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America’s “Sputnik Moment”

by Richard T. Stuebi

An increasing chorus of compelling voices – such as Thomas Friedman and Bill Gates and Jeff Immelt — has been arguing with strengthening force that the U.S. needs to dramatically up its ante in energy technology advancement – not only to address our own future energy needs in an economically and environmentally sustainable way, but also to secure a place for the U.S. in the energy industry of the future, given the massive investments being made by China and Europe in next-generation energy.

In a recent report, the President’s Council of Advisers on Science and Technology (PCAST) weighed in on this topic, urging to President Obama a tripling of energy RD&D from $5 billion annually to $16 billion annually, noting that the $11 billion increase could be funded by small increases in gasoline taxes or transmission “wheeling” charges for coal-fired electricity that would be “well within the normal fluctuations in price seen by consumers”.

The issue seems to be pretty well understood within the Obama Administration itself.  In a late November speech, DOE Secretary Steven Chu used the Sputnik analogy as a call to action for the U.S.:  when the U.S.S.R. launched the first satellite, Sputnik, “the U.S. woke up” and took action to reclaim leadership in the space race.  The implication:  we need some kind of “Sputnik moment” here in the U.S. to truly get serious about the imperatives and opportunities in clean energy technologies.

Well, judged by some of the early dismal U.S. efforts to launch rockets in the wake of Sputnik, I would argue that the U.S. has unfortunately shown a similar response so far to the global race for advanced energy:  much sound and fury, signifying little.  It would be nice for us to get our act together on energy technologies as quickly as NASA did in rocketry fifty years ago, but as I’ve argued in the past (unpopularly within the cleantech community), the space race is not a good analogy for the cleantech race:  unlike space, there is no one top-down customer/agency like NASA that controls all things in energy.

So the “Sputnik moment” quip can only take us so far.  If we can indeed wake up and enact meaningful policies that provide adequate economic/financial signals and incentives to drive the private sector to invest much more heavily in energy technology R&D and commercialization, then the U.S. retains a great chance to catch up to the leaders (up till now in Europe, but increasingly overtaken by China).  Otherwise, while we might make good strides in certain niches, the U.S. will be lapped in the overall cleantech contest, and we’ll have lost the biggest industrial game of the 21st Century.

As the American Economic Association concluded last week in Denver at its annual meeting, the consensus of economists was that the prospects for U.S. economic decline are substantial.  A reversal of fortune of this magnitude will not be achieved without some major changes.  Why not attempt to regain U.S. greatness by aiming to reinvent the biggest sector of the world’s economy?  After all, we need to anyway.