“THE American economy is once again tilting toward danger,” reports the New York Times today.

Despite an aggressive regimen of treatments from the conventional to the exotic — more than $800 billion in federal spending, and trillions of dollars worth of credit from the Federal Reserve — fears of a second recession are growing, along with worries that the country may face several more years of lean prospects.

How should President Obama respond?  The NYT editorial board suggests the following:

Mr. Obama also needs to inspire Americans who have been ground down by the economic crisis and Washington’s small-bore sniping. He needs to rally the nation around a big idea — a project that is worth sacrificing for, worth paying for, worth working for. One that lets them know that there is more ahead than just a return to a status quo of lopsided growth in which corporate profits surge while jobs and incomes lag.

That mission could be the “21st century infrastructure,” that Mr. Obama mentioned on a multi-city trip this month, “not just roads and bridges, but faster Internet access and high-speed rail.” It could be energy independence, with high-tech green jobs and a real chance for addressing global warming. Either of the above would make sense, economically and politically.

How about a national clean energy competitiveness and innovation project?

Yesterday, the White House released a report touting the recovery act’s success at fostering innovation in key economic sectors, most notably clean energy.  ARRA’s $30 billion clean energy investment is unique in its comprehensive approach, the White House notes, containing “investments across the innovation chain – from retooling current auto factories to new manufacturing and commercial deployment to research and development of electric drives and batteries.”

According to the report, the energy investment spike will achieve three major breakthroughs:

“1) Cutting the cost of solar power in half by 2015, putting it on par with the cost of retail electricity from the grid.

2) Cutting the cost of batteries for electric vehicles by 70 percent between 2009 and 2015, putting the lifetime cost of an electric vehicle on-par with that of its non-electric counterpart.

3) Doubling U.S. renewable energy generation capacity and U.S. renewable manufacturing capacity by 2012, a breakthrough that would not be possible without the Recovery Act.“

Robust federal investment in clean energy technologies has created the foundation for an energy industrial revolution in the United States, but the subtext of all this good news is that the achievements are being threatened by an impending funding cliff.  When the funding dries up, the fruits of many of these investments could wilt on the branches before they ever have time to ripen.  As Jesse Jenkins and Devon Swezey noted at Breakthrough Institute:

“Yet while the White House report highlights the considerable clean energy momentum established by the Recovery Act, it also inadvertently raises the specter of an impending clean tech funding cliff which risks sending U.S. clean energy industries into deep freeze as stimulus funds begin to expire over the coming months…. Facing such intense global competition, and with Recovery Act funds poised to expire soon, sending U.S. clean energy markets off a clean tech funding cliff, the U.S. is in dire need of a long-term clean energy investment strategy to regain economic and technological leadership in this new growth sector.”

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Since the collapse of climate legislation, advocates have issued a number of post-mortems and ideas for moving forward.  One of the leading commentators on this front is Andrew Revkin — the lead New York Times environment reporter from 1995 through 2009 — and today at NYT Dot Earth he defined what he calls “The Technology Imperative for Energy and Climate“:

“If you care about fostering prosperity in poor places while limiting the buildup of greenhouse gases in the globe’s shared atmosphere, it’s time to recognize the technology imperative that lies behind the world’s entwined climate and energy challenges… Without greatly intensified work to advance and disseminate energy choices that don’t come with heat-trapping emissions, there’s no smooth path as human populations and appetites crest in the next two generations.”

As an example of what the next agenda might look like, Revkin republishes our op-ed from last week at the National Journal Energy Expert Blog.  In the article, we argued that the United States must quickly pivot from pollution regulation to an aggressive clean energy competitiveness and innovation agenda, including robust and targeted federal support for clean energy research and innovation, manufacturing, and domestic market demand, as well as infrastructure, education, and industry cluster formation.

This builds on the ongoing leadership of groups like Breakthrough Institute, Brookings Metro Policy Center, ITIF, Third Way, American Energy Innovation Council, Bipartisan Policy Center, and others who are helping define a new and robust energy and climate agenda.  We encourage you to follow their work in the months ahead, as well as Andrew Revkin’s commentary at Dot Earth.