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4 Ways the Green New Deal is Trashing the Economy

by Lear Capital EditorialJune 24, 2022
green new deal trashes the economy

Ever since Day 1 of the Biden Administration, the Green New Deal has been crashing through our economy like a wrecking ball. The stated goals are “environmental and social justice” along with awesome, guaranteed new union jobs.

At the center of the Green New Deal is a forced transition away from fossil fuels. In order to force this change, policies must be enacted that make fossil fuels increasingly unaffordable. Thus, the high gas prices you see at the pump may be an economic catastrophe to you, but they are actually THE WHOLE POINT of the policy.

Even though the Green New Deal “doesn’t exist” legislatively, since it has technically not survived a vote in Congress as either a bill or a resolution, it is arguably the centerpiece of the current administration's agenda. It has even been soundly rejected by our elected representatives, yet is being implemented piecemeal through executive actions.

From the cancellation of the Keystone Pipeline and other measures, the Green New Deal is trashing our economy just as effectively as if it was actual law.

Here are 4 ways…

1. War on domestic energy production

The Biden Administration cancelled the Keystone Pipeline on the first day in office. Even though the Green New Deal emphasizes job creation, just eliminating the Keystone Pipeline cost 10,000 jobs alone. Biden also imposed a moratorium on oil and gas leases on federal lands. This has restricted new supply. Existing supply has been throttled by imposing heavy new tax burdens and eliminating existing tax benefits for producers of oil, gas, coal and nuclear energy. 

2. Green Tangle of Red Tape

Refinery capacity is already at a decade low. What does the administration do? Add more regulation and red tape. There are new requirements to add more ethanol to fuel, which also serves to increase food prices by removing that much more corn from the food supply. One strategy they will continue to use is to weaponize the Endangered Species Act against new discovery and drilling efforts. Take for example the tale of the Lesser Prairie Chicken. The listing of this chicken under the Endangered Species Act could impact 1 million+ acres across 5 states. These land grabs and the resulting fees and permits also impact farmers and ranchers, contributing to food supply constraints and higher prices passed on to you at the grocery store.

3. Green Energy is not ready to pick up the slack

For all the efforts to push green alternatives by attacking gas and oil, the green alternatives just aren’t there. Electric vehicles are out of reach of too many American budgets, and aside from Teslas, still lack the range to be practical. Solar and wind just don't pack enough of a punch in power production to replace coal and gas, especially in bad weather or less sunny conditions. The supply constraints to the power grid are leading to brown outs and black outs in many areas.

Germany is learning this lesson the hard way. Their Russian supply is being taken offline, but their green energy sector is still woefully unprepared to pick up the slack. The end result is no energy at all, or energy that absorbs an outsized portion of the family budget, which disproportionally impacts low and fixed income sectors that the Green New Deal claims to help the most.

Strangely enough, absorbing a family's budget at the grocery store and the gas pump doesn't help them magically afford a Tesla.

The most aggressive forms of the Green New Deal want net-zero emissions by 2030. Biden’s goal is 2050. But the ultimate goal is to bury fossil fuels and replace them with something that really doesn’t exist right now.

4. Rampant money printing

One of the most sinister ways the Green New Deal wrecks the economy is by being exorbitantly expensive, yet producing nothing. It aims to disrupt and replace something that is a huge piece of the economy – the energy sector – with a nonfunctional alternative and at great cost.

How will it be paid for? There is a lot of hand-waving in response to that question but the answers seem to fall into 2 categories:

1. Everyone must pay their "fair share" i.e. taxes.

2. The government can just print up whatever it costs since they own the printing press i.e. Modern Monetary Theory.

What could possibly go wrong with those two options? 

These 4 items are just the tip of the iceberg. But make no mistake – the economy is not in shambles, gas prices aren’t high, and inflation is not at a 4 decade high by accident. All of these economic disasters are happening by design, on purpose and are part of a larger agenda

Any attempts to shame gas stations into lowering prices or other surface level efforts should be viewed in the context of election year politics. High gas prices are enormously damaging to the family budget and are wildly unpopular politically.

The stated goals of the Green New Deal are basically to tear down the energy grid as we know it and replace it with green alternatives wrapped up in red tape and government control. If this agenda continues, it could nationalize the energy sector, food production, land usage and the economy as a whole.

The dollar is not likely to survive the abuse inflicted on it in order to finance all this. The dollar is already undergoing plenty of damage, whether or not this agenda is stopped (or paused for 2022 midterms)

What can you do to protect the investments and savings you have that are priced in dollars? If the dollar is tipped into hyperinflation from all this money printing, don’t be vulnerable to losing everything. Consider exchanging some of your dollar assets for something more tangible. Unprintable.

Precious metals have historically acted opposite the dollar and have never been worth zero in 8000 years of human history. Many experts recommend putting 5-20% of your portfolio into gold and precious metals.

As a side noteSilver is especially poised to perform well. Silver is a very important part of manufacturing solar panels, so even if the Green New Deal goes full speed ahead, demand for silver should skyrocket. It could go up either way! It is BOTH a great bartering metal in the case of monetary disruption, and it is an important industrial metal! It is hard to find a downside to owning a little bit of silver in this day and age!

Don’t hesitate to call us to discuss your ideal precious metals strategy for the future. Many experts feel that gold and silver are undervalued, so the time to buy is NOW.

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