Green Way Out
One way to look at the international situation right now is that we're suffering from a global paradox of thrift: around the world, desired saving exceeds the amount businesses are willing to invest. And the result is a global slump that leaves everyone worse off.
So that's how we got into this mess. And we're still looking for the way out.
This above from Paul Krugman today. Of course, he's right. And one critical way out is to channel the savings into green energy investing. This direction is taken by the following sequence of actions:
First, compel demand to be created by passing national renewable electricity standards that require every utility (the monopoly distributors of electricity to consumers) to purchase clean energy -- these standards should be high and (most important) steadily rising year over year, so that the demand is predictable for years to come.
Second, create a "good bank" or federal green energy lending facility that will create a marketable debt security with very low interest which will have two beneficial effects: (1) create the possibility of sound revenue for those who trade it, especially banks, and (2) provide green energy generators and distributors a way to fund the great overbuild of clean for carbon in a way that does not impose unwarranted costs on the whole economy.
Third, use this new good green bank to complement the excellent and visionary initiatives already in the stimulus legislation and to support and underscore the importance of putting a price on carbon, as will be done under the cap and trade program in the President's budget.
March 2, 2009 8:35 AM | Reply | Permalink
GreenStim/GreenJobs is just a slogan so far with little serious thought as to how to plan or implement it:
Throwing an unfunded mandate at debt-ridden, de-regulated, chronically mis-managed and, in some cases, notorously corrupt public utilities is likely to waste energy and capital. It allows the feudal transmission-line monopolies to "greenwash" cross-hauling of high-cost, unreliable "wind power" derived from overseas arms-peddling (eastward) and low-cost, base-load power from coal-fired power-plants (westward).
Here in Texas, where the civil, electrical, and mechanical engineering are done by plantation-era land-speculators, paper-hangers, and, of course, bond-lawyers straight out of a Grisham novel, prices are jacked-up to "whatever the traffic will bear" in order to support not the development of this new alternative to replace that old legacy but to maximize monopoly rent-sharing among bi-partisan concession-tenders and to bail-out improvident projects or ridiculous urban sprawl with indirect taxation.
Now, that Stalinist style of techno-giantism development is "shovel ready", but it is inconsistent with either technological progress, maintenance of plant, sustained economic recovery, or, um, republican democracy.
Then, there is the other paradigm: a GreenBoom or DotCom-II. This features the Venture Capital Industry and a gaggle of spread-sheet and air-brush artists layering multiple rounds of paper capital-formation around "intellectual property" and burning up more of the household savings that these fee-men and other financial intermediaries consider "excessive" but that the already lawyer/lobby looted households are still furiously trying to restore by saving "excessively" with no trustworthy instruments but Treasury paper.
Where has even the least thought been given to what sort of new or just appropriate economic enterprises and financial institutions are truly compatible with economies of scope, scale, cycle, and networks we need but that do not actually fit in with vested interests laying siege to the national and state capitols.
Show me one green industry that is growing fast without benefit of a lobby (I know one but who in Washington or Austin does) and one dirty, archaic industry that is shutting down and laying off its lawyers, lobbyists, pimps, and whores? Now, that would be "change we can believe in!"
But, It is so not happening.
The left and right have their various utopian or dystopian visions. But, the center on these matters, so far, looks to me like just an army empty suits, university lecturers, and underemployed lawyers. Where are Generals Robert, Grove, or Clay? Where is Admiral Rickover? Isambard Kingdom Brunel? All I see are Pelosi & Reid, Summers & Geithner, Laurel & Hardy whooping it up with the rest of the crony and mafiya capitalists.
March 2, 2009 11:35 AM | Reply | Permalink
Reed, how about the idea used in Germany for increasing solar power?
There the government guaranteed that small businesses and individuals who invested in solar panels could sell their power back to the grid at a guaranteed price over the next twenty years. They set the price such that the investment would pay off before 20 years, so that those who chose to pony up the capital would make a profit in the long run.
As a result of this program, Germany now meets 20% of its electricity demands from solar. And hundreds of entreprenuers there have tiny little solar farms, adding clean energy to the grid.
This idea could be combined here with your point number 2, a government sponsored "green bank" facility to finance the investment small businesses and individuals would make in their solar panels.
And this would fit nicely with the initiative to modernize the grid, which aims to make it possible for more electricity to be generated locally, rather than in huge centralized plants (which suffer large transmission losses to population centers).
Just another idea for your consideration.
-- ARG
March 2, 2009 6:04 PM | Reply | Permalink