Green jobs are bogus, cont.

From the comments section (#88 out of 89):

Now that we have dispatched with the nonsense of Green-jobs-are-bogus. ...

Huh? Who has dispacted with that?

Environmental policy can change the mix of jobs but not the overall number of jobs. An economy CAN become greener. This is implicit in my original post. I should have made it explicit and I will in the Env-Econ 101 piece but I didn't think that part of the message would be so easily overlooked.

Green jobs ARE bogus. At least in today's political climate where politicians are promising 5 million green jobs without mentioning the cost (i.e., the loss of jobs in other sectors).

Green government fiscal policy doesn't create jobs in the long run. I've yet to see any real empirical evidence (economic impact studies don't count) that it does. Those who advocate green jobs, in my opinion, are (1) naively hopeful about win-win government policies and will become disillusioned or (2) crass marketeers of government boondoggles or (3) somewhere in-between.

Any comment?

Comments

[Frank Carmelo]

I think you're flat wrong that it is zero-sum game. I think you're flat wrong on your little 3 option list, and your tone is dismissive and arrogant.

There is nothing to go on but assertions here, both on your side and my side. You really don't know squat. There was no "data", for example, that past environmental regulations WOULDN'T wreck the economy, or regulated industries (ie building codes in CA, or catalytic converters in cars, or...many others)

[John Whitehead]

Frank, Frank, Frank (he says shaking his head):

Assertions, theory, what's the diff?

But actually, there is lots of empirical evidence that demand and supply analysis is on target so assertions based demand and supply analysis can't be dismissed as assertions. Especially when there is NO empirical evidence, to date, to make the green-jobs-are-bogus analysis incorrect (anecdotes and regional economic impact analyses don't count).

Actually, there is plenty of real empirical evidence that environmental regulations have not, and will not, wreck the economy. Loads and loads of evidence. I think it is really good evidence.

Therefore, I support many, many environmental regulations on economic grounds.

Who ever said that environmental regs wreck an economy?

Arrogantly,

John Dick ..., er, ... Whitehead

[Brian]

Color me optimistic, and naive. And stubborn. And likely foolish.

I maintain a hope (and a totally inability to substantiate) that green subsidies can lead to a net increase in domestic jobs by shifting the equation such that more of our energy is produced stateside, and less imported from elsewhere.

I'm not crazy enough to think it's 5 million jobs gained and none lost, but frankly, I desperately want to put coal miners out of work (no disrespect to the coal miners, but don't they wish there was some way they could make a living that you could feel good about, or at least better about?).

For me, if it takes telling people that we get 5 million jobs for free to invest heavily in conservation - I'm all for it. Even if there's no net increase in jobs. But I maintain that it might be possible that the weatherstripping installer job created might (might!) replace not a coal miner, but a Saudi oil rig worker. Or maybe 1000 weatherstripping installers replaces 9998 domestic oil rig workers and 2 foreign ones.

Still, if 1000 weatherstripping installers were able to eliminate the need for 2000 domestic oil rig workers and coal miners, I'm still on board.

[John Whitehead]

Brian,

That's a comment I can live with! I hope you are right.

[jim casey]

John - Theoretically, or assertively if you prefer, what if I put solar panels on my home and the folks over at Dominion Power have to lay off a worker, but fabrication, deployment, and maintenance of my system creates a job. Then, I use the new flow of income to purchase other goods and services which creates another job. On top of that, air quality in VA improves raising productivity and the AS curve shifts out, etc etc..... Is this zero sum?

[Justin Rose]

John, I agree with Brian's comments and would add that by boosting our renewable energy sector (R&D, regulations, whatever) we will hopefully develop some new capabilities that we as a country can export as well. You are right that by imposing taxes (or by involving government) we may have a zero sum domestic jobs game, but I'm guessing energy expertise in general and specifically 'green' energy expertise will be in demand for some years to come.

[jim casey]

John - Two more questions.. If we use fiscal policy to stimulate aggregate demand in the short run are these new jobs simply replacing others? I don't think so. Additionally, if we "clean up" the environment with these jobs - then we should get a shifting out of the AS curve in the LR.

Could it be possible to use fiscal policy to directly create jobs that the market would not due? your thoughts??

JC

[odograph]

I see this as a repeat from the title, or an obfuscation of it:

Green government fiscal policy doesn't create jobs in the long run. I've yet to see any real empirical evidence (economic impact studies don't count) that it does.

Who the heck needs long term jobs? For a policy to be of benefit it should (1) be environmentally beneficial, and (2) provide a short term jobs improvement.

In the long term we should (1) be out of recession, (2) be well along in our green energy transformation.

It is thus strange to me that "transitional" policies would be judged as steady-state economics.

[odograph]

Pfft. I wish my first pass proofreading was a little better: "I see this as a [retreat] from the title"

[michael]

Isn't it a bit naive to assume that all this green technology will be manufactured in the good ol' U.S. of A.? While the U.S. tends to be a leader in the development of these technologies (e.g., the National Labs development of battery technology), we tend not to manufacture them (e.g., Panasonic and NEC manufacturing for Japanese automakers).

And that's probably not so bad; maybe 10 battery technology scientists are preferable to 1000 weatherstrippers (which I think sounds better than "weather stripping installers") or 2000 oil riggers.

[Tim Haab]

Y'all have no idea how much I am enjoying this. I finally have a misdirection I can use when I start getting hammered for calling peak oil bogus ("Oh yeah! Well, John says green jobs are bogus).

[odograph]

Vestas is obviously benefiting from the US turn to wind. Or you could say that we are benefiting from past European wind subsidies.

When a program makes a successful product, it hangs around. That's not always the case of course.

The trick is to avoid Bridges to Nowhere in the figurative and literal sense.

[odograph]

Maybe we should use a 1-10 scale for bogosity, Tim.

[John Whitehead]

Jim,

Ecological Economics 101: Preserving natural capital with environmental policy keeps the long run aggregate supply (LRAS) curve from shifting left. An already degraded environment has the LRAS curve to the left of where it would be. Improving the environment with environmental policy would increase labor productivity and shift the LRAS back to where it should be.

[John Whitehead]

Odo,

I believe that your comment is an obfuscation (to confuse, bewilder, or stupefy).

Please show me a "transitional" subsidy. In other words, one that has gone away. Or, are you advocating that a green energy subsidy goes away once we recover from a recession?

[John Whitehead]

Odo,

"Retreat" ?

Yes! I've retreated. You win. I lose.

Now, move along. There is nothing else to see here.

[John Whitehead]

Hi all,

To put 5 million green jobs in context, according to the latest unemployment report (http://www.bls.gov/news.release/empsit.nr0.htm), there are currently 10.3 million unemployed people, of which 2.2 million are long term unemployed (up 822,000 over the past year).

[John Whitehead]

Hi all,

From Kevin Egan at the old post:

John Whitehead says:
I wouldn't launch new energy taxes during a recession. I'd be happy to wait until a recession is over. but I wouldn't award subsidies in the interim either.

I also teach principles of economics and environmental economics classes. I generally agree 100% with John's arguments and feel he is doing a huge service to the profession. However, I disagree with his statement above. Tax energy right now. Get gasoline prices back to $4 per gallon and keep them there. Tax anything coming from fossil fuels. To solve the "not a good idea during a recession problem", simply rebate 100% of the tax revenue collected by lowering other taxes, for example payroll taxes and income taxes. It is really simple: Taxes on goods (income, capital gains) is bad, taxes on bads (i.e., pollution) is good! So just tax the bads and at the same time lower the taxes on the goods. To help it pass, make it a net stimulus. For every $1 raised in tax revenue from the bads, lower taxes on goods by $1.10. Since the taxes on bads are probably going to be regressive, lower payroll taxes more so that low income households do not end-up worse off.

This is simply invoking the demand curve. Raise prices on stuff we don't want (pollution, more driving) and lower prices on stuff we do want (working hard, saving).

[odograph]

The CCC and the WPA are gone.

(Good effort on staying adult.)

[Scott]

"Now that we have dispatched with the nonsense of Green-jobs-are-bogus.

...

Huh? Who has dispacted with that?"

Uh you did:

"Scott,

1) If there is cyclical unemployment and if a big fiscal stimulus gets people working before the normal business cycle correction (when economic growth picks up with government involvement) then, yes, the public works program creates jobs (e.g, CCC during the great depression). "

- There is cyclical unemployment.
- A big fiscal stimulus will get people working before the normal business cycle will correct.
- So according to you: "yes, the public works program creates jobs [in this case green jobs].

[John Whitehead]

Odo,

Adult? I made a tremendous effort ... You should see the comments I typed and deleted! Ha!

But, you're right. Maybe I went over the edge a bit.

The CCC and the WPA were public works programs, not subsidies to industry.

[John Whitehead]

Scott,

Environmental policy can change the mix of jobs but not the overall number of jobs. An economy CAN become greener.

Green jobs ARE bogus. At least in today's political climate where politicians are promising 5 million green jobs without mentioning the cost (i.e., the loss of jobs in other sectors).

Green government fiscal policy doesn't create jobs in the long run. I've yet to see any real empirical evidence (economic impact studies don't count) that it does.

[John Whitehead]

Scott,

Suppose that the big fiscal stimulus does create 5 million green jobs. The problem is it won't kick in until the economy is already in recovery. The big fiscal stimulus will be inflationary* and the fed will pursue contractionary monetary policy as a result.

Fiscal policy is incredibly problematic.

*5 million green jobs would push the unemployment rate to 3.2%, below the natural rate.

[odograph]

John, does that not strike you as a semantic distinction at this point? Green jobs advocates, at least those who place themselves in the "now" of an economic downturn, are suggesting (on higher scales of 1-10), public works programs.

[L]

Tim, Can you do a post on why you think peak oil is bogus? I haven't seen that one in the past.