Summary of Roadmap for a “Green Economic Recovery:” Boosting Short and Long Term Economic Growth while Improving National Security and the Environment
By R. Brown, Web Exclusive Posted Nov. 30, 2008
The Center for American Progress (CAP) and University of Massachusetts’ Political Economy Research Institute (PERI) recently released a report titled “Green Recovery: A Program to Create Good Jobs and Start Building a Low-Carbon Economy.” It detailed how a well-timed and frontloaded investment in the nation’s green industry will boost short and long term economic growth through the creation of white and blue-collar jobs; improve the environment by reducing the nation’s carbon footprint; and improve national security by reducing the nation’s dependence on foreign oil.
The plan, codenamed “Green Economic Recovery,” calls for a strategic short term investment of $100 billion, the approximate amount invested in the April 2008 economic stimulus package, as well as credit stimulus through a federal loan guarantee program in green projects such as
•Retrofitting buildings to make them more energy efficient
• Increasing mass transit and rail transportation
•Building more efficient and smarter electrical grids
•Investment in solar power
•Investment in wind power
•Investment in next-generation biofuels
This “responsible federal investment” according to CAP and PERI, will reduce unemployment through the creation of about 2 million jobs in two years, a majority of which will be in occupations Americans are already trained for such as roofers, electricians, building inspectors, machinist, truck drivers, sheet metal workers, welders, railroad conductors, and more. Specialized jobs such as research scientist and solar panel installers will also be created as well as indirect/induced jobs such as accountants, lawyers, office clerks, human resource managers, and cashiers. The creation of jobs, especially in the construction and manufacturing sectors, will boost the nation’s ailing economy. Green investments will also result in stabilized oil prices due to the widespread availability of alternative and renewable energy. Table 1 list jobs that will be created by strategically investing in all six sectors mentioned above.
TABLE 1
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Green Investments and Jobs
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Strategies for Green
Economic Investment
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Representative Jobs
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Building Retrofitting
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Electricians, Heating/Air Conditioning Installers, Carpenters, Construction Equipment Operators, Roofers, Insulation Workers, Carpenter Helpers, Industrial Truck Drivers, Construction Managers, Building Inspectors
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Mass Transit/Freight Rail
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Civil Engineers, Rail Track Layers, Electricians, Welders, Metal Fabricators, Engine Assemblers, Bus Drivers, Dispatchers, Locomotive Engineers, Railroad Conductors
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Smart Grid
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Computer Software Engineers, Electrical Engineers, Electrical Equipment Assemblers, Electrical Equipment Technicians, Machinists, Team Assemblers, Construction Laborers, Operating Engineers, Electrical Power Line Installers and Repairers
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Wind Power
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Environmental Engineers, Iron and Steel Workers, Millwrights, Sheet Metal Workers, Machinists, Electrical Equipment Assemblers, Construction Equipment Operators, Industrial Truck Drivers, Industrial Production Managers, First-Line Production Supervisors
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Solar Power
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Electrical Engineers, Electricians, Industrial Machinery Mechanics, Welders, Metal Fabricators, Electrical Equipment Assemblers, Construction Equipment Operators, Installation Helpers, Laborers, Construction Managers
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Advanced Biofuels
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Chemical Engineers, Chemists, Chemical Equipment Operators, Chemical Technicians, Mixing and Blending Machine Operators, Agricultural Workers, Industrial Truck Drivers, Farm Product Purchasers, Agricultural and Forestry Supervisors, Agricultural Inspectors
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The $100 billion investment will come from the public and private sector with part of the former provided by revenues obtained from a carbon cap-and-trade program and short term returns are projected to take about one to two years.
Retrofitting buildings, according to the report, will rely on known technologies such as high-performance windows, geothermal heating and cooling, and efficient lighting to name a few. Such investments will deliver the fastest returns and can be implemented immediately. Such a program will rely on congressionally mandated retrofitting of all public buildings with incentives to promote state and local government participation. This program will be administered through currently available funding channels such as the Energy Independence and Security Act (EISA), Low Income Home Energy Assistance Program, Residential Energy Efficiency Tax Credit, Residential Solar and Fuel Cell Tax Credit, Business Energy Tax Credit, and Energy Efficient Mortgage federal loan program among others. The latter programs will encourage retrofitting of privately owned buildings.
Investment in mass transit and rail transportation will be implemented in two tiers-short term investments in current systems and infrastructure through lowered public transportation fares, increased federal support and subsidies for public transportation and employer-based incentives and increased public transportation services; and long term investments in new rail and subway systems.
Smarter electrical grids will rely on synergies resulting from the coupling of information technology and advances in electric power management. Though investment in this arena will take more time than those mentioned above, job creation and returns are projected to begin in a two year time frame. Sources of investment in this category will probably be entire public as it entails the partitioning of profit-making and electrical power generation.
Though funding for the renewable energy sector relies on both public and private investment- which has been the case for the double digit growth of this industry in recent years, a stable policy environment and long term government incentives in the form of tax credits and subsidies will help boost private sector confidence in the industry for even more private investments.
The plan also discussed the advantages of spending $100 billion on a green economic recovery as opposed to other competing economic recovery ideas. One of such ideas calls for investment in increased consumer spending as was the case in the federal stimulus program during the first half of 2008 which refunded tax-payers $600 per individual. Another idea calls for federal investment in the domestic oil industry through increased drilling in the U.S. Though a $100 billion plan for investment in the latter has not been put forth, the U.S. currently subsidies crude oil by an average of $6.6 billion annually and there has been an increased call for more domestic drilling.
An investment of $100 billion in increased consumer spending is projected to produce 1.7 million jobs, 16% lower than that projected by the green economic recovery plan while an equivalent investment in the domestic oil industry will produce a mere 0.5 million jobs-only 25% of the jobs projected by the green recovery plan. In addition, an investment in a green economic recovery offers long term advantages over an equivalent investment in oil such as
•Required labor intensity: investment in a green recovery is more labor intensive than oil drilling which means more jobs for more people.
•Domestic input: investment in a green recovery will require more products and services in the U.S. than imports which supports the national economy while encouraging technological advancements that will eventually be exported.
•Better paying jobs: investment in a green recovery will result in more better paying jobs than a similar investment in the oil industry.
The Green Economic Recovery plan as outlined by CAP and PERI will create 2 million jobs in two years while reducing the nation’s carbon footprint, and dependence on oil. It also provides greater economic opportunities for a larger portion of Americans than other plans thus decreasing income disparity which is currently as high as it was before the great depression of the late 1920s.
To read the entire report, use the following link: http://www.ethanolplug.com/PlugNews/PlugReports/tabid/96/Default.aspx
Read other important reports: http://www.ethanolplug.com/PlugFinance/IndustryReports/tabid/96/Default.aspx
Read summary of Obama's energy plan: http://www.ethanolplug.com/PlugNews/WebExclusiveObamasEnergyPolicy/tabid/125/Default.aspx
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