We will need revenues between $700 billion to $1 trillion annually for the Green New Deal. $400 billion will be for the public jobs programs. Estimates for the transition to 100% clean energy start at $200 billion a year.
Economists predict that we can build a 100 percent renewable energy system at costs comparable to or less than what we would have to spend to continue our reliance on dirty energy. The International Energy Agency estimates that limiting warming to 2° C would require an additional investment of about 1 percent of global GDP per year, which would be $170 billion a year for the US [19]. The former chairperson of the Intergovernmental Panel on Climate Change (IPCC) has made similar estimates.
Jacobson estimates that the total capital cost to go to 100% renewable energy in the US would be $13.4 trillion [20]. Much of those capital costs could be covered by diverting existing investments in nonrenewable energy. America’s coal and nuclear power stations are old and many are dilapidated. In order to keep the lights on in the United States, a new energy system will need to be constructed. Large corporations are walking away from existing power stations, closing them and laying off the workers.
Prices for renewable energy have been falling very fast in recent years, which would reduce the costs in outlining years. The Jacobson report shows that between 2009 and 2014, the cost of solar electricity in the United States fell by 78 percent and the cost of wind energy fell by 58 percent. In many parts of the United States, wind is now the cheapest source of electricity, and solar power is on track to be the cheapest source of power in many parts of the world in the near future. Renewable energy technologies are also continually improving in performance.
When we make the investment required to clean up our emissions and waste, our economy will be revitalized by the wealth created. Our national security will no longer be vulnerable to disruption of oil supplies, and there will be absolutely no reason to send our people abroad to fight wars for oil. Using renewable energy instead of coal and gas will mean health care costs will go down because the foundations of a green economy – clean energy, healthy food, pollution prevention, and active transportation – are also the foundations of human health. The Green New Deal pays for itself through the prevention of chronic disease, which consumes a staggering 75% of $3 trillion in annual health care costs. All in all, this is an investment in our future that will pay off enormously as we build healthy, just, sustainable communities.
According to Jacobson et al, converting to 100% clean energy would also eliminate approximately 62,000 (19,000–115,000) U.S. air pollution premature mortalities per year today, avoiding 600 ($85–$2400) billion per year (2013 dollars) in healthcare costs by 2050. Converting to clean energy would further eliminate $3.3 (1.9–7.1) trillion per year in 2050 global warming costs to the world due to U.S. emissions. These plans will result in each person in the U.S. in 2050 saving $260 (190–320) per year in energy costs (2013 dollars), U.S. health costs per person decreasing by $1500 (210–6000) per year, and global climate costs per person (including costs incurred by extreme weather events, sea level rise, adverse effects on water and agriculture, etc) decreasing by $8300 (4700–17600) per year.
The Green New Deal includes a major cut in federal spending on the military (including the Pentagon budget as well as expenditures on war, nuclear weapons and other military-related areas), which would free up from roughly $500 billion per year. The $1 trillion in current annual United States military spending is equivalent to the rest of the world’s military budgets combined. A 50% cut would leave us with a budget that is still three times the size of China’s, the next biggest spender. U.S. military expenditures have doubled over the past decade without improving security. At the same time, the shift towards a policy of “full spectrum dominance” and expanding American empire has proven counterproductive to peace and security.
A carbon fee will ensure more realistic fossil fuel prices that include the cost to the environment, and are high enough to tackle climate change effectively by creating the economic incentive to drive efficiency and bring alternative fuels to market. The revenues will provide funding for the Green New Deal as well as safety nets for low-income households vulnerable to higher prices on certain items due to rising carbon taxes. We advocate establishing an Oil Legacy Fund, paid for by a tax on the assets of oil and gas companies. The funds raised would help deal with the effects of climate change and smooth the transition to a low-carbon economy.
According to the Congressional Budget Office, a carbon tax of $20 per ton would raise $120 billion a year. [21] We would support a carbon tax of at least $60 per ton ($360 billion per year) and then rising $15 to $20 per ton annually. (Some of the carbon tax revenues would be rebated in various forms to low and middle income households to offset the regressive nature of any consumption or sales tax.)
A carbon tax is an “upstream” tax on the carbon contents of fossil fuels (coal, oil and natural gas) and biofuels. A carbon tax is the most efficient means to instill crucial price signals that spur carbon-reducing investment. A carbon tax can also be used to recapture some of the costs pushed on to taxpayers and consumers from burning fossil fuels. Unlike cap-and-trade, carbon taxes don’t create complex and easily-gamed “carbon markets” with allowances, trading and offsets. Also, because carbon taxes / fees are predictable, unlike volatile cap-and-trade markets, it is easier to plan clean energy investments to avoid carbon taxes.
The wealthy, who have most benefited from the excessive burning of fossil fuels, should pay increased taxes to help with the cost of transitioning to a green economy. Jill Stein has called for a higher estate tax on the wealthiest Americans; raising the top income tax rate while lowering it for low and middle income Americans; and closing various tax loopholes, especially for corporations.
19. We have the Power
20. 100% clean and renewable wind, water, and sunlight (WWS) all-sector energy roadmaps for the 50 United States
21. Effects of a Carbon Tax on the Economy and the Environment
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