The myth of the "green economy"

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Capitalism today requires an arsenal of ideological mystifications to survive. As a historically bankrupt social and economic system, capitalism has nothing to offer humanity except a future of misery, decay, and war. The ruling class finds it necessary to obscure this reality to keep the working class from recognising and acting upon its revolutionary, historic responsibilities. The latest mystification the world bourgeoisie has rolled out from the arsenal is the green economy. Media pundits, politicians, economists and business leaders increasingly envision green industry expansion as a significant component of economic recovery. Some compare the green economy to the biotech and computer technologies in terms of its transformative potential for the American economy. It's almost funny to see all the corporations jumping on the green bandwagon, now that environmentalism is "in." Even the biggest polluters are now advocates for the green movement, like the home heating oil industry television commercial in the US that claims that oil heat is energy efficient and environmentally friendly!

Like all ideological swindles, the green economy has a certain link to reality. There is indeed a genuine and widespread concern about the despoliation of the environment and the very real threat of climate change with potentially catastrophic social impact. And there is undeniably a disastrous global economic downturn that is destroying jobs by the millions throughout the world, worsening poverty and deprivation. This link to reality makes the green economy myth even more pernicious than your typical run-of-the-mill, trumped up propaganda campaign.

The world bourgeoisie advances the preposterous claim that it has a policy alternative to save the day in order to short-circuit the development of class consciousness and the recognition that the environmental disaster and economic crisis graphically expose capitalism as an anachronistic system and poses the necessity for its overthrow in no uncertain terms. In so doing the bourgeoisie denies the fact that the current crisis is a systemic problem and pitches the notion that it is a policy problem that can be dealt with. The green economy, they tell us, will revolutionise the economy and bring back prosperity.

Environmental and economic realities

The scientific evidence about the seriousness of the environmental crisis is voluminous. According to a report released by Barack Obama's White House scientific advisers, global warming has already caused significant changes in weather patterns in the United States, including more heavy downpours, rising temperatures and sea levels, rapidly retreating glaciers, longer growing seasons and altered river flow.[1] This report anticipates that average temperatures in the US could rise by 11o Fahrenheit or approximately 6o C by end of the century. The International Conference on Climate Change in Copenhagen in March, 2009, reported that "temperature rises above 2o C will be very difficult for contemporary societies to cope with, and will increase the level of climate disruption through the rest of the century." And the last time we checked, 6o is three times greater than 2o!

One of the key conclusions of the March Copenhagen Conference was that:

 "Recent observations confirm that given high rates of observed emissions, the worst-case IPCC scenario trajectories (or even worse) are being realised. For many key parameters, the climate system is already moving beyond the patterns of natural variability within which our society and economy have developed and thrives. These parameters include global mean surface temperature, sea-level rise, ocean and ice sheet dynamics, ocean acidification, and extreme climatic events. There is a significant risk that many of the trends will accelerate, leading to an increasing risk of abrupt or irreversible climactic shifts."[2]

Regarding the economic situation, there is hardly a need to present evidence here of the seriousness of the current recession. The bourgeois media itself acknowledges this as the worst economic crisis since the Great Depression. Since the current recession has occurred, despite the myriad state capitalist safeguards and palliatives put in place after the Great Depression in the 1930s supposedly to make sure that such economic devastation never happened again, one could argue that this recession is even worse than 1929. It has certainly brought the world's biggest and most powerful economy, the United States, to its knees, requiring the virtual nationalisation of the banking industry, the propping up of the entire finance industry and the bankruptcy of General Motors, the largest corporation in the world. They used to say "what's good for General Motors is good for the USA." 

The Obama administration first predicted that US unemployment would rise to only 8 percent before stabilising. Reality has already outstripped this overly optimistic prediction, as official unemployment has risen to 9.4 percent and Obama himself now openly acknowledges the unemployment rate will hit double digits before things start to improve. Even these bleak numbers seriously underestimate reality. In the US a person is considered unemployed only if he or she has no job and has applied for a job in the previous 30 days. Unemployed workers who have not applied for a job during this period or who have become so demoralised looking for jobs that don't exist and have given up applying for positions are, by bureaucratic fiat, considered to have withdrawn from the workforce. According to the American state, these "discouraged workers" are no longer workers and are therefore not unemployed! 

Workers who have lost their jobs and can't find new full time positions, but scramble to find menial part-time jobs just to survive - called "involuntary part-time workers" - are not considered unemployed or even underemployed. Provided they have a part-time job of at least 10 hours per week, they are considered "employed" and what's more each and every one of their part-time jobs counts as a "job" in the statistics that record the number of jobs in the economy. Thus for example, a laid off 59-year old special-education teacher's aide who lost her job nine months ago, now works four part-time jobs. Not only is she not unemployed according to the government, she alone accounts for four new jobs in the economy. Working as a fitness instructor teaching five classes a week, a day-care worker, a personal care attendant to a patient with Down's syndrome, and as a personal fitness trainer for private clients, she manages to pull in a grand total of $750 per month, which doesn't help very much since her monthly mortgage payment is $1,000.[3]

The US Labor Department acknowledges that there were 9.1 million such "involuntary part-time workers" in May and that if discouraged workers and involuntary part-time were included in unemployment calculations, unemployment would stand at 16.4 percent, not 9.4. Even the most optimistic prognosticators predict that "full" employment (defined as 6 percent unemployment) can't possibly return until 2013 or 2014 in the US

 The green economy

The green economy mystification was a key element in the Obama presidential campaign. In the second presidential debate in October, 2008, Obama said, "if we create a new energy economy, we can create five million new jobs, easily." More specifically his campaign web site promised to "create five million new jobs by strategically investing $150 billion over the next ten years to catalyse private efforts to build a clean energy future."[4] Programmatically, the Obama/Biden green economy proposal includes the following:

within 10 years saving more oil than is currently imported from the Middle East and Venezuela;

putting 1 million plug-in hybrid cars on the road by 2015;

ensuring that 10 percent of electricity comes from renewable sources by 2012, 25 percent by 2025;

implementing economy-wide cap-and-trade program to reduce greenhouse gas emissions by 80 percent by 2050.[5]

In February 2009, Congress passed Obama's economic recovery plan which earmarked $80 million in stimulus spending for developing alternative fuel sources and other eco-conscious initiatives, which was widely touted among environmental groups as a down payment on the green economy. However, despite the triumphalism of the environmental groups, this paltry $80 million mathematically means that Obama will now have to "strategically" spend $149.926 billion dollars in nine years to fulfil his green economy pledge.

The green economy mystification is not simply an American phenomenon. According to a European environmental activist, "the clean economy is about to take off."7 The European Union is actively promoting green industry investment. European countries introduced their own carbon dioxide cap-and-trade programs in 2005. Germany has enacted the German Renewable Energy Act and introduced a feed-in tariffs (FITs)8 program providing incentives for clean energy investment. In Canada, Ontario Province has adopted a measure modelled on the German FITs. In Britain, efforts to promote environmentally friendly investments are a central element in economic recovery plans. Australia seeks to increase green jobs by 3,000 percent over the next several decades. Germany, Spain and Denmark have been promoting wind power programs. Germany and Spain have also been supporting solar power ventures.

Is the green economy a magic bullet?

The green economy is hardly the magic bullet that will save capitalism from itself. The comparisons of the green economy to the so-called "computer technology revolution" are spurious. This is no new technological revolution that will transform society the way the industrial revolution was able do when it transcended natural production and permitted the development of modern manufacturing, which decreased costs and increased production and helped raise the standard of living. When capitalism was a historically progressive system, capable of expanding the forces of production, when new technologies and new industries arose, they produced millions of new jobs, even as they may have destroyed old jobs and industries. So for example, the rise of the automobile industry, though it largely destroyed such industries as blacksmithing and buggy manufacturing, created millions more jobs in the auto, rubber, steel, aluminium, petroleum and allied industries. However today, in a crisis of global overproduction, insofar as it was able to reduce production costs and increase productivity, computer technology didn't revolutionise the economy, didn't enable the system to overcome its economic crisis, but on the contrary actually aggravated the crisis of overproduction.

The notion that fixing the mess that capitalism has created over the past century is the basis for economic progress is a complete fallacy. It's like saying that Hurricane Katrina which devastated New Orleans in 2004 was good for the economy because it created thousands of new construction jobs and makes possible economic growth. This kind of ideological sleight of hand only works if you leave out of the equation all the human suffering (death, dislocation, poverty) and destruction of productive forces, housing, schools, hospitals, etc. that was caused by Katrina. Fixing something that's broken is not "revolutionising" the economy.

In any case, all the hype about how the green economy will produce new jobs is rubbish. A study commissioned by the US Conference of Mayors projects an increase in green jobs in the US from about 750,000 today to 2.5 million in 2018, an increase of 1,750,000 jobs - much more modest than Obama's prediction of 5 million jobs. However, academic researchers from such universities as York College in Pennsylvania, the University of Illinois and University of Texas Arlington have challenged the Mayors' projections as wildly inflated, because they pad the job numbers with clerical and administrative support positions that have no direct involvement with clean energy production. In any case, even if Obama's inflated claims were accurate, five million new green jobs over ten years would be a drop in the bucket in this economy. Since the current recession began in December 2007, the American economy has lost nearly 6 million jobs to lay-offs and the economy needs 125,000 to 150,000 new jobs a month, or 1,500,000 to 1,800,000 jobs per year, just to absorb new workers coming of age and entering the workforce and keep unemployment stable. Thus, the alleged five million new jobs that will be created "easily" over a period of ten years will not even compensate for all the jobs destroyed in the last 18 months of the current recession!

Nor would the new green jobs compensate for the jobs lost in the oil, gas, coal, nuclear, and automobile industries that would result from the wholesale shift away from fossil fuels in what they call the "black" economy. The highly promoted cap-and-trade program which allows polluting companies to trade allowances to pollute which has already been in place in Europe for four years has yet to have any positive benefits, as emissions levels have increased in the those countries.

Capitalist enterprises will only switch to environmentally friendly practices and investments if there are profits to be made. Since these new technologies require tremendous start up and research and development costs, they have to be very profitable. The only way that governments can promote the green economy is to introduce disincentives for continued use of fossil fuels and incentives to push companies towards green economy investments. So-called "free market" forces will never make this happen; it requires vigorous state capitalist policy intervention. This means increased taxes on the use of fossil fuel technologies, driving up costs for commodities produced by traditional manufacturing processes, and hence prices for consumers. And at the same time, it means government subsidies and tax breaks to green technology companies. All of this will of course be financed out of the hide of the working class, who will pay higher prices for "clean" consumer goods and higher taxes to finance subsidies and compensate for lost revenues due to corporate tax breaks. In the end the green economy that will supposedly "revolutionise" the economy and save the world from ecological disaster is ultimately just another way to foist austerity on the working class and erode even further its standard of living.

World capitalism is totally incapable of the degree of international co-operation necessary to address the ecological threat. Especially in the period of social decomposition, with the disappearance of economic blocs, and a growing tendency for each nation to play its own card on the international arena, in the competition of each against all, such co-operation is impossible. While the US has been attacked for its refusal to participate in the Kyoto Protocols guidelines for curtailing carbon emissions, the nations who were enthusiastic participants in the treaty accomplished nothing in terms of reducing greenhouse gases in the past decade. Even when capitalism "tries" to implement solutions to the environmental crisis, the profit motive works irrationally to undermine social well being. The disastrous example of what happened with the profit-driven switch to produce ethanol from corn as an alternative fuel, which prompted many agribusinesses to switch from food production to producing corn-for-ethanol and contributed to global food shortages and hunger rioting, offers just a taste of what a capitalist green economy has in store for humanity.

The green economy is a smokescreen

The green economy is nothing but a smokescreen, an ideological campaign to give capitalism a human face. In its quest for profits, capitalism has debased the environment. The environmental calamity that capitalism has produced is yet another proof of the fact that it has outlived its usefulness, that it must be cast aside. But the green economy is a cynical response by the ruling class. They say they can fix the problem that flows directly from the very nature of their system. The distance between the promise of the green economy and reality is so enormous as to be laughable. The jobs it will create over the next decade won't even compensate for the jobs lost in the current "recession." They market ecologically friendly foodstuffs, that are supposedly more natural and more organic, but are often priced beyond the reach of the average worker. To conserve energy, they tell us to switch from incandescent bulbs to fluorescent lights, which contain mercury, which is disastrous for the environment, unless disposed of in controlled manner.

No matter how you package it ideologically, capitalism works for profit, not for the fulfilment of human need.

 There is no way for capitalism to extricate itself from the economic crisis, no way for a system based on the profit motive to save the environment. Only the proletariat has the capacity to salvage humanity's future - to destroy this rapacious system of capitalist exploitation of man by man based on a relentless drive for profits and replace it with a society in which the fulfilment of social need is the paramount principle in economic and social life. All this talk about green and black economies is nonsense. Only a red economy will offer humanity a future.

J. Grevin 31/7/9



[1]. By law, the White House is required to issue a report on the impact of global warming, but no such report had been issued since 2000, when the Clinton/Gore administration was still in power. The Bush administration with its strong links to the energy industry and ties to anti-regulation rightwing cronies, refused to issue such a report in the entire eight years of its tenure. Until the Intergovernmental Panel on Climate Change issued its report affirming the existence of global warming as incontrovertible fact, the Bush administration considered the matter an "open" scientific question, much to the dismay of professional scientists on the staff at the Environmental Protection Agency and the National Oceanic and Atmospheric Administration, who found their reports censored or suppressed during the Bush years.

[2]. "Key Messages from the Congress"

[3]. DePass, Dee, "More Workers Fall Back on Part-Time ‘Survival' Jobs," Star Tribune, (Minneapolis, MN), June 21, 2009. p1D


[5]. ibid

6. The 150 billion promised at the time of the electoral debate from which the 80 million already allocated in February 2009 is subtracted.

7. WWF: Green Economy Creates Jobs.

8. Tariffs imposed on businesses for the purchase of electricity from renewable sources.

Recent and ongoing: