20. Economic Recovery from Coronavirus
The coronavirus plunged the world deep into an economic recession, and to recover from a recession, governments typically start spending a lot of money. Where that money goes has a lasting effect on the economy and the environment, and historically, due to investments in fossil fuels, neither the environmental nor economic impacts of these stimulus packages have been stellar. Today, we take a look at a couple of the missteps in the economic recovery from the 2008 financial crisis, and then examine some policy ideas that might create a stronger, more sustainable recovery this time. With special guest Dr. Jennifer Allan: Lecturer in International Relations at Cardiff University in Wales.
Going into this episode, I really thought a “green recovery” from coronavirus was a pipe dream that I and others concerned about the environment had, but no country would actually do. I knew it was economically the right thing to do as well as environmentally. I worried those in power might not know that. So I was really pleasantly surprised in my conversation with Dr. Allan because not only are some countries already doing it, but there may actually be some interest in global cooperation on a green recovery! Since a green recovery plan could move the needle tremendously on climate change, that was so exciting to hear.
Green recoveries intrigued me because of how much creativity they elicit. There are so many different strategies to push toward net-zero emissions, and a recovery plan provides a certain malleability that a plan in regular times might not. The broadband discussion particularly caught my interest because it creates options. Do we want a carbon-free world with primarily electric cars? Do we want primarily public transit? Do we want primarily walking or biking? Or some combination? Or, do we want a world where people don’t have to commute at all? I don’t think I’d heard that possibility taken too seriously before COVID-19, but now, it doesn’t seem weird. Of course, I assume any outcome would have a combination of all of these, but policy can really inform in which direction the world ends up leaning.
I also learned a lot about the 2008 recovery, which turned out to be a real mixed bag. We focused more on some slip-ups in the episode, and I found those two in particular (bank bailout jumpstarting fracking and the auto bailout) absolutely fascinating. Leading up to 2008, there seemed to truly be a lot of promise for a more sustainable future, and while there was certainly awareness of climate change, there wasn’t particularly aggressive policy, which suggests the free market was headed in that direction. The 2008 bailouts completely shook that up, and set off a trend for more fossil fuels and more consumption that has largely lasted until March 2020. It seems like now, we’re more aware of the ramifications of that mistake, but still need to cognizant that we don’t make it again.
Thanks for listening!