Press Release Budget Economic Crisis and Recovery Government United States

Federal Budget Activist’s Guide Explains How to Finance a New Deal That is Green

March 11, 2021

Contact: Karen Conner, 202-281-4159Mail_Outline

Washington DC — The Center for Economic and Policy Research (CEPR) releases today the third and final installment of an activist’s guide to using public spending and taxation to finance a Green New Deal (GND).
In How to Make Joe Biden’s Budget Better, Part III: Financing a Green New Deal, CEPR senior research fellow Max B. Sawicky focuses on the three most likely ways to pay for the new spending needed to implement a New Deal that is green: cuts in defense spending, tax increases, and borrowing.
“The real secret to expanding the US public sector, including any Green New Deal and an expanded care infrastructure, is to demonstrate the benefits of the spending itself, in its own right,” said Sawicky, rather than rely on the crutches of taxing the rich or printing money.
Financing a GND is envisioned in three scenarios, analogous to small, medium, and large. Here is where the popular new topic in budget debates, Modern Monetary Theory (MMT), is discussed. It is also where the guide takes on sacred cows, like deficits and raising taxes, and revives the notion of a peace dividend.
Along with the two previous installments, the guide is written for advocates, decision-makers, and the interested public. It lays out guideposts mutually recognized by the diverse interests that are clamoring for action by the incoming administration.
Part I: How to Make Joe Biden’s Budget Better, Part I: Send Money Now! focuses on cash assistance to families and to state and local governments.
Part II: How to Make Joe Biden’s Budget Better, Part II: Public Investment and the Green New Deal — Do Everything! addresses the longer-term needs of the nation, particularly expanding the concept of the Green New Deal to include a New Deal that is green.

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