The Green-Jobs Engine That Can’t:

During the 2008 presidential campaign, Barack Obama promised to transform America’s energy economy by creating millions of “green jobs.” Accepting his party’s nomination at the Democratic convention in Denver, Obama proclaimed: “I’ll invest $150 billion over the next decade in affordable, renewable sources of energy—wind power and solar power and the next generation of biofuels; an investment that will lead to new industries and 5 million new jobs that pay well and can’t ever be outsourced.” This new energy economy, Obama explained weeks later at the second presidential debate in Nashville, would be an “engine of economic growth” to rival the computer and one, moreover, that we could build “easily.” Though he would have quibbled with Obama over details, Republican candidate John McCain similarly praised the virtues of creating millions of these environmentally friendly jobs, both as an answer to the nation’s economic woes and as a way to reduce carbon emissions.

The green subsidies are considerable. The U.S. Energy Information Administration reported in early 2008 that the government subsidizes solar energy at $24.34 per megawatt-hour (MWh) and wind power at $23.37. Yet even with decades of these massive handouts, as well as numerous state-level mandates for utilities to use green power, wind and solar energy contribute less than one-half of 1 percent of our nation’s electricity. Compare the green energy subsidies to the energy sources reviled by environmentalists, such as natural gas (25 cents per MWh in subsidies), coal (44 cents), hydroelectricity (67 cents), and nuclear power ($1.59). With relatively little government largesse, these sources (along with oil, which undergirds transportation) do the heavy lifting in our energy economy.

The alternative technologies at the heart of Obama’s plan, relying on more such government handouts and mandates, will inevitably raise energy prices—and high power prices are job killers. Industries that make physical products, whether cars or chemicals or paper cups, are energy-intensive and will gravitate to low-energy-cost locales—which is why California and New York, with some of the highest electricity prices in the country, have lost manufacturing jobs in droves. But it’s not just manufacturers that need cheap electricity: Google, the poster child of California’s information-technology economy, houses its massive server farms not in the Golden State but in places with lower electricity costs, like North Carolina and Oregon. Policies that drive up energy costs across the nation, as Obama intends, will drive many of these jobs not elsewhere in the country but overseas.
- Max Schulz

MB4 on February 27, 2009 at 8:36 PM

The Obama Administration’s high-handed notion that 8% of mortgage holders or those about to lose their mortgages are far far more important than the 92% of mortgage holders who have been faithfully paying their debt and following the rules which were provided them in print at the time they took out their loans.

coldwarrior on February 27, 2009 at 10:36 PM

Obviously Our Dear Leader thinks they have better songbun.

In the aftermath of the Korean War, North Korea imposed the notion of “songbun” on its citizenry. The poor and shiftless for being poor and shiftless had “good” songbun, and today they are the privileged class for having failed most impressively. The successful in North Korea were demonized for being that way, and today they are the bottom caste in a society that has committed economic suicide right before our eyes.

So while it’s surely a reach to suggest the U.S. is going the way of North Korea, it’s also true that bad policy has a way of slowly wrecking societies over time. At present, with the federal government creating incentives whereby companies will be rewarded by the tax code for not laying off unproductive employees, and just the same where irresponsible home buyers are being sanctified for being irresponsible, the U.S. political class is imposing its own, minor form of songbun; these actions signaling our nation’s long-term economic decline.
- John Tamny

MB4 on February 27, 2009 at 11:28 PM