As part of his “hard pivot” towards jobs, Barack Obama announced last week a new program to stimulate “green jobs” with a $2.3 billion federal program. Mark Tapscott took a look at the particulars of the grants and checked with the Institute of Energy Research, which had already grabbed its calculator. The bill aims to create 17,000 jobs, mainly temporary, which means that we’ll spend over $135,000 per job in stimulus:
President Obama’s announcement earlier today of an additional $2.3 billion in federal tax credits for creating approximately 17,000 subsidized temporary jobs in the green energy industry is drawing a less than enthusiastic response from Thomas J. Pyle, president of the Institute for Energy Research:
“Show me one other industry that requests and receives a nearly 30 percent taxpayer subsidy. That’s what the wind and solar industries require – at a minimum – to exist. All the president did today is throw more money at an unproven technology that is not economically viable in the marketplace. Unfortunately, the only winners in this latest taxpayer giveaway will be Wall Street money managers and corporate interests in the wind and solar industry.
“If the president really wants to create an environment that will foster economic growth and job creation, he need not look any further than the domestic oil, gas and coal industries. These three industries and energy sources built this nation. For the administration to continue to ignore this fact and to keep the vast resources that taxpayers own under lock and key at the Department of Interior is irresponsible and a disservice to the American people.
“The Outer Continental Shelf (OCS), if opened for business, would create over 1 million high-wage jobs. It would reduce our dangerous dependence on hostile nations for their energy resources and spur economic growth across all 50 states. Development of these energy resources will create sustainable employment, not taxpayer dependent make-work jobs.”
To put this in perspective, the $2.3 billion would create less than 25% of the jobs that were lost in December alone — and only temporarily. Thus far, the economy has not had much problem in generating temporary work; it’s one of the few growth categories of 2009. Normally, that would be seen as a harbinger of job growth as businesses use temp workers to ramp up production, which then requires permanent workers to maintain. However, in this case it seems as though businesses have begun to rely on temp workers as a hedge against onerous new rules coming as part of ObamaCare, as well as to have more flexibility on staffing when new taxes start hitting the bottom line, mainly on energy costs with cap-and-trade proposals.
IER makes a good point, though, on American resources being ignored by the Obama administration. We have an abundant reserve of oil off of both coasts, and it wouldn’t take government money to create those jobs. Indeed, by expediting the leases off of the OCS, private industry would create hundreds of thousands of jobs, mainly high-paying union work, while shifting more of our oil demand onto domestic resources. That alone would bolster the dollar, which would have the effect of driving down energy costs in both real and exchange-rate terms — a boon for the economy at a moment when it desperately needs an invigorating impulse. In fact, the government would increase its revenues at both the federal and state levels by issuing the leases, rather than spending $135,000 per temporary job.
Why aren’t we doing that, if it’s such an economic no-brainer? The Obama administration doesn’t want to encourage the use of fossil fuels; that’s why Interior Secretary Ken Salazar make it more difficult to get leases last week, rather than easier. No-brainers require actual, working brains to recognize, apparently. (via QandO)
Update: Scott Lincicome says it’s an utter boodoggle, and there is plenty more wrong with it.