11 November 2008

More On What's Next for the New Green Economy

I've been thinking more about last week's panel discussion, "What's Next for the Green Economy?"

A few of the questions made me think about President-elect Obama and what he'll be facing when he takes office in January.

So I thought I'd try to answer some of the questions here and, in a future post, I'll offer my two cents to Mr. Obama.

Will a Green Economy rebound faster from financial turmoil?

I think it will, if only because the concerns that are driving the green wave are not going away anytime soon: dependence on foreign oil, stemming climate change, and high fuel prices.

(On the last point, while price per barrel is down in the mid-60s today; it averages out around $109 per barrel for the year. As energy analyst Gregor MacDonald points out in this post, the average price over time is more important for commodities like oil.)

Will consumers stick with Green during tough times?

Tough one. Depends upon how hard hit they are where they keep their wallets. The good news is, companies like Wal-Mart have already made commitments to go green and are making money at it.

It will be tough to maintain momentum if the costs of greener goods don't come down or if manufacturers stick to luxury green items. Overall, however, there are gains in green stuff like organic foods and some consumer goods, such as Energy Star-rated appliances. (TVs should see a bump-up, with the changes coming in the new year concerning the switch to digital signals.)

What is the next administration really facing that's not being talked about in the media?

How to pay for the huge transformation from old, dying economy to new green economy. You can't nickel and dime your way there, but with the War in Iraq (and Afghanistan) still going on and $700B bailout of banks and potentially more for automakers. Where ya gonna get the money?

Does America need a energy technology bubble just like the information technology bubble?

Yes. Bubbles can be good. As author of Pop! Why Bubbles Are Great for the Economy, has written, "the excitement of a new technology interacts with some of the more unstable components of America's character—boundless optimism, a tendency toward entrepreneurship, a tolerance of creative destruction, and greed—to produce a kind of mania."

We could use a little of that boundless optimism today. Dontcha' think?

When the bubble bursts, we'll be left with a new green infrastructure that will keep the new green economy going.

And it may just save our assets.

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