Eby: We can beat back these challenges, but only if we try
Published 10:17 pm Sunday, October 31, 2010
On the eve of a watershed election, we ought to be asking ourselves where we want to go as a state and a nation from outside the box of distracting hyperpartisan attack ads which drown out meaningful discourse.
The discussion we ought to be having revolves around solving problems which have been gathering for a couple of generations.
We keep kicking it down the road rather than confront painful change.
Instead, we began stimulating the economy in the 1980s by consuming more and charging it because this spending was not driven by rising income with wages stagnant.
Household debt stood at $680 billion when I was in high school compared to $14 trillion by 2008.
Government followed suit because constituents sent the clear message of what they want: more services, less taxes. We’re left with massive debts from economic growth generated by this unsustainable borrowing binge.
Truth is, the left and the right conspire when it comes to consumption spending.
The left grows government with stuff like health care. The right obsesses over tax cuts.
Our politicians, intent on re-election, pander to us and indulge both inclinations with nary a thought to the economy we leave our children.
As we’re constantly reminded, companies create American jobs from the bottom up, so the best way to create good jobs here in the United States is to create new industries and companies and to innovate within existing ones.
This means large investments in research, technology and development.
This came through loud and clear in an interview I read with Bill Gates about our energy options.
“First is a pretty dramatic increase in research and development — about $10 billion a year extra,” Gates says. “The U.S. government has an annual budget of $3.5 trillion, so that’s not a lot of money percentage-wise. To pay for it, you could tax energy usage at a very modest level, between one and two percent … Then you need a real energy plan. One example: If you’re going to get sun and wind power out of the center of the country, you have to do some amazing transmission stuff out to the coasts. But if offshore wind is going to be gigantic, then the need for transmission is less imperative. Building transmission takes decades, so you’ve got to really have a plan that considers each option based on the likelihood of success. You have to write down the probabilities so you can shift resources as the probabilities shift.”
Gates also says, “Climate change is a terrible problem, and it absolutely needs to be solved. It deserves to be a huge priority.”
Time magazine’s Nov. 1 cover story on restoring the American dream also makes the point that to move America from consumption to investment, large layouts in research, technology and development “need to become our strongest focus.”
Despite Obama administration increases and new projects, the federal government still spends less on R&D as a percentage of gross domestic product (GDP) than it did in the 1950s.
Manufacturing is a smaller part of our economy and faces intense global competition. The only good jobs that will stay put on our shores are related to knowledge and innovation.
A few weeks ago, South Korea, which has but 50 million people, announced plans to invest $35 billion in renewable-energy projects.
For us to pay for such initiatives would mean getting health care costs and other entitlement programs under control.
Ironically, Restoring the American Dream, whether you read it or watch it on CNN, is written by Fareed Zakaria, who grew up in India in the 1970s, his own dream fueled by bootlegged copies of “Dallas” on Betamax cassettes.
He maybe takes more note than Americans might on the flip-flop of outlooks.
American middle-class contentment created a nation of optimists, contrary to the “fatalism and socialist lethargy that was pervasive in India those days. Americans had a sunny attitude toward life that was utterly refreshing … it’s as if the world has been turned upside down. Indians are brimming with hope and faith in the future … Americans are glum, dispirited and angry. The middle class, in particular, feels under assault … Perhaps most troubling, Americans are strikingly fatalistic about their prospects. The can-do country is convinced that it can’t.”
John Eby is editor of the Dowagiac Daily News, e-mail him at email@example.com