Green Jobs Are a Myth

by William Yeatman on October 1, 2007

CA Senator Barbara Boxer maintains that greenhouse gas emissions regulations would create “millions” of green jobs. And MN Governor Tim Pawlenty claims that compulsory emissions reductions would be a “boost” to the economy.


But are these assertions true? Not according to AEI’s Kenneth Green, who told the Senate Committee on Environment and Public Works that the laws of market economics contradict claims that green is gold:


Now, to the question of the day: do global warming initiatives “create” “new green” jobs? The short answer, I would say, is that they might do so, but only at the expense of other jobs that would otherwise have been produced by the free market. Further, I’d suggest that the end result would be significantly less jobs on net, less overall economic growth on net, and most likely, the loss of existing capital as a by-product.


The fallacious idea that one can make jobs by destroying others is a variation of Bastiat’s Broken Window fallacy. As Bastiat explained, imagine some shopkeepers get their windows broken by a rock-throwing child. At first, people sympathize with the shopkeepers, until someone suggests that the broken windows really aren’t that bad. After all, they “create work” for the glazier, who might buy food, benefiting the grocer, or clothes, benefiting the tailor. If enough windows are broken, the glazier might even hire an assistant, creating a new job.


Did the child then do a public service by breaking the windows? Would it be good public policy to simply break windows at random? No, because what’s not seen in this scenario is what the shopkeepers would have done with the money that they’ve had to use to fix their windows. If they hadn’t needed to fix the windows, the shopkeepers would have put the money to work in their shops, buying more stock from their suppliers, or perhaps adding a coffee-bar, or hiring new stock-people.


So jobs created in the wind energy sector means less jobs in the coal sector. At best, Congress’s climate initiatives would be a wash, not a “boom,” nor a “boost.”  But even breaking even is unlikely, because government would be choosing which sectors benefited and which sectors suffered, and Uncle Sam has never been an efficient arbiter of winners and losers (anyone remember Carter’s synfuels?).  


Green jobs are a myth!

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