Investing in the Environment

February 21, 2017

The White House isn’t explaining government’s environmental options.

The environment is the crux of emerging industry. It doesn’t just enable us to breathe better and protect our children’s lives. It is a growing industry which America could dominate if we tried. It is and will be crucial to housing materials, and protecting existing investments of all kinds. Places and countries that don’t protect their environments will not attract entrepreneurs, workers or investments. Their infrastructure will clog along with people’s lungs.

And as it becomes cheaper solar and wind make other industries possible – sun and wind don’t charge by the hour. Falling behind in environmental infrastructure means disaster, abandoned communities if they don’t first fall into the sea.

As simple a gesture as writing land-planning rules so that new construction has the best orientation to the sun cuts expenses forever. Supporting science, instead of taking scientific findings off government websites, will lead to other helpful steps America could take. Plus everything we do for the environment will depend on putting people to work to get it done.

Yes I know, there are shifts in world temperatures that are not man made. New York was once covered with a huge sheet of ice. Nevertheless, we also know, independently, that carbon and methane are driving global warming. Even if natural processes affect the temperature of our world, mankind is making it much worse. We could take action to bring that down unless we put our heads firmly in the sand. Fighting to minimize climate change is good for the economy. Losing that fight isn’t. It means rescuing people, pulling them away from the coasts, crowding them into smaller less productive areas. More than that, it means that many of the places we live will become uninhabitable. Only the mortuaries will do well.

I once chatted with an engineer about the effects of climate change. I knew that his house is in New York City, only 8 feet above sea level and not far from the coast. So I suggested he move to higher ground. He responded that if the sea rose 8 feet, New York City would be unlivable. The infrastructure of the city wouldn’t work. Roads and streets would be submerged or collapse. It wouldn’t be worth staying even on higher ground. So I suggested moving up here – the Hudson may be at sea level but most of us are much higher than that. His response was chilling but one would be a fool to assume he was wrong. He said that none of us would be safe if 8 million New Yorkers, or more from the metropolitan area or the East Coast, became refugees. Wow. His point is that if large numbers of us become desperate, and remember that most Americans live near the coasts, then all bets are off.

Remember the resistance in Congress to repairing the damage from Sandy. That doesn’t even compare to the costs of a rising sea.

So fighting climate change is good for jobs, protects us from economic collapse, and gives our children and grandchildren something to live for. That’s a heck of a worthwhile investment, and a collective, patriotic goal.

— This commentary was broadcast on WAMC Northeast Report, Feb. 21, 2017.

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Labor Economics

February 14, 2017

The White House isn’t explaining what’s happening to jobs. I once taught labor economics, an issue close to my heart. To some extent, labor is like any other commodity and that’s the problem. Jobs go wherever business can find all the things it needs – the land, transportation, materials, markets, reliable legal relations, at the right prices. And it keeps changing.

We talk about the rust belt as if we did something wrong. Actually we had about a century-long run on the best factory jobs in the country – a ribbon through this state after New York’s government built the Erie Canal and made New York City gateway to the west, turning every city along the Hudson, Mohawk, Erie Canal, and then the great Grand Central Railway into a powerhouse. This area long dominated clothing, technology, science, heavy industry and spawned radio and television networks. Each industry provided resources for newer ones.

But New York’s advantages couldn’t be permanent. For bigger plants with newer methods, business looked for virgin land. Other governments built ports, the Interstates and St. Lawrence Canal, while the aging infrastructure of older cities led firms elsewhere. It couldn’t be permanent. Economic fundamentals inevitably dominate jawboning and presidential rhetoric.

Workers get cast aside unceremoniously. One of my law students was also a human resources specialist at GE, missing class whenever GE announced layoffs. They had long since let the weakest workers go. Now she had to fire the best and it hurt. But big corporations aren’t sentimental.

What’s a city or region supposed to do? The market doesn’t automatically find the next big thing and put it where former employees can get jobs like those they lost. The market didn’t build America automatically. Government changed British rules. Government built a banking system with resources to fund business, and smooth their cash flow – if you read or saw Hamilton, that’s what he was about, government providing what companies couldn’t. Government built ports, canals, highways, and had the railroads built. Government provided public health facilities, water, sanitation, disease control – which became crucial for business. Government invested in schools, and President Lincoln laid the foundation for the modern state university system. President Wilson sparked the country’s first broadcasting system for the war effort. Almost everything in your hands today has government fingerprints on it – the research and development in fundamental physics that led to the lasers, transistors and chips that run almost everything today.

Yes, governments make mistakes. You think private industry doesn’t? Most businesses fail. But only government can provide the fundamentals, the things that all the businesses in the country, region or route need. Only governments are motivated to look beyond individual companies and work for the region.

Governments have been investing in new forms of power. If governments in coal producing states had the sense to invest in emerging industries instead of dying ones, the coal miners might face a much better transition to good jobs than anything presidential jawboning can produce. But government cannot do it if it is afraid to fail.

Governments need to be thinking about what the emerging industries are, what resources will support growth. Not individual businesses that any group of investors could build on their own, but the underlying fundamentals that make broad development possible. And we may only know which ideas work when we try them.

If government thinks small, we all shrink.

— This commentary was broadcast on WAMC Northeast Report, February 14, 2017.


Regionalism vs. the Environment

August 26, 2014

There’s been news recently about a decline in gas prices. Hallelujah? Or oh my God! Decline in prices means more people will build energy inefficient homes and invest in gas guzzling machinery or businesses. Some will benefit, but the world will suffer. How do we accommodate those inconsistent objectives? Read the rest of this entry »


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