Seeing green


Tuesday, May 5
There's a Spanish economic study making the rounds of conservative media outlets that claims that investing in "green" jobs means a net loss in employment.

According to Dr. Gabriel Calzada, a economics professor at Juan Carlos University in Madrid, for every job created in fields such as renewable energy, 2.2 jobs are lost.

A statement like that neatly kills two birds with one stone for conservatives. It proves that concern for the environment is bad for business and also proves that government has no positive role to play in the economy. Plus, it is an easy way to cast doubts on President Obama's plans to boost government funding for green energy.

Unfortunately, Calzada's "Study of the Effects on Employment of Public Aid to Renewable Energy Sources," has plenty of holes in it. And, amazingly enough, it took the free marketeers at The Wall Street Journal to point them out.

For starters, according to Keith Johnson -- a Journal reporter writing for its "Environmental Capital" blog -- Calzada doesn't identify which jobs are destroyed by renewable energy initiatives.

The point Calzada is really trying to make is that government spending on renewable energy is about half as efficient at job creation as private-sector spending. That's fair game for discussion.

Calzada also leans heavily on the idea of "opportunity cost," meaning that a dollar spent on green jobs is a dollar that can't be consumed or invested by the private sector. Thus, a job that depends on consumption might disappear or not be created.

That is a classic economic theory, but it doesn't quite apply here. Calzada is using the example of Spain, which has invested heavily in renewable energy. But Spain supported the renewable energy sector out of existing tax revenues. There were no special taxes levied.

According to Johnson, "The money the government has spent on clean energy may have edged out other government spending, but it's hard to see how it could have edged out private sector spending, especially when the Socialist government there has reduced corporate income tax rates, most recently this past January." This isn't to say that Spain, a country committed to spending more on green technology, is prospering. It has had double-digit unemployment for the past three decades and has a 14 percent unemployment rate now.

To top everything off, Calzada is a founding member of a organization called the Prague Network, which has been described as an international grouping of institutions aimed at countering the growing public unease over the effects of global climate change. He is also the founder and president of the Instituto Juan de Mariana, a Spanish libertarian think tank. And, he's a fellow with the Center for a New Europe, another libertarian think tank that has reportedly accepted $50,000 from ExxonMobil.

So, what we have here is conservatives trumpeting a study written by a economics professor who is philosophically opposed to government intervention in the economy, who believes that climate change fears are overblown and is a fellow at a think tank that takes money from the world's biggest oil company.

However, Calzada's lack of ideological neutrality isn't the sole reason why people should take this study with several grains of salt. The study's lack of hard and specific evidence that spending on renewable energy hurts the economy is more than enough. If conservatives are looking for a way to discredit Obama's clean energy initiatives, they might want to look elsewhere.


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