Is one “green” job worth $5.4 million? Such a thought borders on lunacy. But that’s the cost, so far, of a green job under the Energy Department’s on-going subsidy plan.
Government records show a loan guarantee program the Obama administration said would create or save 65,000 jobs has flopped. Like a falling star, the program has provided only a few thousand jobs in two years. But, even if it had made work for all 65,000 jobless, these employees would have had salaries of more than $2.9 million each. It seems impossible that some of the roughly $19.3 billion left in the jobs fund would not be doled out to other green projects.
A Washington Post story, however, said only 3,545 new jobs so far were paid for with half the amount of the $38.6 billion in loan guarantees. That’s a little better than $5.4 million a job. This inconceivable job creation record came from the Department of Energy, according to the Post story. I attempted unsuccessfully to confirm it. Other publications, however, carried the same astounding information.
Former White House economist Jared Bernstein said the huge pay number assumes that every loan defaults. A much lower amount rather than $19 billion is more likely, he claimed.
The report on scandalous allocation of taxpayer money comes on the heels of the well-publicized collapse of Solyndra, the solar power company that got a loan guarantee of $535 million in stimulus money and a big photo-op for Obama.
But the company is now in bankruptcy after laying off 1,100 employees. It is under investigation by the F.B.I. for possible criminal charges involving the bankruptcy arrangement, which left taxpayers at the end of the line, rather than at the front.
Political opportunism, if not corruption, is seen by critics of the Obama administration’s handout of loan money to Solyndra, when it was known the company was on the brink of bankruptcy. Meanwhile, Solyndra executives planned to take the Fifth at congressional hearings.
The Energy Department grasps tightly to its green jobs plan, insisting it will meet its employment goals at Ford Motor Company, where it alleges it saved 33,000 jobs. That’s about half of the entire workforce of the car company in the U.S. The Energy Department says that with a loan guarantee of $5.9 billion it will enable Ford to change plants in five states so it can build more energy-efficient autos. The department imaginatively explained that the loan money would let the automaker magically “convert” regular Ford jobs to green manufacturing jobs.
A Ford spokesperson said the loans were to help change what were originally truck and SUV plants into plants with the capacity to make more fuel-efficient vehicles. New miles-per-gallon requirements imposed by the administration are forcing car makers to build smaller, lighter, more accident-dangerous vehicles.
Brookings Institution senior fellow Mark Muro, who specializes in the “clean” or low-carbon economy, says the clean economy “has remained elusive.” He has said, “Be sure to let the market provide direction when distributing subsidies, rather than seeking to stimulate this activity on a ‘top down’ basis.”
The author of “Boulevard of Broken Dreams,” Muro says that “no swath of the economy has been more widely celebrated as a source of economic renewal and potential job creation.”
Certainly green jobs have been the crown jewel of the Obama job recovery program. But the jewel appears to be a fake. Harvard Business School Professor Josh Lerner is quoted as saying, “I always take these job estimates with a big grain of salt.” Lerner has written about government efforts that have failed to stimulate targeted industries. He added, “There tends to be a lot of fuzzy math when it comes to calculating these benefits, regardless of the party taking credit for the program.”
The energy Department says its green jobs program is still on track. But it appears to be a track to the land of waste. The Post story wrote that “many economists say that because alternative energy projects are so expensive and slow to ramp up, they are not the most efficient way to stimulate the economy.” But Obama’s ears are stopped up with hope and change.
The Energy Department has said that if one of its 42 projects were in place, 65,000 jobs would be created or saved. Officials say this doesn’t include many jobs in the supply chain that depend on the U.S. staying competitive with countries such as China.
Jeffrey Immelt, General Electric Co. CEO and Obama’s jobs czar is not much help in this effort to make America employee competitive. G.E. has more employees working overseas than in the U.S., thereby setting a grand example of job creation leadership in America.
Enthusiastic backers of solar panels as one of the major “renewable” resources being pushed by the Obama administration never mention the pollution in the manufacture of solar cells. Think of the mining of ore, the processing to produce silicon and all the plastics involved. The manufacturing process consumes so much energy that solar power could be as polluting as oil or coal.
Solar has almost as many problems as wind turbines, the other major green energy source. Last September, the National Renewable Energy Laboratory of the Energy Department said in a lengthy study that it was developing offshore wind power along U.S. coast lines and the Great Lakes shorelines. The study said this would achieve 20 percent of the nation’s electricity needs by 2030.
The study emphasized Denmark, which developed its first offshore project in 1991 as a beacon of success and led Europe to increased reliance on wind power.
In Denmark, however, the Danes became aware that the poor economics of their heavily-subsidized wind energy was a major reason for the nation’s high residential electric rates. Opposition to the gigantic onshore turbines was so great that the state-owned utility finally announced last year that it would abandon plans for any new onshore wind facilities.
A Center for Political Studies (CPS) study found that 90 percent of the jobs were transferred from other technology industries to the wind industry and that only 10 percent of the wind industry jobs were newly created jobs. As a result, the study said, Danish GDP is $270 million lower than it would have been without the wind industry subsidies. Most other European countries that have tried wind power have given up on it.
Although Obama looks to Europe for his political guidance, he would be looking toward failure as with other “top down” subsidized policies.
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