Jeanette Fitzsimons: Government must seize chance to invest in sunrise sector

Opinion

There's an old saying: do what you've always done and you'll get what you've always got. But with the economy, even that option isn't open to us anymore.

Doing what we've always done - basing our economy on speculation, greed and the belief that resources and the environment are unlimited - won't get us out of the mess those same beliefs have created.

It's no accident the world financial system, and following it the world economy, experienced its worst crash in most of our lifetimes around the time that oil prices went above US$150 ($282) a barrel.

In the past seven years world grain reserves reduced from more than 115 days' supply to less than 60 while prices skyrocketed.

Australia and parts of New Zealand faced their worst droughts ever, and more evidence of climate change was reported almost daily, from record shrinking glaciers and ice caps to acid oceans.

It is ironic that only a recession could collapse these high prices.

In New Zealand we struggled with high inflation that even punitive interest rates couldn't control. If resources are shrinking and the money supply is not, prices will continue to rise.

In the US housing market, people mortgaged up to their eyeballs suddenly found it cost twice as much for the weekly food bill and to fill their petrol tank. Overcommitted in the first place, they couldn't handle the mortgage costs too.

Now governments are competing to offer "stimulus packages" to assist a "return to growth". But what, exactly, are they trying to stimulate? It's not enough any longer to say "growth". If we are honest about the real issue, the question now is "what should grow"?

Carmakers in the US made bad commercial decisions and continued to build gas guzzlers. Consumers made sensible decisions and bought smaller, more fuel efficient cars from elsewhere.

Should those wise consumers now pay to bail out the gas guzzler car companies? Or should any rescue package be tied to recognising that US cars on average use twice as much fuel as they need to and companies need to retool?

Many governments and economists are now calling for a "Green New Deal" where government investment to rescue the economy is directed into industries and jobs that will also rescue us from climate change, "peak oil", energy insecurity, obsolete technologies and a toxic environment.

US President Barack Obama is investing US$150 billion of his stimulus package in energy efficiency and renewable energy, including making schools, homes and federal buildings healthier and less energy hungry. In the process he is creating a "double dividend" of five million jobs.

The United Nations Environment Programme has just issued its "Green New Deal" report, calling for a third of the global total of economic stimulus packages to be invested in greening the economy.

They say this offers "the chance to deal with today's immediate crises ... and those on the horizon from future food shortages, natural resource scarcity, energy security and climate change".

France, Denmark, Germany, Spain, Australia, South Korea, China and Mexico have packages that take a step in this direction. Will New Zealand?

This is the biggest opportunity in our lifetimes to use a crisis to create an opportunity. Governments are going to commit large amounts of investment capital and create substantial jobs.

Will they rescue sunset industries, or stimulate sunrise sectors? Will they leave us with more dependence on coal mining, motorways and cars, or with assets such as better public transport, healthier houses that need less energy to heat, more forests on bare hillsides which control flooding and erosion in the future?

A Green New Deal needs to be a comprehensive package that looks at where we want to be in three, 10 and 20 years and what kinds of economic activity will get us there.

A Green New Deal would not skimp on funds for science and research, or for re-training, because they are crucial to technologies that will allow us a good standard of living with a more sparing use of resources.

What might we do? A few ideas would include insulating homes, helping industry and farms improve their energy efficiency, and recycling. Also improving public transport, rather than building new motorways.

Others include planting diverse forest species on eroding land to protect downstream farms from flooding and to capture carbon credits, developing technologies to use less steel and concrete (and more timber) in buildings, because of their climate change impacts.

And training more people in solar technologies and in the energy auditing of large companies.

That would leave us with an economy in much better shape to weather future energy shocks, owing the rest of the world much less for our excess carbon emissions, with a more profitable farming sector that did less environmental damage, and the ability to export that new knowledge.

* Jeanette Fitzsimons, co-leader of the Green Party, will step down from her leadership role in June.