I sent this as an email report to the members of our Change is Coming group in Bernards Township on December 23:
Hi folks:I've finally had a chance to go through my notes on our "Change is Coming" meeting on December 14 in order to follow up with you on the issues we identified and the actions we agreed to take in response to them.My apologies if you get this message more than once; I am trying to reach out to everyone on the list and make sure I have your contact information in one place and can connect you with others working in the same area. I've also added some others who contacted me and wanted to be involved even though they did not attend the meeting - please welcome them if you're leading one of the groups.Community Service ProjectI also want to engage you in our community service project around homelessness during this holiday season.The severe weather we are experiencing is merely inconvenient for most of us, but for the homeless it is often a life-and-death struggle. I am forwarding a proposal from Emily Benjamin on taking an initiative in addressing one aspect of this, working with local banks to identify foreclosure properties that could be occupied, maintained, and paid for through charitable fundraising or public financing.In addition, she has provided some resources for our group in several areas - housing for the homeless, health care, philanthropy and more - from TheDeal.com, that suggest strategies for scaling up such solutions.Her suggestion is that we identify one property, and contact local homeless agencies, national charities, WalMart and other large retailers, and local banks to provide support for the project. I would propose to organize a team to work on this with Emily on this initiative, and also find out and communicate to everyone else on the team (a) what the current conditions in Somerset County really are, (b) what's already being done about them, and (c) what else is urgently needed that we can contribute.If you are willing to undertake one or more of the actions associated with this initiative, please email me directly (and copy Emily at Emily Benjamin <ekb@benjaminfamily.net>), so that we can coordinate and gather this information most efficiently.Issues GroupsThe following people indicated they were interested in one or more of the issues identified at the meeting. Where someone indicated they would take a coordinating role, I've noted this with an asterisk - and we need people to do this for the other groups as well. I've also added a few others to our lists who have indicated they want to work with us in these areas.
If we think about the challenges facing the new Obama Administration, at the top of the list has to be prioritizing the actions that are desperately needed, in so many different areas, and integrating them into a coherent strategy that will put the country back on track, that will get the economy going again, and will once again inspire both sacrifice and greatness.
Should the administration move first on health care, or on the environment, or on housing, or on the economy? Clearly the answer is that it has to do all of these. The question most often asked in the media, though, is how to pay for it.
In some ways this is a strange question, because it is the government that issues the means to pay for things in the first place. But we maintain the polite fiction that it is run like a household, and really ought to balance its budget (except when it shouldn’t). Underneath this is the fear that government will continue to issue money until it causes inflation, and we’ll all be pushing around wheelbarrows of worthless dollars.
Of course this is nonsense.
If the money that the government prints it uses to invest in infrastructure, in science, in health care, and in addressing the challenges of climate change, it strengthens rather than weakens society and the economy. Spending more money means creating new jobs, putting America back to work (and most importantly back to productive work that does not harm but rather restores the global ecosystem), unleashing creativity, and engaging passion. In this context, balancing the federal budget becomes again an interesting challenge, a long-term goal, based on growing the economy. This economic growth must however be based on the principles of sustainability; we need to make a shift from an extractive economy to a renewable, self-sustaining one. The issue is not whether or not to spend money; the issue is where to spend it, to get the most sustainable growth per dollar invested. And we need to think in terms of the long-term return on investment as well, to see this investment as being on behalf of all future generations as well as our own.
This also implies, to some degree, a new approach to economics. It is more than life-cycle costing, valuing environmental services, and incorporating such externalities as greenhouse gas emissions, though it includes all of these. It must be rethought based on the presupposition that the the goal of the economy is to accelerate fairly-distributed abundance, and not simply to increase the already highly concentrated wealth that exists today. And even the wealthy will gladly pay for a return to economic growth and prosperity.
The role of government, then, is help organize people productively and profitably to produce that which is in the society’s long-term best interest. By assisting and supporting the development of sustainable communities, businesses, and families, government fulfills a role that can be embraced by liberals and conservatives alike, that puts the economy at the service of its citizens and inspires them to create more wealth, by creating more value, more innovation, and more self-sufficiency.
The is not the “collapse of capitalism,” but it probably is the end of capitalism as we have known it over the past several decades. All of a sudden, the era of deregulation is over, and even the U.S. is considering tighter government control over and perhaps even the partial government ownership of the financial sector. As Roubini states, “This might be the beginning of the end of the American empire.”
Despite immense losses of wealth, jobs, and consumer confidence, this might turn out to be the sort of shock that leads people to rethink their priorities, and provides an opportunity to focus on the design of a more sustainable economy. Generating our own local fuel and energy, restoring our own productive capacity, reducing waste and unnecessary consumption, might just be the approach we need to restore real wealth and reduce our dependence on both foreign oil and foreign credit. While it’s not the immediate consequence of our unsustainable environmental and social policies, it might serve as evidence of how precarious and artificial our economic system is, and how vulnerable it is to its own excesses.
We are currently living through the worst financial crisis since the great depression. This is a result not so much of a failure on Wall Street as a failure on Main Street in terms of the subprime mortgage mess. Mortgage brokers, many of them very local businesses, wrote no-doc loans for eager buyers and placed them with banks and finance companies, who in turn re-sold them to other lenders and institutional investors in “bundles,” which these lenders resold to private investors in the form of fractional securities.
Most of these loans were to people who needed a home. Although at the end of the real-estate boom many homes were being bought by speculators, the majority of the loans were issued to people who just qualified for them within the guidelines being used at the time. Once these loans adjusted, these families could no longer afford the homes; and currently two million of them are being forced out, having lost their deposits and their payments into their new houses.
If the government guaranteed these loans, instead of buying the “toxic assets” from the financial sector, there would be no toxic assets to worry about, and these two million people would continue to live in their homes - they would just owe some money to the government as well as to the mortgage company, which might be deferred or adjusted according to their income. In other words, if the government “bailed out” lower-income homeowners, it would not have to bail out the Wall Street financiers who have brought about their own demise by “slicing and dicing” these mortgage-backed securities, and developing further esoteric derivatives of highly dubious value based on them.
What we need is not trickle-down economics but a trickle-up economy - which some folks have recognized is the only kind of economy that is sustainable anyway.
Weaving together the state’s policies on energy, the environment, land use, and the economy, especially in the context of the state’s ongoing budget problems, is no easy task.
Over the past several weeks I have attended a half-dozen conferences on these topics, including sessions on the Energy Master Plan, the New Jersey Utilities Association Conference (where I moderated a panel), and PlanSmart NJ’s spring conference, as well as hosting my own event at Fairleigh Dickinson University on “growing the next generation of green ventures.” I’m left with the sense that we need a new dialogue, that connects the dots and provides an effective pathway to sustainability.
It’s my view that we need to get the big picture right, before we get to the details. But we must also then get to the details, because the policies can be good ones but they will mean nothing if they’re not implemented successfully.
Right now New Jersey is in trouble. We are not alone in this; but the impact of climate change, of rising food and energy prices, of economic turmoil - of job losses and foreclosures and Wall Street meltdowns - are increasingly felt right here at home. And at a time when we need to be investing much more heavily in cleaning up the past and building a more sustainable future, the state government is essentially under water, under a sea of debt. There’s $32 billion that the state has borrowed over the last two decades to fund operating costs; there’s $15 billion in health benefit liabilities, and $38 billion in retirement benefit liabilities to state employees - in short, close to $100 billion in “unfunded liabilities,” and this is essentially three times the size of the state’s annual budget.
This is what conservatives like Grover Norquist have always dreamed of - starving the government so much that it drowns in its own bathwater, to mix their favorite metaphors - though I don’t think they imagined it this way. But it was Christie Whitman who massively increased the state’s operating deficit and cut the state’s income taxes by 30%; and the McGreevy administration was too weak and too distracted to do anything to rectify it.
If you take that $100 billion and divide it amongst the roughly 8 million of us, that’s $12,500 per man, woman, and child - which is another way of saying that we’re that far behind the 8-ball before we can think about spending new money.
But if we’re going to get out of this hole, we’re going to have to invest in new technology, energy production, workforce education, and new initiatives to combat poverty and regional disparities.
The reality is that our present condition in New Jersey is simply not sustainable. We must cut our carbon emissions by 80% by 2050, and to do this we must convert most of our transportation (including cars, trucks, and buses) to run on green, renewable electricity. And we must set an example for the rest of the world to do the same. And since we’re already on this runaway train called global warming, we’re going to need to adjust to the realities of sea level rise, species migration, and a significantly higher cost of living.
The only way out of this is to grow an entirely new kind of economy, a green and sustainable economy. This means changing the way we do just about everything, from manufacturing, to shipping, to how we move ourselves from place to place, and to the kinds of homes, towns, and cities we live in.
But why do we also need to fix regional income disparities, concentrated poverty and persistent blight in cities like Camden and Trenton, and environmental and economic injustice? The answer is that we ought to fix it because it’s immoral and unworthy of American society to tolerate such inequities and waste of human potential; and we must fix it because it is a serious drag on our economy and is just as ultimately unsustainable as $6 a gallon gasoline (which is bound to happen anyway; what’s really unsustainable is maintaining $2 a gallon attitudes and thinking it’s really going to come back down again), four-foot sea level rise, and rising asthma and autism rates. If we need “all hands on deck” this means the poor, the rich, and the middle class - and a significant amount of immigration to support our aging population, which demographers are now calling “a silver tsunami.”
Consider just the matter of housing. Not only is our housing poorly designed from an energy and carbon footprint viewpoint, but we also have too much of the wrong kinds of housing, located in the wrong places, and costing more than we can afford to maintain. We need to put people to work to fix all this - to make our homes, our communities, and our businesses all truly sustainable, that is, putting as much energy back into the grid as we’re taking out of it (each home must indeed aim do this), becoming carbon neutral, and supporting us as much as we’re supporting them.
There’s every indication that all this can be done, but there’s not much evidence that we have the will, or the wits, to do it. Consider, for example, that we need to change our entire building code, zoning laws, energy production and distribution system, the buildings we live and work in, the cars we drive, the food we eat and where we get it from.
Some people believe the problem is our 566 municipalities, our mostly powerless 21 county governments, and our almost entirely dysfunctional state government that are to blame. But the reality is both simpler and more complicated than how our decision-making is structured. The fact is, we can make this system work; we’re just not doing so. Reorganizing it - unless we change some other things - just isn’t going to make enough of a difference. We’re not going to find $100 billion by consolidating a few municipalities or fire departments.
In the next section, I suggest some things that can be done. II
Like the rest of the world, New Jersey faces a bleak future if we don’t address multiple challenges – climate change, rising costs for food and energy, a slowdown in new job creation and wealth generation, ever-widening economic disparities, and concentrated poverty. What can we do about this converging set of crises?
The real problem is that we don’t have the right incentives, the incentives we need for people to do the right things. On the contrary, we mostly have incentives for them to do the wrong things. We have incentives for people to send jobs overseas; buy cheap energy from coal-fired plants in Pennsylvania and Ohio, while producing and selling our power to New York State (where they’re paying even more for it than we are); drive to Wal-Mart to get stuff so cheap that it makes up for the cost of getting there; and pay to have people pour chemical fertilizers and pesticides on our lawns and then drive around in lawn tractors that emit as much carbon dioxide as an SUV.
As long as it’s cheaper or more profitable to do that than it is to build energy-efficient homes, put in sustainable landscaping, buy clean energy, get our fruits and vegetables from local farmers’ markets, and so on, guess what? Most of us are going to keep doing it, and chilling out in front of our big-screen TVs or videogame consoles. As long as it’s easier for public officials to say no to new ideas and proposals than to live up to their ideals of public service, or more accepted for workers to do what they’re told rather than what they know is better for the company and for the customer, or cheaper to buy goods from China rather than from around the corner, or more convenient to throw stuff out than to reuse or recycle it - we’ll keep doing it. The problem is certainly a scarcity of vision, creativity, and courage; but it’s compounded by the fact that in most of our institutions these are not qualities that are always rewarded.
At the same time, things are changing, and in some cases changing a lot more rapidly than most of us realize. Given that $4 a gallon gasoline is not going away any time soon, people are buying a lot fewer SUVs these days. A recent survey of 20 dealers revealed that they were all sitting on inventory that simply wasn’t moving. Virtually every town is now considering or holding a green fair, promoting those squiggly light-bulbs, and buying hybrids, ATVs, or even bicycles for their local police.
The head of PSE&G, Ralph Izzo, said recently that our starting point for addressing global warming has to be the complete electrification of our transportation system. Fairleigh Dickinson University is working on a plan to convert many of its existing vehicles to plug-in hybrids, a step towards full electrification; and we should seriously consider giving people incentives to do this.
But this is only going to increase the demand for electricity, so we really need to find ways to cut waste and increase output from clean, renewable sources. Much to the dismay of the suddenly hopeful nuclear industry, this probably does not include nuclear - because we can’t build it fast enough, cheaply enough, or safely enough to allay everyone’s concerns. Building offshore windmills may still be environmentally controversial, but at least no one’s worried about fallout. Besides, uranium is not a renewable resource, and some studies suggest it may be running out sooner rather than later. There’s no silver bullet, and no free lunch. We have to invest in the right technologies, the ones that are going to see us into the next century.
Right now there’s a lot of discussion around NJ’s draft Energy Master Plan. It’s good as far as it goes, but in the end it’s still both insufficiently bold and insufficiently realistic. The challenges are greater, and the steps that need to be taken are more far-reaching. And the design of the programs that are supposed to get us there has not yet shown itself to be successful.
Let’s take one example. New Jersey has adopted a Renewable Portfolio Standard that requires 22.5% by 2020, with at least 2.12% of that from solar. Sounds aggressive, right? But that translates into only about 3600 MW of renewable capacity by 2020, generating 16,000 GWh of electricity - out of an estimated 80,000 GWh needed even if we can cut consumption by 20%. (Just to be clear about the renewable energy and energy efficiency goals: in the first draft of the new Energy Master Plan the NJ Board of Public Utilities used 2 different bases for their calculations. Our renewable energy production is 20% of the total projected production; it’s this production which is supposed to be 20% below what it otherwise would have been.) Meanwhile, Maine set an RPS of 30% by 2000, and has increased that to 40% by 2017. Texas is aiming for 5000 MW of wind alone by 2015. And using the system of issuing Renewable Energy Certificates (RECs) that can be traded on an artificial market is also leading to some anomalies. When it was recently determined that there was more than 2200 MW of unused, environmentally benign small hydro capacity in the Northeast, which could generate nearly 20,000 GWh (the equivalent of three or four new nuclear reactors, and a whole lot cheaper), there was a concern that this would “swamp” the market for RECs for wind and solar. But the answer is not to hold back the development of small hydro, it’s to increase the RPS to 44% by 2020.
In fact, it’s really not a stretch to think about moving a majority of our businesses, our homes, and our communities over to renewable energy over a ten-year period. If you think about it, you can probably imagine your household doing this (after all, wouldn’t everyone prefer to get their electricity from solar, hydro, or wind than from coal, oil, or nuclear?); and if you can do it, so can everyone else.
And this is just one of a number of examples. What’s needed is a system that responds quickly to the opportunities - for New Jersey’s economy, its energy needs, its transportation, and its persistent inequities. Instead, we have BPU Commissioners acknowledging that “we’ve lost two years in the solar industry market transition,” and the DEP acknowledging that the RGGI auction (originally scheduled to raise $70 M this fall for renewables and conservation) has now been pushed off to the first quarter of 2008.
Of course, this requires boldness - not just bold talk but bold action. The Corzine administration seems to know what it needs to do; the challenge is implementing it. If New Jersey had its act together, its citizens would be communicating about this on an entirely different level. Instead, judging by the results, we have a well-meaning but ultimately timid administration in Trenton; a relatively weak legislature; a divided industry and business community, that is beginning to wake up to the need for true sustainability, but is not yet willing to devote adequate resources to it; and a largely uninformed electorate that - though perhaps for the wrong reasons - does not trust any of them. (Most of our environmental groups are also struggling to catch up to the new threats and new challenges, while municipalities, and other major institutions such as hospitals and universities, are just starting to look at appropriate actions.) Somehow we need to move - partly back and partly forward - onto the track of sustainable economic development. We must face reality squarely: we must increase our energy production from clean and renewable resources, we must put our population back to work in the right sorts of “green collar” jobs, and we must restore a sense of purpose to the affairs of our state. And unless we rethink our relationship with nature and with each other, we’re not likely to come up with the right answer.
At a couple of these conferences I listened to the Governor, and I wondered how he felt about his campaign promises to root out corruption, stimulate the economy, and deal with NJ’s structural issues. My guess is that Corzine would be the first to admit he’s not made much headway. At the PlanSmart NJ conference, the Reverend Buster Soaries, once Christie Whitman’s Secretary of State (and like Whitman one of the casualties of the Bush Administration), said that NJ’s problems could only be solved if we had either a charismatic leader or a devastating natural disaster. I don’t think we can afford to wait for either.
I think what we need is a new conversation; a conversation built around the idea of a truly sustainable state - one that leads the way toward a more just and prosperous economy, and a healthier ecosystem for ourselves and for the rest of the planet.
— Jonathan Cloud (Director, Community Green)
Jonathan Cloud is Entrepreneur in Residence at the Institute for Sustainable Enterprise at Fairleigh Dickinson University, and responsible for the Sustainable Business Incubator. Recipient of a UN Environment Award in 1985 for his work in renewable energy, conservation, and appropriate technologies, he has been an entrepreneur, community organizer, and research manager in both the U.S. and Canada. He currently lives in Basking Ridge, NJ with his wife and daughter.
Originally posted at Communitygreen.org/GreenNJ, August 13, 2008.
