[The author is the chairman & CEO of IBM.] JANUARY 13, 2009
Let's Spend on Broadband and the Power Grid Not all stimulus is created equal. By SAMUEL J. PALMISANO Wall Street Journal http://online.wsj.com/article/SB123180687062275609.html?mod=todays_us_opinion As a new American administration takes office during the most severe economic crisis since the Great Depression, everyone is understandably fixated on the present emergency -- on what went wrong and how to fix it. There is a growing feeling of desperation, the idea that we must do something -- anything -- to get the world's economic juices flowing again. Let me offer a different point of view: We shouldn't undertake projects simply for the sake of creating economic activity. Rather than just stimulate, we should transform. Let's seize this opportunity to create more and better jobs, cultivate valuable skills, and not simply repair but prepare our economy for the 21st century. The best news of all is that investing in innovation will cost less and yield faster results than investing in renovation. This view is grounded not in the headlines of the moment, but in the facts of what is now possible technologically for businesses of all sizes. American businesses have the capacity to transform the systems through which the world literally works. The planet isn't just getting smaller and "flatter," it's also becoming smarter. Intelligence now undergirds the way everything operates. Smarter infrastructure is by far our best path to creating new jobs and stimulating growth. We at IBM were asked to map this out by President-elect Barack Obama's transition team, and our research shows that a $30 billion stimulus investment in just three areas -- smart grids, health-care IT and broadband -- could yield almost one million new jobs within one year. That's possible because these kinds of infrastructure have significantly greater economic and societal multiplier effects than traditional infrastructure like bridges and highways. Our power grids are the largest remaining artifact of the Industrial Age, and they're due for a smart upgrade. Using broadband data streams, digital sensors and advanced analytics, demand can be understood in real time. Utilities can source and manage power more intelligently, helping to bring renewable sources onto the grid. And consumers could understand the variable cost of power and alter their behavior accordingly. A smarter utility network could also handle the growing demand for hybrid and electric cars. Today's utility grid would struggle to manage this burden. A $10 billion per year smart grid stimulus investment could yield almost a quarter of a million jobs digitizing the grid and in related industries, such as alternative energy and automotive. This investment will enable new forms of industrial innovation by creating exportable skills, resources and technology. Similarly, investing in electronic health records will stimulate integration and efficiency across the entire health-care system. Indeed, it could actually become a true system -- able to link diagnosis, drug discovery and health-care providers to insurers, employers, patients and communities. Health-care research would become more informed and intelligent, and health-care providers could develop more advanced, individualized treatments with targeted pharmaceutical drug therapies. A $10 billion stimulus investment could generate more than 200,000 direct and indirect jobs. In addition, it could prove a major impetus for streamlining health-care costs. We can learn a lot from the network effect of the stimulus investments in the Interstate highway system of the 1950s. Back then, our economic system was analog. Building a new highway system sped the movement of physical assets, creating a new high-speed transportation system that enabled businesses to expand much more quickly, helping drive economic growth for decades. Today, we live in a digital world. Many of our most valuable assets are online, traded virtually. As a result, communities with broadband access grow employment at a significantly higher rate. And yet today, the United States, the country that developed the Internet, ranks 12th in broadband penetration and 15th in average broadband speed. This is unacceptable if we want our nation to compete in the 21st century. I meet frequently with government leaders around the world, and they are considering exactly these kinds of smart investments. Forward-thinking nations, companies and communities will leverage this opportunity to completely rethink key infrastructure services. Will we? Will the U.S. make investments in our future whose impact is not just additive, but exponential? Let's not fix a flawed past. Let's build a smarter future for our country. ------------ Mr. Palmisano is the chairman and CEO of IBM. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu *********************************** * POST TO [email protected] * *********************************** Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
