Only job Ritter created was his own

March 3, 2011 by Amy
Filed under: Archive, New Energy Economy 

In a recent New York Times editorial former Governor Bill Ritter reveals the magic formula for states with struggling economies – just “create” green jobs the way he did in Colorado! In reality, the only job he created was his own.

Ritter starts by empathizing with other governors as they wrestle “with budget issues, making unenviable choices on which services, programs or salaries to reduce or eliminate, and deciding whether higher taxes and fees are viable.”

He laments that state leaders are “hemmed in by state requirements that the budget be balanced without deficit spending.” He understands how “daunting” and “all-consuming” these decisions can be.

Fortunately, Mr. Ritter offers a solution – use government force to “create” green jobs! He signed 57 pieces of new energy legislation during his one term in office that apparently lured wind and solar companies and “thousands of new jobs” to the centennial state.

A recent Slate Magazine article from Bjorn Lomborg explains the simplicity of the green energy economics that Ritter promotes:

On the face of it, green-job creation seems straightforward. Deploying more wind turbines and solar panels creates a need for more builders, technicians, tradesmen, and specialist employees. Voilà: Simply by investing in green policies, we have not only helped the climate but also lowered unemployment. Indeed, this is the essence of many studies that politicians are eagerly citing. So what did those analyses get wrong?

Too bad economic reality doesn’t cooperate.  First, there are obvious problems, such as the fuzzy definition of “green jobs” and the temporary status of many green jobs. Most importantly, and most costly, are the consequences of “New Energy Economy” that Ritter does not acknowledge but Lomborg does:

The Copenhagen Consensus Center asked Gürcan Gülen, a senior energy economist at the Bureau for Economic Geology at the University of Texas at Austin, to assess the state of the science in defining, measuring, and predicting the creation of green jobs. Gülen concluded that job creation “cannot be defended as another benefit” of well-meaning green policies. In fact, the number of jobs that these policies create is likely to be offset—or worse—by the number of jobs that they destroy.

We’ve written in the past that renewable energy sources are significantly more expensive than traditional sources. Lomborg explains this has a disastrous affect on the economy:

Increasing the cost of electricity and fuel will hurt productivity, reduce overall employment, and cut the amount of disposable income that people have. Yet many studies used by advocates of green jobs have not addressed these costs at all—overlooking both the cost of investment and the price hikes to be faced by end users.

The high cost of “creating” green jobs “could end up resulting in net job losses.” That’s economics 101.

Lomborg adds that the only companies clamoring for government-sanctioned “New Energy Economy” policies are those that stand to benefit from taxpayer and ratepayer subsidies. That is certainly the case in Colorado.

Time for a “New Energy Economy” reality check:

The economic reality of the “New Energy Economy” does not support Ritter’s claim that states can cure their economic woes through a government-coerced employment plan. However, there is one job that was “created” by the “New Energy Economy” – Governor Bill Ritter’s new $300,000 position as director of the Center for the New Energy Economy at Colorado State University. For Ritter, high energy prices and other job losses are worth it.

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One Comment on Only job Ritter created was his own

    [...] regulation and subsidies to create market winners and losers in the energy sector. Measuring the potentially ephemeral nature of many of these “thousands of new jobs” is a key component of the Leeds survey, though calculating the actual cost to taxpayers of each new [...]