Why Obama's Green Job Plan Might Work
January 04, 2009|Marla Dickerson
HEMLOCK, MICH. — While Detroit's automakers struggle to rebuild their sputtering operations, the key to jump-starting Michigan's economy may lie 80 miles northwest of the Motor City.
This is the home of Hemlock Semiconductor Corp. It makes a material crucial for constructing photovoltaic panels. And that has turned this snow-covered hamlet into an unlikely hotbed for solar energy.
On Dec. 15, the same week that General Motors Corp. and Chrysler begged $17.4 billion from taxpayers to stave off collapse, Hemlock announced a $3-billion expansion that could create hundreds of jobs. It's a rare piece of good news for this battered Rust Belt state, whose 9.6% unemployment rate is the nation's highest.
In contrast to Detroit iron, Hemlock's quartz-based polycrystalline silicon is in such demand that workers in white smocks and protective gear toil around the clock to get it to customers around the globe.
Hemlock has been deluged with applications from idle factory hands such as former autoworker Don Sloboda. The 50-year-old Saginaw resident has been retraining at a local community college for what he hopes is the region's new engine of job growth.
"It looks like the future to me," Sloboda said.
Whether clean energy can pull Michigan out of the ditch remains to be seen. But the push is on to retool America with so-called green-collar industries.
President-elect Barack Obama wants to spend $150 billion over the next decade to promote energy from the sun, wind and other renewable sources as well as energy conservation. Plans include raising vehicle fuel-economy standards and subsidizing consumer purchases of plug-in hybrids. Obama wants to weatherize 1 million homes annually and upgrade the nation's creaky electrical grid. His team has talked of providing tax credits and loan guarantees to clean-energy companies.
His goals: create 5 million new jobs repowering America over 10 years; assert U.S. leadership on global climate change; and wean the U.S. from its dependence on imported petroleum.
"Breaking our oil addiction . . . is going to take nothing less than the complete transformation of our economy," Obama said during a campaign stop in Michigan's capital, Lansing, last year.
Americans have heard it before. Every president since Richard Nixon has touted energy independence, yet the goal remains elusive. The U.S. imported less than a third of its crude around the time of the Arab oil embargo in 1973. Today foreigners feed nearly 60% of the nation's petroleum habit.
Obama Job Plan 2010
Obama Spells Out Jobs Plan
WASHINGTON – Two days after he announced that job creation is his administration’s top priority, President Barack Obama detailed a proposal, which he unveiled Friday in Baltimore, to encourage small businesses to start hiring.
His proposed two-part Small Business Jobs and Wages Tax Cut would offer a $5,000 tax credit for each new employee hired this year and reimburse Social Security taxes for businesses that increase wages or hours for existing workers.
Although all businesses are eligible for the program, a cap at $500,000 per business ensures that smaller firms would get the most bang for the buck. The proposal is slated to cost $33 billion – money siphoned from the bank-bailout program, which used fewer taxpayers’ dollars than expected – and to extend to 1 million employers.
Despite Friday’s news that the economy grew at a better than expected 5.7 percent rate in the final three months of last year, unemployment remains stuck at 10 percent. Small businesses account for 64 percent of net job growth, according to the U.S. Small Business Administration.
Small Business Administrator Karen Mills, who traveled across the country to speak with small business owners, said, “many of them see the ability to take that next order, to hire that next person, but don’t have the tools they need yet.”
“Many are eagerly awaiting the right moment,” she said.
The White House doesn’t plan to release estimates of how many jobs the proposal will create. According to a press release from the W.E. Upjohn Institute for Employment Research on Friday, economist Timothy Bartik calculates it could generate at least 1 million jobs, with a cost-per-job of less than $30,000, far cheaper than most stimulus measures.
“I believe that President Obama’s proposal is a well-thought-out plan that will significantly spur job creation at an affordable price,” Bartik said. “If Congress quickly adopts this proposal, it will not solve the United States’ current employment crisis, but it will make a significant dent in our employment problems.”
The job creation proposal is based on a similar tax credit established in 1977 that studies have shown to be successful. That tax credit, which offered $7,000 in inflation-adjusted terms for newly hired workers, helped the employment rate rise 11 percent over the next two years, while unemployment fell 2 percentage points.
Alan Krueger, the chief economist and assistant secretary for economic policy at the Treasury Department, said the latest proposal echoes its precedent, while improving upon some aspects, like applying the credits quarterly instead of yearly. The measure also includes provisions to prevent abuses, such as when companies fire workers and then rehire them to get the tax benefits.
(Reuters) - President Barack Obama said Monday he would unveil proposals next week aimed at spurring job growth in part through infrastructure improvements.
Obama made the comment as he announced he had picked Princeton economist Alan Krueger as the new chief of the Council of Economic Advisers.
He said next week he would lay out a series of steps that the U.S. Congress can take immediately to put more money in the pockets of middle class families and put construction crews to work.
2013: Obama Jobs Council hits 1 year without official meeting
To be continued...........