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Nimble government, job creating machine

Posted By Russ Roberts On August 21, 2011 @ 2:46 pm In Environment,Stimulus,Subsidies | Comments Disabled

The New York Times reports [1] that green technology might not be the job creation engine some have claimed it to be:

In the Bay Area as in much of the country, the green economy is not proving to be the job-creation engine that many politicians envisioned. President Obama once pledged to create five million green jobs over 10 years. Gov. Jerry Brown promised 500,000 clean-technology jobs statewide by the end of the decade. But the results so far suggest such numbers are a pipe dream.

“I won’t say I’m not frustrated,” said Van Jones, an Oakland activist who served briefly as Mr. Obama’s green-jobs czar before resigning under fire after conservative critics said he had signed a petition accusing the Bush administration of deliberately allowing the Sept. 11 terrorist attacks, a claim Mr. Jones denies.

A study released in July by the non-partisan Brookings Institution found clean-technology jobs accounted for just 2 percent of employment nationwide and only slightly more — 2.2 percent — in Silicon Valley. Rather than adding jobs, the study found, the sector actually lost 492 positions from 2003 to 2010 in the South Bay, where the unemployment rate in June was 10.5 percent.

Federal and state efforts to stimulate creation of green jobs have largely failed, government records show. Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.

The weatherization program was initially delayed for seven months while the federal Department of Labor determined prevailing wage standards for the industry. Even after that issue was resolved, the program never really caught on as homeowners balked at the upfront costs.

“Companies and public policy officials really overestimated how much consumers care about energy efficiency,” said Sheeraz Haji, chief executive of the Cleantech Group, a market research firm. “People care about their wallet and the comfort of their home, but it’s not a sexy thing.”

Ah, seven (!) months to determine “prevailing wage standards” in the industry. No hurry. And even then they couldn’t spend the money because consumers, even at subsidized prices, didn’t like the program.

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