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Stimulating the economy with massive new investments in “green” infrastructure seems to be a popular idea, and President-elect Obama has made it a centerpiece of his program. Will it work? We doubt it. Both Obama and congressional Democrats believe we can move to a new carbon-free future by “investing” in “green” technologies and infrastructure, while creating millions of new jobs.

As it stands, Obama is eyeing $100 billion in “green stimulus” as part of a much bigger package - as much as $700 billion or more - of conventional stimulus. He reckons this will create up to five million “green-collar jobs” and “jolt” the economy back to life. “Clean energy is going to be a foundation for rebuilding the American economy,” says Bracken Hendricks of the liberal Center for American Progress and a member of Obama’s transition team.

How will the money be spent? “School repairs,” according to a Bloomberg report, “could be required to meet green building standards, including low-energy boilers and weatherization. Transportation spending could emphasize public transit, and support for new power sources such as wind . . . could go hand in hand with spending on an efficient electricity superhighway.”

Sounds great. But it’ll take money - plus new regulations that will make it more expensive to do anything with oil, even if there are no reasonable alternatives. Nowhere is it mentioned that these “green-collar jobs” would be terribly costly, and that the planned “investments” are really just subsidies. And, as we know, things that require subsidies aren’t competitive in the market, and thus aren’t profitable. Claims that such “investments” will create five million jobs are false. It’s likely more jobs will be killed than created due to higher costs and increased inefficiency of the U.S. economy. A recent report from the Center for Data Analysis at the Heritage Foundation found that limiting CO2 emissions under recent proposed legislation would destroy 900,000
net jobs. 

Spending money on projects where costs exceed benefits simply to “create jobs” is a bad idea. Taking capital from productive uses and redeploying it to politically popular but nonproductive uses lowers productivity by paying those with “green jobs” more than their output is worth. It’s not welfare, it’s “greenfare.” This, by the way, was the make-work model followed during the Great Depression. It didn’t work then, and it won’t work now. These ideas aren’t new - they were thoroughly debunked 158 years ago by pioneering French economist Frederic Bastiat, who wrote about the “broken window fallacy.”

It goes like this: Most people agree that when someone breaks a store window, it’s a tragedy for the shopkeeper. But many also believe the overall economy actually benefits, because the shopkeeper now must buy a new window, a kind of “stimulus.” This logic, of course, makes no sense. Yet it’s the basic idea behind all government stimulus plans. The money for the window comes out of the shopkeeper’s pocket. Instead of carrying more stock in his store, or hiring a clerk, he must spend his money instead on a window. So the “stimulus” is really zero - or negative. “The ‘broken windows’ in this case,” notes American Enterprise Institute analyst Kenneth Green, “would be lost jobs and lost capital in the coal, oil, gas, nuclear and automobile industries.” They together employ more than 1 million people. But millions of other jobs would also be at risk because, as with the shopkeeper, money spent on green projects can’t be spent elsewhere. What was true in Bastiat’s time is certainly true today. The weak productivity report Wednesday, showing a tepid 1.3% gain in nonfarm output per hour, should be warning enough. See report here.

The ANPR is one of the steps EPA has taken in response to the U.S. Supreme Court’s decision in Massachusetts vs. EPA. The ANPR record will set the stage for the debate on climate policy/science in the Obama Administration and in the new Congress.

EPA sought comment on the best available science for purposes of the “endangerment” discussion including the more recent findings of the U.S. Climate Change Science Program, and the most recent IPCC report (AR4).

Here are some of the many responses submitted during the first step after comments were requested on the first step, the CCSP Unified Synthesis Product in August here, here, here, here and here.

Here is a small sampling of some of the responses to the ANPR, the third and final phase of the EPA process of evaluation.

* Why the EPA should find against “Endangerment” by World Climate Report

* Major Issues with IPCC Report by John McLean

* Series of detailed responses catalogued at the Heartland Institute.

* Detailed Response from Dr. Pat Michaels

* NIPCC excerpts as a Rebuttal by Dr. Fred Singer

* Challenging Endangerment by Dr. Fred Singer

* Challenging the Appropriateness of the CCSP and Adequacy of the Scientific Literature used by Ross McKitrick

* Detailed Response by CEI

* The Economic Costs of the EPA’s ANPR Regulations by Heritage Foundation by David Kreutzer, Ph.D. and Karen Campbell, Ph.D. Center for Data Analysis

* A geologist’s response by Dr. Don Easterbrook

* Global warming as a response to cloud changes due to the PDO by Dr. Roy Spencer

* In-depth analysis from Craig Idso

* Response by American Environmental Coalition

* Response reiterating CCSP responses

* Response on the failure of models to replicate observed changes and the neglecting of natural factors, most notably here Ocean Multidecadal cycles

* Response by American Environmental Coalition is here. 

By Joseph Romm, Climate Progress

I have argued that Obama won’t be able to ratify any global climate treaty that is likely to come out of Copenhagen next December. Since the only thing worse than no global climate treaty in 2009 is a treaty that the President can’t get ratified, Obama, I believe, should be lowering expectations rather than making promises he can’t keep.

Greenwire reports that Eileen Claussen, executive director of the Pew Center on Global Climate Change and a former senior Clinton administration climate official, said something quite similar (though for slightly different reasons): “We do not want to repeat Kyoto, where you go and negotiate something
and then you can not deliver it.... That’s the worst of possible worlds, because nothing happens.”

Claussen’s Pew Center has been among the most vocal of the groups trying to lower expectations on the timing for a new international climate agreement given the state of play in Washington. Claussen said she does not think Obama and Congress can finish cap-and-trade legislation in 2009. And she wants the Copenhagen deadline pushed back to give the United States the time it needs to finish its climate law.

Claussen and her colleagues said European officials have told them privately that they are aware of the tight U.N. schedule. But they cannot say this publicly for fear it will disrupt momentum toward a final climate deal. While Claussen credits Obama for giving some important signals on his position, she would like to see him go a step further and tell international officials that the United States won’t be ready to negotiate and agree to a final climate pact by Copenhagen.

If expectations are not lowered before Copenhagen, Claussen said, she worries that the U.N. talks could collapse, generating a fresh round of antagonism toward the United States. “That,” she warned, “really doesn’t benefit anybody.” I have talked to a number of colleagues with congressional experience
who are skeptical that something as complicated as a national cap & trade bill could be completed in 2009, especially given everything else on Obama’s plate.

I believe the UN Framework Convention on Climate Change process can’t survive in its current form. But even if you think it can, Obama should try to delay Copenhagen until after there is a U.S. climate bill. It would be crazy for him to commit to something in international talks in 2009 that he can’t get through his own Congress as a domestic bill in 2010.

And I would repeat that if a Copenhagen Protocol does not include a binding commitment by China to cap emissions by 2020 - with some restrictions on how fast emissions can grow between now and then - it has no chance whatsoever of getting 67 votes in the U.S. Senate at any time during Obama’s term(s) in office. I would go even further: Such a flawed global climate treaty in 2009 might actually undermine chances for a U.S. domestic bill in 2010. Read more here.