Editor's note: Patrick Doherty is the director of the Smart Strategy Initiative at the New America Foundation, a think tank that seeks innovative solutions across the political spectrum.
(CNN) -- On the 40th anniversary of Earth Day, the United States stands at a crossroads. Though the Great Recession appears contained and the U.S. image is improving abroad, the nation remains challenged by war, debt, unemployment, energy, and climate change.
In other words, the triage applied in the economic crisis worked, but the nation still lacks a medium or a long-term strategy. Forty years after that first rally of environmentalists on the National Mall, the best opportunity for a new era of American prosperity and security involves putting sustainability at the center of the Washington's agenda.
To find that new source of long-term prosperity and security, Washington must shift away from crisis management and relearn the art of grand strategy. At its best, American grand strategy enlists our economy and defines our national purpose.
In the Second World War, Washington took over industrial production, armed our British, Russian and Chinese allies, and delivered the coup de grace against the Axis powers.
Less than a decade later, Presidents Harry Truman and Dwight Eisenhower avoided an unwinnable nuclear war and made the East-West conflict a long-term contest of economic and political systems. Our nuclear arsenal would deter aggression, but everyday suburban consumption would win the day. It was in those two episodes that Washington defined the American way of grand strategy: to let our economy do the strategic heavy lifting and minimize the need to use American force.
Today we must return to that fundamental American strategic formula while recognizing our challenges have changed. Twenty years after the end of the Cold War, the new long-term threats are becoming clear. Instead of fascism, communism, or terrorism, in the first half of the 21st century the United States has a two-sided strategic challenge: the inexorable process of global economic inclusion and the rapid depletion of the planet's ecosystem.
The U.N. Development Program estimates that more than 4 billion people are excluded from the legal sector of the global economy, trapped in the informal and black market. As they are gradually included into the global economy, their consumption of energy and raw materials and other goods and services increases dramatically.
A study by the global consulting firm McKinsey warns that under current policies, China will bring 700,000,000 people into its cities by 2030, the world's largest rural-urban migration and a process that will outstrip global production of energy and commodities like cement, copper and plywood. With a recent U.S. military report predicting that oil demand will outstrip supply as early as 2015, today's recession-driven lull in global prices is the exception, not the norm.
Meanwhile, human activity has overwhelmed 60 percent of the life-sustaining services provided by the planetary ecosystem. The Nobel Prize-winning International Panel on Climate Change has raised awareness of this major threat to lives, livelihoods and international stability. But according to U.N.'s Ecosystem Assessment, ecosystem damage goes well beyond climate.
Human activity is depleting earth's ability to manage freshwater, fisheries, soil nutrients, and flood control faster than these capacities are being replaced. With the population growing to 9 billion people, this dynamic will drive significant global conflict, conflict the Pentagon is already anticipating in its four-year planning.
Inclusion and sustainability are America's most serious challenges, but they are also America's most important opportunities. In the 1950s, government policies harnessed the Baby Boom to power a great economic expansion. Instead of treating sustainability as a cost, federal policies could turn the transition to sustainability into a new engine of American prosperity. To do that, however, the government needs to expand its sustainability thinking from a narrow carbon cap-and-trade scheme to a much broader economic transformation.
While pricing carbon is necessary, it is too regressive in the midst of a recession. Transportation costs account for 17 percent for average American households and increasing energy costs would overburden a fragile middle class economy.
Instead, now is the time to reduce America's "vehicle miles traveled." Reducing VMT requires a decisive federal commitment to commuter transit, freight rail, and smart growth. Indeed, if all new communities in the United States were designed "smart" we would reduce carbon emissions 10 percent over 10 years and save smart-growth households $220 billion a year.
More importantly, this strategy puts America back to work, building healthy communities people can afford and have the time to enjoy. Washington can re-dedicate Fannie Mae and Freddie Mac to extend "location efficient" mortgages (loans that recognize when you drive less, you can afford a higher mortgage) and reform the transportation budget to shape incentives for a market- and community-led transition to smart growth.
Then, after we build an economic buffer back into our society, we can use tax policy to shift taxes off wages, which we want more of, and onto carbon and other forms of waste, of which we want less.
As America transitions to a sustainable economy at home, Washington will need to work with our international allies to negotiate a new international commitment to expand smart growth and sustainable trade globally. Europe and Japan are already primed for such a move, while China and India are both desperate for a green global development path that can sustainably bring the rest of their massive populations into the global economy. The sooner we act, the sooner we will end what is becoming an era of resource nationalism and skip the price shocks, scarcity, and regional war that would ultimately result.
On October 9, 2009, President Obama signed an executive order outlining "an integrated strategy for sustainability in the Federal Government." That was a good start, but 40 years after the first Earth Day, it is time to think bigger.
The opinions expressed in this commentary are solely those of Patrick Doherty.