I think it would be irresponsible to answer the question "what is society's most pressing problem" by pointing to anything other than the economic crisis. It is a relatively non-controversial statement to suggest that there are very few people in the media worlds of political reporting and cultural commentary who completely grasp the severity and depths of the crisis we are debating in the public discourse. Indeed, the economy is a complicated field to understand, and I certainly make no pretense to authority herein. But I am very concerned that while much of the recent news stories and punditry seem to be concerned with political warfare—whether or not Republicans and Democrats can get together on an economic stimulus legislation—there are plenty of signs that there is little that can be done to rescue the economy from a severe depression.
In a prescient article from the February 2008 issue of Harper's magazine, Eric Janszen warned that what we are now experiencing—the economic effects of the collapse of the housing bubble—are the consequences of what has become the normal ebb and flow of the macroeconomic mechanism that supports the American, and world, economy. Chronicling the evolution of bubble markets since World War I to the present moment, Janszen argues quite persuasively that the cycle of the bubble economy—the alternating "booms and busts" most recently manifest as the dot-com/dot-bomb and the current home-ownership-society cum foreclosure-auction-society—is now inextricably fundamental to the economic flow. Janszen notes: "That the Internet and housing hyperinflations transpired within a period of ten years, each creating trillions of dollars in fake wealth, is, I believe, only the beginning. There will and must be many more such booms, for without them the economy of the United States can no longer function. The bubble cycle has replaced the business cycle."
Janszen wasn't alone is his foresight. NYU economics professor Nouriel Roubini and contrarian Nassim Nicholas Taleb are two of the few more visible commentators who cried early warnings of the pending doom. And all three worry we are looking at a bigger problem than is commonly understood. While there are plenty of Pollyannas suggesting that fears of "Depression 2.0" are the product of undue cynicism, Taleb warns that globalization not only threatens to expand the scope of the disaster, but also the speed at which it might escalate. Employing a somewhat hyperbolic metaphor to illustrate his point, he notes that in a globalized world, "you cancel an order, a Christmas order here [in the USA], a factory in China closes hours later!" Contrary to previous recessions, this one is an instantaneous worldwide phenomenon.
Another sobering outlook comes from Martin Feldstein, Harvard professor and chief economics advisor during the Reagan administration. Recently named to the President's Economic Recovery Advisory Board, Feldstein echoes all of these concerns, noting that even if a stimulus makes its way into the hands of American taxpayers and businesses, the regular functioning of the broader economy may not be strong enough without a surrogate engine that keeps it afloat. Feldstein noted in an interview on Charlie Rose that one of his greatest fears is that: "we can prop up the economy, replace the lost consumer spending by having government programs and temporary tax cuts, but then at the end of two years, if we turn all that off, there's nothing to guarantee that the economy will continue to go forward."
Although this boom and bust prophecy puts Feldstein and Janszen on the economics team labeled by Robert Reich as "cyclists," even Reich's "structuralist" alternative acknowledges that some basic infrastructural changes are necessary to solve the economic riddle. Pointing to structural flaws in the economy that have worsened since the 1970s, Reich is quick to point out that American dependence on fossil fuels is one area that is sucking resources of American wealth dry.
While all of these commentators will have various degrees of confluence on any number of issues, it seems pretty clear that all would agree that the economy is in serious trouble. While not as clear, I would argue also that they would all also agree that one robust solution to this crisis might be the development of a green technology economy.
At the end of the Harper's article, Eric Janszen suggests that a Green Bubble is the only viable solution to the current debacle. Not only does he agree, Tom Friedman has been beating this war drum for awhile. Echoing Janszen in his NYT column in September, Friedman notes:
The late 20th century saw an Internet boom, bubble and bust. Some people made money; many people lost money, but that dot-com bubble left us with an Internet highway system that helped Microsoft, I.B.M. and Google to spearhead the I.T. revolution.
The early 21st century saw a boom, bubble and now a bust around financial services. But I fear all it will leave behind are a bunch of empty Florida condos that never should have been built, used private jets that the wealthy can no longer afford and dead derivative contracts that no one can understand.
Many of the economists cited above might disagree with Janszen's call for a new bubble. After all, what happens at the end of that cycle? What would we do when the Green Bubble pops? But if we take Friedman's point to heart, that a Green Bubble would leave behind a cleaner, more affordable, more efficient and more effective international society, we might be able to finally escape the boom and bust cycle of the bubble economy model. Because energy is the lynchpin of all economic activity, if we can develop an energy infrastructure that allows us to tap into the clean, abundant and persistent energy resources of the natural world, we might not need a new economic cycle to take up the slack. And rebuilding the world's energy infrastructure would be such a monumental and all encompassing project that, even though millions of jobs would be lost in the change, we would generate millions of jobs and hundreds of trillions of dollars of economic vitality in the process of transition.
So in conclusion, if we're lucky, if we can work hard and build enough innovation into the decision making process, and if we can successfully appeal to common sense—if not also profit motives—perhaps society's greatest problem since the Great Depression is really a moment of opportunity to finally move the world in the right direction.
More articles in this vein:
Secretary Chu
Obama campaigns for green in LA