On The Promise Of "Green Jobs"

Sometimes it seems like the biggest selling point advanced in favor of “renewable energy” is the promise of what are called “green jobs.” What are those? Proponents are often vague, but I suppose that the green jobs largely consist of the work of building, installing, and maintaining the vast future farms of windmills and solar panels, and related infrastructure like transmission lines. Since most of these jobs involve some combination of strenuous labor in remote areas and/or a high level of skill, of course they will be very high-paying jobs. Millions of them. What’s not to like about that?

President Obama was an early arrival at the “green jobs” party, tossing out a “plan to create 5 million new green jobs” as part of his 2008 presidential campaign. (Politifact in November 2016 struggles to figure out how many of those jobs ever got created, and if so, where they may be.) You won’t be surprised to learn that Obama’s ideas pretty much all consisted of some variety of government subsidies, programs, mandates, tax credits, “investments,” expenditures, and the like, e.g., a new “job training program for clean technologies,” a new federal “renewable portfolio standard” to force utilities to switch to wind and/or solar generation, extension of the “production tax credit” for wind and solar, and so on and on.

More recently “green jobs” promoters have further upped the ante. In January of this year, Francie Diep of Pacific Standard quoted the Center for American Progress as predicting that a federal “investment” of just $800 billion per year (!) toward cutting carbon emissions to zero would create 6.8 million net new jobs. Meanwhile, the International Labor Organization (part of the UN) put out a study in 2018 predicting that implementation of the Paris Climate Agreement would create some 24 million “net” green new jobs worldwide by 2030. It all sounds like a near-infinite bounty of new wealth.

Do you spot the fallacy here? I assume as a Manhattan Contrarian reader that you immediately sniff out the scam, but just in case you don’t, let’s reason it through. Consider just those numbers for the U.S. from CAP: $800 billion per year to cut carbon emissions, and that gets you 6.8 million net new jobs. But wait a minute. The 325 million or so Americans already have full access to energy for all their needs, whether those needs be electricity or transportation or heating or industry, without having to spend this incremental $800 billion per year. The proposal then is that at the end of some great economic transformation the same number of people will be paying an additional $800 billion per year for the exact same energy. That’s about an extra $2500 per year per capita, or about $10,000 for every family of four, to purchase absolutely nothing they don’t already have. For comparison, U.S. median family income is about $60,000. So the idea here would reduce every American family’s income by about 16% on average. Meanwhile, the labor market is already tight, with more job openings than job seekers. That means that if somehow the “green jobs” employers can hire the 6.8 million people, those people will just have been diverted from other jobs that they could just as well have had. And somehow the proponents of this “green jobs” thing have convinced themselves that their vast new government spending is a good idea.

Over at the Minnesota-based Center of the American Experiment, economist John Phelan on June 10 has an analysis of what the arrival of “green” energy has meant for that state. The short answer is, via the magic of huge government subsidies and handouts, very large numbers of new well-paid people strive to produce the very same energy that was previously produced by a small fraction of the number of people. Some statistics please:

[I]n 2017, the 412 workers employed in Minnesota’s natural-gas sector produced an average of 16,281 megawatt hours of electricity each. For coal, the figure was 13,230 megawatt hours produced for each of the 1,722 workers employed in the state. . . . But for renewable wind and solar, the numbers are far less encouraging. In . . . Minnesota’s wind sector . . . each of the 1,966 workers . . . generated an average of just 5,665 megawatt hours in 2017. . . . For solar, the numbers are even worse. In 2017, each of Minnesota’s 3,800 solar-energy workers produced an average of just 157 megawatt hours [each]. This was just 1.2 percent of the energy produced by a coal worker and only 1 percent of that which a natural-gas worker produced.

So if you go for solar, it’s about 100 times as many workers to produce the exact same electricity. Oh, except that you don’t get any electricity at night.

Phelan points out that even Official Manhattan Contrarian Worst Economics Writer Paul Krugman has written about the centrality of worker productivity to a society’s wealth generation. Here is the Krugman quote:

“Productivity isn’t everything, but in the long run it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker.”

Well, that was before Krugman got mesmerized by the Green New Deal. In a column on December 31, 2018, Krugman listed among the benefits of the GND:

[T]hese [emissions reduction] policies would visibly create jobs in renewable energy, which already employs a lot more people than coal mining.

Why again is that a good thing?