By Brent Budowsky - 03/03/09 04:06 PM EST
Solar energy. Wind energy. Geothermal energy. Clean coal. Electric batteries. Next-generation cars. Dynamic power grids. Advanced medical technologies. Environment-friendly products. Space-based technology. These are real businesses. With real products and real jobs. Raising substantial long-term tax revenue from these new sectors, companies, jobs and growth.
The fog of pessimism today is understandable, but contrary to the American spirit and alien to the drive that makes America America. The forces that will jumpstart the next great jobs wave are clearly in view, and currently within reach.
They are championed by a president who envisions the moment. They are backed by friends in both parties who understand the power of entrepreneurial drive. They are financed by venture capitalists, private-equity firms and certain investors large and small, institutional and individual, with long-term horizons, faith in the future and tolerance for risk.
These are the heirs to those who built the transcontinental railroad, those who modernized Europe and Japan after the Second World War, those who invented the rockets that transformed electronics and aviation, those who created the computer from their garage, pioneered the Internet from their living rooms and changed the world from their boardrooms.
Let’s do it again. Let’s understand that not all investment is equal. Not all capital gains are the same. Those who take the risks to finance the next great jobs wave should be encouraged, applauded, incentivized and rewarded. For every wealthy individual we condemn for greed that harms the nation, there are other wealthy individuals we should praise for taking the risks that advance the nation.
It is time for both parties to rethink the tax code and the capital gains tax. Some taxes must be raised, but others should be cut.
First, let’s lower the capital gains tax for those businesses that advance America, serve strategic national goals and accelerate the next great American jobs wave, such as: energy that ends our imprisonment to oil; next-generation cars that run on batteries or achieve 75 miles per gallon within five years; products that protect the environment from global warming; and hyper-advanced medical technologies.
Second, let’s create “advance America” enterprise zones that would establish for two years tax-free businesses in strategic sectors located in highly distressed communities and promote this new jobs wave in jobs-disadvantaged localities.
Third, let’s consider a turbo-charged 401(k) for individual investors who put money in a special fund available to professional venture investors, in which the principal would be insured and any profits would accrue to individuals on the same terms as partners in venture firms for these long-term, high-risk, strategically vital investments that generate revenue by driving the next great jobs wave.
Stay tuned for future columns and discussion on The Hill’s Pundits Blog about the next great jobs wave and how we can renew optimism and growth for America.
Budowsky was an aide to former Sen. Lloyd Bentsen and Bill Alexander, then chief deputy majority whip of the House. He holds an LL.M. degree in international financial law from the London School of Economics. He can be read on The Hill’s Pundits Blog and reached at firstname.lastname@example.org.