High economic growth rates and a soaring stock market during the eighties were driven by the enormous productivity gains made possible by the personal computer. The '90s boom was driven by the miracle of the Internet. A big chunk of the growth this decade sprang from artificial and ephemeral real estate gains, which have since gone poof! There is nothing to replace it until we invent something new.
Make energy a national defense issue. After all, the PC (or the microprocessor that drove it) and the Net (or Darpanet, as it was then known) were both the stepchildren of taxpayer funded defense research. Launching a Manhattan Project for alternative energy and transportation could well give us the next decade’s economic driver we are searching for.
The building of a cleantech industry and a smart transmission grid could deliver the millions of jobs the new president has been promising. That would move the engine of US growth out of poorly managed Detroit, foreign crude-dependent Houston, and Heaven help us, bureaucratic and connection-ridden Washington, to entrepreneurial Silicon Valley. It certainly would be a better use of money than rescuing bad stock and bond investments.
Obama says that energy is a priority, but will he make it the top priority? He needs to take the great leap to make us a carbon-free economy. I hope someone close is telling him this.
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