A ‘Green Revolution’ Boom
Will a “housing bubble” lead the United States out of the current recession, as it did during the middle 1990s? According to many financial experts, that scenario is unlikely, just as another Internet boom is also improbable. However, by better understanding the impact of the housing bubble during the 1990s recession, we can better understand the potential impact that a “Green Revolution” and those with a green degree, could have on the recession of 2008-2009.
The 1990-1991 recession had the marks of a genuine recession, including multiple quarters of increases in unemployment and decreases in the Gross Domestic Product (GDP). However, remember the adage of former U.S. House Speaker Tip O’Neill, that “all politics is local.” The economic downturn impacted certain areas of the country in particular, including California and the Northeast. These local hardships stemmed from a variety of causes, including increasing Medicaid costs, rigid tax systems, and new federal mandates. Nevertheless, the ultimate result was that these devastated regions had a significant impact on the decline of the nation’s economic health.
Nevertheless, the recession of the early 1990s did not last forever. The speedy expansion of the nation’s housing markets resulted in a change in the “supply and demand” dichotomy that plays a significant role in macroeconomics. However, it is vital that the amount of consumer borrowing for the purpose of purchasing new homes paralleled the increase in new homes available. This housing boom created an enormous number of jobs, and eventually helped America to climb out of the 1990-1991 recession.
The proof is in the pudding. The homeownership rate is the ratio of the number of housing units that the owners of those units occupy, divided by the number of housing units that non-owners occupy. That figure vacillated in the 1940, and grew steadily during the 1950s and 1960s. However, it went into neutral gear during the 1970s and then dropped in the 1980s. Then the homeownership rate increased again starting in the middle 1990s, which is when the U.S. economy began to flourish again.
If another housing boom (and Internet boom) is unlikely, then what could save the current economy? The good news for those with a green degree is that it is their field of expertise. Regardless of one’s political stripes, scientific data indicates that Mother Nature is extremely “sick.” And according to many environmentalists, nothing short of a “Green Revolution” will remedy the situation. However, even on a microcosmic level, “going green” can save households and businesses a copious amount of money. When entire nations begin implementing green mandates, the profits and savings will be exponentially greater.
In fact, companies’ “going green” has already become a trillion dollar industry! Such companies focus on creating business solutions to problems such as global warming and energy dependence. These are common sense innovations that those with a green degree can help to formulate.
Unfortunately, even the most knowledgeable and innovative economists are uncertain about when the current recession will end. However, it seems likely that a Green Revolution could have the same economic impact on the US economy, as the Information Revolution and Industrial Revolution did!
Green Degree Jobs and the Recovery of the Environment Sector
