In considering their planned economic stimulus package, President-elect Obama’s transition team pondered how beneficial the plan would be if information technology were highlighted.  Instead of consulting government bureaucrats or even academic experts at leading universities the team went to IBM – still the world’s leading information technology firm.

According to an article appearing in December in the Wall Street Journal, IBM chairman and CEO Sam Palmisano presented information directly to Carol Browner, coordinator of climate and energy policy for the incoming administration, and Julius Genachowski – a technology adviser to the president who is rumoured to be in the running for the newly created position of United States chief technology officer.  In the presentation, Palmisano explained how a $30 billion information technology stimulus would create jobs.

As part of the technology stimulus, IBM recommended three areas of primary focus: increased broadband Internet access throughout the country, continued computerization of medical records, and rolling out the smart grid to revolutionise the country’s power distribution system.  IBM worked with the Information Technology and Innovation Foundation think tank based in Washington D.C. to come up with the focus areas.

According to their study, IBM found that a $10 billion investment to boost America’s smart grid infrastructure would create 239,000 new jobs.  IBM would stand to benefit considerably from any IT investment but would particularly within these focus areas.  Big Blue figures prominently in the healthcare digitisation process as well as smart grid technology.

In his presentation to the Obama transition team, Palmisano said that small businesses would create more than half of the new jobs as a result of so-called “network effects.”  For example, economic activity would naturally increase from a higher presence of broadband Internet.  Rolling out the smart grid would bring a wealth of new energy technologies online.

Some countries have made major strides installing smart grids.  Italy, for one, blanketed the country with the money and energy-saving devices several years ago.  Power providers around the world are realising that their power infrastructure is at or past its useful age and that the time has come to make the technological leap.  Typically, transformers in North American power substations are designed to last 40 years, but the average age of these devices is 42 years.

How much of the advice will be incorporated into the stimulus package that lawmakers and the Obama team are working on remains to be seen.  At the end of December, Obama aides said that part of the two-year plan would include spending on traditional infrastructure, including highways, and reduced taxes.

Palmisano was also asked by the Obama team what steps the administration could take without congressional approval.  The CEO suggested an executive order be issued that required data centres in government offices be upgraded to energy-efficient data centres within a three year time limit.

According to Chris Caine, vice president of government programs at IBM, the Obama team approached IBM directly for analysis on whether computer infrastructure investments would create jobs.  "There are lots of econometrics on the number of jobs from traditional infrastructure investments," said Caine in an interview with The Wall Street Journal. "There aren't any metrics for these kinds of calculations.”

Typically, businesses view information technology as a way to streamline operations in a way that increases efficiency while requiring fewer employees.  However, by taking a major initiative such as installing a smart grid nationwide would create untold numbers of jobs because of the new industries created with the new technology.

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