Excellent Summary from Green Job Myths paper here.

ANDREW P. MORRISS H. Ross and Helen Workman Professor of Law & Professor of Business University of Illinois morriss@law.uiuc.edu

WILLIAM T. BOGART Dean of Academic Affairs and Professor of Economics York College of Pennsylvania wtbogart@ycp.edu

ANDREW DORCHAK Head of Reference and Foreign/International Law Specialist Case Western Reserve University School of Law andrew.dorchak@case.edu

ROGER E. MEINERS John and Judy Goolsby Distinguished Professor of Economics and Law University of Texas-Arlington meiners@uta.edu This paper can be downloaded without charge

SUMMARY

Unfortunately, the analysis provided in the green jobs literature is deeply flawed, resting on a series of myths about the economy, the environment, and technology. We have explored the problems in the green jobs analysis in depth; we now conclude by summarizing the mythologies of green jobs in seven myths about green jobs:

Myth 1: There is such a thing as a “green job.” There is no coherent definition of a green job. Green jobs appear to be ones that pay well, are interesting to do, produce products that environmental groups prefer, and do so in a unionized workplace. Yet such criteria have little to do with the environmental impacts of the jobs. To build a coalition for a far reaching transformation of modern society, “green jobs” have become a mechanism to deliver something for every member of a real or imagined coalition to buy their support for a radical transformation of society.

Myth 2: Creating green jobs will boost productive employment. Green jobs estimates include huge numbers of clerical, bureaucratic, and administrative positions that do not produce goods and services for consumption. Simply hiring people to write and enforce regulations, fill out forms, and process paperwork is not a recipe for creating wealth. Much of the promised boost in green employment turns out to be in non-productive (but costly) positions that raise costs for consumers.

Myth 3: Green jobs forecasts are reliable. The forecasts for green employment optimistically predict an employment boom, which is welcome news. Unfortunately, the forecasts, which are sometimes amazingly detailed, are unreliable because they are based on questionable estimates by interest groups of tiny base numbers in employment, extrapolation of growth rates from those small base numbers, and a pervasive, biased, and highly selective optimism about which technologies will improve. Moreover, the estimates use a technique (input-output analysis) that is inappropriate to the conditions of technological change presumed by the green jobs literature itself. This yields seemingly precise estimates that give the illusion of scientific reliability to numbers that are simply the result of the assumptions made to begin the analysis.

Myth 4: Green jobs promote employment growth. Green jobs estimates promise greatly expanded (and pleasant and well-paid) employment. This promise is false. The green jobs model is built on promoting inefficient use of labor, favoring technologies because they employ large numbers rather than because they make use of labor efficiently. In a 504 U.S. Geological Survey, CEMENT STATISTICS (2008), available here Green Jobs Myths competitive market, factors of production, including labor, earn a return based on productivity. By focusing on low labor productivity jobs, the green jobs literature dooms employees to low wages in a shrinking economy. Economic growth cannot be ordered by Congress or by the U.N. Interference in the economy by restricting successful technologies in favor of speculative technologies favored by special interests will generate stagnation.

Myth 5: The world economy can be remade based on local production and reduced consumption without dramatically decreasing human welfare. The green jobs literature rejects the benefits of trade, ignores opportunity costs, and fails to include consumer surplus in welfare calculations to promote its vision. This is a recipe for an economic disaster, not an ecotopia. The twentieth century saw many experiments in creating societies that did not engage in trade and did not value personal welfare. The economic and human disasters that resulted should have conclusively settled the question of whether nations can withdraw into autarky. The global integration of wind turbine production, for example, illustrates that even green technology is not immune from economic reality.

Myth 6: Mandates are a substitute for markets. Green jobs proponents assume that they can reorder society by mandating preferred technologies. But the responses to mandates are not the same as the responses to market incentives. There is powerful evidence that market incentives induce the resource conservation that green jobs advocates purport to desire. The cost of energy is a major incentive to redesign production processes and products to use less energy. People do not want energy; they want the benefits of energy. Those who can deliver more desired goods and services by reducing the energy cost of production will be rewarded. There is no little evidence that successful command and control regimes accomplishing conservation.

Myth 7: Wishing for technological progress is sufficient. The preferred technologies in the green jobs literature face significant problems in scaling up to the levels proposed. These problems are documented in readily available technical literatures, but resolutely ignored in the green jobs reports. At the same time, existing technologies that fail to meet the green jobs proponents political criteria are simply rejected out of hand. This selective technological optimism/pessimism is not a sufficient basis for remaking society to fit the dream of planners, politicians, patricians, or plutocrats who want others to live lives they think other people should be forced to lead.

To attempt to transform modern society on the scale proposed by even the most modest bits of the green jobs literature, such as the Conference of Mayors report, is an effort of staggering complexity and scale. To do so based on the combination of wishful thinking and bad economics embodied in the green jobs literature would be the height of irresponsibility. We have no doubt that there will be significant opportunities to develop new energy sources, new industries, and new jobs in the future. Just as has been true for all of human history thus far, we are equally confident that a market-based discovery process will do a far better job of developing those energy sources, industries, and jobs than could a series of mandates based on imperfect information.

Icecap Note: In support of the authors, we have found:

The economy in every country that has moved down an extreme green path has been hurt. Renewables are unreliable as the wind doesn’t always blow and sun shine. And don’t believe the claims millions of green jobs would result. In Spain, every green job created cost Spain $774,000 in subsidies and resulted in a loss of 2.2 real jobs. Only 1 in 10 green jobs were permanent.  Industry left and in Spain unemployment rose to 27.5%.

Many households in the countries that have gone green are said to be in “energy poverty” (25% UK, 15% Germany). Their energy costs are up to 3 times higher than the U.S. The elderly are said in winter to be forced to “choose between heating and eating” and there are life-threatening blackouts. See here how electricity prices have reached a new high in Germany this week. And an end in the rising price spiral remains elusive, experts warn.

“Wholesale prices for electricity could continue to rise,” Die Welt reports. Large power producers such as RWE, warn that future plant closures due to the transition to green energies and the phasing out of the country’s nuclear power plants will “lead to a shortage” (brownouts and blackouts).

Die Welt ends its article: “The largest block on the electricity bill, however, are taxes, levies and allocations, which account for more than half of the total price.” One major price driver are the mandatory, exorbitantly high green energy feed-in tariffs that grid operators are forced to pay.