As Andy Bernstein pointed out in his report from the White House Clean Energy Economy Forum yesterday, the Obama administration appears willing to look at any and all options to create jobs, particularly in the green sector.
The question is, How fast can they do it? A simmering populist unease at the hundreds of billions of dollars in stimulus funds that went to big banks rather than small businesses or entrepreneurs or infrastructure is likely to reach a boiling point by the next election year or two. For young voters the question seems to be: What will run out first, their patience or their credit?
Faced with massive postcollegiate debt and a still-shrinking jobs market (we only lost 100,000 last month, and that's considered progress), one of the more promising solutions lies in the clean-energy field. The resulting energy independence would allow us to spend less money on defense. The $700 billion or so we spent last year, this year, and on into the foreseeable future on basic defense, not to mention the wars in Iraq and Afghanistan, would go a long way toward providing food, healthcare, and education to just about everyone who needed it.
The challenges facing President Obama and the U.S. Congress have not gone away. Paul Krugman worries that “unemployment is likely to stay near its current level for a year or more,” because “much of the political establishment now sees stimulus as having been discredited by events, so that it’s very hard to come back and scale the policy up to where it should have been in the first place.” But there remains a pathway out of Krugman’s dire vision of “a process of defining prosperity down” — if enough politicians embrace the alternative vision of a green economy, promoted by political leaders as far apart on the ideological spectrum as Van Jones and Sen. Lindsey Graham (R-SC). The basic concept is simple, as the video from Repower America shows — heat up the economy by cooling down the planet.
The Recovery Act made a down payment for clean energy jobs, primarily through public spending. But the creation of a carbon market would drive private investment away from pollution and into clean energy. A Political Economy Research Institute clean energy economy report found that public-private investments of $150 billion a year could be sustained over ten years and create 1.7 million net jobs in the U.S. economy. Fossil-based energy production sends money overseas and sinks money into capital-intensive projects like mining and drilling, whereas clean energy and energy efficiency requires greater local and labor investment.
The stronger the carbon cap is in a carbon market, the greater the investment. A $150 billion carbon market would be about double the size of what is being considered by Congress. That investment would be sufficient to construct a nationwide smart grid, retrofit every building in America for energy efficiency, and produce 20 percent of electricity from renewable sources — all by 2020.