Of course, not all growth in America or elsewhere was fraudulent in these ways—far from it. We did improve productivity and create new companies, like Amazon.com and Google; new products, like the iPod and the iPhone; and new services, like online advertising and open source software, which collectively made people's lives better, easier, more enjoyable, and more productive. But, in America at least, too much of our economic growth was borrowed from our children's piggy banks and from Mother Nature's reserves, not invented. Therefore, we as a society wound up living beyond our collective means.
It all lasted—until it didn't. Or as my friend Rob Watson, the environmental consultant who founded EcoTech International, likes to say: "You know, if you jump off the top floor of an eighty-story building, you can actually feel like you're flying for seventy-nine stories. It's the sudden stop at the end that gets you."
The Great Recession was our sudden stop. The question is: Can we learn from it? As the Stanford economist Paul Romer has said: "A crisis is a terrible thing to waste." I believe we can learn from this crisis and we must learn from this crisis, and the purpose of this book is to provide one pathway for doing so.
This is a revised edition. The hardcover version of this book was first published in September 2008. In it, I argued that America had a problem and the world had a problem. America, I insisted, had "lost its groove" after the end of the Cold War and particularly after 9/11. We had turned inward and begun to export our fears more than our hopes, and we seemed intent on postponing dealing with every big problem weakening our society—from education to Social Security to health care to the deficit to immigration to energy. I argued that we needed to get back to nation-building at home—and I believe it was that sentiment, shared by a majority of Americans, that propelled Barack Obama to the presidency.
But the world also had a problem, I argued. It was getting hot (global warming), flat (the rise of high-consuming middle classes all over the world), and crowded (on track to adding roughly a billion people every thirteen years.) My thesis then, which remains my thesis here, is that America could get its groove back by taking the lead in developing the technologies and policy solutions to address the world's biggest problems—the energy and environmental stresses growing out of a planet getting hot, flat, and crowded.
What has changed? The first thing that has changed is that America's problems and the planet's problems have become more acute. As noted above, the system of growth we have fallen into has destabilized both the Market and Mother Nature to a degree that can no longer be finessed or ignored. The collision of acute financial and ecological distress that made the Great Recession "great" enabled me to see something that was hiding in plain sight—that the problems destabilizing the Market and Mother Nature were rooted in the exact same kind of dishonest accounting, mispricing of risk, privatizing of gains, and socializing of losses.