05 Aug 2009

Something New to Fret About: The U.S.’ "Green Trade Deficit"

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Just when you thought the “green recovery” plans couldn’t get more inefficient:

Green investment is a major pillar of the president’s economic recovery plan. Yet, America’s dependence on foreign countries to produce green technologies may undermine this recovery strategy. Using a list of green goods derived from the Organization of Economic Cooperation and Development (OECD) and the Asia-Pacific Economic Cooperation (APEC), we have determined that the United States ran an overall green trade deficit of -$8.9 billion in 2008, including a deficit of -$6.4 billion in the critical category of renewable energy, one of the main targets of the Obama administration’s green agenda. The U.S. economy also suffered a significant deficit in the pollution management category. On the positive side, the United States ran modest surpluses in two categories–energy efficiency and a grouping of other environmental goods related to water purification and sustainable agriculture.

If current trends continue, the green trade deficit can be expected to widen further as the administration’s agenda increases domestic demand but without sufficient measures to increase domestic production. If the deficit continues to grow, the United States will forego the creation of millions of high-wage, high-skill green manufacturing jobs and lose its potential to be a global producer as well as a consumer of green technologies.

And liberals love to guffaw at General Turgidson when he says, “Mr. President, we cannot afford to let the Soviets create a mineshaft gap!”

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