On Friday the Greens launched their so called Green New Deal, with a price tag of $3.3 billion over three years. It has five main elements:
- Energy efficiency measures such as home insulations, school upgrades etc costing $300 million.
- $1 billion to be shifted from roads to public transport (so not count as new spending)
- $600 million on protecting waterways
- $2 billion constructing 6,000 new state houses
- $440 million on community economic development
Most countries have had a fiscal stimulus to take the edges off the recession. NZIER calculated that the NZ fiscal stimulus to date will save around 10,000 jobs. They also point out that the increased debt lowers household incomes down the track.
The Greens estimate their package would create 18,000 FTE jobs directly and andother 25,000 indirectly.
I’ll analyse parts of it shortly, but have to say for now that it at least passes the initial test that they are proposing generally one off projects, rather than initiatives that would permamently increase Government spending at a time we can’t afford it. They are the sort of projects that can be considered as part of a fiscal stimulus.
The energy efficiency measures tend to be the most sensible, as they actually can pay for themselves over time by lowering energy costs.
The suggestion that $1 billion be taken from motorways and put into public transport is simply not going to happen. The Greens always try and portray it as a choice between roads or public transport. It is not. We need both. There is not a country in the developed world that has just stopped building new roads.
The plan to protect rural waterways from pollution has more appeal to me – there are tourism reasons you may want to do this.
$2 billion for new state houses is not a good priority. The current housing stock is run down and the Govt under Labour became a slum landlord. The Govt’s priority is to improve the current stock before looking to expand it – that is sensible.
So anyway have to give the Greens kudos for actually putting up costed serious proposals, even if I do not like many of them. I much prefer them doing this than working on further things to ban!Tags: Economy, fiscal stimulus, Greens