Another perspective on the lack of an economic recovery

September 29, 2010

By Drs. Robert & Sonia Vogl
President and Vice President
Illinois Renewable Energy Association

A recent article in The Wall Street Journal suggested that an economic recovery is still two to three years away. According to the U.S. Department of Labor, the jobless rate increased in 27 states in August. Although 67,000 new jobs were created, 125,000 new jobs are needed to keep pace with the potential workforce.

Robert Reich, former Secretary of Labor, sees the problem as being in the structure of the economy rather than the business cycle. While economic gains have occurred, Reich reminds us that most of the gains have gone to the top 1 percent of Americans, leaving little money for the majority of citizens to fuel growth and stimulate job creation.

Herman Daly, formerly of the World Bank, is also critical of the structure of the economy. Offshoring of jobs, an increase in illegal immigrants working in the U.S., and consumers being turned into free labor through automation undermine job opportunities here.

Goods produced offshore satisfy the same market as domestic production once did. Since no product is exported in exchange, the U.S. trade deficit has soared. Government stimulus often results in importing more goods and producing more jobs in other lands. Budget deficits and printing more money have done little to raise employment in the U.S.

Service jobs not easily offshored are increasingly filled by hard-working, low-paid immigrants undercutting citizens’ job opportunities. The federal government has done a poor job enforcing immigration laws, which are far more restrictive in other countries than in the United States.

Daly characterizes the concepts of free trade, globalization, open borders and automation as growth policies based on cheap labor, pushing employment and wages down and leading to an unequal distribution of income.

While praised as labor-saving, the automation of services has shifted labor on to consumers, as exemplified by customers pumping their own gasoline.

A new federal push to increase manufacturing in the U.S. is calling attention to the national security risk of relying on parts essential to our economy being made in foreign lands.

Craig Comstock relates that an interesting local jobs campaign for a county commissioner position is being waged by Jeff Golden in southern Oregon. He sees three job areas as likely to grow faster than any other jobs, while paying wages sufficient to support a family. He calls for a focus on food and agriculture, energy conservation and green construction. He highlights the lack of food security, since 97 percent or more of their food is imported into the county. His goal is to secure 20 percent of the county’s food from local sources. As peak oil raises prices, he foresees the need to use far less energy. Retrofitting existing buildings and writing new building codes to encourage energy-efficient new construction can cut energy consumption.

Despite budgetary restraints, Golden calls on county governments to buy locally, bring together stakeholders in food and agriculture, energy conservation and green construction to stimulate working relationships and encourage local financial institutions and investors to support local businesses.

Jeff Rubin, a Canadian economist, believes the end of cheap oil will bring about the end of globalization and revitalization of local economies. Since this is an election year and job concerns are a priority, it remains to be seen if any of the views expressed in this column become part of the political discourse.

Drs. Robert and Sonia Vogl are founders and officers of the Illinois Renewable Energy Association (IREA) and coordinate the annual Renewable Energy and Sustainable Lifestyle Fair. The Vogls and the IREA are members of the Environmental Hall of Fame. Dr. Robert Vogl is vice president of Freedom Field, and Dr. Sonia Vogl is a member of Freedom Field’s Executive Committee. The Vogls consult on energy efficiency, renewable energy and green building. They have 3.2 kW of PV and a 1 kW wind generator at their home. Forty acres of their 180-acre home farm are in ecological restorations. They are active in preserving natural areas and are retired professors from Northern Illinois University. E-mail sonia@essex1.com.

From the Sept. 29-Oct. 5, 2010 issue

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