created.

2. Cancelling Canada’s $3.3 billion in annual subsidies to the fossil fuel industry; not to mention the ≈$60 billion subsidy, in 2015, provided to the fossil fuel industry according to the International Monetary Fund (IMF).

3. Ending tax loopholes in which we lose on average $353 billion in taxable income to each year, like the Stock Option Loophole and the Capital Gains Loophole.

4. Fight tax havens that Canada loses $7.8 billion a year to in income. 

5. Impose the NDP’s wealth tax proposal of a one per cent tax over $20 million in wealth, earning $5.6 billion in revenue. Or move to Bernie Sanders progressive wealth tax proposal which could lead to further income.

6. Reducing Canada’s $21.9 billion (2019-2020 estimate) military budget, that also contributes to climate change. 

There is much we can learn form the New Deal days, and the handling of the Great Depression by former governments on how we can do better today with handling the current recession. A Green New Deal could mobilize both Canadians by providing many with good paying, high quality jobs while investing in our future on this planet, by fighting climate change, and completely reshaping and stimulating our economy in the process. There is much that can be down to better our world and current economic situation, but everyday Canadians must be prepared to organize and fight for a more hopeful and brighter future.

Shelby Prokop-Millar attends York University for a BSc. Psychology. Her areas of expertise are in politics, economics and neuroscience. Feel free to follow her on Twitter: @Lefty_Mind.

Photo Credit: (350.org / Google Images