𝐂𝐚𝐧 𝐭𝐡𝐞 𝐔𝐊 𝐚𝐟𝐟𝐨𝐫𝐝 𝐍𝐞𝐭 𝐙𝐞𝐫𝐨?

Academy of Ideas Economy Forum discussion, introduced by Professor Gordon Hughes.

Jun 16, 2024

Please note the following online discussion sponsored by the Academy of Ideas Economy Forum which will be introduced by the eminent Professor Gordon Hughes.

𝐓𝐡𝐮𝐫𝐬𝐝𝐚𝐲, 𝐉𝐮𝐧𝐞 𝟐𝟕 • 7 - 8:30pm GMT+1 • FREE
𝐂𝐚𝐧 𝐭𝐡𝐞 𝐔𝐊 𝐚𝐟𝐟𝐨𝐫𝐝 𝐍𝐞𝐭 𝐙𝐞𝐫𝐨?

With a UK general election just weeks away, the major parties will be pitching their different plans for the next five years. But there is one major policy on which they are almost all united: to reach ‘Net Zero’ emissions by 2050. Indeed, there is such unanimity among politicians and the mainstream media on this issue that there is unlikely to be very much discussion about it at all during the campaign.

Yet achieving this goal would involve not only a transformation in our economic system but a sacrifice of many other objectives which may be equally or more important to the electorate. The UK is running a unsustainable fiscal deficit of more than 6% of GDP. All parties promise to spend more on health care, housing, education, infrastructure, defence, etc, while also promising to freeze or reduce the tax burden. Alongside such promises, realistic estimates of the costs of adopting Net Zero, not just for the UK but for Europe and the USA, start at 5% of GDP for the next 25 years and may be as high as 10% of GDP.

There is no prospect of financing such expenditures by borrowing. Cutting other public and private investment will accelerate the recent decline in the country's capital stock and GDP per head. Raising taxes is both politically difficult and counter-productive for economic growth. Within such tight fiscal and macroeconomic constraints the money to pay for Net Zero must come either by reducing other public spending or by a drastic squeeze on private consumption.

The failure to discuss such choices openly raises questions about whether a future government will have the authority and public consent to impose the sacrifices required by Net Zero. Or will the result be evasion and a rapid loss of trust in and public support for the new government?

Please go to Eventbrite to obtain your free tickets for this online event.

If you are not familiar with the work of former World Bank advisor, Gordon Hughes I recommend taking a look at the following previous posts some of which include his work.