A Waste of a Good Crisis: The Missed Opportunity of Green Keynesianism

Stream: Panel 73 - Environmental Politics: Changing Environmental Discourses 
Date: Wednesday, 28 September 2016
Time: 11.00 am – 12.30 pm

Abstract

It is widely accepted that limiting climate change to 2°C will require substantial and sustained investments in low-carbon technologies and infrastructure. While a significant amount of investment will have to come from the private sector, the scale of the problem of climate change and the time frames involved demand that public finance also play an important role in mitigation efforts. However, the dominance of market fundamentalism in economic thinking for the past three decades has meant that governments have generally viewed large spending programs as politically undesirable. The focus has instead been on the development of market mechanisms, such as emissions trading schemes that put a price on carbon and other programs to spur private sector investment. In this context, the Global Financial Crisis (GFC) represented a huge opportunity for proponents of public investment in environmental projects or 'Green Keynsianism'. This paper examines the experience of Australia, Canada, Japan, Korea and the US with Green Keynesian programs in the wake of the GFC. Unfortunately, on the whole the cases do not provide much optimism for proponents of Green Keynesianism. Much less funding than was originally allocated to green programs was actually spent in areas that would produce an environmental benefit. Furthermore, a number of projects labelled ‘green’ actually had detrimental environmental outcomes. Several theoretically-based explanations for why governments missed the opportunity for a green outcome from the GFC are provided along with practical recommendations for how environmentalists can better prepare for the next economic crisis.

Author

Kyla Tienhaara (Presenter), Australian National University
Dr. Kyla Tienhaara is a research fellow in the School of Regulation and Global Governance (RegNet) and co-director of the Climate and Environmental Governance Network (CEGNet), Australian National University. Dr. Tienhaara’s main area of interest is the intersection between environmental governance and the global economic system. At present she is working on a project on ‘Building a green economy? The politics of green infrastructure stimulus in the wake of the global financial crisis’ funded by an Australian Research Council Discovery Early Career Researcher Award.