How is Creating Green Jobs Like Banning Tractors to Create Farm Jobs?
Recently the Political Economy Research Institute at the University of Massachusetts released a graphic purporting to show "green" technologies create more jobs than traditional energy sources. The graphic below has been distributed widely by advocates of creating "green jobs." This is a common assertion from the environmental left.
As I note in my book Eco-Fads, this claim is made by many on the left.
One Seattle Times columnist wrote approvingly of a study that found spending on "green" projects "produced more ‘job hours’ than tax cuts or traditional infrastructure spending." This, they claim, is a good thing.
The left, however, is halfhearted in its application of this approach. If they really want to create more jobs we can do much better.
For example, the graph below shows 14 jobs are created per $1 million invested in solar energy, twice the amount created from coal. But we can do better. We can generate 500,000 kilowatt hours (kWh) of perfectly clean energy (enough to power 80 houses for an entire year!) while creating hundreds of jobs.
I’ve modified the original graphic, which ended with the “Mass Transit/Freight Rail” row to include the best option of all – generating electricity using bicycle generators. Pedaling ten hours a day on a stationary bike, each person can generate 1 kWh. Investing $1 million in bicycle generators and paying people the going rate for the energy they create, we could create 1,610 jobs.
There is another benefit: these are not part time jobs. These are full-time jobs for an entire year, unlike many of the temporary jobs often included in “green” jobs calculations.
The reason solar power creates more jobs per $1 million is that solar is extremely inefficient, requiring more workers to do more as they produce less. We could easily apply this to other sectors.
If we want to create more farm jobs (after all the percentage of farm jobs in the economy has fallen dramatically in the last century), we could ban tractors. Think of all the jobs we’d create for farm workers!
Of course, the cost of farm products would rise dramatically, making it more difficult to buy food, especially for low-income families. But do we want to create jobs or not?!
If you’ve done the math by now, you may have figured out that I am paying my green-energy producing bike riders only 10 cents a day – the average rate for generating one kWh of electricity in America. So, let’s pay them $10 a hour. The cost per kWh would rise from 10 cents to $1,000. This might make it more difficult for manufacturers to buy the electricity, but it hardly seems fair to demand our bike riders earn less than a living wage, and wealthy investors like Warren Buffet can certainly afford to pay "a bit more" for electricity.
You may think that environmentalism and concern about resources means doing more with less. According to the Political Economy Research Institute (PERI) and the environmental left, you would be wrong. They believe the way to create jobs and help the environment is by doing less with more – substituting high-cost solar power for low-cost natural gas. Using more resources (human and otherwise) and returning less energy.
PERI might argue this is a ridiculous argument and that while putting people on bikes is silly, solar energy produces energy at a reasonable price. Solar energy, however, costs about three times the national average cost per kWh. They ignore the economic impact of tripling electricity rates on energy users - families and businesses. As long as we are ignoring the impacts of the cost of our policies on energy prices, it makes no difference if the cost per kWh is triple the national average or ten thousand times the cost. Those costs are off PERI's balance sheet.
And there are real-world examples of the “success” of the strategy advocated by PERI. In 2008, Spain was widely lauded for its efforts to create a new, green economy. Today their unemployment rate is 25 percent.
The Pew Research Center ranks Oregon as the top state for “green jobs” in the country. Their unemployment rate has been above the national average every month for the last four years. Number three on the list is California, with a current unemployment rate of 10.9 percent. Last on the list? Natural gas rich North Dakota, with a current unemployment rate of 3 percent.
So, PERI and others who have shared the graphic based on their "analysis" have a choice. Either putting people on bicycles to generate energy is a good jobs strategy because it creates so many jobs, or simply counting the number of jobs needed to generate a particular type of energy is misleading and meaningless. Either way, it demonstrates how shallow the argument is and, as we have seen in Spain, Oregon and California, how economically destructive the philosophy behind the graphic is.