Are Green Jobs an Economic Black Hole?

[twa]

I hope you are right,otherwise we are throwing a lot of money in a black hole.

I read a lot of tech sites,but I also read economists sites

The central planners in Spain, much like President Obama with his stimulus package, assumed that they could get something -- a lot of really good jobs -- for nothing. They were wrong. People who think that way are always wrong.

Read more at the Washington Examiner: http://washingtonexaminer.com/opinion/columnists/2011/08/green-jobs-promise-something-nothing#ixzz1WhVmo5Dg

In the United States, Calzada's study upset the wind power lobby, environmentalists, and the Obama administration. American liberals tried to argue that Calzada had erred by doing what is obvious to everyone outside of government who uses money -- he accounted for the opportunity costs of government spending.

[Burgold]

I hope I'm right too.

I don't mind spending R&D money which is what I hope a bunch of the money the government is spending directly or indirectly is another name for. I didn't mind when local districts offered tax incentives to buy more fuel efficient air conditioners or dishwashers either though. Sometimes, it's tough to get people to give up the buggy whip.

Now, I will say that I kinda like paying half as much at the gas pump than I used to and about a quarter s much as SUV drivers do even knowing that it will take a heck of a lot of trips to the pump to equal the money a new car cost, but whatcha ya gonna do?

[Bliz]

I won't cite any studies because I don't have any. But as someone closely tied in to the construction industry, I will tell you my personal observations.

Green is booming. Every time you turn around you hear about another major green project (which I will subjectively define as over $100 million) getting started.

Vegetative and solar arrays on roofs, LEED certified buildings...these things are being constructed by people and companies that are expanding into green construction, largely by expanding their product base and workforce to do so. These projects are more expensive, and require a higher front-end investment that pays off for the owner over time. Many of them (particularly the addition of solar arrays) are not projects borne of necessity, but are desired upgrades as an investment or to take advantage of tax credits, again with an eye for it paying off over the course of several years. This sort of green construction is a very good thing for the economy.

I haven't read the Spain study, but I am curious how broad a net they cast when they talk about "jobs". It's also fair to ask if all jobs are created equal. If 10 $40k/yr jobs are lost, and 5 $100k/yr jobs are created, is that a net positive or negative? Should the question be whether there is a net gain of income, rather than a net gain of jobs?

[SnyderShrugged]

simple question that I can only find very biased opinion pieces on thus far (from both sides). "How much does each Green Job cost when Federal investment is also included in the equation?" If the cost is less than the reward, awesome. If more, Fail.

---------- Post added September-1st-2011 at 08:45 AM ----------

BTW, If I ever am able to build a new house, I plan to go solar if I can afford it.

[twa]

Ignoring economics is a bad choice

the Green industry is expanding simply because of massive subsidies....ya better get a return on that spending....it comes at a cost

Black Hole at the present

[Burgold]

simple question that I can only find very biased opinion pieces on thus far (from both sides). "How much does each Green Job cost when Federal investment is also included in the equation?" If the cost is less than the reward, awesome. If more, Fail.

---------- Post added September-1st-2011 at 08:45 AM ----------

BTW, If I ever am able to build a new house, I plan to go solar if I can afford it.

I think part of the answer lies in the time horizon you are considering. From what I have read naturally, a bunch of green jobs are actually making money now and it's the technology that's pushing it even harder than the impact of the gov't stimulus. One of the cooler things is the incorporation of nano-like tech into solar collectors. These allow for flexible thinner, lighter, and more durable panels. There's actually some pretty cool stuff on the horizon and even in play.

[SnyderShrugged]

I think part of the answer lies in the time horizon you are considering. From what I have read naturally, a bunch of green jobs are actually making money now and it's the technology that's pushing it even harder than the impact of the gov't stimulus. One of the cooler things is the incorporation of nano-like tech into solar collectors. These allow for flexible thinner, lighter, and more durable panels. There's actually some pretty cool stuff on the horizon and even in play.

what would be an adequate time horizon?

---------- Post added September-1st-2011 at 09:02 AM ----------

Here is one that defaulted on $535 M in federal loans and is chapt 11 now.

http://www.nbcbayarea.com/news/local/Solyndra-Shutting-Down-128802718.html

[Burgold]

I'm going to give an unsatisfying answer. It's creationism and evolution at the same time.

We need to allow natural selection to kill off those companies that can't do it right, have a bad business model, or chase ineffective advances in technology. At the same time, we need to nurture the divine spark and give the garden a chance to prosper and to tend it.

[SnyderShrugged]

I'm going to give an unsatisfying answer. It's creationism and evolution at the same time.

We need to allow natural selection to kill off those companies that can't do it right, have a bad business model, or chase ineffective advances in technology. At the same time, we need to nurture the divine spark and give the garden a chance to prosper and to tend it.

couldnt nurturing good companies come in other forms beyond simply throwing tax payer money their way?

[Burgold]

couldnt nurturing good companies come in other forms beyond simply throwing tax payer money their way?

It does. That's only one aspect. There's also research grants. There's goodwill speeches (which cost little but time) and a thousand other things.

[SnyderShrugged]

It does. That's only one aspect. There's also research grants. There's goodwill speeches (which cost little but time) and a thousand other things.

If those things were all that were done in the "Green Jobs" initiatives, I dont think many would have a problem with them. When reality is faced though, mainly all we see is random money thrown at them with little regard to real life success and value add to the nation.

[Burgold]

Nah, people pick and choose what they want to complain about. For example, in the debt ceiling debate... the Republicans didn's say

A ratio of four dollars cut for every dollar raised is pretty good. They said, "Why the hell are you trying to raise our taxes!" Perspective is an evil and inaccurate thing.

[SnyderShrugged]

Nah, people pick and choose what they want to complain about. For example, in the debt ceiling debate... the Republicans didn's say

A ratio of four dollars cut for every dollar raised is pretty good. They said, "Why the hell are you trying to raise our taxes!" Perspective is an evil and inaccurate thing.

Most regular people, especially outside of party lines, pretty much expect the bottom line results if a major investment of tax payer dollars is used. Simply put, the heavy investment into green jobs appears to have gone the same way as spains has and has yet to yield benefits vs the costs.

[PeterMP]

I don't understand any near term economic case bsed on a green agenda. Windmills are different than an assembly line, for example.

Windmills are more expensive. Assembly lines are less expensive.

Windmills don't improve productivity. Assembly lines did greatly improve productivity.

I can see windmills being a net negative for the economy.

The argument that clean energy will re-patriate jobs is a little loose, at best to me. Much of our domestic electricity is produced domestically through coal, nuclear and natural gas.

Expense is based on how you calculate costs. If you believe that much of our foreign policy is dictated by the desire to mantain access to foreign energy sources, then your costs calculation might change.

Now, if I'm wrong on that point and IF the new green hardware is manufactured within the US, I could see that being a positive aspect. Positive enough to offset higher costs across the economy? Difficult to imagine.

Longer term, I think it is unlikely windmills will be manufatured here (assuming we mantain our current standard of living). Sorter term, where wind mill construction is really being driven by technological improvements, it could be done (is to a certain extent) here, but there are real issues in that the Chinese (and others) are dumping a ton of money into green energy technology.

Larry started a thread the other day that talked party about battery manufacturing not being done here. I pointed out that wasn't completely true as some companies do it here because the technology of the company is tied to somebody that is American (this particular person is at MIT). He's here, so his company is here, so they manufacture here. Longer term, if the company is successful and grows, and the technology becomes more standard, I wouldn't be surprised if the manufacturing is moved else where.

However, even if that is true, you still get the benefit of some of the corporate structure being here and taxes on the company.

If the technology is developed elsewhere, you get zippo.

[Tulane Skins Fan]

Ignoring economics is a bad choicethe Green industry is expanding simply because of massive subsidies....ya better get a return on that spending....it comes at a cost

Black Hole at the present

Unless of course you are ignoring Keynsian economists, right? Then its a good choice?

[twa]

Even Keynesians will tell you futile spending has it's limits....as does green tech

However if you wish to regress as a society I'm good.

[Tulane Skins Fan]

Even Keynesians will tell you futile spending has it's limits....as does green tech

However if you wish to regress as a society I'm good.

No one is trying or wishing to regress as a society. But Keynsian economists to this day say that the stimulus was a good idea, and if anything it should have been bigger. Yet, those economists are regularly dismissed by the right. I'm just saying, you take all the information you have and make an informed decision. You don't just say "green jobs are black holes" or "government is bad."

[twa]

You don't just say "green jobs are black holes" or "government is bad."

You do when they are black holes and govt makes bad choices

Pissing money away is alright when you have it to spare,as is being stupid....it just isn't sustainable even in Keynesianland

[Bliz]

You do when they are black holes and govt makes bad choices

Pissing money away is alright when you have it to spare,as is being stupid....it just isn't sustainable even in Keynesianland

Except it's still too early to judge whether or not it really is a black hole. These are investments in our economy - by definition, we're talking about spending money up front for long term gain. The argument that short term gains are unsatisfactory compared to expenditures is not relevant. Plus you're condemning an EXTREMELY wide range of measures based on one overall evaluation (that may or may not be accurate). Don't throw out the baby with the bathwater. Some of these will be very good and successful programs.

[SnyderShrugged]

Except it's still too early to judge whether or not it really is a black hole. These are investments in our economy - by definition, we're talking about spending money up front for long term gain. The fact that short term gains are unsatisfactory compared to expenditures is not relevant. Plus you're condemning an EXTREMELY wide range of measures based on one overall evaluation (that may or may not be accurate). Don't throw out the baby with the bathwater. Some of these will be very good and successful programs.

curious how long a time frame is appropriate to judge success.

[twa]

Probably longer than the Spain example

add

Bliz why not simply use standard business models?....if it is a losing proposition there needs to be clear possible advancements and limits on the expansion until advancements occur

Simply being Green doesn't make it worthwhile

[Tulane Skins Fan]

You do when they are black holes and govt makes bad choices

Pissing money away is alright when you have it to spare,as is being stupid....it just isn't sustainable even in Keynesianland

So you think we have now made a final determination that green energy is unsustainable, and never will work, and we will always just dump money away by investing in it?

That's really what you think?

Honestly, I think you go to incredible lengths that not even you believe to satisfy your urge to denounce all things government, and all things that cost money.

---------- Post added September-1st-2011 at 03:45 PM ----------

Probably longer than the Spain example

add

Bliz why not simply use standard business models?....if it is a losing proposition there needs to be clear possible advancements and limits on the expansion until advancements occur

Simply being Green doesn't make it worthwhile

Now, you're taking things out of context. No one is saying simply being green is good. We are saying that there should be room for investment into green energy that will eventually lead to lower cost and reduced side effects of energy production.

No one is sitting here saying that we should be putting up solar panels in the Pittsburgh or something. But, there are smart ways to invest in and promote green energy that will be good, in the long run, for the country. Or do you disagree with that all together? Oil, coal and gas are the only energies worth pursuing, ever?

[Wrong Direction]

Expense is based on how you calculate costs. If you believe that much of our foreign policy is dictated by the desire to mantain access to foreign energy sources, then your costs calculation might change.

I have to run, but I wanted to say that I agree in particular with this point.

The details are debatable, but I absolutely can see a good case to invest heavily in all forms of technology at home. I wouldn't limit that to green jobs, but I'd certainly include them. A real plan to become generally energy independent would be worth the investment, IMO. I would love to turn around to OPEC and tell them that we'd be happy to start paying $30/barrel, or we'll just not buy from them.

Probably unrealistic anytime soon, but I'd love to see the initiative to cut through the red tape and make it happen.

And I don't buy the argument that we don't have the expertise to build certain things, like nuclear reactors. That's what training is for. We could do it if we wanted, and committed, even if it's technically not possible this afternoon.

[twa]

No one is sitting here saying that we should be putting up solar panels in the Pittsburgh or something. But, there are smart ways to invest in and promote green energy that will be good, in the long run, for the country. Or do you disagree with that all together? Oil, coal and gas are the only energies worth pursuing, ever?

You obviously never read my posts,we are saying the same thing but your green blinders must keep you from seeing it.

My recognizing the cost factors and the reality of insufficient alt energy capabilities at this time does not mean I do not support alt energy development.

Why is everything all or nothing?

[Bliz]

curious how long a time frame is appropriate to judge success.

More than 2. Less than 20. I can't tell you more specifically. Depends on the particular program.

---------- Post added September-1st-2011 at 05:46 PM ----------

Probably longer than the Spain example

add

Bliz why not simply use standard business models?....if it is a losing proposition there needs to be clear possible advancements and limits on the expansion until advancements occur

Simply being Green doesn't make it worthwhile

Obviously not. But simply being green doesn't mean it is not worthwhile either.

The standard business model is what I think is being or will be used. Of course, some of that investment is what allows advancements to occur.

---------- Post added September-1st-2011 at 05:47 PM ----------

Why is everything all or nothing?

good question

I'm just saying, you take all the information you have and make an informed decision. You don't just say "green jobs are black holes" or "government is bad."

You do when they are black holes and govt makes bad choices