Showing posts with label green jobs. Show all posts
Showing posts with label green jobs. Show all posts

Tuesday, December 11, 2012

Chart of the Day: The Bursting of the Renewable Energy Bubble

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Environmental politics expressed through “manmade global warming” or now revamped as “climate change” has basically the same intent: promote political favored energy, as well as, establish social controls to supposedly protect the climate.

Yet the public hardly realizes that when government intervenes the result has always been the same: imbalances emerge and the laws of economics ventilated through markets will correct them.  This is simply the law of unintended consequence.

The renewable energy industry, which has been the principal beneficiary from climate change policies, have been thrashed by marketplace. Moreover politicization has led to unethical practices or has exposed cronyism such as the Solyndra scandal.

The chart above consisting of the market cap of the 30 of the world’s largest renewable energy companies has plummeted by more than 90% since the 2008 peak. 

From oversupply or to a build up of high capacity, to high energy prices, to the realization of fiscal realities and the European debt crisis, and to the stalemate in global climate negotiations, as explained by the Washington Times (chart also from them, hat tip AEI’s Mark Perry), has brought such politically hyped-to-the-firmament expectations back to earth.

Such outcome has been diametric to the largely free market based Shale gas revolution.

Bottom line: the market eventually explodes the illusions brought upon by politically inflated bubbles.

Saturday, November 03, 2012

CFR: US President Obama’s Renewable Energy Jobs Comes at High Cost to Taxpayers

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The highly connected and the alleged most influential think thank, the Council of Foreign Relations (CFR) on their blog says that US President Obama’s subsidies to green energy industry comes at the great cost to US taxpayers.
The Joint Committee on Taxation estimates that energy-related tax preferences will cost Americans $5.4 billion this year. Half of this, $2.7 billion, will benefit green sectors: $1 billion in nuclear subsidies, $1.3 billion in wind-energy credits for electricity production, and $400 million in solar-energy property credits.

So-called “section 1603” renewable energy grants, part of the 2009 fiscal stimulus package, will cost taxpayers a further $5.8 billion. If we assume that the grants are awarded across sectors in the last five months of this year as they were in the first seven, then the nuclear, solar, and wind energy sectors will receive $4 billion of this, boosting total green-sector subsidies to $6.7 billion this year.

Taxpayers will also provide $700 million in energy-efficient property credits. The credits apply mainly to solar, though we don’t know the precise allocation – so we leave it out of the figure, which therefore understates the cost of solar-backed jobs.

Dividing the total wind, solar, and nuclear subsidies by the number of Americans employed in these sectors (252,000), they are currently generating jobs at an average annual cost to taxpayers of over $29,000. Wind jobs cost taxpayers nearly $47,000 per job per year.

By way of comparison, the coal, oil, and gas sectors receive $2.7 billion in subsidies annually, and employ about 1.4 million Americans. The taxpayer-cost per job in these sectors is therefore just over $1,900.

The bottom line is that green-energy jobs cost taxpayers, on average, 15 times more than oil, gas, and coal jobs. Wind-backed jobs cost 25 times more.
That’s how cronyism works; taxpayers subsidize political pet projects operated and maintained by allies and friends. In return, the benefactors reciprocate through generous campaign donations, silent partnerships and other unscrupulous means of compensation.

This dynamic will hardly change no matter who wins next week in the presidential elections.

Saturday, October 08, 2011

Solyndragate: Emails Implicate the Obama Administration

More evidences of crony capitalism from President Obama’s ‘green jobs’ policies.

From the Business Insider (bold highlights mine)

The White House released a bunch of emails related to the Solyndra bankruptcy scandal to Congressional investigators today, in what has become a regular Friday evening email dump.

The emails, obtained by several news organizations, implicate the most senior levels of the Obama administration in scandal, which has tainted the White House since the solar company went bankrupt last month, leaving taxpayers on the hook for a $534 billion federal loan.

Here are the highlights:

One email, obtained by the Washington Post, suggests that Obama and/or his chief of staff Rahm Emanuel was actively involved in trying to get Solyndra's loan application approved in time for a September 2009 press conference.

“Ron said this morning that the POTUS definitely wants to do this (or Rahm definitely wants the POTUS to do this?),” one White House staffer told an Obama scheduler on Aug. 17, 2009, referring to Ron Klain, former chief of staff for Vice President Joe Biden.

Steve Spinner, an Obama fundraiser who worked in the DOE loan department, repeatedly pushed the chief loan officer to expedite approval of Solyndra's loan — despite the fact that his wife worked for the law firm representing Solyndra. The firm received at least $2.4 million in fees related to the loan, according to the AP. DOE officials have previously stated that Spinner did not "actively participate" in Solyndra's application.

“How [expletive] hard is this? What is he waiting for? Will we have it by the end of the day?” Spinner wrote on Aug. 28, 2009. “I have OVP [Office of Vice President] and WH [White House] breathing down my neck on this. They are getting itchy to get involved if needed. I don’t want that.”

Read more here

Political distribution of scarce resources extrapolates to favoritism, nepotism and cronyism which results to the gaming of the political economy that ultimately leads to corruption.

As Ludwig von Mises wrote,

Corruption is an evil inherent in every government not controlled by a watchful public opinion.

Saturday, September 17, 2011

Video: Jon Stewart on President Obama’s Solyndra Green Jobs Scandal

President Obama’s green jobs showcase… (hat tip: Lew Rockwell blog)
The true engines of economic growth will always be companies like Solyndra...

It's here that companies like Solyndra are leading the way towards a brighter and most prosperous future
…appears to collapsing into a scandal.

Here is the Daily Show Jon Stewart’s comical take…

Friday, September 16, 2011

Green Jobs: The Anatomy of Government Failure

From the Washington Post, (bold emphasis mine)

A $38.6 billion loan guarantee program that the Obama administration promised would create or save 65,000 jobs has created just a few thousand jobs two years after it began, government records show.

The program — designed to jump-start the nation’s clean technology industry by giving energy companies access to low-cost, government-backed loans — has directly created 3,545 new, permanent jobs after giving out almost half the allocated amount, according to Energy Department tallies.

President Obama has made “green jobs” a showcase of his recovery plan, vowing to foster new jobs, new technologies and more competitive American industries. But the loan guarantee program came under scrutiny Wednesday from Republicans and Democrats at a House oversight committee hearing about the collapse of Solyndra, a solar-panel maker whose closure could leave taxpayers on the hook for as much as $527 million.

The GOP lawmakers accused the administration of rushing approval of a guarantee of the firm’s project and failing to adequately vet it. “My goodness. We should be reviewing every one of these loan guarantee” projects, said Rep. Marsha Blackburn (R-Tenn.).

Obama’s efforts to create green jobs are lagging behind expectations at a time of persistently high unemployment. Many economists say that because alternative-­energy projects are so expensive and slow to ramp up, they are not the most efficient way to stimulate the economy.

“There are good reasons to create green jobs, but they have more to do with green than with jobs,” Princeton University economics professor and former Federal Reserve vice chairman Alan Blinder has said.

The loan guarantee program can also be unwieldy. It works like this: Companies negotiate with the Energy Department for a government loan guarantee, which means taxpayers will pay off bank loans if the project fails. Then the Office of Management and Budget must sign off on the guarantees, often changing terms…

Solyndra’s closure prompted concerns about whether the administration made good bets in the rest of its portfolio of clean-tech projects it had helped subsidize with taxpayer-guaranteed loans. The primary investors in Solyndra were funds tied to a major Obama fundraising bundler, Tulsa oilman George Kaiser.

My take:

Again the article proves that there hardly has been any qualm for political authorities to spend on other people’s money because they won’t be held accountable for decision failures.

The political process of picking winners does not guarantee success.

Wrong decisions by political stewards ultimately mean higher taxes which decreases the competitiveness of the economy. Oh don’t blame globalization for the effects of stupid domestic policies.

Importantly, this has been lucid evidence of how central planning fails and how politics can’t subvert the will of the markets.

With taxpayer guarantees, the political beneficiaries of loans (stimulus) from the government are not only protégés of the administration (crony capitalism) but notably have not been subject to the discipline of market forces, and thus, can or will recklessly handle finances even to the risk of finagling them. Call it corruption and moral hazard.

Wednesday, September 09, 2009

John Stossel: The Green Jobs Fallacy

John Stossel explains Frederic Bastiats's Broken Window Fallacy applied by governments to create so called "Green Jobs".

(HT:
Heritage Blog)