Friday, November 07, 2008

Planning the First 100 Days: Green IS the Recession Solution!

The Petroleum Ceiling and the Limits of Growth

Since the credit crisis began, we’ve been hearing a lot about how investing in a ‘Green New Deal’, ‘A Green Economy’, and ‘A Clean Energy Economy’ will rescue us. But how, specifically, will green solutions be our savior, and why – at the end of the age of oil and a time of increasingly dangerous human-caused climatic instability – is this type of policy package so crucial for President Obama to implement during his first 100 Days?

Over the past few months, as I’ve talked about how our economy won’t experience a prolonged period of growth until we wean ourselves from our addiction to oil, I’ve referred to this limit on growth as the “Petroleum Ceiling” on our economy. What I mean – even now as gas prices have temporarily dropped due to recessional demand and investors’ flight to safety in the dollar (among other reasons) – is that as long as our economy is so foolishly dependent on oil, once the business cycle starts to heat up again, demand for oil will go up and with it, the prices of food, commodities and other critical goods and services – bringing the period of growth to a screeching halt.

We saw what happens when gas prices skyrocket this past summer, and fortunately now have a chance to take steps to break through The Petroleum Ceiling before a Peak Oil crisis hits that makes the credit crisis look like a day in Mr. Rogers' Neighborhood. The solution that the new Obama Administration should implement, as a slew of experts have declared, is to invest our tax dollars in something far more inspirational – and likely a considerably better investment – than bailing out greedy, irresponsible investment banks: a Green New Deal centered on the strategic proliferation of renewable energy and energy efficient technologies.

A Key Lesson of the Credit Crisis: If You Know There's a Problem, Solve It Before Catastrophe Hits Especially When There's So Much Hope In the Solutions
Reading through various sources over the past couple of months to glean some pattern of truth about what’s really going on with the financial crisis, more than one of the authors referred to the Petroleum Ceiling problem as evidence that we’ve reached the limits of growth that are possible via an oil-fueled economy given our current transportation, energy and building technologies and infrastructure.

I’m no economist or oil market guru, so I’d love some insight on these ideas from experts in economics and oil. But at this point, it seems pretty clear that we have reached a turning point in human history – a period of a few years where society changes profoundly as old technologies meet their limits, and humanity is faced with the challenge of either finding new ones to replace them (i.e., via a jobs-creating revolution in sustainable clean energy, energy efficiency and more from which will emerge new Bill Gates, Larry Pages and Steve Jobs who bring us technologies that we can now only dream of), or facing some, shall we say, very difficult times.

What kind of difficult times? One recent article asked if the 2008 financial meltdown is a symptom of humanity approaching – if not overshooting – our carrying capacity. Overpopulation and the earth's 'carrying capacity' for humans (the highest number of individuals that available resources can sustain, in humanity’s case depending on lifestyle-related consumption levels) are, of course, a kind of taboo topic – a veritable Elephant in the room during discussions about the ultimate causes of humanity’s environmental and social ills. Wikipedia’s page on human overpopulation, for example, is labeled “disputed”, and is a cacophonous mess of discord.

However, what is quite clear from the ongoing debate over how many people are too many is that we are depleting our ‘natural capital’, with losses rising beyond even the level of the astronomical financial losses stemming from the credit crisis. This depleting natural capital, of course, includes the reality that the energy source that powers our transport, food and climate control systems, which has allowed the human population to grow from 2 billion in 1900 to over 7 billion today, is set to start to decline within 10 years. At the same time, our climate is growing increasingly – and dangerously – unpredictable, with numbers of natural disasters growing rapidly, leaving insurance companies (among others) reeling. What happens if a major Peak Oil Shock hits? As oil markets guru, Matthew Simmons has stated, food shelves could begin to empty in as little as 5-7 days… Clearly, the risk of a catastrophic decline in our quality of life is growing.

Fortunately, of course, humans have this little noodle between our ears that can help us navigate through such challenges to figure out ways to adapt, survive, and flourish. Now that we’ve elected Barak Obama president during this critical time – with a once-in-a-century financial crisis, a peak oil crisis, and a climate crisis closing in upon us – if we’re going to avoid the dire consequences of each of these related calamities, the time to ‘Step it Up’, as Bill McKibben says, is truly right now! Electing the right president was just the beginning.

A New Green Economy Yes We Can!
It's time to get to work making sure that the solutions President Obama proposes during his first 100 Days and beyond approach the path to solving the financial crisis right, in a way that addresses our three most pressing – and intertwined – crises:
  1. The Economy: our broken economy and financial system;
  2. Peak Oil: our dependence on increasingly unpredictably-priced, unreliable, and polluting oil supplies (and fossil fuels in general) and the inefficient vehicles and buildings that they power; and
  3. The Climate Crisis: the quietly – almost radioactively so – spreading catastrophe that is global heating, or ‘Atmosphere Cancer’ as marketing guru, Seth Godin, calls it. ('climate change' and 'global warming' have proven to be tragically inadequate terms for conveying the civilization collapse-inducing potential of humans' destabilization of the earth's climate system, but that's a topic for another post...)
The good news: the same technologies and green infrastructure projects that will create millions of jobs in key emerging 21st century industries will also free us from dependence on oil and help us reduce our greenhouse gas emissions by the recommended level of 80% by 2050.

Who would have thought just 10 years ago that our next period of economic growth would not only thrive on a clean energy and energy efficiency revolution, but would depend on it? For those of us who’ve spent our lives working to advance what we now call “sustainability”, it’s our time. The next few months, if not years, are likely to give us quite the economic roller coaster ride, but let’s not lose sight of how we have the answers right in front of us – and it’s just a matter of executing on the policy end, and on the task of strategic deployment and proliferation of clean energy and energy efficient technologies. Our time has finally come to support President Elect Obama and prove to the world – and to our children and grandchildren who we are passing it on to – that “Yes We Can”!

The Massive Stimulus Potential of Efficient, Clean Technologies
As numerous reports and articles have made clear, the returns for America (and the world) on investment in a sustainable clean energy and efficiency revolution will be to cut our energy costs considerably, thus freeing up hundreds of billions of dollars for Americans – and citizens of the world – to spend on everything else, generating cost savings that reverberate far and wide throughout lives and businesses. At the same time, these solutions will slash our greenhouse gas emissions and boost our public health, national security, and quality of life. Consider the following very brief set of examples:

Savings on Gas Costs – Switching from a car that gets 20 mpg to one that gets 50 mpg will save the average American nearly $1,100/year in gas costs at $3/gallon (given the average distance Americans drive per year – about 12,000 miles; savings rise considerably as gas prices and miles driven go up). That savings is nearly two times the cash provided to us by our 2008 stimulus checks! Multiply that by the 112 million households in the U.S. alone, and that’s $123.2 billion/year that American households are now spending on gas that with a mandate for more efficient vehicles, they would have to spend on…everything else – electronics, clothing, travel, education, you name it. Or of course just to SAVE for themselves or their children.

Not to mention that at 20 lbs of carbon dioxide (CO2) emitted per gallon of gasoline, these financial savings translate to 3.6 tons of CO2 emissions saved. Multiplied by 112 million households, that's an annual reduction of approximately 358.4 million tons of CO2 emissions – about 5% of America’s total.

Savings On Home & Business Energy Costs – Throw in home energy efficiency, including such typical tips as purchasing EnergyStar appliances, using energy efficient light bulbs, and operating your home more efficiently by sealing leaks and turning down the heat and AC a bit, and savings jump another $500 to more than $3,000 per household per year (the final amount depends on the size and energy use of the home; numbers derived from Conservation Value Institute’s ‘GreenTracker’ sustainability savings calculator). Again, multiply that by 112 million households, and find that another $56 billion to $336 billion of Americans’ hard earned dollars are freed up from energy bills for us to spend widely, to save for our children and theirs, and to contribute to charitable organizations working to make our world better.

This is the green vision of a broad economic and social stimulus for America – and one that doesn’t just come and go like our $600 2008 stimulus checks. This is a stimulus that feeds back positively upon itself, providing returns for decades as our transportation, energy, and building technologies and infrastructure become more energy and cost efficient. Green IS the recession solution!

Of course, as a critical bonus, at an average of about 1.34 lbs of CO2 emissions per kWh of electricity and 11.7 lbs of CO2 emissions per Therm of natural gas, these cost savings on home and business energy use translate to hundreds of millions of tons of additional reductions in greenhouse gas emissions per year – significantly further cutting humanity's carbon footprint!

Savings on Health Care Costs & Related Pollution Impacts – A green economy will also generate direct and indirect savings on our skyrocketing health care costs, which have been increasingly weighing down consumer and business spending. Directly, Americans’ costs on pollution-induced health problems like asthma – estimated well into the $billions – will go down. Indirectly, companies that currently have to pay full wages to workers who are either home sick due to pollution-related illnesses, or who are not working at full capacity, will get more bang for their buck as clean technologies replace polluting ones.

How much of an impact will a cleaner, greener economy have on our public health? Consider the findings of a 2006 study that examined the health impacts of air pollution in California’s San Joaquin Valley alone. The researchers estimated that annually, air pollution causes some 23,000 asthma attacks, 3,000 lost work days, 188,400 days of reduced activity in adults, 260 hospital admissions, and 460 premature deaths among people age 30 and older; and for children: 3,230 cases of acute bronchitis, 17,000 days of respiratory problems, and 188,000 days of school absences! The study estimated the financial cost of these impacts to be $3 billion – a regional cost that grows to astronomical levels at national and global scales. Green technologies are clearly healthy for not only our environment and economy, but for ourselves!

Savings on Security Spending AND Greater Economic and National Security – Finally, our national security position will be greatly strengthened. Free from the pressure to make choices that defy American values just because we don’t want to risk angering our oil suppliers (many of which are governments that don’t like us very much), our ability to do what is right for America and the world will no longer be so tragically – and expensively – compromised as it is right now. Consider the security costs of our pursuit of oil in Iraq and Afghanistan, which for the Iraq War alone are estimated to have required enough of our precious tax dollars to shift the world to renewables! The financial and diplomatic benefits are truly exciting, and will almost certainly generate groundbreaking foreign policy breakthroughs in regions where diplomacy and human rights are currently compromised by petropolitics.

Better quality of life – Better quality of life, of course, is what this all translates to – by investing in a renewable energy and energy efficiency revolution that powers A New Green Economy.

Concluding Food for Thought
Since the beginning of the financial crisis, as I’ve read an array of articles on the subject of green stimulus, I have been particularly inspired by the following three quotes:

“Just imagine what a trillion-dollar investment would return to the economy…if we committed at that level to green jobs and technologies…The exciting thing about the energy technology revolution is that it spans the whole economy – from green-collar construction jobs to high-tech solar panel designing jobs. It could lift so many boats.”
– Tom Friedman, NY Times 9/29/2008

“In a green economy, we would rely less on credit from foreigners and more on creativity from Americans…It’s time to stop borrowing and start building…Let’s put people back to work ¬ retrofitting and repowering America. You can’t base a national economy on credit cards. But you can base it on solar panels, wind turbines, smart biofuels and a massive program to weatherize every building and home in America.”
– Van Jones, NY Times, 9/29/2008

“If the 1960s were about raising baby boomers and the '90s about technology, what should the '10s and '20s be about? It's obvious: energy and climate change. That's where the present great unmet needs are. So, let's use the next few years to plan, mapping out a program of energy conservation, reconstruction and renewable power.”
– Economist James K. Galbraith, Washington Post, 9/25/2008.

As I’ve been telling friends over the last year or so, “Green IS the recession solution”! These are not times to be fearful, they are times to be bold. They are times for those of us who've dedicated our lives to advancing sustainability to support President Obama in his mantra: “Yes We Can!”

Jonathan L. Gelbard, Ph.D. is a conservation biologist and communications expert. He is the Executive Director of the Conservation Value Institute and National Sustainability Producer of the Green Apple Festival.


  1. Hopefully the message is heard clearly. President Clinton talked about this message at last year's Greenbuild conference in Chicago. What is the marketing success rate, one needs to be hit 7 times before they act?!? I believe that our time has finally come.

    Please don't disappoint me Obama.

  2. Drive it home Dr. G. Wait. Bike it home. I couldn't agree move. I'm glad to see a Van Jones quote. His program holds lots of promise.