By Patrick Goggin

November 1, 2008

The past month has forcefully opened our collective eyes to the significant vulnerabilities of our national and global economy. At its core, the current crisis arose out of an unregulated environment in which Wall Street smart guys figured out a way to reap astronomic commissions by bundling and selling millions of incredibly risky mortgages.

Seeing the potential to get in on the action, banks from all over the world bought into the risk leaving the planet reeling from the collapse of these mortgage backed securities and paying a monumental price. That price is a growing recession resulting in bulging unemployment and a global economic meltdown on the verge of rivaling the Great Depression.

How can the United States possibly recover, let alone co-lead a league of nations out of the crisis, when we face a $10 trillion debt and a $500 billion deficit growing by leaps and bounds seemingly by the day? And, let’s face it, the tealeaves clearly display that China, not the United States, is now the global economic engine and powerhouse leaving us in its vast wake. Meanwhile, the next administration faces numerous other challenges left by the current administration—all tolled, it faces a total task perhaps greater than that faced by FDR during the Great Depression followed by the second World War.

No challenge is greater than properly addressing global climate change. This reality combined with the current economic crisis and multiple war fronts await the next president creating a perfect storm. Should he close the deal on November 4, Barack Obama with his temperament stands poised to maintain his wealth of reason and composure within the eye of the storm. There, he can draw from his well of capable advisors from all sectors to develop The Renewable Deal.

The sharp economic downturn has caused the price of oil to halve from July’s all-time high of about $145. Consequently, at the very time we need to increase our use of renewable energy, this sharp oil price drop has caused clean energy projects to stutter and falter—their financial attraction and viability has correspondingly declined. Substantial incentive is needed.

During the imminent transition, future President Obama should begin formulating a Renewable Deal. We must transform our economy to one that is sustainable, more innovative and much cleaner. However, at this time a new economy based in cleaning up the grid and energy consumption while revamping our energy infrastructure to distribute clean, renewable energy must be supported and inspired by the government. A creative, incentivized plan crafted by Obama and his advisors can expedite our simultaneous transition to a new national and global green economy.

The Renewable Deal would appropriately invest in projects that create, amongst other things, jobs, future wealth in intellectual property, deficit and debt reduction, and, most importantly, a strong sustainable player in the evolving global green economy. Investing in projects like Ausra’s first solar thermal power plant in California in twenty years that started up this past Thursday in Bakersfield, with plans to grow from 5 to 177 megawatts (powering 125,000 homes) will provide the state hundreds if not thousands of new jobs. Additionally, it provides a model to be implemented internationally that can return significant revenues stateside.

The recent $700 billion rescue package has nothing on the wealth that would be created by this ambitious yet reasonable plan. Imagine American businesses developing technology that in addition to creating jobs and capital here could lend a hand in cleaning China’s economy as well as our air. That can and will be done if President Obama births The Renewable Deal.