(Dear Readers: This post is a diversion from my typical postings here at jumpthecurve.net, but I feel quite passionately about this issue and would like to bring it to your attention. If you like the idea, I encourage you to become a supporter at www.greenbonds.com).
President Obama’s inaugural speech resonated with Americans of all political stripes and persuasions for a number of reasons. He began by calling for the country to prepare for “a new age” and urged Congress to revisit our old energy policy which serves only to “strengthen our adversaries and threaten our planet.” Next, he insisted we “roll back the specter of a warming planet” and remake America by creating new industries and jobs that will lay the foundation for future growth. He then concluded by calling all Americans to a “new era of responsibility.”
It was, to be sure, a lot to ask of a nation engaged in two foreign wars and mired in the midst of the worst economic recession in generations. Nevertheless, millions stand ready to heed his call.
The only problem is that there are few vehicles through which average citizens can rise to and accept the president’s challenges. There is, however, one remarkably simple–and yet under-appreciated–tool at our disposal: “Green bonds.”
Similar to the war bonds program of World War II, green bonds would be issued by the U.S. Government for the sole purpose of financing large-scale renewable energy projects—solar farms; geothermal facilities; wave power plants, etc. –as well as small scale projects and products developed by everyday people with high potential for local or regional impact.
The current economic stimulus package addresses renewable energy to a degree, but only a fraction of the estimated $900 billion is directed toward “green” projects. Worse, the stimulus package passes off the hefty burden of paying for these ventures to future generations. In short, it calls upon current citizens to do nothing. This is unacceptable.
Green bonds address both shortcomings. First, the size of the bonding proposal can be tailored but, as a comparison, it is worth noting that half of all Americans purchased war bonds during the 1940s. In total, they raised $187 billion—an amount comparable to $3 trillion in today’s dollars.
The proceeds would be used to finance, through zero or low interest loans, projects and products designed to break our reliance on fossil fuels; curb carbon dioxide emissions; and lessen the need for a large military presence in the Middle East; while, at the same time, offering investors a safe investment alternative.
Moreover, green bonds, which could be priced between $25 and $10,000, have the added benefit of allowing every American, regardless of their financial means, to become an active participant in the building, strengthening and securing of this country’s future.
The government, as it did during the Second World War, would be responsible for paying off the matured bond. Naturally, there would be a price to be paid, but many of the projects will be able to repay the loans and those which are unsuccessful could be financed by re-allocating a portion of the existing stimulus package. Alternatively, it could be argued that direct payouts to the citizen holders of green bonds are more justifiable than offering massive bailouts to the failed industries of the past.
Green Bonds also hold an additional attraction. It has recently been reported that after years of woeful negligence, Americans are saving more money. This is a positive development but, as most economists would tell you, this new found virtue of thrift can be counterproductive if the money isn’t efficiently returned to the economy.
Green bonds have the benefit of serving as a savings vehicle while simultaneously pumping that money back into the economy—but directing it at specific purposes which benefit America’s broader economic, environmental and national security goals.
As President Obama said in his inaugural address, the question we must ask ourselves today is not whether our government is too big or too small, but whether it works. He further reminds us that government works best when all of its citizens assume their rightful duties.
Just as our forefathers answered the call at our nation’s beginning, and our grandparents’ generation answered the call during the Second World War, it is now our turn. Green bonds provide every citizen the opportunity to share in the “price and promise of citizenship” and, in the process, create a better tomorrow for future generations.
If you support this idea we ask you to show your support by signing our petition at www.greenbonds.com today. Together, we can take this idea to Washington and begin the task of rebuilding this country anew.
Melanie Sanco is the author of the concept paper “Green Bonds” and coordinates the Office of Resource Development and Innovation for the Minneapolis Public Schools, and Jack Uldrich is the author of Green Investing and the former chair of the Independence Party Party of Minnesota.
