Tuesday, December 2, 2008

Green Mirage?

"The notion that green investments would be large, permanent net creators of jobs is mostly a mirage. Somehow these investments must be paid for. If that happens through higher prices, higher taxes or cuts in other government programs, then most green jobs will substitute for other types of jobs."

Robert Samuelson, "Obama's Economic Choice," Washington Post, December 1, 2008

Nothing like an economist throwing cold water on a fashionable idea. But I have to admit that sometimes when people talk green jobs they are really talking about government training programs or subsidized jobs, which certainly have their place, but do not represent a market-based explosion of green. And I think the green jobs movement now recognizes that a green plumber is a plumber.

But economies do grow over time with the right kinds of investments. Different types of infrastructure, whether roads, ports, or the internet, do provide platforms for private sector innovation and growth -- and thus job creation. These longer term effects in a world of global warming and diminishing oil suggest larger payoffs and job creation from smart investments in energy independence. But in the here and now? We need to put in place the policy framework, prioritize key investments, and innovate on the ground.

1 comment:

MovieOverlord said...

They will be marketbased if we define the market to limit pollution - and regulation often defines the real market and is common to all markets today.

For example none of the cars currently on the road are market based except for the fact that we have defined the market as one that limits pollution from the tailpipe. Thus the 50 mpg Honda civic from 1970's can no longer be sold becuase it emits too much pollution.

"Marketbased" does not mean UNREGULATED market.

We don't have any unregulated markets in the world as far as I can tell.

Thus the green markets that will be defined by new regulations and needs will be just as legitimate "market based" markets as anything else that exits within a system of laws for the public good.

Also society always chooses what it wants to be manufactured either by massive numbers of individual purchases or collective legislation through representative government. Both are just as legitimate.

Any improvements to society that cause greater efficiencies or sustainability in society are increases in REAL WEALTH and just as legitimate no matter what funds (government or private industry) are used to pay them. If you truly believe that collective money cannot be allocated for improvements in real wealth by a bureaucracy then you certainly can't believe in the stock market either since stock investment is collective money allocated by bureaucracy of the board and its officers based on their best GUESS as to what is going to produce for society. The only difference is they have often worse shorter term goals driven by short term profit however they have no better judgment as is proven by over building in all sorts of sectors.

Don't fall into the common trap of repeating right wing nonsense that has never been supported by the evidence. We have to retrain a whole generation of people who were brainwashed by the propaganda false economic nonsense put out by paid, institutional hacks for the Mellon family like the Heritage Institute.

Also government borrowed funds are not "stolen wealth" since the money didn't exist before the government printed it. It is no more "stolen" than investment of stock proceeds into a companies capital improvement project or a company borrowing money on bonds.

Money exists to BE ALLOCATED. Money untraded for improvement is paper sitting on a shelf. Money is not a real thing. It is a paper government invention that exists to spur exchanges in the economy and to sponsor capital improvements.

Capital improvements are real and any time you can trade paper for real infrastructure improvement for society society has increased its real wealth.