The Green New Deal — a bold, thinly detailed climate change-centered plan from U.S. Rep. Alexandria Ocasio-Cortez — has drawn heated reactions from Republicans, including U.S. Sen. Joni Ernst of Iowa.
When Ernst spoke against the New York Democrat’s proposal during a Senate session, she called it a “raw deal.” And she made a provocative claim by displaying a large poster that read:
“At $93 trillion, the Green New Deal would cost more than the entire recorded spending of the U.S. since the Constitution went into effect in 1789.”
At $93 trillion, Ernst’s claim uses a colossal figure.
But it’s only about as strong as a clothespin in high wind.
Ocasio-Cortez’s Green New Deal is a House resolution — that is, a non-binding measure and not actual legislation. There’s also a companion measure in the Senate. Senate Majority Leader Mitch McConnell, R-Ky., said in early March that the Senate would vote on the Green New Deal in the coming weeks.
Broadly speaking, the resolutions address ways to curb climate change and protect the environment. The House version has far-reaching environmental goals, including “eliminating pollution and greenhouse gas emissions as much as technologically feasible.” And it reaches into other domestic policy areas, as well.
But the proposal doesn’t lay out any cost figures. And it has not received a cost estimate by the nonpartisan Congressional Budget Office — the gold-standard source on such estimates.
To back Ernst’s $93 trillion claim — a figure that spans 10 years — her office pointed us to a report on the Green New Deal by the American Action Forum, which describes itself as a center-right think tank. The forum is part of the American Action Network, a conservative, nonprofit advocacy organization.
Interestingly, the report does not state its bottom-line estimate of what the Green New Deal would cost. But if you add up the various figures, the cost is pegged at somewhere between $51 trillion and $93 trillion.
So, Ernst is wrong when she flatly states that the Green New Deal will cost $93 trillion.
By far, the largest expenses, as estimated by the American Action Forum, are for non-environmental parts of the proposal: $36 trillion for universal health care and up to to $44.6 trillion for guaranteed union jobs with a family-sustaining wage. The environmental costs include an estimated $5.4 trillion to transition to a “low-carbon electricity grid.”
But Ernst’s claim is even more misleading in that the report itself is full of assumptions, qualifiers and caveats.
Indeed, the report starts with a caveat, saying the breadth of the Green New Deal’s proposals “makes it daunting to assess” using the “standard tools of policy analysis. Nevertheless, this short paper is an initial foray.”
And the report’s lead author, economist and American Action Forum president Douglas Holtz-Eakin, made it clear to us that the report aims to provide very rough estimates on a plan that’s only partially developed.
“It’s important to distinguish whether it’s tens of millions, tens of billions of dollars or tens of trillions of dollars,” he said. “That’s the important information.”
Politico goes so far as to call the $93 trillion “bogus.” But Holtz-Eakin’s work has held up to scrutiny before. He was the director of the Congressional Budget Office from 2003 to 2005 under President George W. Bush. According to the New York Times, he was often “a thorn in the side of the Bush administration.” And Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center, told us the American Action Forum report is “a perfectly reasonable paper” for what it is —putting an “order of magnitude,” rough cost estimate on a bare-bones proposal.
As for the rest of Ernst’s claim — that $93 trillion is “more than the entire recorded spending of the U.S. since the Constitution went into effect in 1789” — Ernst’s office said historical tables from the fiscal 2019 federal budget show total federal spending is $83 trillion since 1789.
Holtz-Eakin told us he had not seen such a figure calculated. But both Holtz-Eakin and Gleckman told us Ernst’s methodology doesn’t take into account 230 years of inflation, population growth and economic growth.
Ernst says: “At $93 trillion, the Green New Deal would cost more than the entire recorded spending of the U.S. since the Constitution went into effect in 1789.”
A center-right think tank run by the former head of the nonpartisan Congressional Budget office estimates the cost of the Green New Deal, over 10 years, at between $51 trillion and $93 trillion. But the report itself described the estimates as an “initial foray,” filled with assumptions and caveats about a thinly detailed plan. No official government cost estimate has been done.
And even if the high-end estimate of $93 trillion were accurate, comparing it with total federal spending since the Constitution is problematic, to say the least. Simply adding up federal spending, as Ernst did, doesn’t take into account either inflation or population growth.
Ernst’s statement simply goes way too far. We rate it False.