10 february 2009

Stimulus Bill Bears Imprint of Technology

New York Times, February 10, 2009

"What oil was to President Bush, clean energy and technology are to the Obama White House"

WASHINGTON — To rally support for his administration’s economic recovery bill recently, President Obama invited about a dozen chief executives, seven of them from technology and energy companies, to the Oval Office.

...The biggest outlay on new initiatives is essentially a technology industry wish list: in the Senate version, about $7 billion for expanding high-speed Internet access, some $20 billion for building a so-called smart grid power network and $20 billion for digitizing health records.

To many on K Street, the stimulus bill was the clearest guide to the new administration’s closest friends in the business world. What oil was to President Bush, some say, clean energy and technology are to the Obama White House....

“A close look at the history of the stimulus bill — the first major product of the new administration — shows that the industries that stand to gain most from the proposed legislation were also working to help shape it even before Mr. Obama had won the election.

For months, the industry officials had been talking with Obama advisers about how to use taxpayer aid to jump-start the economy while laying the groundwork for both the new president’s and their own goals of building a high-tech infrastructure.

.... Campaign finance records also show that executives at many of the energy and technology companies that stand to profit from the stimulus bill were also big contributors to Mr. Obama’s campaign. His promises about a “smart grid” and universal broadband dovetailed with the dreams of many in the technology industry, as well as allied fields like renewable energy and electric power.

Drawing on renewable energy sources, like wind turbines and solar panels, would be easier with a smart grid that could handle inconsistent electricity production. More energy would lower the cost of running giant computer servers, and because such a grid can send signals in both directions, it would also allow variable pricing for peak hours and could potentially expand the Internet network, as would extending other forms of broadband lines to rural and underserved areas. And moving health records online would open new markets for digital connections, data storage and consumer services.

“They all converge,” said Christopher G. Caine, vice president for governmental programs at I.B.M., which is in both the smart grid and health care data businesses. At the transition’s request, I.B.M. prepared a research report concluding that $30 billion in spending this year on the smart grid, broadband access and digitized health records would create approximately 949,000 jobs.

The idea of harnessing such pre-existing proposals to a stimulus package traces back to September 2008, when the financial crisis was worsening and it became clear that a jobs bill could be an early priority if Mr. Obama won the election.

Obama advisers including Mr. [Jason] Furman, Julius Genachowski and Austan Goolsbee began soliciting input from the high-tech and alternative energy interests, including General Motors, I.B.M., Google, the Information Technology Industry Council and the electric utilities’ Edison Institute.

By October, “there was a query that said ‘if you had money to spend on broadband as part of this stimulus, what would you propose?’ ” said Debbie Goldman, a lobbyist for the Communications Workers of America, which has pushed for greater government spending on broadband.
After the election, the campaign’s policy teams went through their agenda and selected those items that could have a quick start and natural end date to identify candidates for a jobs bill.

“Synergies between our short-term goals and our long-term goals,” David Axelrod, a top adviser to Mr. Obama, said in an interview, “that was the sweet spot.”

The transition also sought expert advice, holding conference calls and meetings at its temporary headquarters in Washington with a parade of industry lobbyists and executives from high-tech and clean energy companies from mid-November to early December.

On Dec. 2 for example, Ms. Goldman of the communications workers union made a presentation promoting the jobs that would be created by broadband spending. On the same day, representatives of all the renewable energy trade groups sat around a table making pitches to Carol M. Browner, who is now Mr. Obama’s energy policy chief.

“It was nice they were having us all in so early,” said Karl Gawell of the Geothermal Industry Association, whose members would benefit from $400 million in grants in the House version of the stimulus bill.

The process reached a climax when members of the economic team flew to Chicago for a Dec. 16 meeting with Mr. Obama. The team laid out the structure of the plan — increased spending on infrastructure, education, energy and health care, along with tax cuts, financial aid to states and unemployment and food stamp benefits.

While much of the presentation involved broad themes, Mr. Furman said it put special focus on “a number of high-priority flagship details” like the renewable energy and high-tech components. Mr. Obama signed off on the initial outline, after making a few adjustments.

“The president-elect was particularly interested in the energy component of the plan and pushed for a more robust effort on the smart grid,” Mr. Furman recalled....

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