‘Green Jobs’ Boom Unlikely With Increased Regulation (Sen. James Inhofe)

With the backdrop of a severe recession, President Obama and Congressional Democrats are pitching the ideas that the regulation of greenhouse gases will result in a “green job” boom and have the desirable side-effect of cleaning up the environment. In short, limiting carbon and other greenhouse gas emissions will force Americans to turn to clean energy sources that will employ millions of people. Reality, however, suggests otherwise. In all likelihood, energy bills will rise, manufacturing costs will soar, and there will be an exodus of well-paying jobs.

Need proof? A review of the impact of similar policies in Europe and California provide the evidence. In December, nearly 11,000 metal workers protested similar policies in Brussels for fear of continued outsourcing. In Germany, auto manufacturers have also argued against such strict cuts. Italy protested that new policies would cost its industries up to 20 billion euros. In California, as noted by the Wall Street Journal, state-commissioned economists lambasted the supposedly positive impact of strict greenhouse gas cuts. WSJ columnist Stephen Moore wrote:

“Other states are plundering the Golden State’s industries by convincing businesses to pick up stakes and move out before the cap-and-trade earthquake hits.The state has the fourth-highest housing foreclosure rate in the nation, has lost more businesses than any state in recent years, and is facing a $40 billion deficit. With cap and trade firmly in place, the economic situation is only likely to get worse.”

Green jobs currently enjoy significant government subsidies, and where market circumstances make sense, they will continue to grow at a healthy rate. Case in point, good green jobs are already being created in towns from Tulsa, Oklahoma to Toledo, Ohio to Newton, Iowa. The questions become: How much more is appropriate to subsidize and at what pace? What regions of the country will be winners and losers? And what is the quality and working conditions of these new jobs?

Certainly, the short-term impact of green mandates on the U.S. economy will also depend not just on how many jobs they create but how much income that they generate. A Feb. 3 report by “Good Jobs First,” a coalition of labor and environmental groups, makes this exact argument. Their report finds that low pay is not uncommon in the [green jobs] workplace and that wage rates at many wind and solar manufacturing facilities are below the national average for workers employed in the manufacture of durable goods. They also confirm that some U.S. wind and solar manufacturers have already begun to offshore production of components destined for U.S. markets to low-wage havens such as China and Mexico. These findings hardly represent the panacea that many green jobs proponents advocate.

In short, mandatory carbon caps will force energy providers to utilize much more expensive renewable energy, which will be passed on to already short in the pocket consumers. American businesses will be able to avoid these costs through outsourcing. Like California, but on a national scale, U.S. jobs will migrate to China, India and other emerging markets. We have seen the impact of European and Californian policies and we must recognize the lessons learned, so as not to blindly follow them down the same dark green path.