Obama fails to deliver on the green economy

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There is an old adage that says if you want to be successful in life, pick something you want to do and be the very best at it.

It’s unfortunate that the nation’s leaders can’t seem to get their arms around that advice considering the future viability of our economy depends precisely upon their heeding the wise counsel suggested by this maxim.

When Barack Obama campaigned for president, he promised us a ‘green recovery’ – a return to economic stability based on large government investment in the conversion to low carbon energy along with the modernization of the nation’s infrastructure. Whether you see the word ‘green’ as code for liberal, government expanding, global-warming crazy talk or not, the importance of Obama’s promise was the identification of a sustainable economy that would have a real value – not only the United States but to customers around the world. It was a strategy that would produce jobs, go a long way towards solving the pressing national security problems that come with our dependence on oil, and set the country on a course of once again becoming a manufacturing based society rather than the consumer based economy it has become.

Great idea – but, like all great ideas, it sinks or swims in the execution. So far, there has been little to suggest that anything resembling such a grand plan is underway or even in the planning stages.

In a brilliant article by Dr. Jeffrey Sachs in the Financial Times, Sachs points out  -

Little bits of these efforts are strewn through the stimulus legislation, the pending climate legislation and elsewhere. But the administration has not done the hard work to bring these complex initiatives to reality. Intercity rail does not just appear by itself. Direct-voltage transmission lines require a new federal and regional power grid strategy. Nuclear power requires presidential leadership to get moving again. Carbon-capture and storage requires a partnership of science and industry, backed in early stages by public technology funds.
Via The Financial Times

Sachs has it exactly right. Rather than begin the difficult execution of bringing Obama’s goals to reality – saving and securing our economy for many years into the future while creating meaningful jobs – the Administration has chosen to go for the ‘quick fix’ of keeping interest rates low and pursuing other old-school Keynesian theories designed to push the consumer back into spending mode. It may work for the moment, but, in the long run, this tired tool will become just another bursting bubble that will have done nothing to solve our long term problems.

Of course, the Republicans are not offering anything better. Their response continues to be the tired, supply-side tax cutting measures that have never really provided any benefit beyond putting more money in the large pockets of wealthy. And when the GOP isn’t pushing Reaganomics, they are preaching the disaster that awaits future generations as a result of our burgeoning deficit. That’s all good and fine, except that while it would be good not to leave our kids with our debt, it might also be nice to leave them an economy that permits them the opportunity to earn a living.

Dr. Sachs suggests a three pronged approach to resolving our need to build a long-lasting economy.

First, take advantage of the falling value of the dollar to promote exports for the purchase of US- produced technology while making financing available to low-income countries to help them buy what we have to sell. Of course, we can only do this if we actually produce technology that the world wants. Right now they can get it from the Chinese. And that’s the way it will stay if we don’t get in the game.

Dr. Sachs’ additionally calls for spurring an ‘investment boom’ in a low-carbon economy. This would result in the creation of jobs in the short urn, a more productive economy in the medium run and US technological leadership in the long run.

The third element of the Dr.’s prescription is particularly interesting. Sachs calls for  a “massive expansion in education and training that would address the current unemployment crisis in three ways: by shrinking the numbers of young people searching for work, by building job skills for the future, and by increasing total spending in the economy through education outlays.”

Americans need to come to an understanding that without an economy based on producing something that the world needs – and doing it better than anyone else – we simply have no economic future. This is not a Democratic policy or a Republican policy- this is a survival policy. But it all begins with a plan to make it happen.

We’ve yet to see that plan. The sooner we get one going the better off we’ll be.