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Jared Bernstein

Jared Bernstein

Posted: July 23, 2010 04:46 PM

Recovery Act in Action #8: Jobs in the Heartland

What's Your Reaction:

Our latest Recovery-Act-in-Action installment features some exciting new technology, 100 good-paying manufacturing jobs, and the public/private co-investment that is critical to job growth right now.

It's all taking place in Indianapolis, Indiana, where Allison Transmission is building a new factory to make hybrid systems that go into energy efficient trucks, buses and other commercial vehicles. The new plant, and the 100 folks Allison expects to put to work in it, was partially financed by a $62.8 million Recovery Act grant from the Department of Energy as part of their advanced battery grant program.

There's a lot to like about this project. Once the new plant is fully operational, it will crank out more than 20,000 hybrid propulsion systems each year. If you're like me, your reaction to that is a) wow!... and b) um, what's a hybrid propulsion system?

Laurie Tuttle, Allison's VP of Hybrid Programs, was kind enough to explain it to me. As I understand it, these are systems that take energy that a vehicle generates that would be otherwise wasted, and reuses that energy. For example, when a vehicle slows down, conventional breaks create friction and heat. "Regenerative breaking" recovers that energy and stores it in the battery for later use in acceleration or, on commercial vehicles, for other purposes like powering a boom on a utility truck.

That saves gas, so fuel efficiency in these hybrids are typically goosed by 25-30 percent.

Allison's long-range plan was to start developing these new systems over the next few years. But the Recovery Act grant, matched by about $68 million of capital from their private investors, enabled them to accelerate the production, creating jobs now when they're most needed, and giving our industry the head start it needs to be globally competitive in the production of clean energy transportation.

Ms. Tuttle tends to be pretty technical in discussing this stuff, but she got downright emotional when she described the positive impact this new investment is having on their community, telling me, "Goodness, to be able to bring these jobs right here to our heartland... it just feels great."

You don't see a lot of people getting all choked up about building systems that capture and recycle kinetic energy. But I think those of us who are rooting for new jobs in American manufacturing, lasting opportunities for middle-class workers, and energy efficiency are right with her on this one.

 
Our latest Recovery-Act-in-Action installment features some exciting new technology, 100 good-paying manufacturing jobs, and the public/private co-investment that is critical to job growth right now. ...
Our latest Recovery-Act-in-Action installment features some exciting new technology, 100 good-paying manufacturing jobs, and the public/private co-investment that is critical to job growth right now. ...
 
 
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HUFFPOST SUPER USER
BannedNBoston
Is hemp legal yet?
02:49 PM on 07/26/2010
Decentralized power put up solar panels not BP's brand

http://www.youtube.com/watch?v=-Yxn7fQy2Bs
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HUFFPOST SUPER USER
patches12
12:39 PM on 07/26/2010
100!!! did you say 100!!! WOW ONE HUNDRED... how much did taxpayers have to spend to create these 100 jobs/???
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02:13 PM on 07/25/2010
Now just imagine if everyone in the midwest could eliminate their electric bill by having solar panels! What are you people waiting for? Where are our loans and feed in tariffs - 68 countries are already using the system that WORKS while we desperately scramble to re-enrich Big Energy and re-monopolize (and expand) our electricity grid EVEN WHEN POWERING IT BY UBIQUITOUS SUN AND WIND???

STOP working for Chevron and BP (including their horrible "solar" and "wind" boondoggles) and START working for US - we all want efficiency upgrades and solar panels on our homes and businesses NOW.

Thank you!
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Kache
Toodlum, wake up, I hear a prowler downstairs
12:04 AM on 07/25/2010
UPS trucks. Stop, go. 35% increase in fuel mileage.
11:37 PM on 07/24/2010
It's always dismaying to watch the bureaucrats gamble with other people's money.
09:08 PM on 07/24/2010
And Dow Corning is going to be building an LCD screen plant in China, that's $800,000,000.
Understandably some jobs will go overseas, but corporate America with the help of their butt buddies in Congress is doing nothing about real jobs in America...they just line their pockets from cheap overseas labor.
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08:04 PM on 07/24/2010
$628,000 per job!

The number of unemployed people before the recession was about 7m. Now it's around 14.5m.

So, to "create" the necessary 7.5m jobs will only cost around $4,710,000,000,000.

And we'd have to borrow all of that and never pay it back or all we'd be doing was stealing other jobs (via taxing) or stealing jobs from the future (when we pay the money back).
11:38 PM on 07/24/2010
Yeah, that's almost as much as a city planner's pension!
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02:30 PM on 07/25/2010
If you assume a lifespan of 25 years and each job averaging about $50K, that results in $100,000,000 in salary over the life of the plant - all going to our neighbors.

Do you think that capital investment resulting in manufacturing jobs in the private sector is free, especially for new technology? You are probably the same person who complains when companies offshore manufacturing - and clearly you think that companies spending money (taxes in your case) reduce the number of jobs they create. So why don't you think that capital investment in new factories would reduce the number of jobs they create? Is it ONLY tax-dodging that creates the salary base for companies, or could dodging a multi-million dollar capital investment do the same? Cuz tax dodging results in money we (the govt) then have to borrow and never pay back, too...

Here's what you are missing. If the govt. collects taxes then targets spending on PRODUCTIVE projects like this, 100 jobs are created for 25 years. If the government just walks away and never gets or spends the money, then that 62 million bucks will just go into the pockets of executives and shareholders and NO jobs will be created. So this is actually a more efficient use of the capital than a tax break would be, because those 100 people will still need money...

Viewing the world through the lens of simplistic "the rich should rule the country" dogma is perhaps understandable, but totally destructive.
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08:18 PM on 07/25/2010
I am particularly impressed by your third paragaph. It must be nice thinking that all those "executives and shareholders" get all of this money and then just put it in a big safe in their bedrooms or perhaps bury it in the backyard. Much better that the government take it from them and then decide who should get it (I suppose they clean off the dust and dirt first!).

The government cannot distribute money more effectively or efficiently than the private sector. If it could, the Soviet Union, North Korea and Cuba would be the world's economic powerhouses.
06:03 PM on 07/24/2010
Once companies see that green energy is profitable, they will rush into it. But the FACT is that most Americans believe that the cost of green energy is more expensive than the benefits. A perfect example is how very few Americans add solar roofing to their houses. Any attempt for government to force this will backfire and be a waste of resources. People and their free choices make better decisions than politicians.
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02:15 PM on 07/25/2010
That is all great. So, I assume we can now have the free choice to no longer HUGELY HUGELY subsidize fossil fuels and nukes, right? Cuz the second we do that, solar panels will be THE only thing we all want.

You can't grotesquely distort the marketplace then pretend it's a "free market."
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HUFFPOST SUPER USER
Overtone
See bio on the Aesop Institute website
04:54 PM on 07/24/2010
A huge number of jobs must rapidly be created to supersede fossil fuels faster than might be imagined.

The life threatening impact of oil and the Gulf disaster may prove to be far more serious than has so far been realized!

See What to Do! at http://www.aesopinstitute.org The subtitle is: A 5 Step Program...

400 parts per million of carbon has recently been found to be the Arctic Tipping Point, which could conceivably endanger all of humanity. We are presently approaching 390 ppm. The safe limit is 350 ppm.

A thin oil film on the surface of the North Atlantic and Arctic oceans appears to threaten to raise temperatures toward the catastrophic Tipping Point.

If these facts are accurate, an emergency program that can generate millions of jobs is now urgent.

Little known and hard to fathom breakthroughs involving radically new energy technologies can help to supersede oil much more rapidly than might be readily understood or believed.

See Moving Beyond Oil on the same Aesop Institute website.

All decentralized renewable energy work should rapidly proceed on a 24/7 basis. Congress needs to provide whatever incentives are necessary to make that possible without delay.

We need far more robust steps to effectively attack the problems in the Gulf and prevent as much oil as possible from reaching the Atlantic ocean.

Three programs have the potential to reduce unemployment.

Included are a Human Investment Tax Credit program and The Brooklyn Project. Both at www.aesopinstitute.org
11:39 PM on 07/24/2010
You may have not been keeping up with current events, but the government is broke.
HUFFPOST SUPER USER
deweaver
Scientist, businessman, semi-retired
03:23 PM on 07/24/2010
For a Chief economist for the VP, his not looking that the numbers is amazing. $62.8 million for 100 jobs computes as $628,000 per job for a major international company. This grant to one competitor will block innovation by potential competitors.

Unless you are one of the politically favored, it is silly to try an compete with a subsidized company. If Allison Transmission can't do it on their dime, perhaps leaving the opportunity to someone who is more innovative and actually has a background batteries and power electronics -- not an old line gear/transmission company, that is politically connected.
03:17 PM on 07/24/2010
Just like you, my reaction was WOW! $628,000 per job
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02:25 PM on 07/24/2010
Filibusters to make the Obama administration and Democrats in Congress look inept are one thing. Quite another is a vote against creating jobs in an economy with nearly 10 percent unemployment and midterm elections months away. This new obstructionism is very different from what’s gone on in the past, and that needs to be underscored over and over.

Unless you've been living in a vacuum, you must know that the stimulus has absolutely created jobs, and saved jobs. During the Bush Administration the financial meltdown was already beginning to show it's ugly head in late 2006, but ignored, and in 2007, only brave souls were outspoken about what was happening. But in late 2008, it was apparent we were headed to falling down an abyss.

CNN Money.com reported in November of 2008 that the government reported employers cut 240,000 jobs in October - bringing the year's total job losses to nearly 1.2 million.

Now, it wasn't that long ago, but so many people either refuse to give credit to President Obama, or really just don't know. He said over and over in his campaign speeches when referring to the financial crisis of 2008, "jobs would be the last thing to improve." That is the way with depressions. It is the terrible fact of how recovery takes place.

To improve the situation we need bipartisenship; not going to happen. Stimulus is still being held up in many States, and more stimulus is a bad word in Repub circles.
03:23 PM on 07/24/2010
Please don't overlook the fact that the Democrats had total control of both the House and Senate in 2007 and beyond. Congress controls the purse strings and most regulations. The president makes no laws and can only approve or veto those made by congress. If you blame Bush and the Republicans for problems up to 2006, you must likewise blame the Democrats for any problems after 2006.
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04:10 PM on 07/24/2010
I believe you must look at the fact that this "majority" you speak of was only a 51-49; not much, and one of those was Lieberman who often voted with the Republicans.

They were constrained by three factors: •A majority that's too slim to break party-line filibusters in the Senate or override presidential vetoes. •Republican lawmakers' willingness to stick by the White House most of the time. •And divisions among themselves over how far to go in opposing the war or changing how deals get done on Capitol Hill.

And, you must be aware President Bush had quietly claimed the authority to disobey more than 750 laws enacted since he took office, asserting that he has the power to set aside any statute passed by Congress when it conflicts with his interpretation of the Constitution. He would sign bills with much fanfare, then after the media and the lawmakers left the White House, Bush quietly filed ''signing statements" -- official documents in which a president lays out his legal interpretation of a bill for the federal bureaucracy to follow when implementing the new law. The statements are recorded in the federal register
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HUFFPOST SUPER USER
picaman
Conservatism is an Un-Christian lack of Empathy
02:04 PM on 07/24/2010
Will one of the conservatives that believe that private investment generates far more jobs than public investment, please explain China?
10:15 PM on 07/24/2010
Here you go.
Observations by a man who has traveled the world and dedicated his adult life to understanding the dynamics of politics and investment.
China is not everything it's cracked up to be.

http://www.caseyresearch.com/displayCwc.php
11:40 PM on 07/24/2010
China would generate far more jobs if they had private enterprise. It's rather simple math really.
11:13 AM on 07/24/2010
The proof of the pudding is in the eating, and the White House has just stated that unemployment will stay at or above 9% until 2012. We are currently in a Little Depression. And the Obama administration is not offering us any policy to bring it down faster. This can only be described as a failed economic policy. And that makes Obama, so far, a failed President.

The stimulus was large enough to turn the economy around so that it is now growing, but is was too small to make the economy grow fast enough to bring the unemployment rate down at an acceptable rate.

We need a second stimulus. But his inept political advisors are telling him there is no political support for a second stimulus. Obama needs to get a more competent set of political advisors P.D.Q. If Franklin D. Roosevelt were President, he would engage in a series of fireside chats with the American people explaining why a second stimulus is needed and building up political support for such a second stimulus. But, alas, Obama, at least so far, is no Roosevelt. He is another Jimmy Carter willing to accept failure instead of boldly leading the country in the direction it needs to go.
HUFFPOST PUNDIT
ThatsTheTheWayItIs
religion, ideology, partisanship are delusional
01:31 PM on 07/24/2010
So, 16 months after taking office, despite:

1. taking over the worst financial crisis since the Depression

2. ending the recession. that's right, GDP is growing, recession is over
(that's according to economists, they invented the term, so don't argue with them)

3. bringing unemployment down to 9.5%, and still going lower (was 20% in Depression)

Despite doing that in 18 months, Obama is a "failure"?
So, what does that make FDR? How big a failure was he?

A full five (5) years after FDR took office, after being relected, the Depression had still not ended, and in fact in 1937 the economy reached it's lowest point. Five years after FDR took office!

As to comparisons to Carter: political history seems not to be your forte.
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ssmack3
"Don't work, don't eat"... the Bible
10:47 AM on 07/24/2010
Is this for real?.... Hey, Mr. "Chief Economist"... check the unemployment rate - 9.5%. Last week, the worst jobs numbers since February. We're heading toward a double-dip recession, and the "administration" is doing nothing about it. These one-off stories about a single company hiring a few people don't hide the fact that the economy is still in shambles and there is nothing in the pipeline to correct it.