REMARKS BY VICE PRESIDENT JOSEPH BIDEN AT THE FIRST MEETING OF THE MIDDLE CLASS TASK FORCE
REMARKS BY JOHN PODESTA, PRESIDENT & CEO, CENTER FOR AMERICAN PROGRESS
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VICE PRESIDENT BIDEN: (In progress.) Once again, speaking of Cabinet secretaries, I predict to you, one of the most impressive voices you're going to hear over the next four years is the secretary of Education. I referenced him informally, but I should formally reference him: the secretary of Education, Arne Duncan, who is here to my right. (Applause.)
And as the congressman pointed out, the person who is the engine behind our entire domestic policy here is Melody Barnes, who is here at the end, and I welcome her. (Applause.)
Folks, our first panel is made up of three very distinguished Americans: John Podesta is the president and chief executive officer of the Center for American Progress; he's going to outline a national strategy on how to rebuild the middle class on a foundation of climate solutions and clean energy. And then we're going to hear from Van Jones, the president and founder of Green For All, who will talk about how to connect people to opportunities in the green economy through training them. And then we're going to hear from Fred Krupp, and Fred is president of the Environmental Defense Fund, an outfit I've worked with in my years in the Senate, who will unveil a new website that provides an interactive map of key industries across the country with the potential for growth as a result of investment in clean energy.
And speaking of websites, I remind -- some of this is being televised -- that our website is "AStrongMiddleClass.gov." We've had a great number of Americans contact us with good ideas. And I'm going to conclude -- when we conclude, I'll reiterate this, but we're looking for input, input from all Americans as to ideas they have as to how we can best utilize the opportunity we have now.
But let me begin now, and yield the floor to -- to John Podesta.
MR. PODESTA: Thank you, Mr. Vice President and members of the task force, for inviting me to speak. It's a great honor to be with you and with your colleagues from the Congress.
I want to address three points in my remarks today.
First, I want to talk about green jobs broadly and why they're important to a strong middle class. Second, I'd like to discuss the particular opportunity presented by energy efficiency, as you saw this morning. And finally, I want to give you a few ideas about how we can get started today on a national project to support green jobs at the great scale that we need in this country, drawing on what's already working around the country.
Our energy and climate challenges offer us an opportunity to invest in new infrastructure, new buildings, new business models and new skills for American workers. I call this the "energy opportunity." We always talk about the energy crisis. I think there's really an energy opportunity here.
Just as the information technology and telecommunications revolutions of the 1980s and 1990s drove a generation of innovation and investment, the transformation of energy infrastructure on the platform of efficiency and reduced carbon emissions represents a great potential driver of American innovation, economic growth and job creation as well as wage growth, so important to this task force in the coming decades. The United States must lead this revolution, as Senator Casey suggested.
In the new energy economy, highly efficient vehicles will dominate the roadways, service stations will pump low-carbon fuels and buildings will use daylight, solar heating and cooling, and efficient appliances. In this economy, utility companies will profit when customers save energy. A quarter of electricity will come from renewable sources on a bigger, better, smarter electricity grid.
Today's focus on green jobs can help us understand the work of building that new economy that we so desperately need. A CAP study on the green recovery found that investing in energy efficiency and renewable energy creates more jobs than traditional stimulus and more jobs than investing in traditional fossil fuels. Green investments are more labor intensive; they're more local; redirecting money from imported fuel, pollution and wasted energy instead to skilled labor, modern infrastructure and high-tech manufacturing. Last year, we spent $450 billion importing oil. Green jobs can improve our national security while reducing our trade deficit.
These are familiar jobs. There's nothing fancy about green jobs. They're in engineering and construction and manufacturing and in services. And they're spread broadly, as Fred will describe, across the country.
But as you look to strengthen and expand the middle class, remember that green jobs are not inevitably good jobs with decent wages and benefits. Federal money alone is not enough. Another report that we recently issued cautions that too many companies that receive federal contracts treat workers poorly and fail to pay adequate wages or benefits. More than 4 million federally contracted workers are low wage earners with no benefits.
To make sure that green jobs are good jobs, we need transparency, we need oversight, we need enforcement of the law and job quality standards. The great American middle class was not an accident. It was the direct result of rules that protect workers, strengthen communities and invest in skills and training. And the whole Cabinet has a role to play, but particularly our great new secretary of Labor, Hilda Solis, in protecting those things.
Building this new economy will create a range of green jobs, constructing transit, rewiring the grid, growing new -- next- generation energy crops and rolling steel for windmill towers. But I want to focus on the specific opportunity of energy efficiency, particularly if I can make this work.
Buildings create more greenhouse-gas emissions than cars or industry, and most energy is used in homes. New building codes are critical. But as you saw this morning, we need a strategy to retrofit buildings that are already standing, to cut energy use and emissions.
Energy efficiency is often called the first fuel. The cheapest and cleanest energy is the energy you never have to use. This chart shows the relative cost of different forms of energy and how they change over time, particularly with a rising price for carbon. When we finally take action to cap emissions to fight global-warming pollution, as the president has called for, energy efficiency will make it cheaper and the benefit will only grow.
Energy efficiency is a good investment with -- particularly today, with tight credit markets. This graph shows the relative risk and return of those investments. Treasury bills are low risk and low return. Small-company stocks are high risk and high return. Energy efficiency offers high returns at very low risk.
Global warming is perhaps the biggest market failure in history. This has now become, in the energy circles, a familiar chart that the McKinsey Global Institute did. It arrays the costs of different ways to cut carbon. At the far end is energy efficiency. Below the line are what McKinsey refers to as negative cost abatement strategies. In the business world, negative cost abatement is more commonly referred to as profit. We are retooling -- we are routinely passing up these profitable efficiency gains because our market structure's not working.
And finally, this last chart shows the impact of energy costs on household budgets. Over half of working families' paychecks go to housing, transportation and energies. Families spend more on energy than they do on health care. With millions of people on the edge of losing their homes, cutting energy costs can help the middle class as well as putting people back to work.
That brings us to what we can do today. It will take a national commitment to bring energy efficiency to scale, block by block, neighborhood by neighborhood, city by city. And it'll take access to capital, new training for workers and new incentive (sic) for homeowners.
This is a bold project. The American Recovery and Reinvestment Act makes a gigantic down payment, with $71 billion for clean-energy programs and $20 billion more for energy tax credits, more than three times the current spending.
Public investment can prime the pump, but it's not enough. We need to transform the entire market. Weatherization programs now retrofit about 150,000 homes a year. President Obama has called for 1 million homes, and there's the money in this bill to do that. That's a daunting challenge, to scale up this much this fast. But we have 138 million homes in this country; 75 percent need to be retrofitted. And even at the fast rate that the president's called for, it's going to take us 100 years to retrofit America. So our boldest goals may not be bold enough to meet this challenge.
We can't just settle for investments in public buildings and low- income housing. The money has to be used to transform the entire market. There are good examples in cities and states that showcase pieces of what it'll take. These include the Cambridge Energy Alliance, who offer customers immediate retrofits of 30 percent energy savings with no out-of-pocket payments. In Babylon, New York, they use a revolving loan fund to refinance retrofits, repaid with energy savings that the city collects on monthly bills.
In Delaware, a sustainable-energy utility can meet energy needs not by building new power plants but by aggregating the weatherization of homes and creating a market not only for retrofits but for the verifiable energy savings they produce. And in Los Angeles, the city is retrofitting public buildings to drive worker training and connect people to new green jobs.
A seamless, large-scale national program could follow that -- lead these local efforts to drive dedicated financing resources to reduce out-of-pocket payments, to build sustainable-energy service companies and to link repayment to energy-cost savings.
The American Recovery and Reinvestment Act provides essential resources that, if coordinated, could lay the groundwork for a coherent national program to meet these goals.
We've got a few ideas about how to manage that money at the center. To consider -- we offer to you to consider encouraging states to use a portion of energy-efficiency funds in the recovery package to establish state revolving loan funds for energy retrofits that would drive new investment and create a sustained mechanism to finance real estate projects on into the future. I'd also urge you to coordinate green-job training with other energy spending, including the $500 million for green job acts that Congresswoman Solis sponsored in the Congress. Other funds for green-job training are found throughout this package, so tight coordination is really critical.
And finally, because these ideas have been tested successfully in communities, I think I would urge that you consider putting together the best mayors and governors in the country, who have led the way to try to work with you to give some ideas and guidance to help other states and cities transform their labor, energy, real estate and financial markets to create green jobs.
Lastly, I'd urge you to establish an interagency working group of senior staff to identify and track the funding streams that contribute to a green recovery, and then report back to you on this task force on a regular basis. The nation's at a critical turning point, and I think that the decisions you're making in the coming months will have long-lasting effects on the shape of our recovery. So again, I thank you for the opportunity to be here, and thank you for all the work that you're doing to make this a reality. (Applause.)
VICE PRESIDENT BIDEN: Thank you, John.