Economic Outlook Still Bad from Green Energy
To pay for it, the bill’s authors would use the same resource they tried to take in HR 6: rescinding tax incentives for the oil and natural gas industry. That could raise almost $18 billion over 10 years. But the renewable-energy lobby is trying to focus attention on the bill’s economic benefits instead of dwelling on the controversial issues of global warming and of siphoning off the profit incentives of traditional sources. But other than short term and temporary jobs, just what economic benefit would result?
“Investing in renewable energy will provide a clean source of power and create an explosion of new jobs.”
In late September, this claim attracted the attention of the U.S. Senate Energy and Public Works Committee and its chair, Democratic California Sen. Barbara Boxer. The prospects sounded good but the committee got only half the story. Estimates of just how many jobs are created by “going green” vary widely, but not all economists believe that there really will be any kind of green-job boom. More important is the question of whether these supposedly new jobs simply displace existing jobs or are make-work schemes to transfer wealth. Will they help improve our productivity and prosperity?
Unfortunately, the likely answer is no. The more complete story is that some jobs may be created, but only at the expense of others. Further, the result would be less overall economic growth on net, and most likely, the loss of existing capital. Less wealth and prosperity is the ultimate result. Reducing productivity also makes us less competitive internationally, in an increasingly competitive global economy. Though some jobs may be created in the short term, a longterm downward spiral is also created. Such actions are not sustainable. Congress should keep long-term implications of their “job creation” arguments for increased mandates in mind as they move forward. Ideally, they will recognize the fallacy of creating jobs at the expense of productivity and destroying wealth. Green energy mandates should not be implemented if the cost is less productivity, less wealth, and less prosperity for all Americans.