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The Cruel Hoax of Green Jobs

June 24th, 2010 at 5:43 pm David Frum | 23 Comments |

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My latest column for The Week examines the tough job market facing today’s young graduates and their unrealistic expectations for an economy buoyed by green jobs.

President Obama’s promise of “green jobs” is at best an exaggeration, viagra at worst a hoax.

Green jobs are not organically emerging from the marketplace. They are hothouse creations of government subsidy and regulation. Yes, government can generate employment by mandating that utilities build a certain amount of, say, new solar energy generating capacity. Government could also generate employment by banning the electric lawnmower and forcing everybody to cut grass by hand. But these are not the kinds of innovations on which a generation can build thriving careers.

Government can give away only so much taxpayer money before people get weary. It can mandate only so much uncompetitive and irrational corporate investment before the overall economy loses competitiveness. It would be a very foolish 21-year-old who’d make career decisions based on a promise of government support and shelter for an industry that otherwise cannot pay its own way.

The computer industry of the 1980s offered autonomy and independence. The industry’s big idea (computing power on every desk, linked by voluntary networks) inherently empowered the individual. Not so the green dream, which envisions an economy directed and commanded by government, in which whole industries rise or fall depending on the favor of authorities. Will the government invest money in high-speed rail? Or in “smart” electric grids? Will biomass be included in the government’s mandated quota of renewable technologies? Or does biomass release too much carbon dioxide? These are questions that will be decided by lobbyists, not entrepreneurs.

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23 Comments so far ↓

  • SFTor1

    “Not so the green dream, which envisions an economy directed and commanded by government…”

    A few comments: The American economy is today significantly influenced by OPEC. Green energy will reduce this dependency on Middle East dictators. Does anyone disagree that we would rather have our own government in charge than Islamic dictatorships in the Near East?

    For individuals and families green energy can significantly reduce household expenses and provide more economic freedom. It is true that green energy has yet to become competitive with fossil fuels, but that is partly due to the way we calculate the cost of the competing energy sources. The externalities of fossil fuels are significant and go far beyond pollution. Ask yourself this: is the cost of 9/11 part of the fossil fuel energy bill? The cost of the Iraq War? The cost of the Afghanistan War?

    For our economy and our society there is no question that there are massive savings and risk reductions to be realized through alternative energy.

    When this country put a man on the moon it was a joint effort of the public and private sectors. Energy independence is another worthy project for the entire country to get behind. To paint this as a nefarious take-over plot by government shows a blithe disregard of history and the realities on the ground that I frankly did not expect of Mr. Frum.

    On the Republican side it seems the only acceptable public/private project is war.

  • JJWFromME

    “They are hothouse creations of government subsidy and regulation. ”

    Maybe it’s time for regulation. Paul Krugman has asked this–why is the market magical when it meets a physical limit, but wilting when it faces a human imposed limit? Why does it help the economy when we buy cheap oil overseas, but hurts it when we employ people to generate or save that energy stateside? Why can’t utilities be deregulated in the same way that telecoms were deregulated (in a smart way, not the way California did it, preyed on by Enron as it was).

    And finally, if indeed the effort to rally the collective economy in the direction of greening our energy infrastructure is a flop, what the heck do you propose? Do we let it go on as it is now, piling up the externalities until they come back to bite us? There are an awful lot of people–no matter how many ill informed rants pile up at right wing think tanks–lots of very informed people, who’ve done unassailable, systematic research who say this is a big big problem.

    If you think back before the Reagan crowd made it practically unthinkable, weren’t there business interests who were actually *for* regulation? Sometimes the market doesn’t decide what the public good is. If it did, 5 year olds would still be working in factories. Sometimes *laws* have to enforce the public good. I know Irving Kristol made a living ranting against “doo gooders” blah blah blah. But at some point you have to take a stance for common sense over that kind of mass produced ideology.

  • JJWFromME

    By the way, David Brooks has an interesting historical analogy in this piece:

    http://www.nytimes.com/2010/04/30/opinion/30brooks.html

    Were the railroads “hothouse creations of government subsidy”?

  • jakester

    I have a little background in this. But we must be a really unserious nation when in some of the coldest parts of Upstate NY, people are too stupid/lazy and indifferent to even put storm windows in.

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  • rbottoms

    The computer industry of the 1980s offered autonomy and independence. The industry’s big idea (computing power on every desk, linked by voluntary networks) inherently empowered the individual. Not so the green dream, which envisions an economy directed and commanded by government, in which whole industries rise or fall depending on the favor of authorities. Will the government invest money in high-speed rail? Or in “smart” electric grids? Will biomass be included in the government’s mandated quota of renewable technologies? Or does biomass release too much carbon dioxide? These are questions that will be decided by lobbyists, not entrepreneurs.

    By George you’re right. And any day now Exxon will peel off a billion or two to jump start the private sector Green Jobs initiative that will wean us off fossil fuels.

    I’m sorry, I needed a good laugh.

    Green jobs and technology won’t happen at all unless the United States Government funds the basic, read not immediately profitable, research at its core.

    You think we got to the moon because IBM or Monsanto ponied up the cash and stayed with it while rockets blew up on the launch pad over and over again?

    This “invisible hand” private sector mythology is just so much bullshit.

    The internet, micro-electronics, and even biotechnology exist, because and only because Uncle Sam footed the bill to get it off the ground.

  • Kevin B

    The internet, micro-electronics, and even biotechnology exist, because and only because Uncle Sam footed the bill to get it off the ground.Not to mention the Interstate Highway System.

  • JJWFromME

    “The internet, micro-electronics, and even biotechnology exist, because and only because Uncle Sam footed the bill to get it off the ground.”

    But that was during the cold war. Something tells me if green jobs had something to do with commies or Muslims, David would have no problem supporting them.

  • jabbermule

    If we all agree here that government is the solution to this problem, then why did only 10% of the $787 billion stimulus package go to green job investment? And of that $80-some odd billion, 79% of it was funneled toward foreign companies.

    So, if the federal government footed the bill to get the internet, micro-electronics, and biotechnology up and running, it’s certainly doing a piss-poor job of doing the same for green jobs.

    Question: What percentage of the 2009 stimulus package should have gone towards green jobs?
    Answer: Just about damn near all of it

    Clean energy is the next great engine of growth for America’s economy, and our current elected officials have completely squandered an unprecedented opportunity to help create that economy. If there is anything about Obama’s job performance so far that merits severe criticism from both the left and the right, this is it.

  • LFC

    But that was during the cold war. Something tells me if green jobs had something to do with commies or Muslims, David would have no problem supporting them.

    But in the comments sections, it HAS been explained by a number of us why getting off of oil is a national security issue. That makes it all the more surprising that David ignores this facet.

    Of course if the Middle East becomes vastly less important to U.S. interests, then Americans might feel the same way about Israel. After all, maybe we’d just ignore the entire Middle East, and we can’t have that now can we.

    If we all agree here that government is the solution to this problem, then why did only 10% of the $787 billion stimulus package go to green job investment?

    Two words; “shovel ready”. We had to do something FAST, and you can’t just spin up close to $800 billion in green jobs in a matter of months. We also put much of it into infrastructure, something that is also a good thing for our country. And state gov’t aid.

    Finally, about 30% of the bill was tax cuts, done both to appease Republicans and for speed.

  • florishes

    Ouch, David! Not so. The government doesn’t create Green jobs, but creates the environment in which Green businesses and jobs can flourish. I’m a green entrepreneur – as are many of my partners and affiliates.

    Public-Private partnerships can help facilitate green business start-ups and provide tax incentives in the same way such partnerships and affiliations support traditional businesses.

  • sinz54

    There aren’t going to be “millions of ‘green’ jobs.”

    All this prattle about alternative energy looks OK– as long as we’re talking about a handful of homes using alternative energy or a handful of neurotic millionaires buying electric cars.

    But as soon as you start scaling up these technologies to serve large communities and even regions of the nation, you’re going to run into the same obstacles we’ve put in place on coal and oil.

    Here in MA where I live, it took 9 years for the Cape Wind project just to get the permits to start constructing windmills. All the liberals in Hyannis, led by Ted Kennedy, banded together to fight it on the grounds that windmills obscured their lovely view of the ocean.

    Environmentalists will never allow thousands of square miles of desert ecosystem in the West to be paved over with solar panels. Never.

    So it’s a giant bait and switch. They want us to give up oil BEFORE any new alternative energy has been proven to work for tens of millions of customers.

    Any new engineering technology is going to disturb the environment–that’s what we engineers do. We build things on previously virgin land. And as long as GreenPeace and the Natural Resources Defense Council are committed to keeping unimproved land alone, there won’t be large-scale use of solar power. And NIMBY will continue to kill off wind power projects too.

  • florishes

    Not so cynical – sinz54.

    The entire city of Greensburg, Kansas has rebuilt better, stronger, greener after utter devastation by an EF5 tornado. Now, that town is a net-zero community. Government policy can and will change to remove or reduce existing bureaucracies and other obstacles (such as neoconservative opposition) as we strategically transition to a new energy economy. Still, in your case, 9 years would have passed whether or not the Cape Wind project permit process was wearisome, and 9 years later you have renewable energy – at least you guys started. As for the lovely ocean views…wind farms can be placed farther off shore.

    No bait and switch here…just a decision by the country to begin the transition to American and renewable energy – we still need the oil – for a couple more generations, I imagine.

    Green building practices seek to virtually eliminate site degradation, while protecting delicate ecosystems. And, we don’t need to degrade natural resources (deserts, mountain ranges, etc…) in order to benefit from solar and wind energy. Environmentalists understand this is a false choice – either the beauty of the environment OR the need for alternative energy – a balance can be achieved.

    Americans are (more and more) looking forward to taking on this important challenge.

  • Stewardship

    I recently met with the CEO’s or Senior Executives of several of the major companies involved with US CAP. With the passage of any serious energy and climate legislation, an enormous amount of capital..hundreds of billions of dollars..will be unleashed by these and other companies. They have been ‘stockpiling’ capital, deferring investments, until the government provides the roadmap. This could be the largest private stimulus our economy has ever experienced. Some estimates of jobs created directly due to this investment surge–construction, research, power generation–are upwards of 2 million over a four year period.

    Makes one wonder if Republican strategists are trying to stymie a final bill to delay any economic gain before November 2010 or 2012?

    While not “green jobs” in the truest sense, these jobs will be created if our government adopts a policy to lower our dependence on foreign oil and to incentivize cleaner sources of energy.

  • Krom

    The free market is efficient at producing good and services, but it’s anything but infallible (one of the delusions that a lot of modern conservatives seem to labor under). Innovation can be rather difficult in an exceptionally free free market economy, as serious investment tends to be risk-averse: only after smaller companies, academics, or other individuals unequivocally demonstrate the value of some new good or service do the giants of industry buy in. There are a lot of reasons for it, some good and some not so good. And for a lot of things it works well.

    But here are the shortcomings:
    1) It’s problematic for *potential* industries where smaller players really can’t afford the investment required to do the “prototypical” work, thus forcing the giants to do the innovative work that they’re really not very good at handling.
    2) It doesn’t deal well with finite resources. The natural tendency for a free market economy with many competitive players is not to manage or share resources in an optimal or renewable way; it’s for each player to grab as much as possible, and consequently grab as much of the marketshare as possible. In the particular case of fossil fuels, the writing has been on the wall since the day somebody realized petroleum could be combusted in a useful way.
    3) It also fails to accommodate certain society-wide imperatives that may conflict with the notion of profit-maximization (like the idea that we’ll be up the creek without a paddle if oil becomes prohibitively expensive and we don’t have a viable alternative infrastructure available).

    EDIT: Additionally, regarding the specific topic of whether “green technology” will result in jobs: I think there’s a widespread failure to deal with the topic of how jobs will be found once technology has relatively minimized the number of people required to meet the basic needs of society. If roughly 10% of the population spends their time providing food, shelter, manufacturing and basic infrastructure to the rest of the population, what will the other 90% busy themselves with? Will they all be in service sector jobs?

    In any case, it’s pretty asinine to think the United States should cling to inferior (and ultimately doomed) energy technology just because the alternative *might* require fewer jobs.

  • florishes

    Thanks STEWARDSHIP, for that last comment of yours. I request permission to quote it ad infinitum.

    Still, the GOP energy policy has been outlined by Senator Barton. The ideology is ripe with patriotic language – Renewable energy sources militate against the good ole “Heritage” theme.

    Tradi-shuuuun! Tradition!

  • JonF

    While I hold a definite skepticism about green jobs as a panacea, still it is not true that goivernment spending cannot create significant employment.

    Exhibit A: the defense industry
    Exhibuit B: Healthcare
    Exhibit C: Education

    The number of people who work in these three sectors is far from trivial.

  • uriel81

    I don’t think Denmark’s wind industry is a red herring. Obama put $60 billion of stimulus money into green energy. Just get rid of the government subsidies that mask the real $10/gallon cost of gas and we would see an instant response from American industry. It’s not as lame as you think, David.

  • sinz54

    JonF: it is not true that goivernment spending cannot create significant employment.
    So can war. Are you advocating that?

    Of your list,
    the last two are service industries.

    And the former depends only on political and geopolitical concerns, subject to the whims of who is in Washington. Leftists call for a 50% cut in military spending for ideological reasons; that would certainly cause massive unemployment in that industry. I remember the massive layoffs after the Vietnam War ended.

    When aerospace companies tried to diversify into other fields, the results were poor. Grumman tried to make buses for New York City. They were hilariously poor vehicles, breaking down frequently.

    70% of American energy needs are for transportation. The oil is going into cars and trucks.
    The best answer there is for the Government to require that all new cars be flex-fuel vehicles, able to take a variety of different liquid fuels. And then let the marketplace decide which fuels are most efficient.

    But you can forget about electric cars until you can explain to a Bostonian or New Yorker who parks his car on the street how he’s going to recharge it.

  • JonF

    Re: Of your list,the last two are service industries.

    True, but so what? A job is a job and a paycheck is a paycheck. Also, both these industries do have significant spin-offs in technology which can be licensed and sold worldwide– as well we can sell both healthcare and education (especially the latter) beyond our borders.

    Re: But you can forget about electric cars until you can explain to a Bostonian or New Yorker who parks his car on the street how he’s going to recharge it.

    The future of the automobile will not be pure electric; more likely a hybrid of electric and fuel (not necessarily gasoline). This is not exactly futuristic fanatsy as the first generation of this technology is already well-established.

  • tequilamockingbird

    Surprise, surprise: I disagree. I think this article reveals a fundamental difference between the idealism of Democrats and the greed-is-good philosophy of the Republicans. Graduating in 1982, you should have invested heavily in oil companies, in drug companies, in defense contractors — if your object was simply to make a buck. An option would be to direct your life in a way that would make the world a better place.

    By the way, David, it seems to me that your point in this article runs counter to another position you have taken. I believe you advocate government intervention to discourage the use of fossil fuels by higher taxation; isn’t the green jobs initiative simply another way to kick-start people to reach the same objective, to the benefit of us all, and isn’t that a good thing?

  • tequilamockingbird

    Hats off to the commenters. It’s an interesting thread.

    Sinz54, your vision of the future looks pretty gloomy to me. Flex-fuel cars? That’s it? Otherwise, keep poisoning the planet while extracting and burning fossil fuels, holding off investment in solar and wind, waiting for the magical solution to be discovered?

    The status quo is unsustainable and unacceptable. We should be experimenting with change, and the government should be leading the way, fostering and encouraging new initiatives.

  • balconesfault

    Sinz:

    There aren’t going to be “millions of ‘green’ jobs.”

    Sinz … is your motto “No, We Can’t”? As Tequilamockingbird noted, your own vision seems very limited.

    In fact, there are probably already a million green jobs in America. At the American Wind Energy Conference in Dallas last month alone, there were over 20,000 attendees. I would bet that each of those attendees represented 25-50 jobs somewhere.

    All this prattle about alternative energy looks OK– as long as we’re talking about a handful of homes using alternative energy or a handful of neurotic millionaires buying electric cars.

    Handful? Why not rooftop solar providing a portion of the electric needs for more than half the homes in America? Why not electric cars (and motorcycles) becoming a vehicle of choice for millions of Americans who garage their car every night and have commutes of less than 30 miles each way?

    Both those things would provide tremendous benefit to America. Why should we not strive to implement them?

    But as soon as you start scaling up these technologies to serve large communities and even regions of the nation, you’re going to run into the same obstacles we’ve put in place on coal and oil.

    Do tell …

    Here in MA where I live, it took 9 years for the Cape Wind project just to get the permits to start constructing windmills. All the liberals in Hyannis, led by Ted Kennedy, banded together to fight it on the grounds that windmills obscured their lovely view of the ocean.

    During those same 9 years, total installed wind power generating capacity in America has grown from 2,500 MW to 35,000 MW.

    You can fixate on the long process to permit one very contentious windfarm. Perhaps you should notice the 10x increase in windpower over that time.

    Environmentalists will never allow thousands of square miles of desert ecosystem in the West to be paved over with solar panels. Never.

    Thousands of square miles? You’re right.

    Then again, the total annual US electrical power generation is around 1 millions MW. One thousand square miles of desert covered with solar panels would generate around 200,000 MW with current technology, and new technologies being developed could double that in the coming decade.

    Nobody is envisioning large desert solar projects providing more than 5-10% of our annual power needs. So how about 500 square miles? Or 250? Are those permitable? You betcha.

    So it’s a giant bait and switch. They want us to give up oil BEFORE any new alternative energy has been proven to work for tens of millions of customers.

    No – environmentalists want oil to be priced in a way that incorporates all the externalities spent keeping it flowing (like a 2 trillion dollar Middle Eastern adventure Bush kicked off), or the costs of massive cleanups of the occasional oil spill, or the human costs of breathing air polluted by refinery stacks and car tailpipes.

    Or, conversely, for renewables to be subsidized to an equivalent degree that we currently subsidize oil throughout society.

    Any new engineering technology is going to disturb the environment–that’s what we engineers do. We build things on previously virgin land. And as long as GreenPeace and the Natural Resources Defense Council are committed to keeping unimproved land alone, there won’t be large-scale use of solar power. And NIMBY will continue to kill off wind power projects too.

    In a 2005 study, Navigant Consulting estimated up to 710,000 megawatts of solar electricity generation capacity in the U.S. (or 75 percent of the nation’s consumption) if every viable residential and commercial rooftop was utilized.

    Why are you so fixated on unimproved land, when solar is so compatible with the urban infrastructure? We engineers also build things on existing buildings, we build on brownspaces, we even create new building materials with photovoltaics embedded within them – building on virgin land is simply a fraction of what we do.

    Meanwhile, while there is opposition to wind in some places … there are places in the US where farmers and ranchers are begging for development on their land, and the primary holdup right now is the capacity of our electrical transmission grid to deliver this power to markets. Some very large scale transmission projects are underway right now to change that situation.