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Why the Jobs Crisis Is Actually an Innovation Crisis

Tuesday, March 9th, 2010
Michael Mandel


Michael Mandel, formerly chief economist at BusinessWeek, writes on innovation and growth at www.southmountaineconomics.com.

by Michael Mandel

Forget for the moment the $15 billion jobs bill moving through Congress — even its supporters admit that it’s far too paltry to make even a tiny dent in the unemployment rolls. And ignore the economic commentators who tell you that the labor market is recovering just because job loss has slowed.

No, the U.S. is having a genuine long-term jobs crisis, one which stems from a deeper problem: The Great Innovation Machine of the American economy seems to have broken down. With a few notable exceptions (think Apple and Google), this has been a period when companies have found it remarkably hard to turn promising breakthrough innovations into commercial breakthrough products. The list of “big-idea” innovations that seem tantalizingly close to market, but not quite there, just keeps getting longer and longer. Some examples: After 20 years of research, no human gene therapy has yet been approved for sale by the Food and Drug Administration; electricity generated from solar cells is still far from price-competitive with electricity from coal or natural gas; and biotech has not yet fulfilled its promise of speeding the discovery of new drugs.

The jobs crisis, in my view, is the direct result of the innovation shortfall. Since the 1990s, both Democrats and Republicans have expected the “jobs of the future” to come from the innovative, technologically advanced industries. Computers, semiconductors, internet companies, pharma, biotech, communications: all seemed to have enormous potential to create new jobs. What’s more, innovation seemed to be the only way that the U.S. could compete against low-cost producers abroad.

Many regions designed their economic development strategies around attracting biotech and infotech jobs to replace the “old-line” factory positions that had fled overseas (do a Google search for ‘biotech initiative’ and see how many hits you get). The desire to bring in pharma jobs is the reason why New London tore down homes and businesses to make room for a Pfizer research facility in 2001.

But the sad truth is that the innovative sector of the economy hasn’t generated many jobs recently. Let’s be very specific here. From the bottom of the job market in 2003 to the so-called peak in 2007, technologically advanced industries such as semiconductors, communications equipment manufacturing, and telecommunications lost thousands of jobs. Across the same period, the industry that the Bureau of Labor Statistics calls “Internet publishing and broadcasting and web search portals” — a catch-all category that includes Google, Yahoo! and all the high-profile Internet firms — added only 6,000 jobs.

Life sciences didn’t do much better. From 2003-2007, employment in pharma was stagnant, and biotech added only 16,000 jobs. Indeed, Pfizer recently pulled out of New London, leaving behind a lot of hard feelings. (For more on the jobs shortfall in the innovative sector, see my blog at www.southmountaineconomics.com.)

Turning Innovation into Jobs

So what has happened here? A big part of the jobs crisis stems from a simple fact: Commercializing innovation has taken a lot longer than people expected. Across multiple areas, from biotech to alternative energy to advanced materials to the private uses of space, both large and small companies have faced fundamental scientific and engineering problems. The best example is the sequencing of the human genome, which was announced to great fanfare in 2003. But turning that initial breakthrough into commercial products has turned out to be far more complicated and difficult than many thought. (For more on the innovation shortfall, see my June 2009 cover story, “The Failed Promise of Innovation in the U.S.,” for BusinessWeek.)

In today’s global economy, innovation makes up the main comparative advantage for the U.S. If we are not generating jobs in the innovative industries, it’s no surprise that we have a jobs crisis.

Addressing the innovation shortfall has to be a cooperative project between business and government. How? Here are three low-cost ways to foster a better climate for innovation and jobs:

  • Elevate innovation to the top of the policy agenda. President Obama needs to publicly give higher priority to innovation. In the latest Economic Report of the President, innovation is relegated to the very end of the report, and does not even get a whole chapter to itself (the chapter is called “Fostering Productivity Growth through Innovation and Trade”).

    Why is a public emphasis on innovation important? Government is much better at stopping breakthrough products and services than creating them. New ideas, by definition, are threatening to the status quo. That’s why the president has to give a clear signal to the entire government bureaucracy that innovation is important.

    On the one hand, this shift in public priorities can be done right now, without any additional funding, so Obama wouldn’t have to fight Congress. On the other hand, Obama might have a big struggle to get support from his own economic advisors, some of whom don’t seem to place such high value on innovation.

  • Broaden out government funding for R&D beyond healthcare. To maximize the chances for innovation-related job growth, we want a broad and diverse program of federal support. However, in recent years, federal funding for R&D has increasingly focused on healthcare. Obama’s proposed FY 2011 budget continues that trend, with federal spending on health R&D projected to exceed spending on nonhealth civilian R&D by more than 30 percent. The result: Other areas of R&D are being starved for funds.
  • Improve measurement of the innovative sectors of the economy. Innovation is not as tangible as, say, a new building or a new truck. We are great at counting construction and vehicle production, but horrible at keeping track of innovative activities.

    And as management consultants say, you get what you measure. For example, we know virtually nothing on business spending on R&D in the U.S. during the downturn — a key piece of information for understanding where the economy is going. The good news is that the Bureau of Economic Analysis and the National Science Foundation have made some progress in this direction. However, a relatively small amount of money could accelerate the upgrading of the statistics, with a big impact on policy.

These proposals will not guarantee that the U.S. will suddenly experience a surge of innovation-related job growth. There’s nothing that anyone can do to ensure that commercially viable innovation will arrive on a particular schedule. But to raise the odds of good jobs in the future, we need to make innovation a priority today.

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Charting a Course for a National Infrastructure Revival

Wednesday, February 24th, 2010
Norman Anderson


Norman Anderson is the president and CEO of CG/LA Infrastructure.

by Norman Anderson

As the United States struggles to rouse itself from its economic slumber, the country is beginning to keenly feel the need to lay down a foundation for a new and vibrant economy. A concerted effort to modernize our infrastructure must top any checklist for recovery. The backbone of our economic system has suffered from years of neglect – budgetary, conceptual, institutional. With his recent request for $4 billion to create a National Infrastructure Innovation and Finance Fund, it’s encouraging that President Obama seems to understand how essential an infrastructure revival is to our prosperity.

But such a fund is not nearly enough to bring our infrastructure into the 21st century. And simply devoting money to projects will not lead to results unless we have a clear strategy for revitalizing and reinventing our roads, bridges, railroads, mass transit, and other structures and systems essential to sustaining productivity.

To put it plainly, our current infrastructure model is exhausted. We currently invest 1.3 percent of GDP in infrastructure; in 1980, we invested over three percent. Worse, we are investing in the wrong kind of infrastructure. Right now, we are barely covering replacement costs for a system designed 50 years ago — and which now badly needs updating just to keep up with the rest of the world.

For our country to be globally competitive, we will need to nearly triple our level of infrastructure investment each year over the next 10 years, from the current $150 billion level to at least $400 billion per year. And we will need to think differently about infrastructure, designing projects and promoting firms that are carbon neutral, highly innovative, and transformative.

These goals will require a fundamental shift in orientation, and a new conceptual framework for infrastructure. To see infrastructure through a new prism, we need:

  • bold leadership that inspires Americans to dream big about infrastructure again
  • an uncompromising competitiveness agenda that puts us on track to keep pace with — and lap — nations like China

From that perspective springs three specific ideas on how to get us on a course to an infrastructure revival:

  • a true National Infrastructure Bank
  • a new, NASA-equivalent agency for infrastructure
  • a new focus on the design and aesthetics of infrastructure projects

A Conceptual Framework for Infrastructure

First, the country needs a positive and unified infrastructure vision that ties together immediate job creation and long-term productivity. The last time the country had a grand vision for infrastructure was 60 years ago with the Interstate Highway System.

In a sense, we need to learn how to think about infrastructure again. Without an organizing vision, we are unmoored. In our current mindset, any project will be just as good as another. The discipline of setting priorities, and of creating and following budgets to reach toward an inspiring and ambitious vision, has disappeared. The Greatest Generation conjured up the last coherent vision for U.S. infrastructure. Now we need to create – and execute – a new vision for the next generation.

Second, we need to place the issue of competitiveness at the center of the debate. Like boiling a frog by gradually raising the temperature, the current catastrophe happened slowly, without our noticing until it was too late. For instance, China is investing $300 billion in high-speed rail through 2020, while we congratulate ourselves on a measly $8 billion down payment on a system that lacks vision, institutional support, or a budgetary glide path.

Now that we’ve noticed how far behind we’ve fallen, we have to look at infrastructure through the lens of global competitiveness. We need to be able to make, move, and deliver things much more cheaply. We need to give people better, cheaper, quicker, and cleaner options for moving themselves around the country. And we need to make sure that our water and air quality are measurably world-class. There are many ways to think about competitiveness, but having the right infrastructure, built and operated at a world-beating price, is the place to begin.

From Concept to Execution

But vision and motivation aren’t enough. We also have to execute – to get the mechanics right, and quickly. The third challenge that we need to overcome is that of funding. Specifically, we need a long-term source that will be reliable and impervious to changes in political administrations. Such an agency will also need the authority to select and seed priority infrastructure projects and systems.

A National Infrastructure Bank would fill this void. The bank would be capitalized through the sale of infrastructure bonds to middle-class Americans, who would triply benefit from their investments – contributing to better infrastructure, directly engaging in the creation of a stronger country, and individually benefiting from coupon returns on their investment.

The bank would cover all infrastructure sectors, from transportation to water to energy, and would need to be capitalized at a level of at least $400 billion over 10 years, yielding a minimum of $160 billion a year in strategic infrastructure investments. The National Infrastructure Bank would be a strategic and necessary complement to the Obama administration’s highly successful Build America Bonds program. Overall, this effort would create between two million and 2.5 million new jobs per year for the next 10 years.

We also need a high-functioning public sector – and one viewed as such by the public – if we are to rebuild our infrastructure. More than in most areas of the economy, there is a productive tension in infrastructure policy between the market’s ability to identify opportunities and the long-term wisdom the public sector can provide. Without a strong public sector, this necessary balance – identifying opportunities and creating jobs now, while ensuring benefits for the next generation – will fall out of balance. Private sector energy will never be unleashed on our infrastructure challenges unless there is a strong, high-functioning, and strategic public sector with which it can reliably and aggressively partner.

Today, the public sector – and particularly the infrastructure public sector – is neither seen nor treated as an indispensable arm of a successful state. A fretwork of agencies are involved in different fiefdoms of infrastructure, from the Federal Highway Administration to the Department of Energy to the Environmental Protection Agency. This needs to change. We need an equivalent of NASA for infrastructure, a powerful new federal agency that could drive vision and policy at all levels.

Fifth, we must bridge a design gap.  The U.S. has fallen into a budget trap in infrastructure. We are so pressured by budget issues and the threat of cost overruns that we design our projects without much attention to the inherent grandeur of infrastructure. We seem to be governed by a belief that the aesthetically pleasing is more expensive than the pedestrian, when the reverse is actually true.

Bridges, airports, subway stations, highways, and high-speed rail stations are powerful symbols that define a country and its capacities. Projects and the networks they serve say something about how a nation views itself. Crumbling infrastructure, cut-rate design, and the absence of super projects all suggest not only a lack of confidence – they saddle us with inferior infrastructure well into the future.

Conclusion

We have to establish economic priorities to get ourselves back on our feet. Making strategic decisions on our infrastructure is essential to bring vibrant and equitable growth. The Obama administration needs to fill the voids in our infrastructure policy as soon as possible. Under the right leadership, a recalibration of our infrastructure outlook and priorities can create up to five million jobs in the short run, erasing the losses of the last two years and ensuring an extraordinarily productive future for the next generation.

Editor’s note: This article has been updated since its original publication.

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The Right Track: Improving President Obama’s High-Speed Rail Program

Wednesday, February 17th, 2010
Mark Reutter


PPI Fellow Mark Reutter is the former editor of Railroad History and author of Making Steel: Sparrows Point and the Rise and Ruin of American Industrial Might (2005, rev. ed.).

by Mark Reutter

President Obama made a splash in Florida last month when he announced the award of federal stimulus money to start building a high-speed rail (HSR) line between Tampa and Orlando. “I’m excited. I’m going to come back down here and ride it,” he told a cheering audience at a town hall meeting.

The president certainly got it right when he said that we must break our dependence on the automobile and imported oil. Safe, reliable, and incredibly fast rail promises a breakthrough that people will be willing to pay for and private investors willing to operate. Passenger trains cruising at 150 miles per hour provide a decisive margin of superiority over highway travel and can compete effectively with commercial air in short- and medium-distance markets while cutting overall fuel consumption and greenhouse gases.

But for all the hype surrounding the president’s announcement, this exciting new mode of transportation won’t be arriving in America anytime soon unless the Obama administration and Congress make some “course corrections.” The crux of the problem is that the administration has begun a major civic work without laying down engineering and design protocols that match the standards of fast train lines built elsewhere in the world. Even worse, the distribution of funds from the stimulus package ensures that the most promising projects will remain underfunded.

Defining High-Speed Rail

One thing that’s been little understood by policy makers and the public is that HSR trains operate quite differently from conventional Amtrak trains. First and foremost, they cannot share tracks with much slower freight trains and must be walled off in their own protected corridors. They can climb steeper gradients than regular trains, allowing them to “hug” the landscape and minimize noise and environmental impacts. But in order to maintain top speeds, the lines they travel on must be built with the fewest possible curves. And where curves are unavoidable, they must use larger turning circles to change direction.

Trains running at more than 150 mph need to be far more powerful than conventional trains and use overhead electric lines for power rather than diesel engines. Trainsets are lightweight and based on aerodynamic designs that make for quicker acceleration and more economical braking.

A regular diesel-powered train running on track shared with freight trains is not high-speed rail. It never will be. It cannot and will not compete with highways and commercial air because it is stuck on a 19th-century right-of-way filled with curves and narrow clearances that reflect a period when trains ran no faster than 60 mph. And yet such projects, designated as “Emerging HSR” by the Obama administration, got far too much of the HSR stimulus pot last month.

A Smarter HSR Strategy Is Needed

Of the 29 rail projects that shared $8 billion in Recovery Act stimulus funds, only two – the Tampa-Orlando proposal in Florida and a projected San Diego-Sacramento line in California – qualify as high-speed rail by international standards. The rest can most accurately be called “higher speed rail” or “improving Amtrak on-time performance rail.”

The best of these projects, a $1.1 billion upgrade of the existing rail corridor between Chicago and St. Louis, will eventually permit Amtrak trains to achieve 110-mph maximums and 70-mph averages between the two cities. That’s far below the 150-mph standard set by the European Union. Several other corridor projects funded last month won’t even reach 100-mph speed maximums because they are limited by the curves and congestion on track they share with freight railroads.

The Florida and California proposals that we believed should have served as templates for an emerging HSR program got far fewer funds than they deserved. Both proposals call for lightweight, electrically propelled trains on dedicated guideways running at 150 to 220 mph. Each state got enough stimulus money ($1.25 billion for Florida and $2.25 billion for California) to begin construction, but without any assurance that a working segment can be finished and placed in revenue service. This is a big problem that needs to be remedied.

The Recovery Act provided the first-ever direct federal funds for passenger rail improvements outside of the Northeast Corridor. Responsibility for the program was handed to the Federal Railroad Administration, a small branch of the U.S. Department of Transportation (DOT) that deals primarily with railway safety. There was no precedent for what it had been tasked to do by President Obama. Awarding high-speed passenger projects was a new responsibility for which the agency was largely unprepared and unequipped.

Because it lacked personnel with backgrounds in HSR, the FRA fell back on what it knew best – conventional railway operations – to evaluate grant applications from the states. And the state applications were mostly dusted-off commuter-rail or incremental Amtrak projects, because most state DOTs have no more experience in executing HSR projects than the federal government.

Out of this confluence of modest state applications chasing humble FRA guidelines came a welter of small-scale upgrades – fixing signal systems here and adding a new siding there – that collectively do little to advance a new mode of intercity travel in America.

We have to do better. Minor upgrades of low-speed freight systems will give government critics a perfect target to paint HSR as a “runaway spending train” (as the Wall Street Journal dubbed it) that benefits only a small group of people. If the public’s current enthusiasm for HSR turns into disappointment, there will be little political support for the expenditure of hundreds of billions needed to construct real high-speed networks.

Getting it Right

To rectify this situation, we make the following policy recommendations to the administration and Congress:

  • use the $2.5 billion that Congress has authorized for HSR in 2010 to fully fund the Tampa-Orlando project and provide enough aid to the California project so that a segment of the system can be operational by 2015.
  • provide HSR funds only to projects that feature a dedicated, electric-powered system operating at 150 mph or higher. Adopt international standards for HSR design and construction to guarantee the highest-quality engineering.
  • define upgraded rail corridors as “CSR,” or conventional-speed rail, which could be funded by a separate aid program.
  • develop a sustained source for both HSR and CSR funding, such as a national infrastructure bank advocated by PPI, to ensure a regular and predicable source of funds outside of annual congressional appropriations.
  • set up a Federal HSR Administration, distinct from the FRA and comparable in staff and technical expertise to the Federal Highway Administration. An agency with a specified infrastructure-building mandate is necessary to move the program forward.
  • locate high-speed rail lines, wherever feasible, along highway corridors instead of privately owned freight railroads. The Florida HSR line will use an alignment alongside I-4 between Tampa and Orlando. In other areas, interstates pass through land that is often owned by the federal government, so land-acquisition costs are minimal.
  • encourage the private sector to invest in HSR-building by offering real-estate opportunities along the rights-of-way, such as reserving land near HSR terminals for companies that help underwrite rail projects.
  • open HSR train and station services to bids from private contractors to enhance the revenue stream from ticket sales.
  • encourage domestic manufacture of HSR cars and locomotives through well-targeted tax credits and “green” credits.

Moving Forward

There is no doubt that President Obama is committed to upgrading intercity passenger rail. But last month his administration failed to exert optimal leadership by spreading federal stimulus funds far and wide rather than concentrating on two or three corridors that would give us trains equal to those in Europe and China.

No one said that building a passenger rail network worthy of the 21st century would be easy or cheap. But neither was the transcontinental railroad nor the interstate highway system that transformed overland travel in America in the past. Each required a bold vision accompanied by smart planning, perseverance, and sustained financial support.

The administration’s current plans for HSR represent a welcome change from the neglect of years past. But unless improvements to our HSR strategy are made, we risk squandering the renewed momentum for building a true high-speed network.

Photo credit: http://www.flickr.com/photos/mujitra/ / CC BY 2.0

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Haiti After the Quake: Nation-Building Next Door

Wednesday, February 3rd, 2010
Jim Arkedis


Jim Arkedis is the director of PPI's National Security Project.

Mike Derham


Mike Derham is chair of PPI's Innovative Economy Project.

by Jim Arkedis and Mike Derham

The State of StateDownload the report.

As the tragedy in Haiti plays out in nightly newscasts, Americans can be proud of their contribution to the relief effort. With over 16,000 U.S. forces already deployed and $100 million in reconstruction money pledged from the government — on top of over $500 million donated privately — America’s commitment is firm.

Following the earthquake, President Obama wrote, “[I]n times of tragedy, the United States of America steps forward and helps. That is who we are. That is what we do.” America’s can-do spirit and a large supply of humanitarian resources are certainly a promising start, but all the good intentions in the world won’t stabilize and rebuild our ravaged neighbor. In undertaking this mammoth task, Americans should embrace the implications of the president’s words: the United States’ and international community’s effort in Haiti is nothing short of a long-term nation-building exercise.

And that’s good news. Helping Haiti firmly stand on its own over the long term — both with reconstructed buildings and a functioning government — is not only the right thing to do but will lead to a more stable region.

In a time when U.S. military deployments in Iraq and Afghanistan evoke uncomfortable associations with the term “nation-building,” it’s important to note that America’s troops have been unquestionably welcomed with open arms in Haiti. “It’s high time for those troops to have been deployed. They are crucial to help restore security in our devastated towns,” said Yvon Jerome, mayor of the hard-hit Carrefour district on the outskirts of Port-au-Prince.

On a day-to-day level, any major disaster relief effort will face a set of serious yet known problems: controlling the spread of infectious disease, staving off immediate hunger and dehydration, establishing basic order in a chaotic situation. Since we’re not on the ground in Haiti, we’ll leave decisions like where to put aid stations and which neighborhoods to secure first to responding disaster relief experts.

Though immediate relief is of course today’s pressing need, this memo takes a longer view to highlight potential roadblocks along the way to a robust and effective nation-building effort. First, we prioritize steps required to bring good governance to Haiti, both within the international chain-of-command and the Haitian government. Second, we identify reconstruction priorities and funding issues that must be addressed now to give Haiti a chance at meaningful recovery once the immediate humanitarian crisis is controlled.

Thousands of lives will be saved by the massive international effort underway. But the consequences of an ineffective reconstruction effort could be huge: If the main players in Haiti don’t figure out who’s in charge and plan for the next set of challenges, the international community could do as much damage as good, and billions of dollars and thousands more lives could be lost.

Who’s in Charge, Anyway?

The U.S. military (with 16,000 troops), United Nations (12,000 soldiers), and thousands of international non-governmental organizations have arrived in droves since the earthquake. Coordinating roles, missions, and even arrivals at Port-au-Prince airport between these groups has been confusing. Continued lack of clarity could hamper aid distribution and ultimately cripple reconstruction efforts in the long term.

Broadly speaking, the UN’s Blue Helmets have taken charge of street-level security in a peacekeeping role. U.S. Southern Command has control of the major ports of entry and supply routes that distribute relief aid throughout the city and region. NGO’s have undertaken a variety of humanitarian missions in accordance with their respective specialties.

These missions evolved on an ad hoc basis from mandates or delegated authorities in the panicked aftermath of the quake. For example, Haitian President René Préval signed over air traffic control to the U.S. military in order to better manage the arrival of relief supplies.

But the UN’s mandate is to conduct the Stabilization Mission in Haiti (the UN’s presence is most often referred to by its French acronym MINUSTAH), established in April 2004 under Resolution 1542. In the post-earthquake context, its mission — supporting the Haitian government and enforcing public safety — appears constrained. MINUSTAH originally provided for a maximum of 1,622 civilian police and 6,700 soldiers. Since the earthquake, the only modification has been in MINUSTAH’s number, not its role — the Security Council has approved an increase in force size to 12,000 soldiers.

Friction between competing missions has hampered efforts. In one anecdote that typifies these complications, French Secretary of State for Cooperation Alain Joyandet implied that the Americans were giving preferential landing rights to U.S. planes and called on the UN to clarify the American role in Haiti, saying the priority was “helping Haiti, not occupying Haiti.”

Fixing the Authority Problem

Such bureaucratic infighting decreases trust between international partners working toward the same goal. The lack of a unified command will slow the relief effort as governments and institutions must constantly cross-check with one another before taking meaningful action. We make the following recommendations for beginning the long struggle to rebuild Haiti:

  • Establish Meaningful Governance: In its current incarnation the UN mission lacks the capacity to address what needs to be done, missing the mandate to deal with post-earthquake reconstruction. MINUSTAH should be upgraded to become a full “nation-building” program, designed to last 10 years. The UN and EU missions in Kosovo offer the best model. The UN’s experience in Kosovo shows that just “peacekeeping” isn’t sufficient to help rebuild a society. The UN Interim Administration in Kosovo (UNMIK) had four pillars—policing and justice, civil administration, institution-building, and reconstruction and development—that can be adapted to address the multiple problems Haiti faces as it rebuilds from the earthquake.Edmond Mulet, the former and now interim head of MINUSTAH, should be elevated to Special Representative of the Secretary General to give him a clearer mandate. (He replaced his successor, Hédi Annabi, who perished in the quake.) In addition to the “peacekeeping” pillar currently in place, other duties of development, civil administration, and institution-building should be added and all international troops on the ground, including America’s, should be brought under its chain of command. A beefed-up MINUSTAH would work with the remaining Haitian government, by assisting with oversight and capacity building.
  • Police, Not Peacekeepers: Under the pre-earthquake MINUSTAH, Brazil led 7,000 troops — mostly from the Americas — in Haiti. Immediately after the quake, Brazilian Defense Minister Nelson Jobim was in Port-au-Prince to oversee his troops and committed to doubling them and having them stay for at least five more years. While a peacekeeping role will be vital in the months to come to get Haiti back on its feet, the role of Brazilian and other blue-helmeted troops will need to change.Once order is established, the UN mission will essentially become a national police force in the absence of a Haitian alternative. To transfer power back to the local government, the UN mission should be tasked with building an effective security force and justice system. That means in addition to cops, the UN may solicit prosecutors and judges in a proxy judiciary. It’s a tall order, but it may be the only way that allows the remaining Haitian government to fully concentrate on reconstruction.
  • Consider Moving the Capital: Port-au-Prince has been reduced to a rubble heap. To solve an immediate problem, we recommend that the government consider transferring its functions and offices from Port-Au-Prince to Cap-Haïtien, per George Mason University economist Tyler Cowen’s suggestion. The new capital would also serve as the new base for MINUSTAH. A move would allow the government to focus on core issues of governance in the wake of the disaster. Cap-Haïtien, Haiti’s second-largest city, was relatively untouched by the earthquake. It has a harbor and the longest runway outside of Port-au-Prince, allowing for reconstruction efforts to be staged from there.

Priorities for Haitian Reconstruction

Beyond the complex and immediate issues surrounding relief aid, the international community must already begin work on second-order concerns once immediate humanitarian priorities are brought under control.

Front and center is economic stabilization. Though signs are emerging that basic economic activity is returning, it must be solidified. International institutions and donor countries are set to meet again at the UN in March to discuss funding for reconstruction. It would be useful to come up with a battle plan for rebuilding by establishing priorities among competing interests in government, business, and communities.

  • Remittances: Haitians need cash in hand, and quickly. It’s the best hope of sustaining any meaningful economic activity when banking has slowed dramatically and business within the Port-Au-Prince region is struggling to survive. With the announcement that Haitians can take advantage of TPS (Temporary Protective Status) from the U.S. Immigration Service, upwards of 200,000 undocumented Haitians will be able to join 600,000 Haitians working legally in the U.S.That diaspora, along with similar groups in Canada and elsewhere, sent home at least one-third of Haiti’s GDP last year. To capitalize on the outpouring of goodwill by the Haitian diaspora, money must flow directly to individuals. Wire services expect to get money transfers going to Haiti in the short term. However, with the banking sector of Haiti already fragile, and many local money transfer agents (i.e. the local corner store) wiped out by the earthquake, making sure remittances arrive will be key. Here a simple technological solution can meet the challenge. Sub-Saharan Africa has adopted programs like M-PESA to allow people to use their cell phones as checking accounts. The time and effort necessary to establish a similar system in Haiti would be worthwhile.Credit can be transferred to individual phone numbers — including from overseas — and that credit can then be used for purchases from other phone owners who have a similar plan (including prepaid) from their provider. Cell coverage is one of the few institutions that covers all of Haiti. It is also an institution that has worked through the crisis, and that the American military is working to make sure stays running. But only 30 percent of Haitians have cell phones — so in addition to cell phone credit transfer, increasing cell phone penetration should be another priority.
  • Empower the State Department: The U.S. military’s presence cannot and should not be sustained at 16,000 troops. Once the humanitarian crisis is controlled, American troops should be withdrawn, and the American component of the UN mandate should be headed by the State Department. The State Department should focus on building long-term civil institutions through accountable governance programs. Further, it should actively engage the NGO community to build the unions, a free press, and political parties. Haiti’s fragile democracy has been unable to respond to this crisis, and long-term American involvement in the country’s civil institutions will better enable it to do so in the future.
  • Debt Relief: Many have suggested that the key to Haiti’s fortunes is finishing the “Highly Indebted Poor Country Initiative” debt-forgiveness process by getting France, Venezuela, and the Inter-American Development Bank (Haiti’s three largest creditors) to wipe out Port-Au-Prince’s debt. But this is hardly a panacea. Haiti’s debt amounts to service payments of only $50 million per year. In other words, debt forgiveness will help, but it will not be significant enough to alleviate any real suffering.

  • Infrastructure: Infrastructure investment offers the quickest way to rebuild Haiti. Rebuilding the roads, bridges, and major points of transportation benefits individuals, businesses, and government. The international community should work with the Haitian people to make sure that building codes are drawn up and, more importantly, enforced. The destructiveness of the earthquake was magnified by the fact that almost no rebar was used to reinforce concrete structures in the country. This turned Port-au-Prince into a rubble field instead of a quake-struck city. Building-code enforcement would also protect against the hurricanes that frequently lash the country. To rebuild Port-au-Prince, the idea of acknowledging squatter’s rights may be the most effective way to rebuild quickly, by recognizing the tools for development that individuals already have at hand.
  • Funding: Given France’s colonial past with Haiti, the Obama administration and UN should invest significant political capital to press Paris to take the lead in funding infrastructure development. The colonial relationship between France and Haiti has been historically strained as France demanded — and received — compensation for its lost colony from a newly independent Haiti. Since it took Haiti 122 years to clear the books, France should seize the opportunity to right this historic wrong. Even in the aftermath of this disaster, the French have been shamefully outpaced by the British in the initial round of pledges, but they can rebound by making a more sizeable pledge at the Haiti donor conference in March.
  • Renew and Expand the CBI: But while France can take the lead on the debt-forgiveness front, the U.S. can take the lead on fostering development. The Caribbean Basin Initiative (CBI), a trade-preferences act signed by President Reagan in 1982 is designed to promote development in the Caribbean countries – including Haiti. Its expiration — set for September 30 of this year — would be a further blow to the economic redevelopment of Haiti. In addition to just renewing it, however, the Congress and administration must expand the CBI to remove tariffs on Haiti’s agricultural production, specifically sugar. Allowing these vital drivers of the Haitian economy to be competitive in its largest export market would go far in giving Haitians a chance at sustained economic growth.

The rebuilding of Haiti after such a devastating event will be a long and difficult process. Local factors (corruption, lack of infrastructure, poverty) and international circumstances (the global recession, lack of focus by the international community) could forestall recovery. But firm resolve behind a nation-building project is critical if Haiti is to stand again. These prescriptions for both relief and reconstruction offer Haiti a meaningful chance to overcome the worst of the disaster and give the Haitian people hope for a better tomorrow.

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Fast Track to the Future: A High-Speed Rail Agenda for America

Monday, January 25th, 2010
Mark Reutter


PPI Fellow Mark Reutter is the former editor of Railroad History and author of Making Steel: Sparrows Point and the Rise and Ruin of American Industrial Might (2005, rev. ed.).

by Mark Reutter

The State of StateDownload the full report.

In the next few weeks, the administration will be announcing which states will be awarded funds from $8 billion dedicated for high-speed rail (HSR) development in the stimulus package. Right now, 259 applications from the states valued at $57 billion are chasing the recovery plan money. The administration’s decision to devote considerable resources to developing HSR underscores its commitment to bring bullet trains to the U.S. But unless it makes the right decisions about where to put the money and what policies to follow, the new enthusiasm for HSR could be just the latest false start in a long, disappointing history.

Last spring, President Barack Obama unveiled his vision for a national HSR network. The president conjured up an image of a 21st-century train infrastructure, “a system that reduces travel times and increases mobility…reduces congestion and boosts productivity…reduces destructive emissions and creates jobs.” The administration also put forward a rail policy that, rather than laying track coast to coast, would concentrate on heavily populated corridors where short distances between cities would let faster trains compete effectively with cars and airplanes.

Since then, the administration has called on states to submit plans for HSR competitive grants. Congress, meanwhile, added $2.5 billion to the HSR pot for fiscal year 2010, and it remains possible that the House and Senate will add billions more in a second jobs stimulus, focusing on infrastructure, likely to be taken up this winter.

For decades, high-speed rail has been a fantasy, mired in bureaucratic, regulatory and market inertia. But with the renewed push for it by the administration, the high-speed rail future is beginning to take shape. The benefits of high-speed rail are enormous. For one, HSR is a big step toward energy independence and a post-carbon future. HSR corridors operated with nonpolluting electric locomotives could reduce carbon emissions by as much as six million pounds annually.

HSR also has a strong track record of jumpstarting economic development along its path. Fast, efficient transportation could revitalize depressed cities and transform regional economies. And while the creation of an HSR network lies in the future, it will put people to work immediately. Eighty percent of the cost of HSR is in infrastructure-building and land acquisition, while 20 percent goes for the trainsets and stations that passengers use. New rights of way need to be built now for HSR corridors that are projected to be operational in a few years – meaning tens of thousands of jobs that can’t be exported.

The question that we now face is: How do we get there from here?

The choice that the Obama administration and Congress face is simple: modest incrementalism versus a truly transformative vision. The administration’s commitment to fund high-speed rail is a step in the right direction, but it’s not the end of the process. Lest the allocation of stimulus funds to HSR become President Obama’s own “Mission Accomplished,” the administration needs to remain engaged, proactive, and forward-thinking in shepherding high-speed rail to completion.

With HSR, President Obama can leave a lasting imprint on the American landscape and economy. But that legacy can only be secured if the administration is willing to make bold decisions and confront a tired political culture. If we really are serious about making the high-speed rail future a reality, the old ways of doing business will not suffice.

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The State of State: A Proposal for Reorganization at Foggy Bottom

Wednesday, January 13th, 2010
Matt Armstrong


Matt Armstrong is an advisor and consultant on public diplomacy and strategic communication to the Departments of Defense and State, Congress, NATO and others. He is a principal with Armstrong Strategic Insights Group, LLC, and publishes the blog www.MountainRunner.us.

by Matt Armstrong

The State of StateDownload the full report.

The past decade has seen the U.S. government expand its activities around the globe in response to complex and stateless threats. In the face of these challenges, Secretary of Defense Robert Gates, Chairman of the Joint Chiefs of Staff Admiral Michael Mullen, and members of Congress have all called for increasing the resources and capabilities of the State Department to roll back what Gates has termed the “creeping militarization” of foreign policy. But efforts at reform are hindered by an institutional structure rooted in a 19th-century view of the world.

The days of traditional diplomacy conducted behind closed doors are over. The democratization of information and means of destruction makes a kid with a keyboard potentially more dangerous than an F-22. Addressing poverty, pandemics, resource security, and terrorism requires multilateral and dynamic partnerships with governments and publics. But the State Department has yet to adapt to the new context of global engagement. The diverse threats that confront the U.S. and our allies cannot be managed through a country-centric approach. For State to be effective and relevant, it needs to evolve and become both a Department of State and Non-State.

Currently, State’s structure impedes its efforts to develop coherent responses to pressing threats. The vesting of authority in U.S. embassies too often complicates interagency and pan-regional coordination and inhibits the effective request for and distribution of resources. No less significant, the structure also implicitly empowers the Defense Department’s regionally focused combatant commands, like Central Command, as alternatives to the State Department. Compounded by years of managerial neglect, and a lack of long-term vision, strategic planning, and budgeting, the State Department requires high-level patches and workarounds to do its job adequately.

State’s ineffectiveness has created voids filled by other agencies, notably the Pentagon. The Department of Agriculture (USDA) has also sought to move in on the space left by State. USDA in late 2009 asked that funds be transferred from the U.S. Agency for International Development (USAID) and State Department for projects in Afghanistan. Such a move would further dilute State’s efficacy, sow confusion, and widen gaps between requirements and actions in foreign policy.

Fixing the Old Hierarchy

The last major reorganization of the State Department was in 1944. That reshuffling was internally driven, and today’s change could occur within the bureaucracy’s walls as well. But the complexity of the department today likely requires a major realignment of fundamentals, something on the order of magnitude of the Goldwater-Nichols Act of 1986. That landmark legislation shifted the Defense Department’s operational focus from the services (Army, Navy, Air Force) to the regional commands (Central Command, Pacific Command, etc.).

Foggy Bottom’s regional bureaus are, on their face, like the Defense Department’s combatant commands. But in reality, they are merely support staff for the embassies (the “country teams”). If Defense were to mimic State’s structure, it would be akin to making European Command subservient to individual U.S. military bases in Europe.

Each of State’s regional bureaus are led by an assistant secretary who reports to the under secretary for political affairs. (The under secretary also has other responsibilities, such as overseeing development and implementation of U.S. government policies with the United Nations and its affiliated agencies, as well as the fight against international narcotics and crime.) The under secretary, in turn, reports to the Secretary of State. By contrast, the combatant commander, the assistant secretary’s ostensible counterpart in Defense, has a direct line to the Secretary of Defense.1

The State Department’s hierarchy was fine for another era when issues were confined within state borders by local authority, geography, and technology. But in recent years, the structure’s flaws have become conspicuous. The department’s ability to respond to crisis is fragmented and sclerotic. When successes do happen, they tend to be the result of individuals working around or outside the bureaucracy. Secretary of State Hillary Clinton has circumvented the current system with crisis-specific czars called Special Representatives. These Special Representatives, like Richard Holbrooke for Afghanistan and Pakistan, operate like super ambassadors with regional powers that should reside – but don’t – in the regional bureaus.2

For State to be a viable national security actor, the old hierarchy must be flattened and power should be redistributed. It is hard to imagine isolating a combatant commander by reducing his rank to three-star general and having him report to a four-star general – who then decides what the Secretary of Defense should be bothered with.

Why do we allow such a structure at State? Instead, each regional bureau should be empowered with leadership from a dedicated under secretary who reports directly to the secretary. This would make regional bureau leadership functionally equivalent to combatant commanders in rank and access to senior leadership.

Recalibrating the leadership would help build congressional confidence toward increasing State’s resources, enhance the department’s interagency role, facilitate integration as interagency authorities are matched up, and ultimately begin a shift toward greater balance between State and Defense. The regional bureau under secretaries would act and be seen as the high-level authorities that the U.S. requires, and likely become viable alternatives to the combatant commanders.

The geographic breakdowns of the State Department and the Defense Department must also be synchronized to facilitate greater government coordination. State’s six regional bureaus – Western Hemisphere, European and Eurasian, Near Eastern, African, South and Central Asian, and East Asian and Pacific – only loosely align with the seven combatant commands (the Pentagon splits the Western Hemisphere into two commands).

There are a few, but significant, differences. For example, the State Department includes North Africa in its Near East Bureau, while Central Command, which covers the Middle East, includes only Egypt among North African countries (Libya, Algeria, and Morocco, among others, fall under the African Command). Another difference: the Near East Bureau’s eastern border is Iran, and thus does not include Afghanistan, Pakistan, or the other -stans, which fall under the Bureau of South and Central Asian Affairs; all those countries fall under Centcom in the Defense Department.

The under secretaries, like the Defense Department’s combatant commander, must be career officers. These positions require tremendous depth of experience within the State Department and across agencies and should not be politically appointed.

Some critics opposed to empowering the regional bureaus argue that only the ambassador can serve as the president’s personal envoy. Besides implying that the rest of the State Department does not represent the president, the distinction is a historical artifact from a time when communications were slow. Each regional bureau under secretary should be empowered with the same plenipotentiary authority to represent the president that America’s ambassadors possess.

The creation of new regional under secretaries should prompt the reevaluation of other under secretary and assistant secretary offices. Certainly the under secretary for political affairs, to whom the geographic bureaus would no longer report, should be downgraded. There will certainly be a ripple effect as roles and responsibilities are shifted and realigned.

To be clear, a macro-regional design must not result in the elimination of embassies or consular posts, or any other reduction in physical, diplomatic (public or traditional) presence abroad. Some may argue that international postings are redundant in an interconnected era, but any such drawdown would be a massive blow to our public diplomacy, as studies have shown that connectivity in the virtual world is stronger when reinforced by real-world interactions.3

Climbing the Hill

As with Goldwater-Nichols, Congress will likely need to be involved in any major shake-up of the State Department. But unlike the Pentagon, State has not actively cultivated and engaged key Hill leadership or staffs. The historic lack of communication between State and Congress is emblematized by the fact that State has one congressional liaison office on Capitol Hill (in the basement of a House office building) whereas the Defense Department has eight (four on the Senate side and four on the House side). The relationship between the Defense Department and the Armed Services Committees is substantially more interactive than that of the State Department and the relevant committees. As a result, the State Department is essentially a black box of unknown workings and products, inhibiting the cultivation of a congressional constituency.

Over the decades, Congress has at times been suspicious of the State Department. At the beginning of the Cold War, Congress restricted domestic dissemination of the State Department’s public diplomacy products because of concerns over the department’s “Communist infiltration and pro-Russian policy” (according to the Democratic chairman of the House Rules Committee in 1946) and the “drones, the loafers, and the incompetents” that comprised its staff (according to the Republican chairman of the House Appropriations Committee in 1947).

Since 9/11, the State Department has done little to earn the confidence of Congress, which resisted expanding the department until the election of President Obama. The department’s own inspector general has found significant systemic failures in many areas, including in its efforts to reorganize its nonproliferation bureau. Under the Bush administration, State’s senior leadership abrogated critical responsibilities that were subsequently taken up, if reluctantly and clumsily, by the Defense Department, notably in the areas of public diplomacy but also in reconstruction and development.

The State Department’s inaugural Quadrennial Diplomacy and Development Review (QDDR), underway now, is a platform not only for changing the country focus but also engaging Congress. The QDDR is modeled on the Defense Department’s Quadrennial Defense Review, which examines the Pentagon’s strategic capabilities and requirements based on the threats and challenges today and tomorrow. The QDDR should take up the reorganization proposed here.

Realignment will not be easy. It requires the committed support of the president, the secretaries of state and defense, the National Security Council, and Congress. But the potential benefits are considerable. Adjusting the focus of the State Department from country to region would permit the secretary of state to exercise more effective leadership and oversight over the instruments of power. It’s the logical step to take in a new era of stateless challenges, and a demonstration to the world that U.S. power does not always have to wear combat boots.

————————————————————

1 The under secretary for political affairs is the most senior Foreign Service Officer in the State Department and is the third-ranking official in the department, below the Secretary and the Deputy Secretary.

2 In addition to Special Representatives, the new senior advisor for innovation, attached directly to the Secretary’s office, should arguably reside within either the under secretary for public diplomacy and public affairs or the under secretary for democracy and global affairs but understandably does not because of issues of capacity and capability.

3 See Nicholas A. Christakis and James H. Fowler, Connected: The Surprising Power of Our Social Networks and How They Shape Our Lives (Little, Brown & Company, 2009).

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Spooks in the Machine: How the Pentagon Should Fight Cyber Spies

Wednesday, January 6th, 2010
Noah Shachtman


Noah Shachtman is a contributing editor at Wired magazine, and the editor of its award-winning national security blog, "Danger Room."

by Noah Shachtman

Spooks in the MachineDownload the full report.

In Washington, “cybersecurity” is a term that’s come to have a thousand meanings, and none at all. Any crime, prank, intelligence operation, or foreign-government attack involving a computer has become a “cyber threat.” Russian teenagers defacing Georgia’s websites, hackers eyeing the power grid, overseas powers embedding government microchips with malicious code – they all share equal billing as cyber foes. The vague definition muddies the debate about what the real dangers are, where they lie, and how to respond to them. No wonder it took the White House so long to find someone to serve as a “czar” to coordinate government-wide responses. No wonder Congress is having such a hard time passing smart legislation.

But at the Pentagon, they aren’t worried about some kid painting a Hitler moustache on Defense Secretary Robert Gates’ online portrait. They’re not even that concerned about a full-scale attack on the military’s networks – even though the modern American way of war depends so heavily on the free flow of data. In the military, there’s now broad agreement that one cyber threat trumps all others: electronic espionage, the infiltration (and possible corruption) of Defense Department networks. The Pentagon is seeking to coalesce around an organizational response, if not clear-cut answers, to the cyber-spying problem. But it’s a very open question whether the solutions that they have come up with will make things better or worse for the military.

Well-placed spy software not only opens a window for an adversary to look into American military operations. That window can also be used to extract information — everything from drone video feeds to ammunition requests to intelligence reports. Such an opening also gives that enemy a chance to introduce his own false data, turning American command-and-control systems against themselves. How does a soldier trust an order, if he doesn’t know who else is listening – or who gave the order in the first place?  “For a sophisticated adversary, it’s to his advantage to keep your network up and running. He can learn what you know. He can cause confusion, delay your response times – and shape your actions,” says one Defense Department cyber official.

Cyber spying on sensitive government networks isn’t some theoretical concern. In December, we learned that militants could tap into the overhead surveillance feed of almost any aircraft in the American fleet – from spy drones to fighter jets. The Wall Street Journal reported earlier this year that intruders were able to copy and siphon off “several terabytes of data” about the advanced F-35 Joint Strike Fighter stealth aircraft from the unclassified networks of defense contractor Lockheed Martin. In 2008, USB “thumb drives” were used to slip malicious and self-replicating code onto military computers. According to a 60 Minutes report, the software was able to monitor the classified networks of U.S. Central Command, which runs the American war efforts in Iraq and Afghanistan. In 2007, the unclassified e-mail system of the Office of the Secretary of Defense was compromised. Earlier in the decade, a researcher from Sandia National Laboratories caught Chinese cyber sleuths with specs for the U.S. Army’s helicopter mission-planning system and for Falconview, the Air Force’s aerial imagery software.

The Problem of the Open Network

What’s particularly vexing about these intrusions is that sophisticated methods weren’t necessarily required to get inside the networks. In 2007, detailed schematics of Bagram Air Base in Afghanistan and the Camp Bucca detention facility in Iraq were downloaded by reporters from file transfer protocol servers with easy-to-find passwords or no protection at all. The malware that spread via thumb drive across the military in 2008 had been around, in one form or another, since the early ‘90s. In 2009, troops were so susceptible to virus- or Trojan-laden messages — supposedly sent from friends on Facebook and Twitter — that U.S. Strategic Command network security officers wanted to ban access to the social networks altogether.

In other words, the end user – the service member or Pentagon civilian sitting at his desktop – is largely responsible for letting in these electronic intruders. They’re the ones who set passwords to “1234,” plug unknown drives into their computer, or download a Trojan virus when all they meant to do was sneak a peek at some online porn. “This makes us our own worst threat,” writes one Department of Defense network security specialist. “There are a variety of reasons for this and most are tied to the collective DoD inability to mitigate known vulnerabilities — vulnerabilities users intentionally and unintentionally utilize to create adverse impacts or risks.”

The Pentagon spends millions of dollars every year on so-called “information assurance” – checking to see that military desktops are loaded only with trusted software, and reminding users not to respond to e-mails from Nigerians with dubious business propositions. But within the Defense Department, these are seen as Sisyphean tasks. “With seven million systems in the DoD, think how many idiots there are bound to be,” one Pentagon cybersecurity official says.

cybersecurity memo photo 3The armed forces find it much easier to ban something than to educate its troops about responsible use. MySpace and YouTube are inaccessible from Pentagon computers – even though the military makes extensive use of the sites. Thumb drives are mostly forbidden as well, even though battlefield units rely on them to swap data in lonely places where bandwidth is hard to find. In the name of information security, information flow has been restricted. Meanwhile, secret overhead surveillance feeds are routinely left unencrypted; with an off-the-shelf satellite dish and $26 software, militants can see through the Air Force’s eyes in the sky. It’s a problem the military has known about for more than a decade but never bothered to fix. According to the Wall Street Journal, “the Pentagon assumed local adversaries wouldn’t know how to exploit it.”

Clearly, there needs to be a rather serious re-evaluation of military information assurance. The Pentagon needs to do a better job of figuring out theoretical risks from actual dangers; secret drone feeds can’t be left open while blogs are placed off-limits. Troops also need to be trained – and then trusted. The military routinely gives a 19-year-old private the power to kill everyone he sees. Surely, if that private can be taught to use an automatic rifle responsibly, he can be educated in computing without sharing secrets.

An Imperfect Solution

Now, many in the military are wondering whether an even more serious overreaction is in the works. In June, Secretary Gates established U.S. Cyber Command to coordinate all of the military’s activities online. Heading the new command will be Lt. Gen. Keith Alexander, director of the super-secret National Security Agency. Conveniently for Alexander, the command will be located at Ft. Meade, Maryland – right next to the NSA’s headquarters. The job of stopping electronic espionage, in other words, is being put in the hands of the military and intelligence outfit which is already responsible for snooping on e-mail, breaking electronic encryption algorithms, and sneaking into foreign networks. It has a logic: Our cyber spies will tackle their cyber spies. And few government agencies can rival the NSA’s information security expertise.

But the move is problematic, too. For all of the NSA’s brainpower, the agency has had its share of spectacular failures. It spent six years and $1.2 billion on the “Trailblazer” effort to sift through electronic communications, with little to show for it. The successor project, “Turbulence,” has proved problematic, as well.

The NSA’s well-developed (some would say overdeveloped) sense of secrecy could also be an issue. Much of the country’s network infrastructure is in private, not government, hands. A great deal of today’s most important cybersecurity research is being pursued at private companies and universities, from Microsoft to M.I.T. How well can a clandestine agency work with these unclassified groups? Or even with military groups that might not be able to match the NSA’s security clearances?

Finally, the NSA has a rich history of monitoring the communications of Americans – sometimes legally, sometimes not. Earlier this year, the Justice Department confirmed that the agency was still “overcollecting” on U.S. citizens, despite the wide latitude the NSA now enjoyed to spy on whom they like. According to the New York Times, the agency even “tried to wiretap a member of Congress without a warrant.” Some in the armed forces cybersecurity community argue that in order to stop online espionage, the infiltrators need to be caught before they enter American networks. Cyberdefense becomes cyberoffense. With such a broad charter, the monitoring of innocent Americans’ datastreams would only grow, with an agency well-known for privacy violations in charge.

Guard the Networks – or Live Without Them

Clearly, the NSA has a major role to play in the nation’s network security. They’ve got the expertise that’s lacking in the various armed services’ geek squads, the network policy makers at U.S. Strategic Command’s Joint Task Force Global Network Operations, and the Defense Information Systems Agency’s cadre of Pentagon system administrators. But the NSA’s role can’t be all-encompassing. The agency needs to be part of a team. That team needs to include players that can work with experts both in and out of government. And that team needs to have oversight of the NSA’s activities, so that citizens’ civil liberties aren’t slaughtered wholesale in the name of cybersecurity.

Other groups within the Pentagon are trying to make the armed forces more resilient in the face of cyber attacks. They not only want to make the military’s data networks less susceptible to infiltration – they want to make its social connections more durable, too. If the military information grid is compromised, and orders can’t be trusted, they want service members to be able to carry on with their missions regardless.

Troops can’t lose time-honored skills just because they’re in a digital age. They need to be able to navigate without electronic maps, assemble information without online databases, and distribute battle plans without e-mail. Some cybersecurity specialists say that more and more “redundant” networks need to be added in order to keep the military’s data flowing. But for this group, the most important cyber defense may be learning to live without networks at all.

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It’s About Time: 180 Six-Hour Days No Longer Meet the Needs of Students

Monday, December 7th, 2009
Jennifer Davis


Jennifer Davis is the president and CEO of the National Center on Time & Learning.

Chris Gabrieli


Chris Gabrieli is chairman of the National Center on Time & Learning.

by Jennifer Davis and Chris Gabrieli

The problems that beset America’s schools are myriad: a seemingly unbridgeable achievement gap; deteriorating international competitive position in educational attainment; data showing that schools are narrowing their curricula at a time when a broader course of study is necessary for success. But these challenges have also forced the country’s education leaders to think creatively about reforming the nation’s schools.

One idea that has begun to catch on is the need to change one of the most intractable features of our country’s education system: a 19th-century school calendar of 180 six-hour school days. Increasingly, schools across the country are switching to an expanded time frame to enhance teaching and learning.

Our organization, the National Center on Time & Learning (NCTL), has sought to focus the education policy agenda on converting standard district public schools across America to expanded learning time (ELT) schools. After successfully promoting the idea of shifting schools to ELT in Massachusetts — the first such state policy in the nation — NCTL has spent the last two years building federal interest in the concept, as well as early-adopter interest in several other states and districts.

Education leaders have recognized the need for more days in our school calendar for some time now, but until recently there has been little movement on the issue. While many charter schools have been quick to innovate, using their autonomy to give students the additional time they need to excel academically, traditional district schools have not followed suit. Costs and deeply entrenched cultural routines and expectations have been key obstacles to change. More important, education leaders and policy makers have lacked the “proof points,” policy levers, and models for the successful expansion of learning time within standard schools.

Steps in the Right Direction

But all of this is changing. Today, we are proud to release a new report that finds that a growing number of U.S. schools have already broken from the traditional school calendar and shifted to expanded learning time to improve educational outcomes. The report draws from our new national database and is the first effort to catalog schools operating with days substantially longer than the six-hour norm and, in many cases, a calendar that exceeds the standard 180-day school year.

The report comes at a time of great momentum for the issue nationally. In March, President Obama called for expanded learning time as part of his education agenda, stating, “We can no longer afford an academic calendar designed for when America was a nation of farmers who needed their children at home plowing the land at the end of each day.” In his Senate confirmation hearing, Secretary of Education Arne Duncan said, “I think our school day is too short, our week is too short, our year is too short.” And the guidelines for the highly competitive Race to the Top grant channel unprecedented federal funds to education, including incentivizing adoption of a longer school day and year as part of a strategy for improving schools.

Supported by the William and Flora Hewlett Foundation, the report and accompanying database comes over 25 years after A Nation at Risk called for a longer school day and year. The report, Tracking an Emerging Movement: A Report on Expanded-Time Schools in America, identifies 655 schools in 36 states serving more than 300,000 students that met the following definition: “An expanded-time school is any public school that has deliberately added more time to the school day and/or days to the school year for all enrolled students (or has been founded with a deliberately longer day and/or year than surrounding public schools) for the express purpose of improving student outcomes.” The study also includes key characteristics and survey data on 245 schools on how the added time is utilized and funded.

Key Findings and Future Research

Significant findings from the analysis of the profiled schools include:

  • On average these schools offer about 25 percent more time than the national norm, which would translate over the course of a school career to over three additional years in school for participating students;
  • While many of the schools included are public charter schools, more than one-quarter of the schools identified are standard district public schools;
  • Compared with national averages, schools with expanded time serve a more heavily minority and poorer student population;
  • 75 percent of schools that convert from a traditional school schedule to an expanded school day pay their teachers more for the additional time worked, an average increase of over 13 percent, while only 44 percent of new schools that start up offer increased compensation; and
  • Data suggest that more time may boost academic achievement, with students in schools with a significantly expanded school day outperforming their district peers.

While the limited data show a positive relationship between student performance and daily time, more study is needed to know what impact these schools will have on closing achievement gaps and providing a more well-rounded education. Even at this stage, however, we can surmise that the act of giving students and teachers more time together has the potential to unlock greater student achievement and engagement, as past research has been fairly clear in establishing a link between time spent learning and student retention and mastery.

As leaders in Washington, D.C. and throughout the country seek to spur the kinds of educational innovation that will bring us closer to our ambitious goal of universal student proficiency, it is clear that expanded time will be a part of the solution. Our challenge will be to learn from the highest performers and ensure that best practices are implemented as this movement expands.

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The Pentagon’s Most Expensive Weapon

Monday, November 30th, 2009
Jim Arkedis


Jim Arkedis is the director of PPI's National Security Project.

by Jim Arkedis

The Pentagon's Most Expensive WeaponDownload the full report.

When President Obama signed a $680-billion military policy bill last month, he fulfilled a promise to reform defense spending, slashing more weapons systems than any president had in decades. Left to wither were big-ticket programs like the F-22 fighter jet, the Combat Search and Rescue helicopter, the Airborne Lasers, and the Future Combat Systems. Conceived during the Cold War, these systems have come under criticism for their cost overruns and irrelevance to today’s unconventional conflicts.

The weapons bill represents a win for the president and Secretary of Defense Robert Gates. Gates, in particular, has made a mission of reforming Pentagon culture and breaking the grip of the military-industrial-legislative complex. But the reform of the procurement process hasn’t pleased everyone. For liberals, it doesn’t go far enough. Just before the November 2008 election, Rep. Barney Frank (D-MA) had called for an across-the-board 25-percent cut in defense spending, saying we didn’t need “all these fancy new weapons.” On the other side of the aisle, Sen. James Inhofe (R-OK) and Sen. Saxby Chambliss (R-GA) have accused Obama of “gutting”the defense budget.

It’s not surprising that weapons systems draw all the attention when defense spending reform comes up. They translate into jobs that defense contractors spread cunningly across the nation’s states and congressional districts. But the “guns versus butter” debates between liberals and conservatives miss a key point. It’s not just weapons that drive defense spending through the roof — it’s the people, too.

According to its official budget, the Defense Department will spend $533.8 billion in 2010 in the following categories:

  • Personnel: $136 billion
  • Operations & Maintenance: $185.7 billion
  • Weapons Procurement: $107.4 billion
  • Research & Development for Weapons and Technology: $78.6 billion
  • Other: $26.1 billion

The personnel figure, however, doesn’t come close to capturing what America is really spending on defense personnel. According to PPI’s calculations, the real price tag is much bigger: $301.1 billion each year, 121 percent higher than the Pentagon’s figure. In other words, if you want major savings in defense spending, cutting weapons systems and the ever-elusive “waste, fraud and abuse” won’t take you far enough.

The point here is not that our military spends too much on people. It’s that personnel costs are the untold story in the defense spending debate. The U.S. military has grown 50,000 troops larger since 2001. At the same time, America has been embroiled in two counterinsurgencies that depend more on boots on the ground than planes in the sky or ships at sea.

The new emphasis on manpower-intensive counterinsurgency will have enormous repercussions on defense spending long after the wars are over. The aim of this report is to raise awareness among policy makers and the public about the real costs of U.S. military manpower.

It deconstructs the budgets of the Departments of Defense and Veterans Affairs to develop a more accurate overall measure of spending on America’s war fighters across their lifetime.

Calculating the Actual Cost of Manpower

Oddly, the Pentagon doesn’t even agree with itself about the total cost of military personnel. One of its public relations documents, titled “Taking Care of People,” says the Pentagon will actually spend $244.6 billion — or over $100 billion dollars more than the personnel account — on America’s service members in fiscal year 2010.

The Pentagon arrived at this figure by adding salaries of both active duty service members and civilian employees, plus services found under other accounts within the Pentagon’s budget, such as family support and housing. To this, the Pentagon adds costs partially paid out of the Department of Veterans Affairs, like military health care.

Pentagon Budget

Source: Department of Defense

Fair enough. The $136 billion line item for personnel costs in the Pentagon’s 2010 budget is incomplete because it does not fully account for the indirect and lifetime costs of military personnel. However, the DoD selectively included pay and benefits that are not counted in the “Taking Care of People” calculation, while acknowledging other health care costs. Moreover, while it includes certain support costs for personnel (p. 31 of PDF), it ignores indirect costs associated with housing, moving, and transportation of personnel. And while it includes some benefits paid by the Department of Veterans Affairs, it omits VA retiree benefits (p. 153 of PDF).

A more accurate calculation of U.S. defense personnel spending should encompass three aspects of a soldier’s cost to the military:

1. The service member’s active association with the military. This period counts pay and benefits disbursed to personnel on active or reserve duty.

2. The indirect costs associated with active duty personnel that are vital to their ability to serve, such as housing and transportation.

3. The service member’s passive association with the military. This includes retiree and health-care benefits and services provided by the Department of Veterans Affairs.

In a sense, everything from housing for enlisted troops to cataract surgery for the Vietnam vet must be counted to capture what the U.S. really spends on its military personnel. Taking all that into account, we arrive at the following calculation from the 2010 line items in the budgets of the Department of Defense and Veterans Affairs:

DoD-&-VA-budget

By this reckoning, in 2010, the U.S. government will spend a grand total of $301.1 billion on active duty and retired personnel, or 56 percent of what America spends on national defense. If DoD’s budget included the VA’s 2010 planned outlays for entitlements, health care and family support, the baseline Pentagon budget (excluding Iraq and Afghanistan) in 2010 would swell from $533.8 billion to $638 billion.

In short, U.S. defense spending is so high mainly because we maintain a highly professional, all-volunteer force and because of the global reach of America’s foreign policy. Ultimately, what we spend on defense reflects our foreign policy commitments. Much of America’s robust internationalist foreign policy is due to clear national security interests, as in Afghanistan. However, cost considerations must be part of the discussion, be they a decisive factor or not, when we talk about deployments. We may decide that the cost is worth incurring to keep our country safe, but being equipped with the knowledge of how much a deployment will cost us is simply a matter of good governance.

Soaring Personnel Costs

A perfect storm of extended overseas deployments and an expanding military will have ramifications on the Pentagon’s personnel spending obligations for years to come.

In 2001, there were 1.39 million troops on active duty; today, there are 1.44 million. The end-strength will continue to rise, assuming President Obama keeps his campaign pledge to increase the military’s size by 92,000 soldiers and marines. In July 2009, Secretary Gates called for an additional 22,000 Army soldiers, saying the persistent pace of operations in the two wars over several years has meant a steady increase in the number of troops who are wounded, stressed or otherwise unable to deploy with their units. In short, that’s an ever-expanding pool of overseas deployments, potential casualties, and lifetime benefit obligations.

The Department of Veterans Affairs budget tracks these accelerating obligations. Before America deployed to Afghanistan and then Iraq, the VA’s budget was $48.2 billion. As a result of those deployments, the VA budget has skyrocketed 134 percent to $112.8 billion in 2010. The spending, with a few annual variations, remains approximately a 50-50 split between discretionary costs — the bulk of which is devoted to medical care — and entitlement programs for veterans.

VA Budget

Source: Department of Veterans Affairs

As the Obama administration moves to curtail American involvement in Iraq while devising a new strategy in Afghanistan, Congressional Budget Committee Chairman Rep. John Spratt’s (D-SC) prediction at a PPI event in February seems prescient: “I have a sneaking suspicion that the near-term costs are going to outweigh the near-term savings.” As those deployments end over the next several years, the best-case scenario is that VA spending will remain at the current elevated plateau.

One simple, but ultimately ineffective, way of reforming military spending on personnel is to cut the salaries and benefits of the men and women who have joined the U.S. military. However, that prescription treats the symptom and not the root of the problem. Moreover, it would penalize the hard-working men and women of the armed forces who perform their duties admirably — clearly not an option.

Another way to get costs down would be to return to the draft. But that would diminish our military’s prowess and morale — again, not an option for the U.S.

The problem of rising personnel costs can only be addressed from higher up the chain. Extended deployments overseas invariably increase costs because of the strain they place on the force — in casualties, logistics, sustainability, and recruiting and retention costs. Once the force has recovered from Iraq and Afghanistan, it is incumbent on America’s civilian leadership to carefully weigh the extended cost burden placed on the Pentagon’s personnel account when plotting our global security strategy. In short, America must choose its wars and deployments carefully, as exploding personnel costs are the untold story of Pentagon spending in 2010 and beyond.

None of this is to argue against sensible procurement reforms. Debates over which weapons to cut and which best serve America’s new foreign policy objectives and war-fighting doctrines are necessary. The White House needs to impose fiscal discipline on a Congress that doesn’t like to make tough choices.

However, debates about defense spending should be informed by realism about what really drives up costs. Our analysis yields a clear conclusion: it’s the people, stupid. America spends a lot mainly because its force is asked to do so much. Any clear-eyed assessment of Pentagon spending needs to take the costs and benefits of our overseas commitments into account.

Download the full report.

Update: The previous version of the piece contained a typo. It originally stated that the president signed “a $680-million military policy bill.” Thanks to reader John Rose for spotting the error.

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How Litigators Tried to Sneak a Pet Earmark into Health Reform

Monday, November 23rd, 2009
Phil Goldberg


Phil Goldberg is an attorney at Shook Hardy & Bacon LLP in the firm’s Washington, D.C.-based Public Policy Group. From 1993 through 2000, he was a staff member to three Democratic Members of Congress, including Rep. Steve Rothman (NJ), when Mr. Rothman served on the House Judiciary Committee.

by Phil Goldberg

As the full Senate debate over health care reform legislation finally gets under way following Saturday’s vote, Democratic leaders in Congress should continue fending off special-interest amendments that could be added to what promises to be an enormous piece of legislation. One such provision almost made it into a House committee’s bill earlier this year: a “litigation earmark,” as some in the business community termed it, that had nothing to do with improving America’s health care or cutting health costs but would have opened the door to speculative, mass litigations against American businesses. Alert legislators yanked the amendment, but it could very well sneak into the final bill if progressives are not vigilant.

Health care reform has proven to be challenging to enact and could well stall if this kind of legislative chicanery rules the day. Pharmaceutical companies, personal physicians, and other groups have understood the need for compromise and have offered up important cost savings to help achieve reform. To further cut costs, the president asked his administration and Congress to explore medical liability reform, which the Congressional Budget Office recently estimated could save $54 billion over 10 years. Liability reform is also popular among some Democrats and Republicans needed for the bill’s passage. But expanding liability by creating independent standing for high-dollar, industry-wide lawsuits, as the “litigation earmark” would have done, takes the bill in the exact opposition direction: it would drive up costs – both in the health care industry and throughout the American business community.

The offending act came in July when the House Ways and Means Committee unveiled an 800-page amendment to its health care bill that included a 10-page provision to completely alter the purpose and scope of the Medicare Secondary Payer Act (MSP). The MSP Act is an existing law that is solely intended to punish people who owe Medicare money but have yet to pay their debts. Under the amendment proposed in July, however, the MSP Act would have been transformed to give any freelance lawyer independent standing to file a lawsuit by merely alleging that a company’s product or conduct wrongfully contributed to a condition for which a Medicare beneficiary sought treatment. Moreover, the lawyer would be allowed to aggregate all such claims. The end result would be a mass action for all monies Medicare has spent or will spend on the health care of beneficiaries involving that product or conduct.

A Potential Windfall

The big money potential in these speculative mass Medicare recoupment actions is undeniable. The first targets would likely be product manufacturers, namely makers of cigarettes, guns, alcoholic beverages, sodas, and snack foods, for the health effects of their products, as these industries have been the object of other speculative, industry-wide theories of liability in recent years. Pharmaceutical companies and medical device manufacturers would also be in the cross hairs, as they too have been targeted using similar theories under existing laws.

The reforms could have adverse consequences on America’s health care options. Prescription drugs and medical devices, while providing valuable benefits to consumers, can fail or cause unavoidable side effects for some people, necessitating additional care. If the proposed changes were made, a freelance lawyer could file an expensive mass MSP action focusing on the costs of such treatments without any regard for the practical impact the suit would have. The litigation could raise product costs and limit the availability of medicines and devices for those that benefit from them.

Medicare would be powerless to stop such MSP lawsuits. Because the MSP lawyers would have independent standing, Medicare would have no oversight authority to assure that new MSP suits would be in the nation’s health-care — let alone Medicare’s — interest. The same goes for the allegedly injured beneficiaries. They would not be involved at all, so it would not matter if the beneficiaries believed that the product or conduct did not cause them any harm. The proposed amendments also raise privacy concerns because they require Medicare to turn over patients’ private health records to help the lawyers advance their claims.

Fortunately, a bipartisan group of legislators pulled the amendment from the House Ways & Means Committee’s health reform bill. As a Democrat, I rarely give kudos on civil liability issues to my party’s leadership, but they deserve it for recognizing that such a broad expansion of industry liability has nothing to do with improving health care.

What the Earmark Would Have Done

The idea of using the little-known MSP Act for mass Medicare recoupment suits appears to have been born in the tobacco litigation wars. MSP claims for the costs of treating smoking-related ailments were tried a few years ago as add-ons to existing suits. As Chief Judge Gladys Kessler of the D.C. Circuit wrote, those lawsuits failed because “Congress did not intend the MSP to be used as an across-the-board procedural vehicle for suing” companies.

Rather, the scope and purpose of the MSP Act has always been debt collection, and it should remain so. The law is properly limited to punishing those who do not pay existing debts to Medicare. Once there is a pre-determination that someone owes and has not paid a debt to Medicare, the MSP Act authorizes a private cause of action against the debtor for twice the original debt. If the suit is successful, the claimant gives Medicare the amount of the original debt and keeps the other half as a collector’s fee.

The Ways & Means language, through five core changes, attempted to shift the focus of the MSP Act from debt collection to speculative mass Medicare recoupment actions. The bill:

(1) eliminated the requirement of a pre-existing determination that the defendant owes money to Medicare. This change allowed an MSP action against anyone that might be responsible for costs associated with treatment of a Medicare beneficiary;

(2) authorized actions based on all items and services furnished to all Medicare beneficiaries related to a product or service;

(3) gave standing to anyone, even if not injured, to bring this newly created class-type action. The bill, however, did not provide any class action safeguards to keep the lawsuits in check;

(4) allowed the MSP lawyer to prove causation through generalized evidence, including statistical and epidemiological studies. As a result, the lawyer may never have to show that the defendant caused any beneficiaries’ actual injuries; and

(5) increased liability to include funds Medicare already spent on a beneficiary’s injuries, as well as funds that might be spent in the future and a bounty equal to 30 percent of the recovery.

The Need for Progressive Vigilance

A new effort to change the MSP Act is likely to arise again. Prior to this past July, similar reforms were floated in the Senate Finance Committee in 2007. Both provisions were mislabeled, as one was called a “clarifying” amendment and the other an “enforcement” provision. They also were drafted to look like whistleblower actions.

Progressives should continue to oppose such attempts. Allowing random people to speculatively sue companies for Medicare expenditures violates core tenets of American jurisprudence. The suits do not allege product defect, do not hold a company liable for causing individual harm, and try to get rid of true cause-and-effect liability. Also, by eliminating the requirement of a pre-existing determination of debt to Medicare and lowering the standards for causation, the reforms could lead companies absolved of wrongfully causing anyone’s actual injuries to be held liable nonetheless to the MSP lawyers.

When President Obama addressed the nation to rally Americans behind health care reform, he challenged those in the health care system to put America’s needs above their self-interests. Putting the client’s interest above others can be a virtue for lobbyists and lawyers, but cynically attempting to use reform legislation to push through a litigation provision having nothing to do with health care is an unwelcome move. Today’s debate is about improving our health care system and reducing costs. Progressives in Congress should remain vigilant and continue to put America’s health care first.

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Posted in A New Framework for Growth and Equity, Daily Fix, Fixing Our Broken Politics, Policy Memo | 2 Comments »

Why Progressives Should Be More Open to Nuclear Energy

Wednesday, November 18th, 2009
Andrew Klein


Andrew C. Klein is a Professor of Nuclear Engineering and Radiation Health Physics at Oregon State University.

by Andrew Klein

Klein policy memo

Download the full report.

The international scientific consensus is clear: The Earth is warming, and humanity’s reliance on carbon-based energy sources is a significant factor. Scientists working under the auspices of the United Nations believe that unless global emissions are stabilized by 2030 and cut by at least half by 2050, the Earth’s temperature will increase by more than 3 degrees centigrade by the end of this century.

Should this happen, these scientists predict, both the natural world and human society will experience dire consequences, including mass extinctions, severe flooding caused by rising sea levels, and the failure of primary crops. To prevent these predictions from coming to pass, developed countries like the United States may need to cut carbon emissions by as much as 80 percent by 2050.

So far, the progressive response to this challenge has focused on increasing our use of renewable sources such as wind, solar, and geothermal energy.  A renewable-based energy portfolio is certainly a worthy goal. However, it will probably be a long time—likely decades, not years—before such sources have a realistic prospect of providing the baseload needs of our national economy, let alone meeting the requirements of the entire globe.

In short, we sorely need reliable, non-carbon energy sources as we make the transition to an economy that makes significant use of renewable energy. In light of this need, it is time for progressives to become more open-minded about an energy source that they have tended to eschew or even demonize: nuclear power.

Nuclear has already proved its value as an alternative to greenhouse-gas-emitting energy sources. While there are only 104 nuclear reactors operating across the country, those plants provide about a fifth of all the country’s electric power—and about 80 percent of all the zero-carbon energy produced in the U.S.

Addressing Progressive Concerns

If the extent of our current reliance on nuclear power comes as a surprise, that may be because the industry has done a good job of avoiding the mishaps that once sullied its reputation. Since the Three Mile Island accident in 1979, U.S. nuclear power plants have experienced no serious incidents, and are generally considered the safest and best-operated nuclear facilities in the world. In fact, the safety culture at U.S. plants is so strong that working at a U.S. nuclear power plant is safer than working in the manufacturing sector.

Along with the safety issue, another factor that has made some progressives slow to seriously consider the merits of nuclear energy is economics. While the cost of nuclear power is often a point of heated debate, the fact is that nuclear plants produce the cheapest electric power on the grid. Currently, nuclear plants generate electricity for around 2 cents per kilowatt-hour in a market where the average cost is more than 10 cents per kilowatt-hour.

But there’s a caveat here, and the critics of nuclear energy are quick to point it out: The savings from nuclear energy come once a plant is up and running. The real issue is whether it makes long-term economic sense to incur the enormous expenses of building new plants from scratch. Whether the cost of new plants is competitive remains to be proved, but several utilities have signed contracts to build new nuclear power plants at costs that appear quite reasonable. Time will tell if the final cost of these new plants meets expectations.

Another sticking point is the issue of nuclear waste. Progress toward resolving the issue of what to do with nuclear fuel after it is used in a reactor is currently on hold.  President Obama has called for the formation of a “blue-ribbon panel” to reexamine the options for dealing with this highly radioactive material. Alternatives under consideration include burying the fuel “as is” in stable geologic formations and recycling the still useful parts of the fuel with disposal of the truly non-reusable remaining components.  The good news is that once-used nuclear fuel can be stored safely for a long period of time while researchers and politicians look for a better solution.

Some people are concerned that these projects will divert vital funds from renewable-energy projects, but there is no evidence that this would be the case. U.S. utilities have very aggressive plans to increase their use of renewables—electric companies plan to deploy about 145 gigawatts of new wind capacity over the next 10 years.

The Challenges for Renewables

Nuclear projects under serious consideration are predominantly in parts of the country with limited renewable resources, such as in densely populated southeastern states where the air is too languid for wind energy, the sun is too cloud-blocked for current or near-term solar technologies, and a potentially useful biomass sector remains in its infancy. Areas with more economic and accessible renewable resources—such as the wind corridors along the coasts and through the Great Plains—are likely to have the best chance at being successful in deploying renewables at larger scales, breaking the technological ground for others to follow.

Eventually, advances in technology may allow utilities in more states to build practical renewable-energy facilities. Moreover, we must build a 21st-century electricity grid that will enable more widespread use of renewables and allow widely distributed electricity generated in resource-rich areas to be efficiently transmitted across long distances to parts of the country that need energy.

But these changes will take many decades. In the interim, if we are to arrest the increase in emissions by 2030, as recommended by climate scientists, nuclear power should help provide a path to an emissions-free future.

No one expects that nuclear energy (or any other single technology) can solve all our energy challenges by itself. However, it can clearly help. Just one plant of the type that three U.S. utilities have recently signed contracts to build would displace the burning of about 7 million tons of coal each year.

Most importantly, as the U.S. and other countries increase the use of hybrid and electric vehicles, access to non-emitting electricity will become an essential element in the reduction of greenhouse gases. Renewable energy used in combination with a new generation of nuclear power plants gives us our best opportunity to reduce carbon emissions in a realistic and cost-effective manner.

The Global Appetite for Nuclear Energy

While Americans weigh the important issues associated with nuclear power, the fact is that many other countries have already decided to proceed with the construction of a new generation of nuclear plants. There are 50 new reactors currently under construction in 13 countries around the world. China alone will place 16 new plants into operation by 2020, which would quadruple its nuclear capacity in the next decade or so. Other developing countries are following this example—some 30 countries that do not currently operate commercial nuclear plants are actively considering the construction of nuclear power plants.

Hazards lurk here. Few of these nuclear newcomers—which include nations such as Jordan, the United Arab Emirates, and Indonesia—have the trained personnel and infrastructures in place to implement adequate regulations and controls at their facilities.

Nevertheless, the quest for greater energy independence and a non-carbon source capable of fueling developing economies is spurring these countries to build nuclear power plants. It is in everyone’s interest that these projects be carried out in the most responsible manner, with safety set as the highest priority.

Just as America’s ability to influence other countries to reduce greenhouse gases depends on our ability to take the necessary steps at home, our ability to work with other countries to assure nuclear safety will depend on how seriously they view our commitment to advanced nuclear energy technologies. America’s voice will carry far less weight in developing countries if those nations are building new plants 30 years more advanced than anything in use in the U.S.

If the U.S. technological infrastructure decays to irrelevance, we will have little ability to influence other countries in the development of meaningful safety standards. If U.S. companies are unable to build their advanced technologies in this country, we will have little success in convincing other nations to use our technologies instead of those that may be less safe.

Nuclear Energy and Jobs

In addition, a true nuclear renaissance could bring tens of thousands of new high-technology, manufacturing, and construction jobs to the U.S. Many companies are already preparing for the expected construction of new plants. More than 10,000 jobs have already been created, and each nuclear plant project will employ around 1,500 people during construction and about 800 during operation.

Beyond these jobs, the Nuclear Energy Institute, an industry trade group, estimates that each new nuclear plant will require approximately 400,000 cubic yards of concrete, 66,000 tons of steel, 44 miles of piping, 300 miles of electric wiring, and 130,000 electrical components. In many parts of the country ravaged by recession, a nuclear plant project would provide a major long-term economic boost.

After nuclear plant construction ceased in the U.S., American firms lost the ability to manufacture many of the key components required for a new nuclear plant. The opportunity to restore this vital component of the industrial base, which would provide the capability to manufacture many other complex components for other applications, is now before us. With so many nuclear power plants planned around the world, American workers can regain a share of this expanding export market—but not unless new plants are built in the U.S.

Progressives must consider the role that nuclear energy can and will play in the U.S. and around the world. The “Just Say No” approach to nuclear energy has proven to be counterproductive to our national interests. Today, the world is moving toward an energy future that is cleaner and less reliant on fossil fuels—a future that includes nuclear power. It is time for progressives to assume a leading role in helping to shape that future.

Download the full report.

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Understanding the Threat from al Qaeda

Monday, November 16th, 2009
Jim Arkedis


Jim Arkedis is the director of PPI's National Security Project.

by Jim Arkedis

At first glance, it seems like an obvious call: al Qaeda hasn’t attacked the U.S. in over eight years, so why endanger more American lives and spend billions to fend off a group that’s on the ropes?

Or, even for many who believe al Qaeda continues to pose a threat, it’s hardly obvious why the Obama administration is considering Gen. McChrystal’s request of 40,000 more troops for Afghanistan. After all, the terrorist group has withered to maybe 100 members, most of whom are across the border in Pakistan. Shouldn’t a counterterrorism strategy that disrupts plots as they develop be enough?

A friend who works in Hollywood once told me that movie producers emphasize that the audience should understand exactly what’s at stake throughout the picture. In the Afghan security drama, the audience — the American public — has long since been lost and bored by the plot. Who can blame them? Think of all the twists and turns that have diverted their attention over the last eight years: Iraq, Hurricane Katrina, a torture debate, Gitmo, wiretaps, and, of course, Afghanistan, among many other factors, have all desensitized, frustrated, or angered much of the country to the point that many are sick of thinking about national security. If George McGovern dusted off his presidential campaign slogan, “Come Home, America,” and ran this year, he might fare better than last time.

That’s why as the White House contemplates its choice for strategy and resources in Afghanistan, it’s crucial that Americans become reacquainted with what’s still at stake.

A Loss of Urgency

Right now, it’s true that al Qaeda’s senior leadership — the only one of the many different “al Qaeda” groups worldwide that has a serious interest in attacking the U.S. — probably doesn’t have the capability to plan and execute a devastating 9/11-style terrorist attack. Al Qaeda’s core leadership remains intact, but after eight years of pounding by American and NATO forces, it’s highly questionable whether Osama Bin Laden’s intimate cadre could today mount an intricate logistical and financial campaign necessary for a large-scale operation half a world away.

One can’t blame Americans for thinking that the stakes aren’t particularly high. America feels relatively secure today, and some complacency may have set in.

But as Steve Coll first suggested in Ghost Wars, his history of intelligence services in Afghanistan and Pakistan, it’s helpful to think of America as a soccer goalie defending against Team al Qaeda. It’s possible to pitch shut-out after shut-out for several games in a row, but no matter how good the goalie is, at some point, he’s bound to let one through.

To build on Coll’s metaphor, al Qaeda, unfortunately, is prepared for a long season. One of al Qaeda’s under-appreciated strengths is its patience. Bin Laden’s modus operandi is that it’s better to do nothing than to try and fail. Al Qaeda took five years to plan the 1998 East Africa embassy bombings, two years for 2000’s U.S.S. Cole attack, and another two for 9/11. Plot development time would no doubt be much longer today.

That’s why al Qaeda is effectively sitting on the sidelines in Pakistan. It has been pinned down by the American and NATO presence in Afghanistan and is biding its time, hoping that the Taliban can retake control of Afghanistan and re-open the playing field.

A Plan to Defeat — Not Delay — Terrorism

Gen. McChrystal’s plan is a proposal to keep them off the field for good. Instead of worrying about disrupting plots as American intelligence learns of them, McChrystal’s strategy, if successful, would permanently deny al Qaeda a chance to slip one past the goalie by forever taking away the safe haven it needs to plot a massive terrorist operation.

Some question the links between al Qaeda and the Taliban, wondering whether, should the Taliban return to power in Afghanistan, it would necessarily facilitate al Qaeda’s return. But in an essay in Foreign Affairs, Barbara Elias provides a convincing rebuttal: “If key Taliban officials behaved as representatives of a government seeking to maintain control of their territory, they would have given up al Qaeda in the fall of 2001, just as Pakistan supposedly agreed to give up the Taliban. Why would they turn against al Qaeda now if they didn’t then?”

As I argued in an article for Foreign Policy, al Qaeda needs a safe haven along the Afghan-Pakistan border to have any hope of conducting a massive terrorist attack against the U.S. The Obama administration and European leaders may never be able to fully defend against a Madrid- or London-style attack, but America can defend against another 9/11 by denying al Qaeda the cover it needs to conceive, plan, train for, and execute a terrorist plot.

There’s no question that Gen. McChrystal’s request is a bitter pill to swallow as the administration asks for billions more to finish off a distant enemy seemingly on its last legs. It is tempting to wager that America will remain secure even if the Taliban retake parts of Afghanistan by keeping al Qaeda off balance with less expensive Special Forces raids and targeted air strikes.

That roll of the dice isn’t worth it. If al Qaeda regroups and re-grows by implanting itself in Afghan territory, it would establish itself anew as a serious security threat to the U.S. And if it were able to launch another 9/11-style attack, the White House — regardless of its occupant — would be back at square one, making new decisions about thousands more American lives and hundreds of billions fresh dollars. It’s not an attractive option, but on the whole, it makes more sense to swallow the castor oil and adopt Gen. McChrystal’s recommendations. They offer the best chance of permanently quashing the al Qaeda threat.

That’s what’s at stake.

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