America Needs a Jobs Race to the Top

The models are there. The federal experiment with Race to the Top worked. The state experiments with public-private partnerships are working. Let's combine the two and create millions of jobs in America.
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As last week's jobs numbers reminded us, emerging from the biggest economic crisis since the Great Depression isn't going to be easy. We need to be creative and daring. We need a moon shot -- a Jobs Race to the Top. The goal: create three million new jobs in three years.

It's doable with an aggressive strategy. Here's how it could work:

• Take funds the U.S. now spends on economic development programs (about $170 billion) and redirect a portion to a Jobs Race to the Top competition among the country's regions, states and communities. For it to have an effect, it needs to have the size and scope of the education Race to the Top.

• Focus the competition on clean energy job creation. There is a critical national need for this and it can create all kinds of jobs for all kinds of people in all kinds of regions across the country.

• Devote the competition to rewarding the most effective public-private partnerships. These must be developed at the local level. Define "effective" in terms of the numbers of lasting jobs created quickly.

• Reward regions that build on their strengths, partner with the private sector and change public policy to drive jobs results. Take the Sunbelt states. In exchange for federal dollars to offset a company's upfront capital costs or new technology installation, these states might create a dramatically streamlined permitting process for solar farms. Or they could offer a partnership with specific private-sector solar energy producers to build out the energy generation, and ensure strong demand for renewable energy inside the region through a robust Renewable Energy Standard.

The regional governments might lease land tracts at low rates, or even offer them for free. State governments might give incentives for solar energy production. Public utility commissions might offer ways to partner with the Federal Energy Regulatory Commission to streamline electric grid siting. Allow regions to partner to make their best competitive case; develop the most creative, dynamic and effective public policy, and use the federal dollars to drive technological advances and investment that might otherwise head to another country.

• The same analysis could be done for other regions -- including the nation's high wind areas, the best places to manufacture clean energy or energy efficiency products, regions with the potential to develop biofuels, nuclear, hydro-energy or waste-to-energy technologies. Every region has something to offer to our clean energy future, and every region could be creating all kinds of jobs for their citizens right now -- if incentives were right.

• To get quick results, announce the competition in early 2011 and the winners within six months.

In Michigan, we are trying our own version of this race -- focused on the lithium-ion advanced battery for the electric car, a high-tech product previously manufactured almost exclusively in Asia.

We offered irresistible state tax incentives for manufacturers of "advanced energy storage." We pancaked our state incentives on top of the competitive federal Department of Energy grants to advanced battery companies and suppliers. We also created robust public-private partnerships.

In just over a year, we have attracted 18 domestic and international companies, projected to create 63,000 private-sector jobs in Michigan. With breathtaking speed, we built an entire advanced battery "ecosystem" for the purpose of electrifying the automobile.

If the states are the laboratories of democracy, Washington can take a lesson from what is happening in Michigan.

Comprehensive clean energy projects require lots of local collaboration and private sector involvement. Without a financial carrot, the difficult regulatory changes at the local level would take years -- if not decades. As we saw with the education Race to the Top, a financial incentive at these fiscally tight times caused states to dramatically change public policy to achieve the critical federal goal of increasing educational achievement in America.

An Energy Jobs Race to the Top is likely to ensure that America will actually be at the table to feast on this explosively growing jobs sector -- instead of watching our global economic competitors eat our lunch.

The New Deal was about employment by the federal government. But this new era demands a private sector-focused, bottom-up approach: jobs created by businesses through local public-private partnerships in an economic sector important to our national strength and incentivized by the federal government.

The models are there. The federal experiment with Race to the Top worked. The state experiments with public-private partnerships are working -- look at Michigan. Let's combine the two and create millions of jobs in America.

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