It is with no small amount of angst, though of no surprise at all, that just a day after the made-up debt-ceiling crisis was averted that I find Senate Majority Leader Democrat Harry Reid announcing that his first order of business when the Senate re-adjourns after its month long siesta will be to take up energy legislation under the guise of creating jobs. And just a day later, on August 3, Senator Jeff Bingaman, Democrat from New Mexico and chair of the Senate Energy and Natural Resources Committee, announced that he planned on bringing as many as 14 energy related bills up for a vote – all to create jobs. Green jobs that is!
There is just one huge, gaping problem with the push. All the money the government spends on green jobs (or the money they make the public and businesses spend when the push involves mandates as opposed to just subsidies), simply adds to the debt and deficit. Indeed, since the Energy Department was created 34 years ago, it has poured hundreds of billions of dollars down the black hole that is green energy.
The government can create jobs with all the money it spends – though as my friend Todd Myers recent post reinforces, they can’t account for the results of how the money is spent – but the green jobs created, result in a net job loss (and a net economic loss). Incentives and mandates for green jobs create artificial jobs that wouldn’t be supported by the market, and because the products they create and the energy they produce are expensive but unreliable they raise energy costs and result in net energy and job losses in the broader economy. Pete Geddes and I have written about the net job losses from government green job efforts before.
I have also written about the high costs and limited effectiveness of green energy subsidies in generating inexpensive, reliable energy.
A nice addition to the above cited works is a recent study by the Institute for Energy Research (IER) that details, using only government sources, the tremendous growth in renewable energy subsidies between 2007 and 2010 (yes, Bush shares the blame with Obama for this travesty). All the while the economy has been in the tank, unemployment has remained high, foreclosures are setting records, banks are failing and the government has taken on unprecedented levels of debt. Renewable energy has made out like a bandit, having seen their subsidies increase by 186 percent, led by a 10-fold increase in wind power subsidies and more than 600 percent increase in solar power. Certainly jobs have increased in these industries. But most of them are temporary and the job gains have been more than offset by the lost jobs in and out of the energy industry.
It’s certainly true, as both the NCPA and the IER have noted that fossil fuels also receive subsidies – but, the subsidies for energy sources have grown by a much lower amount and they produce a higher quality (due to reliability and regularity) source and amount of energy per dollar of subsidy. Take away the subsidies for fossil fuels – as I and the NCPA have argued we should – and, absent government restrictions, we will still get the vast majority of our power from them. Take away the subsidies from renewable sources and they largely disappear except for boutique uses and as novelty energy sources for the wealthy.
In the midst of this continuing battle over how to reduce operating deficits and long-term government debt, a good place to start is ending all energy subsidies and mandates. The country will save money and have a more reliable, more secure energy supply.
Albert Einstein defined insanity as doing the same thing over and over again and expecting different results. What does that say about the Senate leadership and President Obama with regard to their new and improved push for green jobs by promoting green energy?