Gunther: "Phony Green Jobs Debate"

Marc Gunther at The Energy Collective pretty much agrees with me on the “green jobs” thing.

Let’s get real: We can’t predict oil prices 12 months out. Last spring, virtually no one anticipated the global financial crisis of last fall. And we are projecting the number of green jobs that will be created or lost on a state-by-state basis by a law that won’t take effect until 2012? Who are we kidding?

I called Russ Roberts, an economist at George Mason University who hosts the fine EconTalk podcast, for some guidance on how to think about green jobs and the economics of climate regulation. “Creating green jobs is easy,” he told me. “We could employ millions of people picking up litter, and we could make them very good-paying jobs if we want. But of course that would make us poorer as a nation. There’s a cost to providing those jobs that would have to be borne by other people in the economy.”

It’s not just the cost of higher taxes that needs to be factored into the equation, he noted. To the degree that the government makes policy that favors, say, vast construction of wind turbines throughout the upper Midwest, the people doing those jobs will be drawn from somewhere else, maybe even from more productive work. If policy leads to the hiring of thousands of contractors to do energy efficiency, the cost of building a new home or renovating your basement may go up because many of the good construction workers are busy.

“As voters and citizens and readers, what we want to think about is the big picture—are we moving in the right direction when it comes to environmental policy?” Roberts says. Put another way, are we spending enough money today to head off the threat of global warming in the future? Because if anyone tells you that we can deal with climate change at no cost, they probably shouldn’t be trusted.

Maybe that’s what bothers me about the green jobs ads. They’re like political campaign ads. They promise something for nothing. They treat the voters like children. They’re emotional and not educational. And they’re not helping to build a movement around climate change.

Other than that, they’re fine.

It is certainly good to have worthwhile projects to employ people doing, while we reconsider how to arrange things so that having a job stays rewarding while not having one gets a lot less punishing. And unless we get very lucky, this carbon thing is going to cost us plenty, no matter how we approach it. But the issue is not jobs. That just reinforces people’s confusion. 

The environment is not a subsidiary of the economy. It is the other way around.
Something called the Sustainable Development Commission in the UK, which appears to have some sort of government charter, issued a report called Prosperity Without Growth which is on the whole a worthwhile read for people unfamiliar with the idea of a steady-state economy. There are lots of good quotes in there that will be showing up here.
It also talks about the confusion in the relationship between “green jobs” and the redesign of the economy. They point out that the natural inclination of politicians is to just treat the “green jobs” thing as an ordinary Keynesian stimulus, to get the economy “back on track”. I believe Prof. Obama is doing an astonishingly good job at this goal, actually, which is unfortunate given that it is the wrong goal.  
The report hits on the awkwardness of the Keynesian strategy at this juncture at several points. For instance, while we see this on p.69:

By early 2009, a strong international consensus had emerged in support of a very simple idea. Economic recovery demands investment. Targeting that investment towards energy security, low carbon infrastructures and ecological protection offers multiple benefits. These benefits include:

  • freeing up resources for household spending and productive investment by reducing energy and material costs
  • reducing our reliance on imports and our exposure to the fragile geopolitics of energy supply
  • providing a much-needed boost to jobs in the expanding ‘environmental industries’ sector
  • making progress towards the demanding carbon emission reduction targets needed to stabilize the global atmosphere
  • protecting valuable ecological assets and imporving the quality of our living environment for generations to come

which is all true and very compelling, but on the other hand, from p. 71:

it is difficult to escape the conclusion that in the longer term, we’re going to need something more than this. Returning the economy to a condition of continual consumption growth is the default assumption of Keynesianism. … the systemic drivers of growth push us relentlessly towards ever more unsutainable resource throughput. A different way of ensuring stability and maintaining employment is essential. 

A great deal depends on how these policies are sold and implemented. Were it not for the financial crisis, it might be better to wait until the public gained a better grip on the issues. There is a real risk that supporters will end up as confused about the fundamental purpose of these initiatives as its opponents. 

Some of us are eager to challenge the structure of society, and specifically of its economics. I myself am not so reckless as to look forward to it. I do understand that it is necessary. I wonder if those advocating “green jobs” while avoiding explaining how serious the underlying issues are might not be doing more harm than good.  If the economy can be rebooted, will people shrug off the idea of sustainability as some nice WPA-like project and get on with business?
Will people ever get the idea that the planet is full, and that consequently the basic idea of the invisible hand is broken? That nothing you do is only your own business anymore? That we’re not on the lonesome prairie, we’re on a leaky boat, and we’d better learn how to get along because there’s no place further west to go? 
I don’t know. Not if we don’t try to explain it, I reckon.
Update: See also John Whitehead on the Environmental Economics blog, who doesn’t think that “green jobs” necessarily will have a net positive impact on employment. 

Image from Sunwize.com


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Failure of Short Run Strategies in Long Run Arguments

There’s plenty of evidence that politically active people interested in fighting climate change think very differently than scientists who are also interested. I also think they are getting it wrong.

This is in my email from Gore’s “We Campaign”.

Dear Michael,

I asked Troy Galloway — a former steelworker who now builds wind turbine blades — to share his story. Congress needs to support more opportunities like this and revitalize the economy.

– Cathy

———- Forwarded message ———-

From: Troy Galloway
Subject: Worst day of my life

The worst day of my life was when I got that pink slip. I expected to work in the steel mill until the day I retired, and then suddenly my job and my livelihood were gone.

Then in 2006 a wind turbine company opened two plants near my home in Hollsopple, Pennsylvania. Today, I build the blades for wind turbines that are powering parts of America with clean electricity.

A clean energy job saved my family and me, and many more in my community. But with the current economic mess, even some of my smartest and hardest-working friends here are still struggling — as I know millions of Americans are.

That’s why I am asking you for help.

We need millions more green jobs — like the one that saved me — all across the nation. And those jobs will only be available if our leaders in Washington take bold steps.

Please sign the petition to our leaders here:

http://www.RepowerAmerica.org/troyvideo

Here’s what the petition says:

“Congress must support bold national policies this year to transition to a clean energy economy and help solve the climate crisis. We urge you to cap carbon pollution to help create the jobs and businesses that will Repower America.”

I’m hearing some talk on TV about how we can’t afford to deal with the climate crisis and the economic crisis at the same time. Well, my experience shows we can’t afford not to. The green jobs that reduce carbon pollution are this country’s ticket out of a deep economic rut.

I hear that we lost half a million jobs last month. Imagine if those laid-off workers could turn in their pink slips for jobs in wind, solar, clean cars and green technology.

Well, our leaders in Washington have an opportunity to deliver green jobs like these to cities and towns all across America.

Send them a message today:

http://www.RepowerAmerica.org/troyvideo

Sincerely,

Troy

“Well, my experience shows we can’t afford not to.” Um, no it doesn’t. It indicates, perhaps, but it doesn’t prove anything. It’s a datum, not a proof. There is a huge difference. (Then there’s that “well”. Well, that reminds me of Ronald Reagan, and if you’ll recall, that’s where our troubles really started. )

Is this a bad approach? I think so; in fact I think it’s dreadful. Even if it doesn’t strike you as reprehensible to argue in this anecdotal way, consider the strategic implications of this tactic.

It alienates people who think quantitatively in favor of those who don’t. In the short run that may be enough, but this isn’t a short run decision. Engineers and MDs and corporate mangers can be forgiven for having their BS detectors go off, when the arguments they see are the arguments of BS-vendors. And while in the short run such people can be overwhelmed, they have long-run influence in their communities and associations that matter a great deal.

So even leaving aside the ethical problems, I don’t think that this tradeoff is a winner in the long run, and that may have something to do with why, despite having the truth on our side, we are not winning in the long run. We don’t have to win a battle. We have to win every battle. Getting a bill passed is a trivial matter. The public must be won over overwhelmingly.

Anyway, Mr. Gore wrote an excellent book called The Assault on Reason. It’s peculiar, because this campaign has me strongly inclined to recommend to Mr. Gore that he read it.
Mr. Gore, in his disastrous his-to-lose-and-actually-lost Y2K campaign, showed that his capacity to connect with the experts in science and policy was not matched by his capacity to connect with experts in politics. He is listening to the worng people again.

While the left worries about winning battles, the right worries about the war. The field of play in this game is not symmetrical; the tools of reason win in the long run while the tools of polemics work in the short. For advocates of sane policy to exclusively use ancedote in favor of analysis abandons the terrain of advantage and limits the battle to places where the advantage is with the oppposition.

The implicit idea that the purpose of pushing sustainability is to support employment has no fewer than five problems

  1. It is not logically supported in arguments made in its favor. For all its supporters know sustainability costs jobs. Certainly the idea that it is a net economic benefit in conventional terms (neglecting externalities) is unlikely.
  2. It abandons the far more important and susbtantiated argument of externalities.
  3. It totally abandons technically sophisticated opinion leaders like engineers and doctors, who will see through manipulation and be inclined to presume there are no better arguments to offer if nothing more is offered.
  4. It totally abandons addressing the question of sustainability in economics, failing to draw attention to the underlying problem of the growth imperative and how to overcome it.
  5. It continues the assault on reason, weakening collective reasoning.

This approach may just be enough to win a round given the support of the Obana administration. But a round is not enough. The population needs to be won over permanently and decisively. A narrow legislative victory will accomplish very little in the long run; perhaps it will hurt more than it helps.

The author of the above communication has been nominated as an undersecretary of DoE. I have been unable to track down Cathy Zoi’s biography, but it’s hard at first glance to see how that nomination is a good thing, given that what is valuable about DoE is science and technology, and what needs to be excised is the excessive tendency toward posturing and spin.
Maybe this is intended a concession on Obama’s part to Gore’s constituency, but I’m concerned that this doesn’t speak well for either of them.