Read Stephen’s newest blog post at the Daily Journal of Commerce: Can Government Stimulate the Economy?
I have generally found the presidential debates to be less than inspiring (I guess that oil, gas and coal expansions are more impressive than an agenda based on green jobs, clean air and clean water). I have, however, found the positioning related to the role of government in stimulating our economy to be highly troublesome.
In Monday’s debate, former Gov. Mitt Romney re-iterated his case to keep government out of business when he said, “It’s not government that makes business successful. It’s not government investments that make businesses grow and hire people.” Yes, Mitt, I think we all agree, and I doubt there is a successful business owner in the nation who believes government is what “makes” a business succeed; however, and especially in troubled times, government plays a key role in fostering that success.
The U.S. government’s expansionary tactics in reaction to the 2008 economic crash kept this state, our country and the globe from experiencing what would otherwise have been the greatest depression in the past 75 years. Clearly the Great Recession has been, and continues to be, hellish and stressful, and as a young CEO in the building market, I am hyper aware of just how hard we were knocked back. Yet now that my company is strongly planted back on its feet with a healthy future ahead and preparing for its 10-year celebration, I am able to reflect on how it was able to survive and find support.
Certainly the U.S. Federal Reserve’s wise move to continue driving mortgage rates to historic lows has been a primary force behind the major uptick in new construction nationally. The Boston Globe recently reported low rates as the primary reason for the 38 percent growth in new construction starts over the past 12 months. Behind these statistics are great local stories of new jobs and healthy homes. I have to wonder whether a Romney administration would have interacted with business in this way.
In 2009, the city of Portland, with $2.5 million in government block grant funds, seeded a brilliant concept put forth by CEO Derek Smith for city residents to receive home energy upgrades through low-interest loans backed by the energy savings created. The resulting company, Clean Energy Works Portland, expanded statewide to become Clean Energy Works Oregon (CEWO) through $20 million dollars of seed funding from the U.S. Department of Energy’s Better Buildings Neighborhood program. Derek reports that, in less than two years, CEWO has weatherized nearly 2,000 homes, added 300 jobs to Oregon’s economy and saved Oregonians over 22.1 gigawatt-hours (GWh) in energy – that’s more energy than 22 nuclear power plants can produce in one hour; the 0.1 GWh alone will fly a Boeing 747 for an hour! The beauty of it all is that these savings and benefits will just keep on accumulating. As a primary contractor for Clean Energy Works Oregon, I can attest that the 300 jobs created by CEWO are solid and climbing. I’m proud to be an American when I know that because our government believed in our industries’ smart ideas, we now have 300 and growing working class heroes back in action. I hope the national discourse can move beyond Romney negating the role of government in restoring our economy and Obama defending both his successes and failures in this arena. Instead, let’s have more focus on the specifics of how the government on both sides of the debate can collaborate to optimally support businesses to succeed. It’s critical we take our time and investigate which industries merit investment and then invest in those ideas to best enable more working class heroes to survive and thrive. From my perspective, I’d bet on the energy conservation industry!