Financing the Green New Deal by Robert C. Hockett

Author:Robert C. Hockett
Language: eng
Format: epub
ISBN: 9783030484507
Publisher: Springer International Publishing

3.1.2.2 Tier Two: The Investment Committee

Whichever option for the NIC’s top tier we adopt, it probably makes sense to impanel just below it a more operationally focused tier. It would be at this level that more detailed planning and execution of project-specific NIC financing is done. We might call this the NIC Investment Committee, and think of its role in rough analogy to the Open Market Committee of the Fed (FOMC), the finance committee of any large business concern possessed of a chief financial officer (CFO), or the investment or fund manager of any investment bank or investment fund.

The Investment Committee under this scenario would assess and develop various financing options for various Green New Deal projects or portfolios of such projects, with appropriations, retained earnings, or bond sales on the income side and running from grants through loans to bond purchases and equity investments on the output side, all in conformity with the goals and desiderata elaborated above in Chap. 2. It would then present these options to the Council for approval or selection, then execute on whatever options the Council ultimately opts for.

The Investment Committee might comprise a simple subcommittee of the Council itself, again partly reminiscent of the Fed FOMC model, or might comprise mainly or only persons with significant financial management experience, with the chair of the Commission itself also serving as chair, ex officio or otherwise, of the Committee. Either way, in view of the mainly technical nature of its functions, the Committee members should have, jointly and severally, top level financial expertise and experience. For the Committee will, in effect, be conducting the NIC’s principal funding and investment operations like any finance committee or investment or fund manager.

One additional layer of possible nuance is worth noting: It might be well to subdivide the Investment Committee into two subcommittees, one concerned primarily with direct ‘primary’ market investment, the other concerned with indirect, secondary and tertiary market operations. In such case the Primary Market Subcommittee would act much like a contemporary infrastructure bank does in underwriting and capital-raising more generally. The Secondary Market Subcommittee, analogously, would function more like a fund manager in purchasing various kinds of securities issued by private and public sector entities whose investment operations complement the Council’s mandate.

Needless to say, both subcommittees would coordinate, as the departments of any complex institution do, under the auspices of the Investment Committee of which they are part. And the latter Committee, as noted above, would operate under the continuous oversight of the Council.

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