But Can We Pay For It? An Economic Evaluation of 2020 Climate Policy Proposals

October 30, 2019

Ariela Weinberger, aweinberger@rooseveltinstitute.org

New Roosevelt Forward brief suggests that Democratic climate proposals will not only cut US carbon emissions but are also economically feasible

New York, NY—With the climate crisis at the forefront of the Democratic presidential debates, candidates—ranging from Sen. Bernie Sanders (I-VT) to former vice president Joseph Biden—have released policy proposals calling for substantial new public investment in a carbon-free economy.

While these plans have been met by skeptics asking how we can afford it, a new brief released today from Roosevelt Forward Fellow JW Mason and Senior Associate Kristina Karlsson finds that each of the candidates’ plans are economically feasible. As “Don’t Fear the Deficit: Why We Can Afford a Green New Deal” shows, the spending plans proposed, while substantial, could be financed entirely with new borrowing, targeted taxes on high incomes and wealth, or a combination of the two.

“All of the climate plans on the table can be fully financed through some mix of public borrowing and taxes. The exact mix of financing will depend on the political situation, as well as on other economic and social goals,” said Karlsson.

“Policymakers shouldn’t be asking whether these plans cost too much, but whether they are big enough. Our goal in this brief is to show that the spending proposed by all of these plans is well within the federal government’s capacity to borrow or raise taxes on the very rich. Dealing with the climate emergency does not require raising taxes on working and middle-class Americans or cuts to other programs,” said Mason.

This paper builds on the June report, Decarbonizing the US Economy: Pathways Toward a Green New Deal. To learn more about how current economic conditions allow for increased public spending and why borrowing by the government is a desirable feature of policymaking, download the fact sheet, “But How Do We Pay for It?’ Why Spending Money on Ambitious New Programs Is a Feature—Not a Bug—in Today’s Economy.”

About Roosevelt Forward

Roosevelt Forward’s mission is based on a fundamental belief that until economic and social rules work for all Americans, they are not working. Inspired by the legacy of Franklin and Eleanor, Roosevelt Forward reimagines the rules to create a nation where everyone enjoys a fair share of our collective prosperity. Roosevelt Forward intends to serve as a policy and advocacy organization, bringing together multiple generations of thinkers and leaders to help drive key economic and social debates and have local and national impact.