Green Jobs and Rebuilding Our Economy: Beyond the Presidential Campaigns

During the recent presidential debates Senator John McCain said developing green technologies and alternative energies can "get our economy going by creating millions of jobs." On this point Senator Barak Obama agreed: "If we create a new energy economy, we can create 5 million jobs, easily, here in the United States." 

Despite the enthusiasm of the presidential candidates, in recent days we've seen lots of old-style thinking that the financial crisis would require steming efforts to build a green economy. The concern is that a recession is the wrong time to increase the costs of energy by regulating or taxing carbon dioxide emissions. This is the old environment/economic growth trade off. However, if we reduce carbon dioxide emissions by making our cars, homes, appliances and businesses more energy efficient, we can reduce pollution while making our economy more efficient and cost effective. In Tom Friedman's new book, Hot, Flat and Crowded he correctly observes that the effort to go green could actually allow the United States to maintain its economic power through the 21^st century. 

We do seem to be taking some modest steps in the direction of building a renewable energy industry. At least, we are no longer in danger of moving backward. Renewable fuel tax credits for businesses and consumers were extended as part of the $700 billion economic rescue plan approved by Congress during the first week of October. They include: a tax credit for owners of electric cars, a $20 tax credit per month to employers of bike commuters and the extension of the production tax credits and investment tax credits provisions for renewable energy, according to US News and World Report.

However, due to the current financial melt-down, many investors are holding back their capital and gravitating toward conservative investments. Dean Robert F. Bruner of the University of Virginia's Darden School of Business, told Politico in early October: "The problem with state-of-the-art green ventures is their payoff horizons are further in the future than was the case with the technology sector."

Yet Bruner believes that Obama's plan to inject $15 billion annually into private efforts to build clean energy could help stimulate new investment. The sum, when compared with federal research into health and defense projects, is small, Bruner told Politico, but "it is a material step up. It would help to draw talent into universities and private enterprise. It would be a signal of serious intent for venture capitalists to follow along."

According to Obama's website, the goal is to, "Invest $150 billion over 10 years to accelerate the commercialization of plug‐in hybrids, promote development of commercial scale renewable energy, encourage energy efficiency, invest in low emissions coal plants, advance the next generation of bio-fuels and fuel infrastructure, and begin transition to a new digital electricity grid."

Obama would also establish a federal investment program to help manufacturing centers modernize and help Americans learn new skills to produce "green" products. Within this program is an increased $1 billion per year federal investment for the research and development of advanced technologies.

Alternatively, McCain would, establish a permanent tax credit equal to 10% of wages spent on R&D. "At a time when our companies need to be more competitive, we need to provide a permanent incentive to innovate, and remove the uncertainty now hanging over businesses as they make R&D investment decisions," his campaign websites states.  The site goes on to observe that "green jobs and green technology will be vital to our economic future. There is no reason that the US should not be a leader in developing and deploying these new technologies."

For McCain, many of the "green jobs" would be in clean coal and nuclear power. I'm not sure how green I would consider those jobs, but at least the idea is to reduce the impact of fossil fuels on the environment.

It's pretty obvious that Obama has a more comprehensive and assertive approach to investment in renewables, but we will need to do a great deal more if we are going to transform the energy base of our economy away from fossil fuels. What is needed is nothing short of the same level of investment in basic science and applied research and development that the United States undertook after World War II.  The Cold War motivated us to build a science establishment that set the pace for the world. We are going to need to do that again with a focus on renewable and more efficient energy.

As Obama correctly notes, we need to stimulate investment to accelerate commercialization of existing energy efficiency and renewable energy technologies. But we also need to develop new technology. Basic science research capacity must be expanded in the United States. This means attracting the world's best scientific minds by re-opening the doors we slammed shut after 9/11. We also need to dramatically and rapidly increase government support for scientific research. In addition, we need to enhance our effort to increase science literacy in elementary schools, middle schools, high schools and colleges. The economy of the present runs on brainpower, and the economy of the future will be even more reliant on technological innovation. The importance of education to our economy has been a theme of the Obama campaign, and it has been encouraging to see him emphasize this critical point.

I am grateful for the extensive research for this piece provided by Sara Schonhardt, 2009 Master's Candidate, School of International and Public Affairs, Columbia University.