ss cover - cegn · the american prospect a3 green economy l ess than 200 years ago, industrializing...

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special report special report april 2006 With articles by David Morris Pete Myers • Sen. Barack Obama Tom Daschle • Bracken Hendricks Michael Lerner • Gayle Smith Chris Mooney • Merrill Goozner and more … After OIL The economic and political promise of a post-petroleum society With articles by David Morris Pete Myers • Sen. Barack Obama Tom Daschle • Bracken Hendricks Michael Lerner • Gayle Smith Chris Mooney • Merrill Goozner and more … The economic and political promise of a post-petroleum society After OIL

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s p ec i a l r e p o rts p ec i a l r e p o rtapril 2006

With articles by David MorrisPete Myers • Sen. Barack Obama Tom Daschle • Bracken HendricksMichael Lerner • Gayle Smith Chris Mooney • Merrill Gooznerand more …

AfterOIL

The economic andpolitical promise of apost-petroleum society

With articles by David MorrisPete Myers • Sen. Barack Obama Tom Daschle • Bracken HendricksMichael Lerner • Gayle Smith Chris Mooney • Merrill Gooznerand more …

The economic andpolitical promise of apost-petroleum society

AfterOIL

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special report green economy

The inexorable advance of climate change and concernsabout oil dependency have put renewable energy back on thepublic agenda. Finally, a “green economy” based on excitinginnovations in agricultural technology could reduce ourthirst for oil, reverse environmental destruction—andrevive rural America and its populist politics.

A3 The Once and Future Carbohydrate EconomySubstituting living plants for fossil fuels could trans-form energy security, the environment, world trade,and U.S. politics. Are we ready to do it right? By David Morris

A8 A New Prairie Populism How renewable energy can transform heartlandpolitics and economics By Bracken Hendricks

A12 Fueling the FutureA progressive vision for America’s auto industry By Senator Barack Obama

A13 Good Genes Gone BadThe new public health reflects our understanding of how environmental contaminants harm genes.New genetic science offers new hope. By Pete Myers

A17 Follow the FarmersBuilding a sustainable economic future fromAmerica’s heartland By Tom Daschle

A18 Building GreenDeveloper Jonathan Rose discusses green construc-tion with Robert Kuttner.

A20 Merrill Goozner on the need for government leader-ship; Richard Heinberg on the looming threat ofglobal oil depletion; Chris Mooney on the promise ofthe new green chemistry; Christopher D. Cook onensuring that small farmers reap rewards of a farm-based energy policy; Ezra Klein on Europe’s leader-ship on smart environmental policies; Gayle Smithon an agenda to unite farmers at home and in theworld’s poorest reaches; and Michael Lerner on thegreen economy as a new global ethic.

We gratefully acknowledge the support of the Wallace Global Fund, which made this special report possible. Special thanks to Nelson Harvey for research assistance.

Cover illustration by McDavid Henderson

FOUNDING CO-EDITORS Robert Kuttner, Paul StarrCO-FOUNDER Robert B. Reich

EDITOR Michael TomaskyDEPUTY EDITOR Sarah BlustainINVESTIGATIVE EDITOR Joe ConasonMANAGING EDITOR Erin PressleyEDITOR-AT-LARGE Harold MeyersonART DIRECTOR Aaron MoralesSENIOR EDITOR/WEB EDITOR Tara McKelveyPOLICY EDITOR Dorian FriedmanSENIOR EDITOR Garance Franke-RutaSTAFF WRITERS Sam Rosenfeld, Matthew YglesiasASSISTANT MANAGING EDITOR Melissa ThompsonASSISTANT WEB EDITOR Alec OveisWRITING FELLOWS Mark Leon Goldberg, Ezra KleinINTERNS Ulrik Gade, Nelson Harvey, Jared Irmas, Erica Lipper, ElizabethSpellmire, Natasha WilliamsSENIOR CORRESPONDENTS Ann Crittenden, Barbara T. Dreyfuss, RobertDreyfuss, James Fallows, Gershom Gorenberg, E.J. Graff, Mark Greif, John B.Judis, Chris Mooney, Joseph Rosenbloom, Richard Rothstein, Laura Rozen,Peter Schrag, Noy Thrupkaew, Sarah WildmanCONTRIBUTING EDITORS Marcia Angell, Alan Brinkley, Jonathan Cohn, JeffFaux, Merrill Goozner, Arlie Hochschild, Christopher Jencks, RandallKennedy, Robert S. McIntyre, Alicia H. Munnell, Karen M. Paget, AlejandroPortes, Jedediah Purdy, Robert D. Putnam, Samantha Sanchez, Deborah A.Stone, Cass R. Sunstein, William Julius Wilson

PRESIDENT/PUBLISHER Diane Straus TuckerASSOCIATE PUBLISHER Robin HutsonCONTROLLER Barbara SaundersDIRECTOR OF DEVELOPMENT Judy WhiteMARKETING MANAGER DJ FrancisPUBLISHING ASSOCIATE Sarah GurfeinDEVELOPMENT ASSISTANT Rachel FlankPUBLISHING ASSISTANT Matthew GrondinIT DIRECTOR AND WEB MASTER Jocelyne YourougouACCOUNTING MANAGER Tim O’BrienCIRCULATION CONSULTANTS ProCirc, Cary Zel, Director; Susi Chapman, Manager

FOUNDING SPONSORS Kenneth J. Arrow, Daniel Bell, Kenneth B. Clark, Marian Wright Edelman, John Kenneth Galbraith, SidneyHarman, Irving Harris, Albert O. Hirschman, Harry Kahn, Charles Lindblom,Arthur M. Schlesinger, Jr., Fritz Stern, James TobinBOARD OF DIRECTORS Ben Taylor, ChairmanMaria Echaveste, Danny Goldberg, Jehmu Greene, Christopher Jencks,Michael J. Johnston, Randall Kennedy, Robert Kuttner, Richard C. Leone,Nancy Mills, Robert B. Reich, Adele Simmons, Paul Starr

ADVERTISING SALES Sarah Gurfein, (202) 776-0730SUBSCRIPTION CUSTOMER SERVICE 1-888-MUST-READ (687-8732)

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MEDIA RELATIONS Dorian Friedman, (202) 776-0730

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Less than 200 years ago, industrializing so-cieties were carbohydrate economies. In 1820,Americans used two tons of vegetables for everyone ton of minerals. Plants were the primary rawmaterial in the production of dyes, chemicals,

paints, inks, solvents, construction materials, even energy.For the next 125 years, hydrocarbon and carbohydrate bat-

tled for industrial supremacy. Coal gases fueled the world’s firsturban lighting systems. Coal tars ushered in the synthetic dyesindustries. Cotton and wood pulp provided the world’s firstplastics and synthetic textiles. In 1860, corn-derived ethanol wasa best-selling industrial chemical, and as late as 1870, wood pro-vided 70 percent of the nation’s energy.

The first plastic was a bioplastic. In the mid-19th century, aBritish billiard ball company determined that at the rate Africanelephants were being killed, the supply of ivory could soon beexhausted. The firm offered a handsome prize for a product withproperties similar to ivory, yet derived from a more abundantraw material. Two New Jersey printers, John and Isaiah Hyatt,won the prize for a cotton-derived product dubbed collodion.

Ironically, collodion never made it as a billiard ball: Theplastic, whose scientific name is cellulose nitrate, is more pop-ularly known as guncotton, a mild explosive. When a rack ofcellulose nitrate pool balls was broken, a loud pop often re-sulted. Confusion and casualties ensued in saloons where pa-trons were not only drinking but sometimes armed.

People did find other uses for collodion, however, in den-tures and buttons. Later, a new cotton-based plastic called cel-luloid spawned consumer photography. To this day, many inHollywood still call their films celluloids, although StevenSpielberg may not remember why.

At the end of the 19th century the names of chemical com-panies and products often contained a form of the word cel-

lulose, a living chemical consisting of a long string of carbonand hydrogen and oxygen molecules (thus the word carbohy-drate). The name of one of the country’s largest chemical man-ufacturers, Celanese Corporation, was a contraction of“cellulose” and “the easy feeling” of wearing acetate apparel.After celluloid, cellophane, the world’s first film plastic, wasintroduced to instant success.

By 1920, however, the nation had reversed the vegetable-mineral ratio, using two tons of minerals for every one ton ofvegetables. Coal displaced wood for energy. Gasoline-poweredcars roamed the streets. Yet outside the nation’s energy mar-kets, living carbon still held its own against fossilized or deadcarbon. Rayon, made from wood pulp, was the world’s best-selling synthetic fiber. The first injection molding machines inthe 1930s made plastic products from cellulose acetate.

The Great Depression, the collapse of international trade,and then World War II spawned a worldwide effort to replaceimports with domestically produced products. Brazilians madeplastics from coffee beans, Italians made fine suits from milkprotein, and by the 1940s, four million vehicles in Europeancountries were operating on ethanol blends of up to 33 percent.Arthur D. Little wowed and charmed the world by literallymaking a silk purse from a sow’s ear.

In 1941, when Japan cut off access to Asia’s rubber plantations,the United States launched a crash synthetic rubber program.Washington drafted into service both the nation’s oil refineriesand breweries. In 1943, most of America’s synthetic rubber wasmade from ethanol. By 1945, the United States produced over 600million gallons of ethanol, a level not again attained until themid-1980s. A small amount of ethanol was made from wood.

Up until the end of World War II, some companies werestill hedging their bets on the material base of the future chem-ical industry. In 1945, the large British chemical manufacturer

The Once and Future Carbohydrate EconomyBY DAVID MORRIS

high oil prices, energy security concerns, and a growingawareness of climate change have put the prospect of a carbohydrateeconomy back on the public agenda. The successful substitution ofliving plants for fossilized plants would profoundly and positivelyinfluence the future of agriculture, the environment, world trade, andenergy security. Whether the result will truly benefit farmers, theworld economy, and the natural environment depends on the natureof the policies we design to achieve that transformation.

ments, like sulfur and mercury. As an environmental move-ment emerged and as governments began to regulate thesepollutants, the cost of using hydrocarbons rose to reflect theirtrue environmental cost, and biofuels and products becamemore competitive.

As a clean air measure, for example, the federal governmentrequired oxygenates in gasoline. That created a large market foroxygen-containing additives like ethanol. Regulations reduc-ing sulfur levels in diesel helped open up a market for biodiesel.When governments required degradable plastics, bioplastics be-came more competitive. When phosphates in detergents wererestricted, enzyme markets expanded.

The third factor was the rising price of oil and natural gas.In 1970, the price of crude oil was $1.80 per barrel. The pricesoared to $34 a barrel in 1982, and then fluctuated between $10a barrel and $30 a barrel for the next 20 years. Finally, in 2005,high oil and natural gas prices seemed here to stay, a result ofthe rising cost of producing oil and the risk premium an un-stable Middle East imposed on oil markets.

With oil at $50 a barrel, many biochemicals have becomeflat out competitive with petrochemicals. At $60 a barrel,ethanol derived from corn is competitive without subsidies.

These three factors made a significant market for bioprod-ucts possible. They did not make their use inevitable. Remem-ber, bioproducts must invade markets long controlled by the oiland petrochemical industry. In many cases, bioproducts actu-ally need their competitors’ permission to enter these markets.

Consider the instructive history of fuel ethanol.After World War I, car companies introduced high-

compression engines. Existing fuels caused knocking, a resultof uneven combustion. The industry feverishly sought an anti-knock additive. Ultimately, it narrowed the choice to two:ethanol or lead. Ethanol would require 10 percent of the gastank. To achieve the same effect, lead needed less than 1 per-cent. The car companies, unsurprisingly, chose lead, and stuckto it even after outcries from the public health community aboutthe effects of leaded gasoline.

In the 1970s, as part of its air quality efforts, the Environ-mental Protection Agency phased out leaded gasoline. Oil com-panies again could have substituted ethanol. Instead they choseto reformulate gasoline to increase the proportion of aromaticchemicals like benzene, toluene, and xylene. Then, in the late1980s, the nation discovered these chemicals were carcino-genic and imposed limits on their use. The oil companies againcould have switched to ethanol. Instead they chose mtbe, aproduct made from natural gas–derived methanol and isobuty-lene, a byproduct of the refinery process.

In the late 1990s, the nation discovered that mtbe was pol-luting ground water. Nineteen states began to phase out mtbe.So long as the Clean Air Act’s oxygenate requirement remained,highly polluted urban areas had only one alternative: ethanol.The phase out of mtbe is the primary reason U.S. fuel ethanolconsumption has doubled in the last three years.

Regrettably, this does not necessarily mean the market isembracing biofuel. Beginning in 1999, California petitioned the

ici still maintained three divisions: one based on coal, one onpetroleum, and one on molasses.

Meanwhile, the carbohydrate economy was featured in thepopular press and newsreels, reporting on such sensational de-velopments as Henry Ford’s biological car. The body of the 1941demonstration vehicle consisted of a variety of plant fibers, in-cluding hemp. The dashboard, wheel, and seat covers weremade from soy protein. The tires were made from goldenrods,bred by Thomas Edison on his urban farm in Fort Myers,Florida. The tank was filled with corn-derived ethanol.

The next time you watch the obligatory Christmas showingof It’s a Wonderful Life, pay close attention to this scene: JimmyStewart is on the phone with his brother, who excitedly pro-claims he is going to be rich because he is on the ground floorof the next major industry, soybean-derived plastics!

Yet only 25 years later, movie audiences hear Dustin Hoff-man in The Graduate ask an older man for career advice. Theman responds with one word, “plastics,” and everyone in the au-dience knows he means petroleum-derived plastics.

In a quarter of a century, the carbohydrate economy hadvirtually disappeared, a victim of remarkably low crude oilprices (the price dropped to under $1 a barrel in the late 1940s)and rapid advances in making an ever-wider variety of low-cost products from crude oil. American farmers didn’t mind;the Marshall Plan alleviated the 20-year-old agricultural depres-sion by creating a large export market for U.S. surplus crops.

By 1975, not a drop of ethanol was in our nation’s gas tanks.Indeed, industrial ethanol was made from petroleum. Bioplasticsdisappeared. Mineral oil inks replaced vegetable oil inks. Ameri-cans used eight tons of minerals for every one ton of vegetables.

the pendulum swings backBeginning in the 1970s, the carbohydrate economy slowly beganto reemerge, the result of three mutually reinforcing trends.

The first was technological. Advances in the biological sci-ences lowered the cost of making bioproducts. At first, entre-preneurs focused on high-priced and low-volume markets, likemedicines and medical equipment. As production expanded andfirms moved down the learning curve, costs dropped and largermarkets opened up.

In the 1980s, for example, polylactic acid (pla), a chemicalderived from milk sugar (lactose), was used to make a suturethat could be absorbed inside the body. The cost was high, some$200 per pound, but only an ounce or less was used in the sur-gery. By the late 1990s, the price of pla, now made from lessexpensive corn sugar (fructose), had fallen to about a dollar apound. pla is increasingly competitive with petrochemicals foruse as a textile, in car bodies, and in containers.

The second factor was political. Fossil fuels are attractive be-cause, under great pressure over eons, the oxygen contained inliving material was squeezed out (hence the name hydrocarbon),leaving a very dense energy source. One pound of coal containsthe same amount of energy as four pounds of wood.

However, the same geological pressure that squeezed outoxygen squeezed in several unnatural and unwelcome ele-

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federal government to exempt it from theoxygenate requirement. The oil compa-nies, not surprisingly, liked this idea, andpromised to formulate a gasoline thatcould meet all performance standardswithout compromising public health. LastAugust, the federal government eliminatedthe oxygenate requirement. California Sen-ator Dianne Feinstein, the leader of theanti-ethanol fight, exulted. Instead of using5.7 percent ethanol blends, Californiacould now revert to a gasoline composed100 percent of fossil fuels.

There’s an old saying: Fool me once,shame on you. Fool me twice, shame onme. To which I would add: Fool me fourtimes, I’m an idiot.

Despite the rocky road traveled by bio-fuels, it appears that they are now here tostay. Production has doubled in the lasttwo years and may double again in thenext three years. In Brazil, ethanol nowconstitutes 40 percent of all automobilefuel; 80 percent of new cars are flexiblefueled cars, capable of using any propor-tion of ethanol and gasoline.

Half a dozen countries now mandatebiofuels; a dozen more may soon. DuPontis developing a carbohydrate-based divi-sion. Vegetable oils have displaced 40percent of black inks in newspapers. Hy-draulic fluids increasingly are made fromvegetable oils, not mineral oils. Bioplas-tics are here.

fashioning the rulesFor the first time in 60 years, the carbohydrate economy is backon the public-policy agenda. We may be changing the very ma-terial foundation of industrial economies. Whether and how weaffect that change can profoundly affect the future of our natu-ral environment, our rural economies, agriculture, and worldtrade. It is an exciting historical opportunity, but one we shouldapproach with deliberation and foresight.

As we design new rules we should keep in mind several keypoints:

• First, plants must play an important industrial role if weare to achieve a sustainable, renewable economy.

Plant-based energy sources and materials, often termed bio-mass, boast two essential features not found in other renewableresources, like geothermal, hydro, wind, sunlight. Biomass canbe made into physical products and comes with built-in storage.

Wind and sunlight are intermittent. To count on them, wewould need a way to store them. Plants are, in effect, batteriesof stored chemical energy.

Wind and sunlight can be harnessed only to produce somemc

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forms of energy—heat, mechanical, electrical. Biomass can beused to make physical products. Thus biomass, but not windor sunlight, can substitute for petrochemicals.

• Second, we need to pay attention to farmers.The wind blows regardless of public policy. Policymakers can

focus on developing effective harvesting technologies. But agri-culture requires the enthusiastic participation of cultivators—farmers. Unless the farmers have the economic incentive, biomassenergy and materials will not appear in significant quantities.

• Third, a carbohydrate economy could have grave environ-mental consequences.

Unlike most other renewable resources, biomass can be cul-tivated, harvested, and processed in nonsustainable ways. Soilerosion, fertilizer and pesticide runoff, and industrial pollutionall can result from biomass inappropriately grown and processed.Public policy also needs to ensure that, when using biomass by-products such as cornstalks and wheat straw, farmland is not de-nuded of nutrients that nature needs to regenerate the land.

• Fourth, unlike other renewable resources, agriculture can

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satisfy a wide array of needs: food, fuel, clothing, construction,paper, and chemicals.

Policymakers must be careful if they introduce incentivesthat favor energy over other end uses of farming. In the hierar-chy of uses of agriculture, food is still the highest and best use.And there may be other uses more valuable than making energy.

In the late 1970s and early 1980s, Congress subsidizedgarbage incinerators that generated electricity. Then we foundthat more fossil fuels could be displaced, at a lower cost, andwith a more positive environmental impact, by recycling thepaper and composting the grass and leaves.

Another case of misguided subsidy: Congress and the stateof Minnesota recently offered handsome incentives for the gen-eration of electricity from poultry manure. They overlookedthe fact that it is a dry manure, high in nitrogen and inexpen-sive to transport, and an increasingly attractive substitute fornatural gas-derived fertilizers. In Minnesota, most poultrymanure is currently sold to farmers. But by the end of 2007,because of the new incentives, more than half the dry manuregenerated in the state will be diverted into making electricity,forcing farmers to look for fertilizer substitutes. Ironically, the

fastest growing segment of agriculture is now organic foods,which cannot be grown using synthetic fertilizers.

• Fifth, biomass is not a silver energy bullet.But it can play a crucial role in reducing our reliance on oil.Worldwide, tens of billions of tons of biomass potentially are

available for making chemicals and fuels. But we will needevery one of those billions to meet even a minor portion of ourfuture needs. Overall, biomass may satisfy 10 to 15 percent ofour future energy needs. But it can displace a more significantpart of our transportation fuels and an even more significantpart of our oil fuels.

In the United States, about 60 percent of our oil is used fortransportation. (An additional 15 to 18 percent is used to makepetrochemicals.) Biofuels’ compactness and relative ease oftransport make them attractive transportation fuels.

Su∞cient biomass exists to potentially displace 100 percentof our petrochemicals and 50 to 100 percent of our oil-basedtransportation fuels.

• Sixth, even in transportation, biomass will be the minorpartner in a dual-fueled strategy.

The most e∞cient and environmentally benign transportationsystem will be powered primarily by electricity. Electric vehiclesget over 100 miles per gallon. Unlike today’s hybrid cars, whichare internal combustion engine vehicles with a motor assist, to-morrow’s plug-in hybrid cars will charge their batteries from theelectricity system and become electric cars with an engine backup.

Between 50 percent and 100 percent of the vehicle’s motive

power will come from electricity. Su∞cient biomass exists in thissituation to provide 100 percent of the biofuels needed by thebackup engine.

• Seventh, a carbohydrate economy will have a profoundimpact on agriculture and world trade.

The carbohydrate economy may have a far more profoundimpact on agriculture than on energy. Biomass may satisfyonly a small part of our energy needs. But the additionalamount required will be enormous, perhaps tripling the totalamount of plant matter currently used for all purposes (food,feed, textiles, construction, paper). Thousands, perhaps tensof thousands, of biorefineries producing a variety of final prod-ucts will dot rural landscapes.

Public policies to date have focused on expanding the use ofbiofuels. We need to pay as much attention to quality as we doon quantity. What do we want the new carbohydrate economyto look like? Aside from oil displacement, what are our long-term objectives, and our strategy for achieving them?

farmers and local ownershipMore than a century of bitter experience has taught farmers that

when they simply sell a raw crop, theyfall ever further behind. Farmers receiveabout the same price for their crops todayas they did 30 years ago, while the cost offarm inputs has more than doubled.

In 1970, a bushel of corn could pur-chase about five and a half gallons of

gasoline. Today, a bushel of corn is worth only three-quartersof a gallon of gasoline.

About 30 years ago, farmers reinvented the producer coop-erative, a business structure in which farmers own the process-ing and manufacturing links in the value-added chain. Thebirth of the first modern producer cooperatives occurred in the1970s: Minnesota and North Dakota sugar beet farmers learnedthat the area’s sole sugar beet processing plant would close,leaving them little market for their crop.

The farmers pooled their financial resources and boughtthe plant. The price of sugar soared. The sugar beet growersmade a great deal of money. And in America, financial suc-cess begets imitation.

Other producer cooperatives emerged, slowly in the late1980s and early 1990s, and then with increasing speed in thelate 1990s and early years of the 21st century. Recently, the tra-ditional cooperative has been joined by a new business form,the limited liability corporation.

Farmers today make substantial and ongoing investmentsin land and equipment. In the last decade they’ve discoveredinvesting in a factory can be more financially rewarding thaninvesting in land or equipment.

Iowa State University (isu) estimates the five-year averageafter-tax return for an ethanol dry mill at 23 percent. On theother hand, 70 percent of Iowa’s counties averaged returns onfarmland of 2.5 percent or less.

Farmers who own the factory benefit far more from increas-

The carbohydrate economy could transform agriculture

as well as energy, reviving producer co-ops, and giving

farmers a hedge against voilatile commodity prices.

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ing ethanol demand than those who do not. Increased ethanolconsumption over the last 25 years may have raised the over-all price of corn by 10 to 15 cents per bushel. Farmer-ownersreceive annual dividends four, five, even 10 times higher.

Farmer-owned biorefineries also serve as a hedge for farm-ers against volatile commodity prices. When corn prices de-cline, production costs of ethanol also decline. At least a portionof the income lost on the sale of the raw material can be re-couped from the increased profits from the sale of ethanol.

Farmer ownership also benefits the broader rural commu-nity. An oil refinery gets its raw material from out of the state,perhaps from outside the country. A biorefinery usually pur-chases its raw material within 50 to 100 miles of the facility.

Moreover, virtually all the oil refinery’s profits leave the statefor distant corporate headquarters and even more distant share-holders. Farmer- or local-owned biorefineries retain virtuallyall of the profits inside the state.

Consider Minnesota. For every dollar spent on ethanol in thestate—assuming the ethanol is produced in-state in a farmer-owned biorefinery—some 75 percent stays in the state economy.For every dollar spent on gasoline, some 75 percent leaves thestate economy. This equation makes biorefineries a powerfuleconomic development vehicle.

How can we encourage farmer- and local-owned biorefiner-ies? Here again, Minnesota’s record is instructive. In the early1980s, Minnesota’s ethanol incentive mirrored that of the fed-eral government by exempting ethanol sold in the state from aportion of the state gas tax.

The incentive worked. Minnesotans purchased ethanol-blended gasoline. But Minnesota didn’t produce the ethanol.In the mid-1980s, farmers persuaded the legislature that pub-lic subsidies could more clearly benefit the state economy.

The legislature converted part of the tax exemption into adirect producer payment. The new incentive had three impor-tant features:1. Production had to occur inside the state.2. The biorefinery could receive payments only for the first 15

million gallons of ethanol produced each year. This encour-aged smaller facilities, which in turn enabled farmer andlocal ownership.

3. An individual plant could receive the incentive only for 10 years. It would not become a continual drain on publicresources.The incentive proved remarkably successful. Today, 12 of

Minnesota’s 16 biorefineries are majority-owned by Minnesotafarmers. Some 25 to 30 percent of Minnesota’s full-time grainfarmers own shares.

We need to redesign the federal incentive with the Min-nesota experience in mind. We could begin by converting halfthe federal incentive of 51 cents per gallon of ethanol into a di-rect payment to the producer. (The other half could be retainedas an excise tax exemption but should be tied to an index com-prised of the price of corn and the price of wholesale gasoline.When the spread between them rises above a certain level, thetax incentive disappears.) A producer could receive payments

for no more than 10 years, and only on the first 20 million gal-lons of annual production.

The federal producer payment could differ from Minnesota’sin two respects. Production would not be required in anyspecific state. And farmer- and/or local-owned biorefinerieswould be favored.

the new brotherhood of the world’s farmersThe carbohydrate economy has the worldwide potential to catalyzea cooperative farmer movement that displaces the traditionalfarmer-versus-farmer battles. Traditionally, the carbohydrate hasbattled other carbohydrates for market share. High-fructose cornsugar versus sugar cane. Brazilian soybeans versus U.S. soybeans.In the future, producers of carbohydrates can cooperate to cap-ture another huge, untapped market: hydrocarbons.

Farmers have been slow to recognize this opportunity. In fact,U.S. agricultural organizations allied themselves with the coaland oil industries to attack the Kyoto treaty. Such an allianceis reasonable if farmers view themselves simply as consumersof fossil fuels. If they view their crops as competitors to fossilfuels, however, opposing Kyoto makes no sense. They shouldenthusiastically embrace treaties to reduce global warming be-cause these treaties invariably impose penalties on the deadcarbon contained in coal and crude oil, while offering rewardsfor the living carbon contained in crops and trees.

Today, agriculture is one of the most contentious issues inworld trade. A carbohydrate economy can reduce and perhapseven eliminate that tension. Rather than Indian and Brazilianand Nigerian farmers fighting for European and American mar-kets, they can sell into vast new domestic energy and industrialmarkets. Indeed, the case for import substitution is even strongerin the south. Most southern countries can buy imports only withhard currencies. They can obtain hard currencies only by increas-ing exports or borrowing from the imf or other banks. Thus, dis-placing oil imports with domestic fuels can reduce their externaldebt while bolstering their rural economies.

W e live in an era of tumultuous change. yetwe should recall Bertrand Russell’s distinction be-tween change and progress. Change, he argued, is

inevitable. Progress is controversial. Change is scientific.Progress is ethical.

We will have change, whether we want it or not. But progresscomes only when we design rules that channel human ingenu-ity and entrepreneurial energy and investment capital towardconstructing a society and an economy compatible with thevalues we hold most dear.

The carbohydrate economy beckons. tap

David Morris is vice president of the Minneapolis andWashington, D.C.–based Institute for Local Self-Reliance anddirects its New Rules Project. He has been an advisor to theenergy departments of Presidents Ford, Carter, Clinton, andGeorge W. Bush. He is the author of The Carbohydrate Econ-omy (1992) and A Better Way (2003).

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A New Prairie PopulismAs clean energy begins to transform economies in America’s

heartland, it creates fertile ground for a new progressive politics.

BY BRACKEN HENDRICKS

Brian schweitzer is an agricultural scien-tist, a gun owner, and a third-generation Mon-tana farmer. He is also a popular Democraticgovernor of a usually conservative “red” state.Schweitzer likes to joke that he has a rule for him-

self: If he stays longer than 24 hours in Washington, D.C., hetakes a bath in tomato juice when he gets home—the classichome remedy for the stench of skunk spray. This is pureSchweitzer. The man is not of the elite, and he is not going tobe pulled away from his roots. But Schweitzer has a powerful,homegrown, progressive vision of America.

In his bid for governor, Schweitzer ran as an unabashedDemocrat in a state with a long Republican tradition, and heran on values: not the narrowly defined moral values of theChristian right, but broadly shared American values of freedom,opportunity, self-reliance, and responsibility to future genera-tions. This stance played out in his treatment of the issues. Onthe environment, rather than accepting the right’s formulationof burdensome federal regulations imposed by coastal tree-hugging elites, he proudly sounded a call to preserve and pro-tect traditional hunting and fishing grounds, guaranteeingaccess for sportsmen and honoring the cherished traditions ofgenerations of Montanans.

But Schweitzer’s real passion is energy and its connectionto economic development. On his desk in Helena you won’tfind stacks of papers; instead, he has vials of oil—safflower,canola, and camelina—and biodiesel made from these Montanacrops. Schweitzer has made alternative energy and smart useof natural resources a centerpiece first of his campaign, and thenof his administration, showcasing how investment in new, clean,and innovative energy can rebuild Montana’s economy, putmoney back into the pockets of his constituents, and createlasting opportunities for Montana farms and businesses.

When Schweitzer took over the statehouse, Montana pro-duced less wind energy than any other state in the union—evenRhode Island and Delaware—yet it ranked among the top forwind potential. Today, he has passed an ambitious renewableenergy law that requires 15 percent of all state electricity, by2015, to come from wind and other clean energy sources. And

he is already more than halfway to meeting that goal—at acheaper price per megawatt than the state’s new traditionalcoal plants. Under his leadership, Montana passed new taxcredits for investment in biodiesel production, and today, thanksto public grants and loans, a plant in Culbertson that oncemade confectionary oil from canola and safflower now turns outbiofuels for the local market at a price below the cost of diesel.For Schweitzer, this is common sense, but it’s also rooted in hislove of the land, his sense of patriotism, and his commitmentto a better future for his state.

In january, when president bush delivered hisState of the Union address, he startled listeners by declar-ing that America is addicted to oil. It took only a only few

seconds in an hour-long address, but it represented a stunningturnabout, however insincere. This was hardly Nixon going toChina, since there was little serious policy follow up. But, asLa Rochefoucauld famously said, hypocrisy is the tribute thatvice pays to virtue. If an oil-man president felt he had to ad-dress, even only symbolically, what so many of his countrymensensed, it was an important coming of age for the goal of a post-petroleum economy.

The costs of our collective oil addiction are hardly news toworking Americans who have been paying more at the pump,nor to security experts who chart the vulnerabilities of oiltankers, pipelines, power plants, and refineries to disruption byterrorist attack, and the excessive influence of oil on America’sgeopolitical goals. Nor was it news to economists who trackour escalating trade deficit, diminishing reserves, and the ever-increasing fuel demand from China and the developing world.But it was a stark indication of just how far and fast the poli-tics of energy, and by extension all of American politics, havebeen changing. Admitting you have a problem is, after all, thefirst step in curing any addiction.

By Superbowl Sunday GM was running commercials fortrucks that run on ethanol, and the auto industry was soften-ing its line on changing fuel technology. And prospects for a bi-partisan oil savings bill in the Senate suddenly seemed a littlebrighter. But these visible signs are really just the tip of a po-

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litical iceberg that has been quietly build-ing for several years. They represent ashift not just on energy policy, but on thepolitics of how we build our economy,where we invest as a society, and whatpublic benefits we as citizens will demandin return for our votes and for our taxes.

Stephanie herseth is southDakota’s lone member of Congress,and the state’s first woman to serve

in the U.S. House. She won her seat in aJune 2004 special election, and immedi-ately defended it in November of that year.Millions of dollars in out-of-state moneyflowed into her Great Plains district. Thestate went easily for Bush by a wide mar-gin; Tom Daschle, the sitting minorityleader of the U.S. Senate, was unseated ina startling upset; and Republicans retainedtheir solid grip on the state legislature.

Yet Herseth, daughter of a local cornfarmer, was elected with deep support. Acenterpiece of her ultimate victory was herunwavering commitment to enacting a re-newable fuels standard to require the useof eight billion gallons of ethanol per year.What could have been a minor policy de-tail was in South Dakota a stand thatshowed the people what she was about andthe agricultural way of life she came from.

She carried the race easily and has be-come a national champion for homegrowndomestic alternatives to oil in Congress,leading the newly formed Rural WorkingGroup in the House, and helping put theissue at the center of the agenda with herDemocratic colleagues. In recent monthsthese bread-and-butter rural issues havebeen advanced by minority leader Nancy Pelosi as the centerpieceof a new Innovation Agenda for America. That farm-state issuesare emerging not only as regional priorities, but as core progres-sive strategies for innovation, national security, and long-term eco-nomic growth, is a seismic shift.

As Herseth says, “South Dakotans’ livelihoods have alwaysbeen deeply tied to the land, and many of us look at biofuels asa last chance to save our way of life. If we can shift from grow-ing food to growing energy to sell all over the world, maybe wecan ensure that the next generation of farmers and ranchers canstay on the family farm and pass it on to their kids. It’s aboutchoice and the ability to live the way we want to live. This is as-pirational: as patriotic Americans, we can be part of the solu-tion to one of the biggest problems facing our country by makingourselves energy independent, and we can preserve our way oflife in the process.”

Two states to the south, kathleen sebelius, thegovernor of Kansas, is favored to win reelection in 2006.As a popular Democrat in Kansas, an epicenter of the

religious right, she is a rising star among Democratic governors.Perhaps not coincidentally, Governor Sebelius has recentlytaken over the helm of the bipartisan Governors’ Ethanol Coali-tion. Governor Sebelius has placed her bets on farm-based en-ergy as a major tool for rebuilding the future of her state’seconomy. As farm incomes have fallen and aerospace jobs havefled for cheaper labor markets, she sees new value-added pro-duction and good manufacturing jobs in the growing calls forenergy independence through ethanol and wind.

Down-ballot, Raj Goyle, challenger for a long-held Repub-lican state legislature seat in Wichita, declares, “Clean energymeans new technology that puts machinists back to work inWichita making rotors and turbines, and it means new rev-

Prairie promise: Could the nation’s solidly red core hold the key to a progressive political revival? Top,county-by-county 2004 presidential election returns. Bottom, regions with crops (namely, cellulosicmaterials) that could yield enough ethanol to replace 25 percent of U.S. gasoline demand by 2025.

Less than 500,000500,001-1,000,0001,000,001-2,500,0002,500,001-6,000,000Above 6,000,000

Cellulosic materials in tons

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enue for farmers supplying electricity and fuel to a nationthat’s nearing an energy crisis.” To Kansans like Sebelius andGoyle, this is just common sense and a smart business deci-sion for America; it’s also good politics.

And it is not just in Republican farm-belt states that pro-gressive leaders are using energy politics to offer a better visionof the economic future. In the swing state of Pennsylvania, Gov-ernor Ed Rendell has passed a far-reaching renewable energylaw that not only committed the commonwealth to significantmarkets for solar and wind, but also brought in the coal indus-try, offering jobs for unionized mine workers cleaning up wastecoal to produce new energy resources. And in another swingstate, New Mexico, Governor Bill Richardson has worked withother Western governors to connect climate change concerns,renewable power, and alternative energy to an ambitious agendafor Western regional economic development. While in the Sen-ate—building on ground first tilled by progressive Democratslike Iowan Tom Harkin and South Dakotan Tom Daschle—a

new generation of Democrats from Barack Obama to HillaryClinton are staking their leadership claims on this issue.

The trend has a Republican flipside, too. Defining a big vi-sion on energy has helped Republican governors in decidedly“blue” Massachusetts, New York, and California show their dif-ference from backward-looking national conservatives, oftenthrough collaboration with Democrats. Governors in these stateshave used ambitious clean energy programs to demonstrateleadership on technology, jobs, security, economic development,and environmental stewardship. By doing so, they have helpedtranscend the bitter polarization of American politics.

There is indeed something stirring in the greatPlains and the Mountain West, in the Sunbelt, the Mid-west farm belt, and the nation’s industrial heartland. In

a country so cleanly split in two between equal and competingpolitical camps, it has become increasingly easy to take forgranted permanent red and blue lines of polarization. But itwould be a mistake to believe our nation is fundamentally di-vided on its essential definition, when under the surface thereis such complex unease and a building potential for rapid re-alignment. A deep hunger for change and meaningful debateis afoot in America today, just beneath the predictable cynicismof politics as usual. And it’s perhaps strongest in red-state Amer-ica, where the economic pain and vulnerability of the presentmoment is most palpable.

You can see the tension in all the polling—the president’sfalling approval rating is coupled with the paradoxical failure of

Democrats to pick up gains; anger over corruption in Congressis pitted against distress over a general coarsening of media cul-ture; frustration with high salaries for corporate ceos is bracedby an equal sense that personal morality and ethics are in de-cline. The old politics just don’t seem to fit. The old battle linesfail to describe the current problems and are hopelessly weak atoffering solutions that are likely to do any good. It is little won-der then, with so little to hope for, and so few champions, thatthe country is starkly divided on how to proceed.

Thomas Frank wrote about this in What’s the Matter withKansas? He put his finger on the political movement of heart-land voters toward tough stands on moral values, and correctlyidentified it as an effort to address a creeping discomfort witha culture and an economic system that’s ever more insecure anduncaring for the fate of average folks. Yet it would be a mistaketo understand this debate as a split between one camp focusedon “moral values” and another offering “economic self-interest.”This view misses the real core of the tension for most voters in

America today. In truth, our economicproblems and our values crises are deeplyintertwined and lead us back to a crisis inour national sense of purpose. The malaiseof rural poverty, a diminishing manufac-turing employment base, and the creep-ing low-road culture of Wal-Mart jobswith discount wages all contribute to thedeepening fear and insecurity driving our

economic, political, and ethical landscape.Instead, Americans are looking for some way to reconcile

their moral concerns with their economic insecurity, to createa vision for the country and the world that they can believe inagain, a vision that offers both prosperity and justice, that makesus all safer, and restores the chance for an ennobling future.What appears today to be two competing ideologies, one redand one blue, one based on moral values and one on populisteconomic theories, instead could just as easily be the sign of onenation searching for deeper answers, waiting to come togetheraround real leadership and a real vision of a future that mar-ries these equally pressing national imperatives, in order tobuild an economy with meaning, compassion, justice, and hope.

The candidate or party that first steps forward to articulatesuch a bold and unifying vision, backed by a strong commit-ment and clear priorities, will really have something to run on,something that can break the Gordian knot of the last fewelections. Rather than making only tactical and cautious playsfor the narrow and vacillating middle, the party that steps for-ward with a dynamic agenda just might find a country everybit as willing to produce a landslide as it has been to cast votesfor paper-thin margins of victory.

L ooking out across the vast divide of today’sred- and blue-state America, it’s important to rememberthat America’s heartland has not always been the center

of conservative thought. It was red-state America that gave birthto the populist movement. A radical agrarian agenda swept like

Heartland progressives like Henry Wallace would have

found the split between economic interest and moral values

incomprehensible. Their vision was rooted in core American

principles of liberty, prosperity, and reward for hard work.

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wildfire out of Texas and across the rural west of Oklahoma,Kansas, and Missouri, mobilized around issues of debt, invest-ment, and giving working farmers an ownership stake in the fu-ture of the nation. Later it was a revolt by heartland progressiveslike Iowan John L. Lewis that gave America an industrial labormovement, coming up with innovations that merged ethics andeconomics, like child labor laws, overtime protection, and theweekend. And it was the heartland instinct to view the economythrough a moral lens that led another Iowan, Henry A. Wallace,to fight for a progressive vision of government that regulated cor-porate abuse in the name of the public interest, that buffered eco-nomic cycles to keep family farmers on their land, and that builta social compact to keep the elderly out of poverty.

Consistently throughout our history, red-state America hasarticulated a deeply moral vision of the American economy,rooted in the practical ethics of working men and women.Often grounded in religious teachings and respect for the valueof work and thrift—and fueled by a deep concern for the com-mon man—these leaders and their movements helped artic-ulate an economic theory that counterposed Wall Street’smarket fundamentalism to Main Street’s need for investment,fair rules, and a level playing field in order to grow a great na-tion out of the wilderness.

The original heartland progressives like Henry Wallace wouldhave found the split between economic self-interest and moralvalues incomprehensible. Theirs was a pragmatic but deeplymoral vision grounded in the long-term self-interest of the na-tion, an economic vision rooted in core American principles ofliberty, widely shared prosperity, reward for hard work, andequality of opportunity. This reform platform had as its bedrocka belief in science and playing by the rules, and it reorganizedAmerican politics and priorities. It was this prairie populism—a mainstream American notion of opportunity and possibility—that created new coalitions and a new base of political power,that linked the interests of farmers and mechanics, grange mem-bers and recent immigrants, around a constantly improving fu-ture unfolding in the crucible of a dynamic American economyfounded on liberty, equality, and justice.

Today, amid the current ferment of political anger and dis-satisfaction, it is possible to discern once again the potential fora similar emerging realignment around a political agenda thatfeatures investment, good government, and the belief inprogress. It is also not surprising that clean energy is at thecenter of this political reframing. For our energy problems haveclear and credible solutions at hand, offering a political programwith hope at its root and the chance to side with the future andto clarify for voters what our leaders stand for.

National polling bears out this potential. A 2005 nationalsurvey by Democracy Corps found 57 percent of U.S. voters“much more likely” to back a candidate who supported anApollo-style crash program to promote clean energy and re-duce dependence on imported oil. That result was strongerthan responses on prescription drugs, health care, pensions,jobs, or the economy, and was beaten only by support for ed-ucation, an issue that also captures our hope for the future. Sim-

ilar findings can be seen in polling by the Renewable Fuels As-sociation, which shows consistent support of 70 percent orhigher across nearly all ages and regions of the country for ex-tending policies that invest in biofuels and alternatives to oil.Furthermore, Democracy Corps polls show that oil companycorruption, like Halliburton’s attempts to influence the federalenergy bill, has a more galvanizing negative reaction than anyother issue tested.

In the current political moment, the move to cleanrenewable energy is that rarest of issues, one that representsnot only good politics but great policy as well. Governor

Schweitzer captures this truth in a story.After a recent speech to a Montana audience, the visiting U.S.

undersecretary of agriculture took questions from the audi-ence. Governor Schweitzer was allowed to pose the first ques-tion. The United States currently spends $6 billion a year tosubsidize the grains we export, Schweitzer began. Farmers thengive 40 percent of the price of their crops to the railroads to shipthe grain to port; multinational corporations then use moreenergy to ship the grain to the Third World to sell it below theproduction costs of subsistence farmers driving them out ofbusiness, Schweitzer continued. We then send boats full of oilback across the ocean, with oil and grain tankers passing eachother somewhere on the high seas. The unloaded oil is thenrefined and shipped back to rural America, where farmers againpick up the cost of freight. With farmers losing their land athome and abroad, energy prices out of control, and new threatsto our security, Schweitzer concluded, shouldn’t we just investthat $6 billion a year in the production of oil seed, help farm-ers own a piece of refineries, and break our addiction to oil?

To which the U.S. undersecretary of agriculture replied:“Next!”

In the year 2000 there was no energy plank in the Democ-ratic platform. It wasn’t seen as a Democratic issue and was ad-dressed only as a subset of the environment in terms of globalwarming and air pollution. In 2004 not only was energy treatedto its own section, it ran as a theme throughout the platform.Freedom from oil was one of the four pillars of the national se-curity plan that dominated the Democrats’ program, clean ande∞cient energy was put forward as a tool for investing in smallbusiness and restoring communities, and the promotion of arenewables industry was a centerpiece of the strategy for re-building America’s manufacturing base.

With the American people feeling increasingly under siege,and our national economy increasingly threadbare, it just mightbe that this country is finally ready for another dose of thatcommonsense prairie populism, and an economy that buildsprosperity by investing in its people. If our leaders don’t get busyserving up a real agenda, it might be that in 2008, it will be thevoters saying, “Next!” tap

Bracken Hendricks is a senior fellow at the Center forAmerican Progress. He was executive director of the ApolloAlliance and served in the Clinton administration.

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into the wider commercial market. Washington can help in important

ways. First, we can reduce the risk of in-vesting by providing loan guarantees andventure capital to entrepreneurs with thebest plans to develop and sell biofuels ona commercial market.

Next, we tell the private sector therewill always be a market for renewablefuels. Let’s ramp up the renewable fuelstandard and create an alternative dieselstandard so that by 2025, 65 billion gal-lons of alternative fuels a year will beblended into the petroleum supply.

Third, every automobile the govern-ment purchases—starting right now—should be a flexible-fuel vehicle. When itbecomes possible in the coming years, weshould also mandate that every govern-ment car is the type of hybrid that youcan plug in to an outlet and recharge.

More broadly, we should then ensurethat, within a decade, every new car sold inAmerica can run on flexible fuel. We canadvance this goal by offering manufactur-ers a $100 tax credit for every flexible-fueltank they install before the decade is up.

As my friend Tom Daschle details inthis report, millions of people driving flex-ible-fuel vehicles don’t even know it. Theauto companies shouldn’t get cafe credit

for making these cars ifthey don’t let buyersknow about them, sothe entire auto industryshould follow GM’s leadand put a yellow gas cap on all flexible fuelvehicles, and notify con-sumers in writing as well.

We have a choice inthis country. We cancontinue down our pathof oil dependence andwatch as foreign compe-

tition kills our auto industry. Or we canhelp the industry transform itself back intothe giant it once was. Eighty years later,Henry Ford’s dream of a future without oilis not only possible, it’s essential. For our en-vironment, our security, and our economy,it’s finally time for America to pursue it. tap

Barack Obama, a Democrat, is the jun-ior U.S. Senator from Illinois.

“The fuel of the future is going to comefrom fruit like that sumach out by theroad, or from apples, weeds, sawdust—almost anything. There is fuel in everybit of vegetable matter that can be fer-mented. There’s enough alcohol in oneyear’s yield of an acre of potatoes to drivethe machinery necessary to cultivate thefields for a hundred years.”

This prescient vision of anAmerica where homegrown biofu-els replace oil as our primary source

of energy wasn’t uttered by a scientist oran environmentalist. It wasn’t offered bysome politician or interest group advocate.

It was the vision of an automaker. His name was Henry Ford, and the yearwas 1925.

Even then, during the earliest days ofthe auto industry, there was a widespreadbelief within the business that the carswe drive could be powered by the foodwe grow. Ford went so far as to build hisfirst Model T so that it could run onethanol. As oil soon became the nation’sdominant fuel, however, this visionaryauto was scrapped—and with it, Ford’sdream of an oil-free future.

More than 80 years later, America’saddiction to oil makes it clear that wehave to go back to that future. Doing sowon’t just free us from our dependence ona dangerous and finite fossil fuel, it willalso rejuvenate an industry desperate foranother chance.

Henry Ford’s corporation now findsitself struggling to survive under stiffcompetition, rising health-care costs, andthe consumer skittishness that comesfrom volatile oil prices. Together, GM andFord recently announced plans to lay offup to 60,000 workers.

Across the globe, other countries andtheir auto industries are realizing theenormous potential of a post-oil econ-omy. Toyota is doubling production of thepopular hybrid Prius, and it’s readying a

new production plant in China. Waitinglists for these foreign hybrids in our owncountry are months long, but U.S. au-tomakers lag far behind.

There is now no doubt that cars thatuse less oil represent the future of the autoindustry. If U.S. car companies hope to bea part of that future—if they hope to sur-vive—they must start building more ofthese cars. And we must help them do it.

Right now, one of the biggest costs fac-ing auto manufacturers is health care.Last year, retiree health care alone costthe Big 3 automakers nearly $6.7 billion.No wonder they’re having trouble findingthe money to invest in fuel-e∞cient cars.

I believe we should make a deal withthe auto companies to solve this problem.Legislation I’ve introduced called “HealthCare for Hybrids” would allow the federalgovernment to pick up part of the tab forthe automakers’ retiree health-care costs.In exchange, the companies would usesome of that savings to build and invest inmore fuel-e∞cient cars.It’s a win-win proposal:Their retirees will betaken care of, they’ llsave dramatically onhealth costs, and they’llbe free to invest in thefuel-e∞cient cars thatare key to their compet-itive future.

But building carsthat use less oil is

only one side of theequation. The other involves replacingthat oil with the homegrown biofuelsHenry Ford spoke of long ago.

Already, hundreds of fueling stationsuse a blend of ethanol and gasoline knownas E85, and there are millions of cars onthe road with the flexible-fuel tanks nec-essary to use this fuel—including my own.But the challenge we face is getting bio-fuels out of the labs, out of the farms, and

Fueling the FutureBY SENATOR BARACK OBAMA

Within a decade,

every car sold

in the United

States should be

able to run on

flexible fuel.

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Good Genes Gone Bad The new public health reflects our understanding of how environmental

contaminants damage genes. New genetic science offers new hope.

BY PETE MYERS

Scarcely a week goes by without coverage ofa new discovery by scientists revealing that yet an-other disease is linked to one or another gene. Therange of health conditions now known to be gene re-lated is astonishing. Some are just what you would

have expected 50 years ago: many cancers, birth defects, ob-scure metabolic disorders, and diabetes. Others are less obvi-ous, for example, brain disorders like schizophrenia, Parkinson’sdisease, and Alzheimer’s disease.

Most people react to this news—disease linked to genes—asyet another confirmation of life’s capriciousness. Genes are whatwe got from our parents. If we’re lucky, we get the good genes,and that means at least one health condition that won’t burdenus in life, compound the toll of growing old, or hurry us towardthe grave. If we aren’t lucky, well then, who ever said life is fair?

In the medical community and pharmaceutical industry,findings like these are fueling a rush in search of cures using“gene therapy.” If the experts can figure out what’s wrong witha gene, well, perhaps a designer drug can fix it.

But one corner of science reacts quite differently, flipping the

old “nature vs. nurture,” or “genes vs. environment” dichotomyon its head. In this corner, when a disease is linked to a gene,the research question shifts to a completely different perspec-tive: What contaminants in the environment could be alteringthe behavior of that gene?

In other words, diseases linked to genes aren’t simply the fa-talistic results of inheritance. Diseases can also be the result ofgood genes gone bad because of interference from somethingin the environment. Rather than inviting exotic medical inter-ventions, diseases caused by environmental interference withgene behavior may be preventable if the contaminant can beidentified and the exposure eliminated. And please note thatthis isn’t about mutation. The dna sequence doesn’t change. Itisn’t originally a “bad” gene, but rather one that’s been hijacked.

This perspective does more than simply shift the bound-aries of what is known as “environmentally caused disease.” Itreframes the issue entirely. Classically, we have perceived dis-eases and disabilities as having distinctly genetic or environmen-tal causes, or perhaps having a contribution from both due tomutation or some interaction between heredity and environ-

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person’s life. When working properly, those changes give youmale or female sex organs, a functional brain, and an immunesystem that defends against disease. They regulate weight andprotect you from cancers. In short, the right changes in geneexpression as the fetus is growing are essential to a person’shealth and quality of life.

Third, some environmental contaminants can interfere withgene expression, preventing genes from turning on when youneed them, or turning them on when they should be silent. Takearsenic. At high levels, arsenic kills outright. At intermediatedoses, arsenic is associated with a wide array of illnesses. At trulylow doses—10 parts per billion, the new standard for drinkingwater in the United States—experiments with cells indicate thatarsenic can prevent some genes from being turned on by gluco-corticoid hormones. These hormones control genes important fordisease resistance, glucose metabolism, and a number of othervital processes. Some of these genes make proteins that are im-portant for tumor suppression, for example. These effects werediscovered as a result of experiments conducted using cells in a

laboratory setting. Still, the results suggestthat if the same processes are at work inpeople—which is likely—then people ex-posed to arsenic at that low dose may beill-prepared to fight tumors. Arsenic in thiscase isn’t causing illness directly, but it isinstead setting the stage for illness to win

over health. The arsenic’s contribution undermines disease resist-ance by preventing protective genes from being turned on.

A key finding is that gene hijacking can takeplace at extremely low—almost undetectable—levels ofexposure to some environmental chemicals. Exposure to

high doses of many substances can be outright toxic—poisonousin the classic sense. Historically, toxicologists have bowed to themantra “the dose makes the poison.” But with low-dose exposures,the mechanism of action is different. It isn’t a simple case of out-right toxicity in which the more of a poison you take, the greaterthe toxic effect. Gene hijacking during fetal development can belike shifting the course of an ocean liner two degrees at the be-ginning of a voyage. Over a thousand-mile trip (or a 70-year lifespan), you wind up in a very different port. Or you may crash ontorocky shores. For example, in a fetus or infant, a subtle changein the path of development can lead to an immune system thatcan’t resist common bacteria or that responds hyperactively, asin the case of asthma. A female fetus exposed in the womb canwind up with a uterus that isn’t shaped properly; a male fetus maymature with a permanently low sperm count.

Our genes are vulnerable to hijacking throughout life. Butfetal development and the period from childhood through pu-berty are the most vulnerable stages of life. This has taken onadditional significance as work on gene hijacking has con-verged with another new field in the health sciences, “devel-opmental origins of adult disease.” This work, which has rootsin both animal and human studies, is revealing that manychronic illnesses and health conditions experienced by adults

ment (as in some mental illnesses), and we have labored hardto sort out blame. This new perspective says something very dif-ferent: Yes, we do inherit our genes from our parents, but theenvironment—including diet, experience and contamination—can alter how a specific gene behaves throughout life.

That new understanding holds immense promise for pub-lic health. It means that revelations by genetic research of “dis-eases linked to genes” aren’t a litany of fatalism. Instead theyare a compilation of diseases that may have environmental eti-ologies and can thus be candidates for prevention through ex-posure reduction. Not all diseases with a genetic basis will workthis way, but the list will very likely be large and will includesome profoundly important illnesses.

To make sense of this new framing—what itmeans for a disease to be linked to a gene—requiresthree pieces of information: two that form the core of

modern molecular genetics, and a third that has emerged fromnew scientific discovery over the past two decades.

First, just as Gregor Mendel discovered in the late 1800s, youinherit genetic material from your parents. Decades of researchduring the 20th century then led to the discovery that genes arepieces of dna in your chromosomes.

Second, genes aren’t just passive strands of dna but, in-stead, are part of nature’s nanotechnology. They are tiny chem-ical manufacturing plants controlled by an intricate anddynamic set of chemical messengers that travel within and be-tween cells to turn specific genes on, or off, at the proper time.When geneticists talk about gene behavior, they are referringto how a gene is turned on to set the steps in motion that leadto protein synthesis or other key changes in cell function. Thereare many variations of this process. In one scenario, involvinghormones like testosterone and estrogen, the hormone mole-cule arrives from outside the cell, goes into the nucleus, andbinds with another molecule called a receptor. This bound com-plex then controls the activity of the gene.

This process begins before conception in the formation ofeggs and sperm and it continues through death. It is the mo-lecular symphony of life, with 20,000-plus genes in eachhuman cell, turning on and off as molecular signals reach theswitch on a gene that controls its action. Different genes re-spond to different signals, yet the same gene in different tis-sues can also be programmed quite differently. That’s why eventhough all the cells in a person’s body have the same genesand we each have many different types of tissues, one body parttakes on the characteristics of an eye and another a finger ora liver or a brain. And while changes in gene expression takeplace at the molecular level, they have a huge impact on a

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Exposure to substances at high doses can be toxic—

outright poisonous. But extremely low doses of

environmental contaminants can cause gene damage.

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can have their origins in early development gone awry.One early signal of the important role fetal events play in the

onset of adult disease was revealed due to the discovery, in 1971,that young women who had been exposed in the womb to a drugcalled diethylstilbestrol, or des, developed a rare cancer in theirlate teens. Another came from research showing that adultswhose mothers were starved in the third trimester of pregnancyare prone to obesity and other chronic problems, including heartdisease, in adulthood. A third has emerged over the last decadeas it has become clear that most cases of testicular cancer arisefrom failure of tissues within the fetal testes to differentiateproperly. These undifferentiated tissues lie dormant for two tothree decades and then turn into tumors. Research publishedin 2005 has even shown that a gene implicated in Alzheimer’s,a disease of old age, may be vulnerable to hijacking around thetime of birth. This work, done with rodents exposed to low lev-els of lead, shows that the gene behavesnormally through adulthood, but inold age it’s activated to an abnormallyhigh level. The same study also showedthat exposing an adult to the same lowamount of lead doesn’t have this effect.

The poster-child molecule for thisreframing of links between environ-ment and health is one that almost noone has heard of, but that almost every-one has in their tissues and fluids. Thatmolecule is bisphenol A, invented in1891 by the Russian chemist A.P. Di-anin and discovered in 1936 to causeresponses similar to those of the nat-ural hormone estrogen. That discov-ery took place during the rush ofpharmaceutical research to find syn-thetic estrogens, and bisphenol A, or bpa, lost out to its morepowerful cousin, des. While des went on to be used by millionsof women to control di∞cult pregnancies before it was outed asa cancer-causing agent, bisphenol A was put on the shelf untila polymer chemist discovered around 1950 that it could be com-bined in chains to make polycarbonate plastic and certain epoxyresins. Use since that discovery has skyrocketed, to the point thatover six billion pounds are synthesized each year and the mol-ecule is now included in countless consumer products.

Ironically, one of the most conspicuous of these uses is thetransparent plastic water bottles, often tinted bright colors,which are wild favorites on campuses, strapped to countlessbackpacks of health-conscious Generation X members who’vebeen told the material is safe because it is rigid and doesn’tsmell like plastic or leach dioxin. True, these bottles don’t leachdioxin. That was never the concern. But they do leach bisphe-nol A because the chemical bonds that create the polymer eas-ily degrade in water—and they do so even faster if the plasticgets hot or is exposed to alcohol, soaps, or acids. bpa exposurecomes from many other sources, for example, in a resin usedto line metal food cans, from which it also leaches.r

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Today almost all people sampled in the devel-oped world have bisphenol A in their body at trace lev-els (in the low parts per billion), including in amniotic

fluid, umbilical cord blood, and placental tissue. A Centers forDisease Control study in 2005 detected low amounts of bpa inthe urine of 95 percent of Americans sampled. Twenty years agoscientists would have looked at those levels and scoffed: toolow to make a difference. Indeed, back then these levels weretoo low to even measure. But since 1997, well over 200 articleshave been published in the peer-reviewed scientific literatureshowing that bpa has a biological impact on cells and animalsat levels beneath the current federal standards, which werebased on data gathered in the early 1980s. In cells, bpa hasbeen shown to alter vital genetic signaling pathways at underone part per trillion. In animals, effects have been reported atless than one part per billion.

Significantly, all of the reports ofmajor effects come from governmentor academic studies, while none ofthe 12 studies funded by industryhas reported harm. And independ-ent analyses of those 12 reveal notonly fatal flaws in experimental de-sign, but outright misrepresentationof data. As recently as January 2006,industry scientists used these verystudies and misrepresentations toargue during a hearing convened bythe California legislature that bpa issafe. One “product-defense” firm tes-tifying in those hearings, the D.C.-based Weinberg Group, was revealedby an investigative report publishedin February 2006 to have its roots

in defending tobacco and aggressively soliciting businessfrom companies whose materials are under attack becauseof health and safety concerns. One of the firm’s most recentclients is a company that manufactures a Teflon chemicaljudged by an epa science advisory board in early 2006 to bea likely human carcinogen.

The list of diseases and adverse health conditions now plau-sibly linked to bisphenol A by animal and cell research is largeand reflects disease trends in the human population. It runsfrom reduced sperm count to spontaneous miscarriages; fromprostate and breast cancers to degenerative brain diseases;from attention deficit disorders to obesity and insulin resist-ance, which links it to Type 2 diabetes. “Plausibly” is a long wayfrom “certainly.” Even if it accounts for only some percentage,say 10 percent or 20 percent, of cases, these “plausibly linked”conditions have been caused by exposure to bpa. And those arecases that could have been prevented and health-care coststhat could have been avoided.

How does one molecule contribute to so much suffering?Research shows that bpa alters the behavior of over 200 genes,more than one percent of all human genes. The genes affected

Clean Water: But watch that bottle.

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aren’t controlling minor traits like eye color. They are genesinvolved centrally in how cells multiply, how stem cells becomemore specialized, how metabolism is regulated, and how thebrain gets wired as a fetus grows. It is not at all surprising,therefore, to see so many potential links to health problems.

Because of the extremely low levels at which bpa hasdemonstrable effects, this molecule is at the center of the de-bate over low-level contamination, gene expression, and humanhealth, but it is by no means alone. It is but one of hundredsof synthetic chemicals that have been found to alter gene be-havior. Some are compounds that have been of concern fordecades, like dioxins, polychlorinated biphenyls (pcbs), andcertain pesticides. Others, like phthalates, Teflon-related chem-icals, and brominated flame retardants, have been attractingattention more recently, especially because they are present inconsumer products in every home in America; hence, exposureis ubiquitous. The United States has made good—but incom-plete—progress on the former, but for too many, particularlyin the latter group, the work has barely begun.

What do these results mean for human health? Scientistsaren’t certain because despite 50 years of growing use of bpain commerce, there have been almost no human studies. Thechemical industry takes the “absence of proof of harm in hu-mans” as evidence of safety rather than simply a result of thefact that almost no one has investigated the matter, even thoughthere is extensive evidence of harm in other animals. The pre-ceding list of plausible links includes conditions that have be-come epidemics over the past several decades, the same timeframe during which exposure to bpa became virtually unavoid-able. Those trends are what you would predict from the animalstudies, but a lot of other things in our world have also changed,so the congruence of trends proves nothing by itself. Definitivehuman studies can take decades to complete, especially if thefocus is on something as complex as adult diseases caused bydevelopmental exposure. Only one study has attempted to testpredictions based on the recent animal research involving bpa,and it confirmed the prediction, but the study was small andneeds to be repeated.

The National Institute of Child Health and Human Devel-opment has spent tens of millions of dollars over the past fiveyears planning a study that would track 100,000 subjects fromconception to age 21. Patterned after a famous and highly pro-ductive study of cardiovascular health called the FraminghamHeart Study, the National Children’s Study would examinemany different factors affecting development, including envi-ronmental chemicals and diet. This sweeping scale of researchis required scientifically to reach firm conclusions about whichproducts are safe and which are not. Unfortunately, PresidentBush’s proposed budget for 2007 has eliminated funding.

The united states has already demonstrated anability to reduce harmful exposures dramatically throughstronger public-health standards. Exposure to lead, pcbs,

hexachlorobenzene, and other contaminants is now at muchlower levels than it was 40 years ago. The newer contaminants,

like bpa (in principle), are no less amenable to policy interven-tion, but corporations and their “product defense” consultantsare now far more sophisticated about battling government ef-forts to strengthen public-health standards, making it everharder for agencies to keep the standards up-to-date with cur-rent science. For example, bpa’s current standard is based upondata gathered in the mid-1980s.

Two new sources of opportunities to reduce harmful expo-sure are “green chemistry” and the marketplace for safer prod-ucts. By paying attention to the molecular detail of howcontaminants cause harm, chemists can invent new materialsthat are harmless by molecular design. bpa causes harm becauseof coincidence: Its shape fits into the estrogen receptor. Minorchanges in that structure should yield a molecule that can beused to make similar plastics, but that won’t alter gene expres-sion. Entrepreneurial companies, seeing potential profits in in-herently safe products, are actively involved in bringing suchproducts to market.

Until the early 20th century, the United States was wrackedwith waves of epidemics, mostly of infectious diseases. Most ofthose were finally controlled through public-health interven-tions, especially better water treatment, not through antibi-otics or even vaccines. Huge public investments were made,even though the science wasn’t definite. Those investmentschanged the face of public health in this country. We have cleandrinking water, and sewage systems that work (most of thetime). And today very few people die from waterborne diseasesin the United States.

Today’s epidemics are very different. They involve cancers,cardiovascular problems, and metabolic syndrome (obesity andType 2 diabetes), and in the young they include some seriousbehavioral problems like attention disorders and autism. Theseepidemics have obvious human costs, and they burden theeconomy. The medical conditions that would have been stud-ied by the National Children’s Study cost the United States$640 billion annually.

If today’s epidemics continue along the trend lines thathave emerged over the past 30 years, it is likely that this gen-eration of children will be the first in modern history to haveless healthy adult lives than those of their parents. Changes ingene expression play a significant role in virtually all of them.It is highly likely that some percentage is caused by exposureto contaminants. Those epidemics, in principle, can be pre-vented. As this science advances, and as people, government,and companies act upon these developments, it is possible toenvision a transformation in public health just as radical, andpositive, as that achieved when society cleaned its water ofinfectious-disease agents. tap

Pete Myers is founder, ceo, and chief scientist of Environmen-tal Health Sciences in Charlottesville, Virginia. Former directorof the W. Alton Jones Foundation, he is a coauthor of OurStolen Future (1996), which explores the threats posed by man-made chemical contaminants to fetal development and humanhealth. For more, see www.EnvironmentalHealthNews.org.

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a liquid fuel that could become ourcountry’s transportation fuel of choice.Farmers immediately understood thepower of ethanol, and they have broughtus to the point where energy independ-ence is in sight. Now the rest of us needto do our part.

Today, the ethanol industry is respon-sible for creating 200,000 jobs andreducing our need for foreign oil by 3.1billion gallons per year. Within a decade,it will achieve twice those amounts—proof positive there are sources of energyright here in America if only we invest inthe technology, seize the potential, andinnovate our way out of dependence onforeign oil. If we’re serious about thatgoal, we need to build a “hybrid econ-omy”—one powered by homegrown en-ergy sources, whether it’s gasified coal,ethanol, or wind and solar power.

As we learned in the barn late thatnight, farmers have done their part. Nowit’s President Bush’s turn. In his State ofthe Union address, the president recog-nized our national addiction to oil, buthis actions since then have spoken louderthan his words. In fact, the president’sbudget includes more funding for re-search and development for oil compa-nies—at a time of record profits for thosecompanies—than it does for innovationin non-oil biofuels.

The recently passed Energy Policy Actprovides numerous opportunities for thegovernment to support innovation inother American-made renewable fuels,including new forms of ethanol from

crops grown not just in the Midwest butacross the country. These are opportuni-ties for innovation that, as with genomeresearch, can be accelerated with modestgovernment support to ensure solutionsare market-ready long before they wouldbe otherwise. Republican and Democra-tic governors across the country are nowrightly calling on Congress to do what thepresident did not: to fully fund innovationin next year’s budget.

While the president and Congress canensure that we invest in innovation, au-tomakers can ensure that we turn thatinnovation into action. Today, there areabout 4.5 million flexible fuel vehicles onAmerica’s roads. Those vehicles are engi-neered to use “E85”, a homegrown gasblend that is 85 percent ethanol and isequal or superior to conventional gasolinein terms of performance and cost.

The problem is that far too few con-sumers who own these cars even knowthey can burn E85. And those who areaware find that they have very few op-portunities to actually purchase the fuel:Barely 600 of the nearly 180,000 retailgas stations nationwide offer E85, duelargely to major oil company interfer-ence. The oil companies must be forcedto stop their anti-competitive practiceof prohibiting E85 dispensers frombeing installed at their stations—by fed-eral law, if necessary.

What good is this innovative technol-ogy if barriers like this exist? That is whyour automakers—who revolutionizedmanufacturing with the invention of the

assembly line—should notify every cus-tomer whose vehicle has the technologyto use E85. If we can contact customersto tell them something is wrong with theircars, we can surely contact them to tellthem something is right.

At the same time, automakers shouldfollow the lead of market innovatorslike General Motors and each announcenow that their entire fleet will be E85-ready by 2010. At present, it costsroughly $50 per car to make sure thatautomobiles rolling off the assemblyline are ready to use E85. I am confidentour automakers can soon bring thatprice down dramatically.

This effort should not fall solely to thegovernment or Detroit. Though tradi-tional investment houses have been reluc-tant to embrace ethanol, Wall Street isbeginning to learn what farmers havelong known. In fact, The Wall Street Jour-nal recently reported that the leadingsalesman for ethanol’s profitability is Sil-icon Valley’s Vinod Khosla, venture cap-italist extraordinaire and founder of SunMicrosystems Inc.

Lastly, our friends in the environmen-tal community have come a long way inrecognizing the potential of biofuels, andwe need to build on that progress. Thereis no better option to decrease petroleumuse in the nation’s transportation sectorand to do it now. At the same time,ethanol has been proven to reduce emis-sions of carbon dioxide and other green-house gases. And at least one recentstudy demonstrates that we could meetall our transportation fuel needs in 2050without increasing the amount of landcurrently in cultivation.

Energy independence is our sharednational goal. If we each do our part, wecan meet that goal with biofuels fromAmerica’s farms—and help the environ-ment, the economy, and our nation’scherished agricultural tradition in theprocess. tap

Tom Daschle, the former DemocraticLeader of the U.S. Senate, is currentlySpecial Policy Adviser at Alston & Birdand a Distinguished Senior Fellow atthe Center for American Progress inWashington.

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Follow the FarmersBY TOM DASCHLE

Twenty years ago, on a farm outside my home-

town of Aberdeen, South Dakota, I stood with a few

dozen local corn growers in a machine shack, huddled

around a still. We were trying to show the farmers that their

crops could be turned into what we then called gasohol—

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these different elements of society go green,the effect is cumulative. As we get more ar-chitects and contractors who know howto build green, they create a demand forgreen materials, the cost of materialscomes down and investment in green ma-terial development goes up. So we’re in themiddle of a rapidly accelerating positivetrend. We’re also seeing shifts in consumerpreference. Some people want suburbansprawl, but more and more want compact,walkable, mixed-use communities.

Kuttner: Isn’t federal policy still a story ofthe starvation of housing and mass transit,the continued subsidizing of gas-guzzlingautomobiles, and hostility to planning? Rose: We have never really had a thought-ful national infrastructure policy and wecertainly do not have one now. We reallyneed a comprehensive planning approachfor water, sewer, gas, electric, telephone,power, data, transportation, education,housing, libraries, and hospitals, that tiesthem all together in a comprehensive way.We currently have an administration thatis trying to de-fund those essential aspectsof community.

The current administration is also cut-ting back on all the affordable housing sub-sidies and community development blockgrants that provide basic infrastructure tocities and communities. Unfortunately, thehuge federal deficit and declining federalresources to the states are putting pressureon state and local budgets to make up thegap. And the American citizen somehowdoesn’t yet tie the rise in local taxes to thereduction in federal resources.

Kuttner: Your company is involved inthe rebuilding of New Orleans, isn’t it?Rose: Our company is part of theLouisiana Recovery Authority’s (lra)master planning team that is looking atrebuilding all of southern Louisiana post-Katrina/Rita. We’re working on both af-fordable housing issues and the greenbuilding issues. If the lra uses the moneywell, the results could be extraordinarilyexciting. Louisiana and Mississippi, withthe inflow of federal funds and the needfor comprehensive planning, could actu-ally change the way that regional envi-ronmentally based planning is done. tap

Jonathan Rose Companies llc is one ofAmerica’s largest green developers ofaffordable housing and other ventures,with more than one billion dollars worthof projects under management. Prospectco-editor Robert Kuttner spoke with ceoJonathan Rose.

Kuttner: What makes a building “green”? Rose: For affordable housing, we recom-mend a level we call “practical green,”which is wonderfully described in theEnterprise Foundation’s Green Commu-nities program. The U.S. Green BuildingCouncil has established the widely usedleed (Leadership in Energy and Environ-mental Design) system that rates build-ings Certified, Silver, Gold or Platinum. A“certified” building has basic green char-acteristics: more energy e∞ciency, freshair, ample daylight, and low use of toxicmaterials. When you get into a car, thenew car smell comes from volatile organicchemicals (vocs), which are not good foryou. That’s the same thing you smell whenyou live in an apartment with a new car-pet or a house that’s been repainted. Abasic green building won’t have vocs orother toxic materials.

Going up the scale, a “silver” buildingwill be better at water saving, and will in-clude more materials from recycled or rap-idly renewable sources, such as bamboo. A“gold” building might incorporate a raisedfloor system, filtered air or solar panels. A“platinum” building might include moreactive systems such as purifying and recy-cling the building’s wastewater.

Kuttner: Isn’t a lot of the payoff ulti-mately not just in how you build, but inthe whole spatial pattern of development?Rose: Yes, the most green thing one cando is to locate a building or home or shop-ping space or school in a walkable commu-nity close to mass transportation. Thebiggest impact on the environment comesfrom cars. A building “uses” three times asmuch energy in transporting people to and

from the building as is used by the build-ing itself. So if you can locate that build-ing in a downtown, near mass transit, yousystemically save huge amounts of energy.

Kuttner: That’s plausible in dense citieslike Boston, but how do you retro-plansprawl-America?Rose: Well, cities across America are nowadding light rail. There is tremendous con-sumer demand to live near light rail stops.Every city that has added light rail in thelast 20 years has found that the consumeruse has been two or three times the origi-nal projections. Los Angeles is densifying,adding heavy rail and light rail, andtremendous higher density development ishappening at the rail stops. So if Los An-geles can do it, any community can do it.

Kuttner: What are the main obstaclesand inducements to this path generally?Rose: One challenge used to be puttingtogether a team of architects and particu-larly mechanical engineers who really un-derstand green building. But the field isgrowing rapidly. A green building is amuch cheaper building to operate and sowe are seeing rapid adoption of greenbuildings in the affordable housing area.Churches and synagogues and mosquessee greening as a way to express caring forcreation. Hospitals and health-care cen-ters rapidly becoming green, because whyshould healing environments be intrinsi-cally unhealthy? Studies actually show thatthe more access patients have to fresh airand daylight, the quicker they heal. As

Building Green

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1. Green or “vegetated” roof: Rooftop gar-dens can help retain and filter stormwaterrunoff, improve air quality, and provide a nat-ural layer of insulation, promoting energyconservation.

2. Walls and wallboard: Eco-friendly wallscan be constructed from any number of re-newable products, including agriboard, amixture of straw, wheat, and agriculturalwaste. Wallboard is easily produced fromgrain sorghum or corn, and particle boardcan be made from rice straw.

3. Windows: Double-glazed panels, windowsfilled with a viscous gas such as argon orkrypton, or panes covered with a reflectivecoating can dramatically minimize heat lossin cold climates and limit radiant heat dur-ing the warmer months.

4. Insulation: Manufactured using soybeanoil, soy-based insulation contains no for-maldehyde or chlorofluorocarbons, harmfulorganic compounds that deplete the ozonelayer and are contained in many brands ofconventional insulation.

5. Flooring: A growing market for “environ-mentally responsible” flooring has led to suchoptions as carpeting composed of bio-basedpolymers derived from corn, wheat, or otherrapidly renewable resources as well as floorsof bamboo, which regenerates quickly andcan be harvested without killing the plant.

6. Furniture: “Green” furniture may be madefrom a range of recycled materials, includ-ing glass and plastic from milk containers.

7. Solar panels: An array of photovoltaic pan-els on the rooftop collect solar energy—aninfinitely “renewable” energy source—toserve electricity needs in the building. Whenelectricity needs in the building are low, excessenergy can often be sold to the local utility,generating revenue for the building owners.

8. Biodiesel-powered generator: The ulti-mate “green” building might feature this gen-erator that burns biodiesel made from corn,soybeans, or other bioproducts. It spins tur-bines that generate electricity, which thenpowers the entire heating, ventilation andcooling system.

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If the “mission accomplished”photo-op was the defining momentof the Bush administration’s foreign

policy, the president’s recent visit to theNational Renewal Energy Laboratory inGolden, Colorado, defined its energy pol-icy. One week after he embraced alterna-tive energy in his State of the Unionaddress, Bush’s budget axed 32 employ-ees at the nation’s premier alternative en-ergy lab, a facility that developed keytechnologies for hybrid cars and photo-voltaic cells. His political operatives did-n’t even know what they had done untila few hours before his visit, triggering amad scramble to restore the jobs to avoidembarrassing the president.

Too late. Reporters had a field day. Butthey should have paid more attention tothe rest of the administration’s proposedfederal budget, the ultimate arbiter of na-tional energy policy. Bush’s TV rhetoricwas disconnected from reality.

Programs that could reduce green-house gas emissions and lower U.S. de-pendence on foreign oil got short shrift.Instead, the president proposed lavishingnew resources on long-range research pro-grams that had more to do with reward-

ing key corporate backers—“clean coal”and nuclear power, as well as corn-basedethanol—than with building a compre-hensive, sustainable energy system.

Under the president’s plan, homeweatherization assistance programs willbe cut by nearly a third; investment ingeothermal, hydropower, and solar heat-ing and lighting programs will be elimi-nated; and aid for upgrading localbuilding codes (a key element in improv-ing energy e∞ciency) will be ended. “Thestates will now have to become the truelaboratories of innovation because thefederal budget is not helpful,” said NewMexico Governor Bill Richardson, whoheaded the Department of Energy in theClinton administration.

In the decades since presidentJimmy Carter donned a cardigan to

declare energy e∞ciency the moral equiv-alent of war, the United States has essen-tially relied on market mechanisms towean itself from oil. This was a depar-ture from the 1975 Energy Policy Con-servation Act, which required automakersto achieve specific fleet averages in milesper gallon. Unfortunately, corporate av-

Can Government Go Green?The opportunity is there, but market forces alone won’t realize it.

BY MERRILL GOOZNER

erage fuel economy (cafe) standards,which were remarkably successful inachieving their initial goals, were aban-doned as a strategy. The cafe goal waslast raised in 1990.

As inflation-adjusted oil and gas pricesfell from their 1980s highs, markets re-sponded the way markets do: mindlessly.The U.S. transportation sector becameeven more dependent on cheap foreignoil; the unanticipated suv loophole madea mockery of the fuel standards (suvs arecounted under the weaker light-truckstandard, not the tougher passenger ve-hicle one, even though that’s how mostare used); the electricity sector adoptednatural gas as the primary supplementfor coal; and the overall economy laggedfar behind its European and Japanese ri-vals in both energy e∞ciency and addingrenewable sources like solar, wind, andgeothermal into the energy mix. Concernsabout global warming, air pollution, anddefense outlays required to maintain ac-cess to Middle Eastern oil were ignored.

During the current Bush administra-tion, these trends accelerated. In earlierdays, political proponents of alternativeswere driven from the national dialogueby an administration with deep personal,political, and financial ties to fossil fuelindustries. Vice President Dick Cheney,launching an energy strategy hatched insecret with his energy industry cronies,famously claimed that energy e∞ciencyand alternatives may be signs of “per-sonal virtue” but have no place in thenational strategy. Even after 9-11, whichpresented the nation with a golden op-portunity to move down a different en-ergy path, nothing changed.

However, energy markets have belat-edly begun to reflect some of the hiddencosts of U.S. reliance on fossil fuels. Hur-ricane Katrina and global warming, insta-bility in many of the oil-producingregions of the world, growing competitionfor supplies from China and India, andaccumulating evidence that the globe hasfinally reached its peak oil-producing ca-pacity have kept oil more than $60 a bar-rel and gasoline prices well above $2 a gallon. Home-heating oil and naturalgas prices have increased 16 percent and24 percent, respectively, in the past year.

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Mr. Market is responding to thechanged circumstances, sort of. The use ofalternatives to oil and gas is exploding.Demand for hybrids, solar installations,and wind power is rising at a 30 percentannual clip. But this consumer-driven re-sponse begins from such a small base thatit would take decades to push fossil fuelsfrom their preeminent position. Bush’scontradictory strategy both promotesmore oil exploration and hopes to hastenenergy diversification by giving a push tothe supply side. At some point, the cost ofalternatives, presumably, will fall belowthe cost of importing oil.

Unfortunately, it’s the same strategythat minimalist proponents of energy al-ternatives and reduced dependence onforeign oil have used for three decadeswithout success. The sunk costs of oil, gas,and coal dependency—the transportationinfrastructure, the sprawl, the powerplants, the industrial and commercialbuildings and processes (not to mentiontheir political influence)—create inertialforces that adjust to every increase in fos-sil fuel prices the way a frog adjusts to ris-ing water temperatures. It doesn’t knowthat it is cooked until it’s too late.

Three potentially powerful po-litical streams could push the govern-

ment toward more active intervention inenergy markets. Labor and its allies havelaunched an Apollo project to promote thegood-jobs and technological potential of al-ternative energy strategies. Environmen-talists continue to sound the alarm aboutthe consequences of global climate change.And in the wake of 9-11, a vocal elementwithin the national security establishmentrecognizes that breaking the foreign oilhabit requires breaking the oil habit en-tirely. Operating under the umbrella SetAmerica Free Coalition, they respondedto the president’s speech with a call for “afocus on deployment, not only R&D.”

A comprehensive government strategywould proceed on multiple fronts: not justbiomass fuels, but higher fuel e∞ciencystandards; not just more research intowind, solar, and geothermal power, butincreased state requirements that they bedeployed; not just industrial energye∞ciency, but higher e∞ciency standards

for lighting, home-heating systems, ap-pliances, weatherization, and buildingcodes. “There is no slam dunk,” says ScottSklar of the Sustainable Energy Coalition.

Energy consumption in the unitedStates can be divided into three dis-

tinct sectors: transportation, electricitygeneration, and the industrial/commer-cial/residential sectors. Each consumesroughly one-third daily demand for en-ergy. Each requires its own strategy.

In transportation, the United Statesshould raise the cafe standard while giv-ing the U.S. auto industry a three-yearbreathing space for retooling. In additionto lifting the suv/light truck exemption(except for legitimate working vehicles),the fleet average should be raised to 40miles per gallon (mpg) in 2010, 50 mpgin 2013, and 60 mpg in 2016. Every ve-hicle coming off the assembly line should,starting in the next model year, be a flex-ible-fuel vehicle that can run on any typeof alcohol or gas-alcohol blend—roughlya $150 per car add-on that will have lessimpact on the new car market than re-quiring seat belts and air bags.

Transforming the electricity sector willrequire a mix of federal and state poli-cies, because most utilities are state-regulated. Twenty states and the Districtof Columbia already ask utilities to obtaina certain percentage of their electricityfrom renewable sources like wind, geo-thermal, solar, or hydroelectric power. Atleast 15 states have taxed electricity con-sumers to fund investment in renewablesand energy e∞ciency, which provides afar greater return on investment thanbuilding new power plants. All statesneed to adopt such standards. The federalgovernment should play a stronger role ineasing the permitting process for new re-newable energy facilities. It should alsomake permanent the current temporarytax breaks for renewables. “Businesswon’t invest based on a tax credit that

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needs to be renewed every two years,” saysMichael Eckhart, president of the Amer-ican Council on Renewable Energy.“Globally, the market demand is quitegood. The question now is whether we’llhave a domestic industry producing it.”

The building and industrial sectors alsoneed a boost from government to leapfrogahead on e∞ciency. Revamped buildingcodes and appliance standards and thestrategic use of tax incentives would cre-ate thousands of jobs retrofitting Amer-

ica’s industrial and commercial sectors.This could reduce energy usage, increaseprofitability, and restore the competitive-ness of lagging U.S. industries.

Greening the U.S. economy has obvi-ous security and environmental benefits.But it is also a high-growth strategy thatcan provide millions of well-paid jobs for

working-class Americans, who are cur-rently the biggest losers from oil depend-ency. It will never be achieved withoutthe strong hand of government leadingthe way. In 1961, President John F.Kennedy vowed to put a man on themoon in less than a decade, and the U.S.government got the job done. Is there anyreason to think that this nation couldn’trise to the energy challenge? tap

Merrill Goozner is a Prospect seniorcorrespondent.

Greening the U.S. economy has obvious security and

environmental benefits. But it is also a strategy that can

provide millions of well-paid jobs for Americans.

G R E E N FACTS

The United States spends a staggering $200,000a minute on foreign oil. Some 65 percent of ouroil consumption today comes from foreignsources—and many of them, of course, notori-ously unstable nations—up from 58 percent in thelast five years alone.— Source: Center forAmerican Progress

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risks. The project leader was Robert L.Hirsch, who has had a distinguished ca-reer in formulating energy policy. TheExecutive Summary begins:

The peaking of world oil productionpresents the United States and theworld with an unprecedented risk man-agement problem. As peaking is ap-proached, liquid fuel prices and pricevolatility will increase dramatically, and,without timely mitigation, the eco-nomic, social, and political costs will beunprecedented. Viable mitigation op-tions exist on both the supply and de-mand sides, but to have substantialimpact, they must be initiated morethan a decade in advance of peaking.

The Hirsch report effectively under-mines the standard free-market argumentthat as oil becomes scarcer, higher priceswill necessarily stimulate more exploration,development of alternative fuels, and themore e∞cient use of remaining quantities.The transitional problem is timing.

An obvious example is the failure oftoday’s higher prices to induce more pur-chases of fuel-e∞cient cars. Our fleet fuele∞ciency for cars is currently quite low,averaging about 22 miles per gallon.Technology exists (including electric/icehybrid engines, diesel hybrids, and plug-in hybrids) that could easily achieve be-tween 60 and 100 mpg. But even with aprice-spike high enough to induce thisshift, auto manufacturers would requireat least five years for retooling, and morethan double that will be needed for thesubstantial majority of existing vehiclesto be replaced by energy-e∞cient models.

Thus the response to peak oil will takeconsiderable time and investment capi-tal. Market forces alone will not solve theproblem. The solutions will require boththe government and the private sector,as well as citizen efforts on a scale notseen since World War II. tap

Richard Heinberg is the author of TheParty’s Over and Powerdown, and is aCore Faculty member of New College ofCalifornia in Santa Rosa. This article isadapted from The Oil Depletion Proto-col: A Plan to Avert Oil Wars, Terror-ism, and Economic Collapse (NewSociety Publishers, June 2006).

The Challenge of Peak OilThe longer we delay adapting to the inevitable depletion of worldwideoil reserves, the more painful the coming economic transition will be.

BY RICHARD HEINBERG

The supply of extractable oilis subject to geological limits. Atsome point those limits will over-

come our ability to produce oil at the ever-expanding rates that growing economiesdemand. The global peak is likely to occurwell before societies adapt painlessly to adifferent energy regime. And that likelytime lag contradicts the way orthodoxeconomists imagine that rising pricessolve supply shocks by steering economiesto develop and use substitutes.

Oil is different from most commodi-ties, because, as President Bush so mem-orably declared, we are addicted to it, andbecause substitute energy sources can-not be developed and deployed overnight.And as long as oil remains available andprofitable, the existing energy regime alsoresists the development and substitutionof alternatives.

During the early 20th century, Amer-ica was the world’s foremost producerand exporter of oil. In 1970, the rate ofU.S. oil extraction reached its all-timemaximum and has generally declinedsince, even with later discoveries inAlaska and the Gulf of Mexico. Today theUnited States imports almost two-thirdsof the oil it uses.

Altogether, according to ChevronTex-aco, out of 48 significant oil-producingnations worldwide, 33 are already expe-riencing declining production. Few doubt

that the rate of oil production for theworld in total will peak at some point.That point is known as peak oil. If thepeak were to occur within the next fiveyears, national economies could not ad-just quickly enough without major dis-locations, while a peak 20 years hencewould present easier adaptation, assum-ing we begin adapting now.

Further evidence for a near-term peakincludes the fact that global rates of oildiscovery have been falling since the early1960s—a fact confirmed by no less thanExxonMobil. Currently, only about onebarrel of oil is being discovered for everyfive extracted.

On their face, current world petro-leum reserves numbers look reassuring.U.S. government agencies estimateproven reserves at more than 1.1 trillionbarrels. Some sources claim even more.However, oil optimists include costly andhard-to-extract sources such as Canadiantar sands. And some of the largest pro-ducing nations may have inflated theirreserves figures for political reasons. Animportant study released in January con-cluded that Kuwait’s o∞cial reservesfigures are double the amount that canactually be produced.

Matthew Simmons, founder of Sim-mons & Company International energyinvestment bank and author of Twilightin the Desert: The Coming Saudi Oil Shockand the World Economy, concludes, fromhis study of technical papers from the So-ciety of Petroleum Engineers, that SaudiArabian oil production could be close toits maximum, and that world oil produc-tion is also therefore close to peak.

Another important 2005 study, “Peak-ing of World Oil Production: Impacts,Mitigation and Risk Management,” pre-pared by Science Applications Interna-tional Corporation for the U.S.Department of Energy, makes clear the

G R E E N FACTS

Since 1989, the U.S. transportation sector hasused more petroleum than the nation produces.Under current projections, that sector will con-sume fully twice as much as we produce by theyear 2020. — Source: U.S. Department of Energy

t h e a m e r i c a n p ro s p ect a 2 3

W hen the 2005 nobel prizein chemistry was announcedlast October in Stockholm, the

new laureates—Yves Chauvin of the Insti-tute Français du Pétrole, Robert Grubbsof Caltech, and Richard Schrock of mit—won recognition for creating “fantasticopportunities for producing new mole-cules.” They had explained and developeda reaction known as metathesis, which al-lows chemists to selectively design organicmolecules by trading atoms across differ-ent compounds. In search of an analogyto help the pubic grasp this concept, theRoyal Swedish Academy of Scienceslikened the process to changing partnersin a dance. Then came the political state-ment: The advance represented a “greatstep forward for green chemistry,” theacademy declared. It allowed chemists toslash the number of steps needed to pro-duce a desired molecule, as well as to re-duce the number of unwanted and oftendangerous byproducts.

The Nobel Prize citation marks theo∞cial arrival of green chemistry. A con-cept that grew out of a unique collabo-ration between a scientist in privateindustry and one working for the U.S.Environmental Protection Agency, it’snow making major waves in the world ofscience. The journal Green Chemistry,founded only in 1999, has seen its “im-pact factor,” a measure of how widely ajournal is cited, skyrocket. And perhapseven more significantly, the precepts ofgreen chemistry are being adopted bybusinesses seeking to better serve thebottom line. At a time of considerablepessimism about corporate America’spenchant for attacking scientific infor-mation pointing to health risks arisingfrom its products, green chemistry pres-ents a happier and more positive tale—suggesting that economic growth andenvironmental and health protections

aren’t necessarily incompatible after all.The concept of green chemistry—in

essence, building environmental andpublic health concerns into the chemicaldesign process at the outset, rather thanwaiting until after a substance is pro-duced and unleashed to determinewhether it’s hazardous—dates back to theearly 1990s. A key intellectual reactionoccurred when John Warner, a chemistwith Polaroid, met with epa o∞cial PaulAnastas (who happened to be an oldfriend) to discuss a new innovation that,for once, had government regulators ex-cited rather than worried. Warner hadcome up with a simpler and less toxicprocess, based on the use of tiny crystals,to help prevent Polaroid’s instant filmfrom deteriorating on the store shelf.Anastas recognized that Warner and Po-laroid had accomplished all of the epa’s

pollution prevention objectives throughchemical design and scientific innova-tion, rather than through after-the-factregulatory action.

In 1991, the epa launched its GreenChemistry Program. By 1996, the agencyhad created the annual PresidentialGreen Chemistry Challenge Award, hon-oring companies and scientific innova-tors helping to prevent pollution beforegovernment regulators have to step in. In1998, Anastas and Warner teamed up towrite the influential book Green Chem-istry: Theory and Practice, which artic-ulated the 12 principles of their approach,including prevention (“it is better to pre-vent waste than to treat or clean up wasteafter it has been created”), safer solventsand auxiliaries (“the use of auxiliary sub-stances [e.g., solvents, separation agents,etc.] should be made unnecessary wher-ever possible and innocuous whenused”), and design for degradation(“chemical products should be designedso that at the end of their function they

break down into innocuous degradationproducts and do not persist in the envi-ronment”). For the first time, the scienceitself made such revolutionary ounce-of-prevention ideas possible.

Warner and Anastas have continuedto evangelize about their ideas and haveseen them take root at major institutions.Warner founded the first green chemistryPh.D. program at the University of Mass-achusetts-Boston (later duplicated whenhe moved to University of Massachusetts-

Lowell). Students learn about buildingmolecules but also about toxicology andwhat makes certain substances hazardous.Rather amazingly, traditional chemistryeducation does not include such instruc-tion even though, as Warner points out, toget his chemistry Ph.D. he did have tolearn how to translate a scientific paperinto a foreign language. Anastas, mean-while, now heads up the Green ChemistryInstitute, founded in 1997, at the hallowedAmerican Chemical Society.

The advantages of green chem-istry become immediately appar-

ent when you apply its principles tosome of the classic case studies of good

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The Right ChemistryGreen chemistry offers industry a way to reduce regulatory andclean-up costs with the proverbial ounce of prevention.

BY CHRIS MOONEY

G R E E N FACTS

Eighteen percent of the petroleum we con-sume in America today is used to make petro-chemicals, and their manufacture and disposalgenerates serious toxic emissions. Organicbiomass—simple plant materials—could sub-stitute for much or all of these petroleum-derived materials.

— Source: Institute for Local Self-Reliance

have been the greatest innovators. TakeAgraQuest, a 2003 winner of the presi-dential green chemistry award based inDavis, California. The company has pi-oneered environmentally friendly andbiologically based pest control productslike Serenade, a biofungicide that pro-tects crops without leaving any chemical

residue or harming beneficial organismslike bees and wasps. NatureWorks, an-other presidential award winner, is actu-ally owned by agriculture giant CargillDow. It’s making water bottles and pack-aging substances out of corn, rather thanusing more traditional petroleum-basedprocesses for creating plastics.

Environmentalists have been rightlyconcerned about companies engaging in“greenwashing”—selling themselves asenvironmentally friendly to enhance pub-lic relations, without actually walking thewalk. But these examples—and they’reonly a small sampling—demonstrate thatgreen chemistry has gone far beyondmere show at this point, earning seriousscientific and economic recognition. Nowthe quest begins to fill the other 95 per-cent of the toolbox.

“It’s a really exciting time to be achemist,” says Anastas.

The allure of the science should helpfurther accelerate the spread of greenchemistry; so should the obvious eco-nomic benefits and competitive advan-tages for companies. And there’s anotherfactor as well. Increasingly, customersand investors are demanding that thecompanies in which they place theirtrust reflect their own values when itcomes to protecting public health andthe environment. Today, companies areincreasingly realizing that if they don’tgo green on their own, the market maydo it for them. tap

Chris Mooney is a Prospect senior cor-respondent and author of the recentbook The Republican War on Science.

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chemicals gone bad—like, for example,chlorofluorcarbons (cfcs). These chem-icals were designed for a reason: Previ-ous refrigerants had been toxic. Bycontrast, cfcs weren’t flammable or oth-erwise hazardous—at least to humans.Their popularity quickly spread, andthey became widely used in refrigera-tors, air conditioners, and as propellantsin various sprays. It wasn’t until the mid-1970s that scientists first realized, al-most by accident, that the long-livedchemicals were making their way up intothe stratosphere and releasing chlorineatoms that, in turn, set off chain reac-tions that were destroying the earth’sprotective ozone layer.

How would a green chemist approachsubstances like cfcs? Not make them,to put it simply. From the very start, ex-plains Anastas, the green chemist wouldthink about properties of a molecule likepersistence or durability (how long-livedor indestructible it is). Indeed, the “de-sign for degradation” principle of greenchemistry explicitly addresses this topic.So if a chemical—like cfc—doesn’t de-

grade easily, that’s a warning signal thatit might have an unexpected effect whenreleased into the world. “By addressingthe problems at the design phase, youhave a much greater chance of avoidingthese surprises,” Anastas explains.

These days—when many major com-panies have a cfc-type story in their

past—that’s a message that business-men can appreciate. Companies spenda fortune dealing with the government’sregulatory process—installing scrub-bers in power plants, engaging in toxicclean ups, defending themselves incourt, paying damages. On top of that,they often spend money on public rela-

tions to burnish—or rehabilitate—theirimages. Sometimes they even dole outfor scientific expertise or “product de-fense,” so that if their products are ac-cused of causing health risks they canfight back with a tobacco company–stylestrategy of doubt and denial.

Yet if companies could fully imple-ment green chemistry—and actuallycease causing real or potential harmsin the first place—all of these costsmight be cut.

No wonder, then, that green chem-istry is “definitely penetrating into themarket,” according to Andrea Larson, aprofessor at the Darden School of Busi-ness Administration at the University ofVirginia who’s writing a book about theeconomic benefits reaped by companiesthat pursue sustainable business prac-tices. To be sure, Larson emphasizes, notall firms involved in green chemistryhave made it a major strategic focus.That’s in part because, in the words ofWarner, green chemistry’s “toolbox” isstill 95 percent empty, meaning that itcannot yet provide solutions for mostchemical problems.

Nevertheless, considerable awarenessof green chemistry exists, includingamong major companies like Pfizer andDuPont. Even mega-corporations like GEand Wal-Mart have at least made generalnods recently toward more environmen-tally friendly business practices. “If you’rethinking long term, and positioning yourcompany, then you’d better be on top ofthis stuff, or you’re going to be left be-hind,” says Larson.

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The sheer allure of the science will help spread green

chemistry. But so will the economic advantages to

business and, increasingly, demands from consumers.

G R E E N FACTS

The concentration of greenhouse gases in ouratmosphere is now 27 percent higher than any-time in the past 650,000 years. And despite re-

medial efforts, the emissions level in 2004was 16 percent higher than in 1990.

Carbon emissions are projected torise another 37 percent by 2030—

according to the Bush admin-istration’s Department

of Energy.— Source: Center for

American Progress;epica

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investment of at least $10,000 and deliver5,000 or more bushels of corn each year.According to manager David Kolsrud, theplant produces a healthy return of 30-pluscents per gallon, and “through the firsteight years of operation [farmers] havegotten back over five times their originalinvestment … From a rural developmentstandpoint we feel very strongly that com-munity-based plants with farmer owner-ship have a more significant value to thearea than having outside ownership.”

But as ethanol undergoes an in-evitable process of industrialization,

and capital requirements intensify, smalland medium-sized farmers could besqueezed out unless policies are explicitlydesigned to promote them. Kolsrud warily

observes that “the industry trend is towardlarger facilities which are either owned byfarmers, or, as in many cases, are owned byWall Street investors and other bigger en-tities getting into the business.” Kolsrud re-mains optimistic that small co-ops cansurvive—“for a while”—by selling ethanolthrough larger marketing alliances, but thelong-term picture for farmers is unclear.

This corporate presence is nothingnew, says John Crabtree, analyst for theCenter for Rural Affairs, a Nebraska-basedfarm advocacy group. “People need to un-derstand that ethanol production is al-ready an incredibly concentrated market.Archer Daniels Midland and Cargill con-trol the lion’s share of ethanol production.”

Ethanol leader adm’s market share hasactually declined from a stunningly high60 percent to a still-worrisome 25 to 30percent in recent years. But a recent analy-sis by usda agricultural economists con-

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Business, as Usual?Ethanol could be a huge boost to small farmers and the rural economy.But unless we are vigilant, the big winners could be the usual suspects.

BY CHRISTOPHER D. COOK

W hen president bush sud-denly embraced wood chipsand biofuels on national tele-

vision, renewable energy producers re-ceived a prime-time injection of hope.Ethanol backers forecast a boon for farm-ers and the environment. Yet seriousquestions remain about whether ethanolmerely enables our addiction to an unsus-tainable auto-centered society—unlessit’s part of a broader shift in consump-tion and production.

Equally critical is the matter of whata carbohydrate economy means forAmerica’s two million farmers (by nomeans a monolithic lot), and for the fu-ture of sustainable agriculture. Will bio-fuels benefit smaller growers, or justlarge-scale producers and agribusiness?How will pressures for increased produc-tion and reduced energy prices effectfarmers? Would small and mid-sizedgrowers fare any better in the energyeconomy than they have in a rapidly con-solidating food economy that has drivenso many off the land and into poverty?

The stakes are significant: Protectingsmaller-scale, diversified farms is intrin-sic to ecological stewardship and ruraleconomic health, sustainable farming ad-vocates (and some biofuels proponents)argue. A major biofuels expansion couldspur yet more large-scale industrial agri-culture, which often relies heavily on pe-troleum-based fertilizers and pesticidesand deploys fuel-guzzling farm machin-ery. Pressures for large-volume produc-tion and cheap energy might ultimatelyharm smaller farmers and the environ-ment—unless there are explicit policies toprotect both.

The exploding ethanol markethas brought U.S. corn growers—and

agribusiness firms like Archer DanielsMidland (adm) and Cargill—a harvest

of fresh cash: a crop of 1.25 billionbushels in 2004 (projected to be 1.6 bil-lion by the end of this year), worth morethan $3 billion, according to a studyprepared for the Renewable Fuels Asso-ciation. Ethanol’s direct and spin-off ef-fects, the trade group says, include anestimated 147,206 jobs created, $14 bil-lion added to the U.S. gross domesticproduct, and a trade benefit from reduc-ing oil imports by 143 million barrels.Ninety-five plants across the country, 46 of them farmer-owned, now produce4 billion gallons a year (1 billion gallonsof it by adm alone) of ethanol. Another31 plants are under construction.

A growing portion of America’s cornharvest—roughly 18 percent, up from just8 percent in 2000, according to usdadata—is now funneled to fuel production.With corn prices consistently below thecost of production and fuel prices march-ing upward, ethanol has provided flexibil-ity to some growers, particularly those infarmer-owned cooperatives. “Even at thesmall farm level you can see real opportu-nities to improve the farm economy by cre-ating new markets and new ownerships,”says Patrick Mazza, research director forClimate Solutions, a renewable-energygroup based in Washington state. “What’snice for the ethanol farmers in those co-opsis that when corn prices are high they canmake money on corn and when corn pricesare low they can make money on ethanol.”

The epicenter of farmer success so faris Minnesota, where clean-fuel standardsand producer incentives have spurred anethanol boom led by 12 farmer co-ops. InMinnesota’s southwestern corner, thesmall city of Luverne is home to thefarmer-owned Cornerstone Co-op, whichchurns out more than 20 million gallonsof corn ethanol annually. Launched in1998, the cooperative has attracted 220area farmers who must pony up an initial

G R E E N FACTS

The average 100-million gallon ethanol facilitycreates nearly 1,600 jobs and generates$223 million annually in increasedgross state product.

— Source: The RenewableFuels Association

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cluded, “The fuel ethanol industry may verywell be in transition toward an inevitableconcentration of ownership into the handsof a few large processing firms.” The mar-ket is driven by large-scale gasoline refiningfirms, which “don’t want to deal with allthese small plants,” and a “virtual consoli-dation of ethanol processing” is takingplace. (adm didn’t respond to multiple re-quests for comment for this story.)

New biorefinery developments aretrending away from farmer ownership.In 1999, farmers owned all new plantsbeing constructed, but by 2006 “they

owned just 19% of the 1.7 billion gallonsthat will flow from 29 new plants goingup or expanding,” according to SuccessfulFarming magazine.

“You have some of the same players asin the food sector, Cargill and adm, whoseinterest is in buying low and selling high,”points out George Boody, executive direc-tor of the Minnesota-based Land Stew-ardship Project, who wants to ensure thatbiofuels are grown sustainably. “Massiveproduction of a few crops is the best wayto get there, and that typically doesn’t bodewell for small to mid-sized farmers be-cause the margins get too tight and theacreage requirements grow and grow.”

Farming expert and author MartyStrange, a onetime director of the Centerfor Rural Affairs, says ethanol’s growth,like the rest of agricultural industrializa-tion, brings little hope for smaller produc-ers. “There’s no question that large-scaleethanol production depends on large-scale grain production. The small-scalediversified grain farmer is not what theethanol industry relies on.”

Another dilemma: By edging out di-versified farming, large-scale corn mono-cropping could weaken local food security,

requiring more long-distance transport offoods (already averaging roughly 1,800miles per item)—thus more diesel pollu-tion from the trucks that haul foodstuffs.Meanwhile, epa efforts to repair the Gulfof Mexico’s 10,000-square-mile hypoxiczone, a massive oxygen-killing algae bloomcreated in good part by runoff from fertil-izers and pesticides applied to corn andother grain crops, may call for less corn—not more. Likewise, some advocates em-phasize the need for more localized ethanol(and biodiesel) production, to supportfarmers and avoid the ironies of cross-country shipping of renewable fuels.

These economic and ecologicaltensions are generating increased col-

laboration between sustainable farmingand clean-energy advocates. Jim Klein-schmit, rural communities program di-rector for the Institute for Agricultureand Trade Policy, cites a growing concernthat biofuels “be produced in a way that’ssustainable for the landscape, for thefarmer’s pocketbook, and for the com-munity.” Patrick Mazza and others saythat ethanol and other biomass energycan be produced in a way that sustainsfarmers and the environment, if policyincentives are designed to promote both.

An array of ideas are afloat to encour-age a more sustainable biofuels expan-sion: a diversified renewable energypolicy that, rather than expanding corncrops, promotes more wind power andcellulosic energy from switchgrass and

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European Shades of GreenIn addition to our trade imbalance, America has a huge deficit ofsmart environmental policies. Here’s where more imports makes sense.

BY EZRA KLEIN

Oh, and one more thing,” saidSebastian Paauw, organizer of arecent trip I took to the Nether-

lands, “we’re not going to rent you a car,but we’ll give you a bike.”

True to his word, he promptly pro-vided me with a bicycle. And while thecheese, wine, and charmingly narrow

streets and alleyways made me feel prettyEuropean, my new, cosmopolitan identitydidn’t quite click till I was gliding abouton my sloping, bright-red three-speed.

But I’m a Californian, and a southernCalifornian at that. So I’m plenty usedto lands where automobile intertwineswith identity. When the British architec-

crop residues (which may favor localized,small-scale production); a federal versionof Minnesota’s model, creating targetedincentives for farmer co-ops; and in-creased research spending by the usdaand Department of Energy to developsmaller-scale biofuels processing plants.Negotiations for the 2007 federal farmbill, already simmering, will feature a bat-tle between agribusiness’ push formonocropping of cheap commodities,and family farm groups’ efforts to raisecrop prices and rein in corporate control.

Iowa corn and soybean farmer GeorgeNaylor, president of the National FamilyFarm Coalition, warns that without propersupports, intense pressures for cheap en-ergy will further imperil farmers’ frayedpocketbooks. “It’s an absolute must thatthere be public policy to make sure that theenvironment is taken into account, howland is being used, and whether familyfarmers benefit at all from it.” Such policy,says Naylor, must incorporate the inter-twined concerns of small farmers, sustain-able agriculture, and clean energy—“so itisn’t just a matter of everyone going outand plowing the hell out of the countrysidethinking there’s going to be a pot of goldat the end of the rainbow.” tap

Christopher D. Cook’s writings haveappeared in Harper’s, The Economist,the Christian Science Monitor and else-where. He is the author of Diet for aDead Planet: Big Business and theComing Food Crisis (New Press).

G R E E N FACTS

When burned, biodiesel emits 48 percent lesscarbon monoxide, 80 percent less aromatic hy-drocarbons—which contribute to both smogand ozone—and 100 percent less sulfates thanconventional petroleum diesel.

—Source: The National Biodiesel Board

t h e a m e r i c a n p ro s p ect a 2 7

tural critic Reyner Banham decided tointerpret Los Angeles, he learned todrive, judging it impossible to under-stand the city without a stick shift. At-tempting to experience Europe fromwithin a Hummer would be like Ban-ham exploring LA as a pedestrian: itwouldn’t work, and would earn scornfrom the natives to boot.

That’s largely because, for a variety ofreasons, Europe has long been more seri-ous about its environmentalism than theUnited States. Much belligerent unilater-alism has been ascribed to George W.Bush’s rejection of the Kyoto climatechange protocols, but less discussed is theimpetus for Europe’s wholehearted em-brace. It springs, at least in part, from theknowledge that global warming will dev-astate that continent first and worst. Sci-entists predict that by 2080, Europe willno longer have winters, their storied,stately alpines will melt, and over in theNetherlands, Sebastian Paauw’s kids won’tbe handing out any more bikes; they’ll betoo busy offering scuba gear to adventur-ous explorers eager to dive through theremains of a charming European coun-try that went the way of Atlantis.

But Europe has no intention of goinggently into that good—if ahistoricallywarm—night. According to German en-vironmental minister Jürgen Tritten, hiscountrymen have made a tradition ofscreening the 1958 Oscar-winning West-ern The Big Country during holidays.The film stars Gregory Peck, playing aretired ship captain who moves west tomarry his sweetheart and ends up acci-dentally embroiled in a conflict overwater rights. Not to give it away, but Peck,playing the anti-cowboy, ends up wrest-ing control of the river from rival ranch-ers and demanding that the locals respectthe resource and cease ravaging the com-mons. If only it were so easy in real life,Tritten seemed to imply. Sadly, it turnsout that it’s much easier to mediate in abig country, or even a big continent, thana whole world.

America, the world’s largest producerof carbon gases, has evinced nothing buthostility to curbing emissions, and withno nation-state version of Gregory Peckon the horizon to demand temperance,

the Europeans have had to lead by exam-ple. And so they have.

Tritten’s Germany, for one, hassprinted into the lead on climate change,implementing an array of programs toincrease the usage of renewable energyresources. Currently, use of solar, wind,geothermal and tidal power and biomasscuts CO2 production by 50 million tons.The German government has mandatedthat, by 2020, these and other alternativesources of energy make up 20 percent ofthe country’s electricity needs and, by2050, 50 percent of total energy con-sumption. These ambitious goals haveopened up new markets for German cor-porations. Estimates have photovoltaic(solar) cells comprising a $100 billionmarket by 2020. Japan has long led thisfield, with the United States in secondplace. No longer. Germany has firmlysupplanted us, boasting 140 installedmegawatts versus our mere 70. And thatunderstates American slippage in themarket. California, land of sunshine,plays host to the world’s largest solarplant, which the German EnvironmentMinistry financed to the tune of six mil-lion euros. Based on the experience ac-crued during that project, it will be aGerman company, Solar Millenium, that

will construct the first commercial powerplant to produce “parabolic-trough” solarenergy, which uses sophisticated mirrorsystems that concentrate the sun’s radi-ation, in Granada, Spain. But hey—whowants to be on the cutting edge of tomor-row’s technologies?

Oh, right, iceland. because overthere, they’re tired of their best

known export being Björk and have re-solved to attain an early lead on hydrogentechnologies and, for that matter, maketheir entire country oil free by 2050. Tobe fair, Iceland is in a unique energy sit-uation, sitting as it does atop a limitlessamount of geothermal power providedby a hyperconcentration of volcanoes thatboil the country’s underground springsand baths, generating heat that can thenbe harnessed for electricity.

That natural advantage, however, hasspurred the island nation to reconcep-tualize its economy as the perfect testingground for hydrogen, a clean, e∞cient,and renewable source of energy. Andwith the highest per capita car owner-ship rate in the world—and no domesticfuel industry to offer competition—Ice-landers have adopted the project whole-heartedly. Their bus fleet already runs

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Here Comes the Sun: Switzerland’s largest photovoltaic power station, at the Verbois Dam

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on the stuff; the buses emit a ghostly trailof water vapors that, during cold weather,occasionally scares visitors into thinkingthe buses are burning. When the fueltank depletes, the buses drive into theworld’s first commercial hydrogen sta-tion, developed with Shell and o∞ciallyopened in April 2003. Along for the ridehave been all manner of multinationals,from interested organizations like the

European Union to desirous multina-tionals like DaimlerChrysler.

But while Iceland works to routinizethe hydrogen economy and eventuallyrender it economically competitiveenough for export, the rest of Europe istaking a decidedly less dramatic approachto curbing carbon emissions. Wind powerhas, ahem, swept the continent, particu-larly Denmark, where travelers arrivingby boat float past 20 massive turbines,calmly spinning their 100-foot bladesabout two miles off the coast while pow-ering 32,000 homes on the mainland.Like solar power, wind power is anotherindustry Americans seemed poised todominate. Indeed, the Danish producerscut their teeth on an order for 10,000turbines from California in the early1980s. But the tax credits and govern-ment subsidies driving the Californianexpansion lapsed, and so did the GoldenState’s interest.

The Danes, meanwhile, parlayed theirturbine production into the country’slargest export industry, dominating therapidly expanding market for wind-powertechnologies. Wind power accounts fornearly 13 percent of Denmark’s currentenergy usage, and is expected to accountfor fully 50 percent by 2030. Denmark isparticularly well-suited to wind, and itssuccess is only partially replicable acrossthe European Union and the world. Sowhat of all the other European countries

A Win-Win BargainAmerican and Third World farmers are at odds over farm subsidies.Trade rules that promote energy crops could serve everyone.

BY GAYLE SMITH

As presently structured, theglobal trading system frequentlypits the working poor in the de-

veloped and developing worlds againstone another. The subsidies that help sus-tain the livelihoods of American farmershave a direct, adverse effect on the abil-ity of farmers in the world’s poorest coun-tries to compete on the global market.

The conventional wisdom holds thatthe phaseout of subsidies paid to Amer-ican farmers will automatically lead to afair market price for poor farmers in thedeveloping world. But farm commodityprices are notoriously volatile, and thereis a better way to achieve a win-win so-lution: By reducing export subsidies and

increasing investment in the productionof energy crops, the United States can laythe groundwork for a grand bargain thatwould allow American farmers to in-crease domestic income while expandingthe market in other agricultural goodsfor farmers from poor countries.

Even with the expansion of globaltrade, 54 countries are poorer today thanthey were 15 years ago. Poverty levels inAfrica have increased by 43 percent overthe last decade, and almost half of theworld’s people live on less than $2 per day.

It is both ironic and tragic thatchanges to U.S. trade policy that favor thedeveloping world are often opposed byfarm interests on the grounds that they

not gusted by or placed on top of limitlessenergy sources?

On January 1, 2005, the EuropeanUnion’s carbon trading program wentlive. Power plants and farms that accountfor about half the EU’s CO2 emissionsand that are scattered across the conti-nent have been given carbon emission al-lowances—limits that they must meet. Ifthey’re able to institute e∞ciencies andcome in under their caps, they can sellthe remaining credits to organizationsand industries having more trouble livingwithin their CO2 means. Currently, en-ergy use that exceeds 20 megawatts anhour triggers automatic enrollment in thesystem, and the carbon caps, negotiatedby home governments, are fairly relaxed.Both ends are expected to tighten as thesystem ramps up and comes in for reviewand revision in 2008. Early signs, how-ever, are promising. The bbc reports thatby November 2005, over 200 millionmetric tons of carbon had been traded.

And for Europe, that may be the fu-ture: taking the individual commitmentsof its leading member-states and forc-ing them on the developing economies

eager to enter the European Union’s em-brace. In May of 2004, Cyprus, the CzechRepublic, Estonia, Hungary, Latvia,Lithuania, Malta, Poland, Slovakia, andSlovenia all joined the European Union.One precondition for their entry: to ac-cept the acquis communautaire, thebody of ratified EU laws. Among theselaws are a score of relatively strict envi-ronmental protection standards cover-ing everything from climate change towaste management. This has triggeredan investment boom of sorts. For Polandalone, complying with the wastewaterand management regulations will cost60 billion euros.

And so, interestingly, the EuropeanUnion itself has assumed Gregory Peck’sHollywood role, at least in Europe. Butroping in a bunch of small-time rancheswhile an agribusiness conglomerate digsin upstream is of questionable value. Inthe end, Europe can lead its horses towater and teach them how to drink mod-erately. When it comes to the challenge ofglobal climate change, however, that’s oflimited utility unless they can makeAmerica do it, too. tap

G R E E N FACTS

A national investment of $50 to $77billion in wind energy could create atleast 120,000 new jobs in the 20states that have lost themost manufacturingjobs since 2001.— Source: Renewable Energy Policy Project

t h e a m e r i c a n p ro s p ect a 2 9

hurt U.S. producers. The irony is that bypromoting development through increas-ing trade and better terms of trade, theUnited States can help to increase thepurchasing power of the world’s poor, andthus pave the way for increased marketdemand for American goods and servicesin the future. The tragedy is that this ar-gument pits producers at home andabroad against one another, when in factthey aspire to the same goals—and facesome of the same challenges.

Farmers are famously vulnerable toprices beyond their control while theircosts are fixed. Like farmers everywhere,American producers need dynamic pub-lic policies to increase and secure the pros-perity of their operations. Unfortunately,U.S. farm subsidies, with their produc-tion-related incentives, generate oftenperverse market conditions for U.S. farm-ers. Even though the United States De-partment of Agriculture forecasts nearrecord-level production of corn and soy-beans in 2005, the glut of commoditieson the market caused by payment incen-tives is depressing prices below domesticoperating costs. As a result, farm subsidiespaid out in 2005 will increase more than60 percent from 2004, and will likely ex-ceed the 2000 record of $22.9 billion.

However, just 10 percent of commod-ity farmers collect more than 70 percentof the payments. Record subsidy pay-ments will do nothing for the 60 percentof farming households that lose moneyon their agricultural operations and mustrely on off-farm income for survival.Without crop diversification and the re-duction of production-related subsidies,American farmers will continue to sufferfrom the economic downturns created,in part, by the United States’ own policies.

By investing in biofuels derived fromplants and agricultural waste, theUnited States can develop a cleaner,more sustainable alternative to oil andrevive a flagging domestic agriculturalsector. At the community level, farmersthat produce dedicated energy crops cangrow both their own incomes and theirown supply of affordable energy. At thenational level, the production of biofu-els will generate new industries, newtechnologies, and new markets, all while

reducing energy expenditures andpaving the way for developing countriesto put their resources into real, mean-ingful development.

How to achieve this bargain?One way is to take a new tack on trade.

The latest in a string of trade negoti-ations, the Doha Round of trade talks waslaunched with a commitment by theworld’s richest nations to make develop-ment a centerpiece of trade and reformthe trading system to enable poorer coun-tries to make real gains, particularly in

areas of relative competitive strength, likeagriculture, which sustains 70 percent ofthe rural poor in developing countries.But the Doha Round is stalled, as bothsides are dug in. The United States andEurope refuse to cut agricultural subsi-dies until poor nations further open mar-kets to manufacturing exports.

A World Bank study recently notedthat the sheer size of agricultural subsi-dies relative to the size of the markethas the effect of rewarding noncompet-itive producers and wreaking havoc onsmall economies that are heavily de-pendent on the export of only a fewcrops. For example, the combined valueof U.S. and European Union cotton sub-sidies is $4.4 billion—in a global cottonmarket valued at $20 billion.

In West Africa, cotton was introduced

at the dawn of independence in the 1960sand initially paved the way to relativewealth, fetching such a high price on theworld market that it came to be known as“white gold.” Entire economies wereturned over to cotton production, andtoday cotton is the primary source of na-tional income for countries like Benin,Mali, Burkina Faso, and Chad. Yet, thissame white gold today drives economicdecline. Over time, the heavily subsidizedcotton sector in the United States has dis-placed the smaller and more fragileeconomies of West Africa by triggering

overproduction and, with it, a dramaticfall in the international price of cotton.West African cotton producers earn anaverage of just $400 per year.

Taken alone, a reduction in exportsubsidies by the developed world isinsu∞cient to ensure that the world’spoorest citizens see real and sustainablebenefits from globalization. Yet by com-bining subsidy reduction with invest-ments in alternative energy at home andabroad, the United States can make ashift in subsidy policy more politicallyacceptable and lead the way to a more eq-uitable global future.

Although the we have only four per-cent of the world’s population, we accountfor a quarter of global petroleum demand,making the United States the mostprofligate oil consumer on the planet. Our

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“White Gold”: Cotton, once a boon to West African economies, has recently driven decline.

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oil dependence is draining the federalbudget, corrupting the global environ-ment, contributing to high energy prices,and skewing our foreign policy.

The developing world’s dependence onoil, meanwhile, fuels rampant poverty.The doubling of the price of oil over thelast two years has had a disproportionateimpact on the world’s poorest countries,38 of which are net importers and 25 of

which import all of their oil. Three-quar-ters of the countries considered to be per-forming well enough economically toqualify for international debt relief, mean-while, are net oil importers; some allo-cate as much as 5 percent of their grossdomestic product to cover oil imports.

But it is the developing world that isleading the way to a new, renewable en-ergy future, with Brazil, a rising agricul-tural superpower, in the lead. Over thepast 30 years, Brazil has turned its richsupply of sugarcane into ethanol, therebycreating both fuel and jobs. Today, themajority of Brazilian drivers fill up witha gasoline blend that is 25 percentethanol, while a growing number of carson the road run on pure ethanol. The eco-nomic impact has been substantial: Be-tween 1975 and 2000, Brazil’s ethanoluse saved the country $43.5 billion worthof oil imports and created one millionnew jobs for its citizens.

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A Renewable Economy as a Global Ethic It’s a win-win equation for the planet—and one that will advance thegoals of sustainable agriculture, clean energy, and human health.

BY MICHAEL LERNER

In a song dedicated to martinLuther King Jr., James Taylor sings: We are bound togetherBy our desire to see the world becomeA place where our children can growup free and strong.

For more than three decades, theworld movement for sustainable devel-opment has been driven by that aspira-tion. The vision of a plant-based economyis a new way of offering a more concretevision of sustainable development to cre-

strated how biofuels, coupled with stronge∞ciency and smart-growth policies,could dramatically reduce, if not elimi-nate, the United States’ need for oil. Bydramatically increasing investment in theresearch, development, and deploymentcomponents of a large-scale agriculture-based energy sector, and by providing theincentives and risk-management toolsthat can support the transition to newcrops, the U.S. government and privatesector could, as Brazil has done, trans-form our energy landscape and the livesof America’s small farmers. And by devel-oping a new competitive edge and creat-ing new domestic markets for Americanfarmers, we could free up other commod-ity markets to the developing world andhelp to ensure that the world’s poorestfarmers can fairly compete.

Ensuring that the 2007 federal farmbill includes robust provisions for domes-tic energy production, capitalized in partby reductions in export subsidies, will aidfarmers at home and abroad. But more isneeded to extend the promise of renew-able energy—and with it, the escape frompoverty—to the world’s poorest farmers.

First, we must rapidly scale up our in-vestments in research and development,and fully fund and disseminate these ad-vances in technology throughout the de-veloping world. Second, we can target ourdevelopment aid. The United States,along with other members of the G8, pro-vides debt relief to countries that meet adesignated set of performance standards.The savings are then invested in criticalsocial sectors, including health and edu-

cation. If we allowed the savings to alsobe invested in the development and de-ployment of biofuels, those countrieswould be able to ensure increased in-comes for their agricultural producersand reduce their cost of oil imports.

Like any country, the United Statescan and should pursue its own economicinterests in defining the terms of worldtrade. But our own prosperity, security,and moral credibility depend on a worldunited behind common principles and aglobal order that affords a majority of theworld’s people the right to live in dignity,earn a living wage, and offer better livesto their children.

Here is an opportunity to truly thinkglobally and act locally. By investing in thepotential of our own domestic agriculturalsector to produce alternative energy, theUnited States can create new markets, in-crease farm income, and offer rural Amer-ica something better than just a safety net:a competitive edge. In so doing, the UnitedStates can take the first step in a strategydesigned to offer farmers in the develop-ing world something better: the chance tocompete in a fair market. tap

Gayle Smith is a senior fellow at theCenter for American Progress. Previ-ously, she was a special assistant toPresident Clinton, and held senior postsat the National Security Council andthe U.S. Agency for International Devel-opment, and in 2005 directed theGlobal Poverty track of Clinton’s GlobalInitiative. Smith was based in Africafor almost 20 years as a journalist.

G R E E N FACTS

Apart from 2004, in every year since 1998,between a quarter and a half of all net farmincome in the United States has come from gov-ernment payments. Not since the 1980s has theaverage American farmer been so dependenton Washington for so much of his income.

— Source: Agricultural Policy Analysis Center,University of Tennessee

t h e a m e r i c a n p ro s p ect a 3 1

ate a world safe for children and all life.For many groups that now work sep-

arately, the vision of a plant-based greeneconomy also provides opportunities towork together. In the United States,nonprofit networks operate principallyin separate silos on green economy is-sues such as environmental health, cli-mate change, sustainable agriculture,sustainable consumption, forest preser-vation, smart growth, environmentaljustice, and the like. Each of these net-works is, in itself, far too small to drivetransformative economic change. Thegreen economy, by contrast, is a com-prehensive social agenda that canachieve many of the goals of all of thesediverse groups.

The green economy can attract alliesin the government and for-profit sectors.It makes deep sense from a geopoliticaland strategic perspective for the UnitedStates to take this decisive step towardenergy independence. The green econ-omy makes political sense in many “red”as well as “blue” states, and suggests anew bipartisanship. It is in the interest ofthe farm states to grow our energy, fuel,and materials feedstocks.

A bio-based economy is the only scal-able alternative to a global economy ad-dicted to oil and petrochemicals. Atcurrent rates of growth, China and Indiaalone will outstrip the entire global de-mand for oil and other key raw materialswithin 30 years.

In the United States, with vastacreage available to plant crops, a bio-based economy, in which we “grow”green energy, green materials, andgreen chemistry feedstocks, is also thebest hope for a new industrial produc-tion base for good jobs. Bio-based pro-duction represents the marriage of thegoals of sustainable agriculture, greenenergy, and the broader environmentalhealth movement.

One central question is: whowill own and control this technolog-

ical revolution? The petrochemical in-dustry has controlled the heights of theglobal economy and global geopoliticalstrategies for the last century. This hasled to global climate destabilization, the

poisoning of the entire web of life withtoxic chemicals, and a foreign policy thatrequires sustained hostilities in the Mid-dle East and support for undemocraticregimes wherever there are remaininggas and oil reserves.

The bio-based economy can andshould be based on larger democratic and“open source” values and strategies. Op-portunities exist for local and regional in-terests to take substantial ownership ofthese new technologies, to help promotean economy that supports health, envi-ronment, and community interests.

Above all, the green economy is self-evidently linked to a sustainable worldthat will support human health. Humanhealth is fundamentally dependent on

a stable climate and crops that can begrown in a stable climate. Humanhealth is equally dependent on the re-versal of a century of buildup of toxicchemicals in the body of all life. In hu-mans, more than 100 diseases, disor-ders, and conditions are linked inleading toxicology texts to manmadechemical contaminants. The revolutionin environmental health sciences de-scribed by Pete Myers [see “Good GenesGone Bad,” page A13] is generating alarge body of evidence that many of theepidemic conditions of our time are re-lated to these contaminants.

Clean air, clean water, and safe foodsare historically issues that have animatedvoters. Now voters show a growing con-cern about visible evidence of climatechange and of the pervasive, perniciousimpact of chemicals on health.

Patient and health professionalgroups concerned with cancer, birthdefects, asthma, heart disease, learningand developmental disabilities, infertil-ity and pregnancy, Parkinson’s disease,and endometriosis have already begunto engage to fight for a healthy environ-ment and a phaseout of toxic chemicals.As the concerns of these health groups

converge, a set of issues that were onceconsidered “environmental” are beingreframed as fundamental to the healthand safety of families. This is a profoundtransformation.

A parallel development is the grow-ing involvement of faith communities.Faith groups have become critical leadersin the struggle for climate-friendly en-ergy policies. Increasingly, these samefaith groups are engaging the issue oftoxic chemicals. Just as patients’ groupsbring human health to the table, faithgroups bring an indispensable moralvoice to the dialogue.

The specifics of how we frame thegreen economy debate, and the strate-gies and tactics we pursue, deserve care-

ful attention. The goal would be tosubstantively unite the key health, envi-ronment, faith, labor, justice, and non-governmental organization communitieswho share these concerns, in conjunc-tion with the many enlightened corpo-rate interests who embrace a greeneconomic future.

The environmental health movement,which over the past decade has broughttogether a formidable range of interestsconcerned with chemicals and health, isa good example of the extent to whichsuch alliances are achievable when a con-structive new frame, such as environmen-tal health, is widely adopted.

The green economy is not the ultimateframe, since there are important issues itdoes not address. But it is a practical andachievable next step that could bring to-gether progressives and conservatives inan alliance to build a healthy and sus-tainable world. tap

Michael Lerner is president of Com-monweal, a health and environmentalresearch institute in Bolinas, Califor-nia. He acknowledges the contribu-tions of Gary Cohen and Pete Myers tothis article.

g r e e n eco n o my

A bio-based economy is the only alternative to our oil

addiction: China and India will outstrip the entire global

demand for oil and other raw materials within 30 years.