Are Depressions Green? (An Update)

In March 2009, I posted a blog over at MasterResource.Org entitled, “Are Depressions Green?” What prompted that piece was speech by Cambridge University economist Terry Barker at the Copenhagen climate conference.

Barker told delegates that the Great Depression of the 1930s reduced global CO2 emissions by 35%. He opined that if the current economic downturn persists for several years, it might cut global emissions in half.

Citing the International Energy Agency’s CO2 Emissions from Fuel Combustion Highlights (2005 Edition), I offered additional proof of the emission-cutting power of economic collapse. From 1990 to 2003, CO2 emission declined 38% in Bulgaria, 35.3% in Estonia, 52.3% in Latvia, 43.5% in Lithuania, 43.3% in Rumania, 24.5% in Russia, 30.2% in the Slovak Republic, and 50.1% in Ukraine.

I commented:

So clearly, governments do have the power to achieve deep emission cuts in in a single decade or even in a few years. However, there’s not a shred of historical evidence that they can do this without first engineering severe economic contractions.

A new study by University of Exerter scientist Pierre Friedlingstein and colleagues finds that from 2008 to 2009, global emissions declined by 1.3%, the first time since the late 1990s. There were significant regional differences, depending on whether a country’s economy was shrinking or growing. As summarized by USA Today:

The largest decreases occurred in Europe, Japan and North America: 6.9% in the United States, 8.6% in the U.K., 7% in Germany, 11.8% in Japan and 8.4% in Russia.

In contrast, emissions jumped in emerging economies, including 8% in China and 6.2% in India. China remains the top emitter of carbon dioxide from the burning of fossil fuels, followed by the USA, India, Russia and Japan.

A question for the greenhouse lobby: If depressions induce deep emission cuts, then wouldn’t mandating deep cuts prolong or intensify our current economic woes?

Seems like a no-brainer, but they’ll tell you that putting a price on carbon will stimulate the creation of “green jobs” (like window caulkers?) and “industries of the future” (like windmills?). Our friends at the Institute for Energy Research summarize and link to several studies debunking the green jobs myth. 

Here’s how I ended “Are Depressions Green?”:

So-called green industries and jobs were bit players even when the economy was booming. That’s because even when credit markets were flush and fossil energy prices were high, green industries were relatively unproductive. For example, as my colleague Iain Murray estimates, one coal-industry job supports seven times as much electricity as one wind-industry job.

It strains credulity to claim that diverting capital and labor from, e.g., the coal industry to the wind industry will create a macroeconomic benefit, or that economic recovery can be built on jobs and industries that depended heavily on subsidies, tax preferences, and mandates even in prosperous times.