Green Jobs: Myth vs. Reality

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Green Jobs: Myth vs. Reality

In October 2008, the State of California released its official report on what's known as The Global Warming Solutions Act of 2006, which is intended to reduce greenhouse gases to 1990 levels by the year 2020.1  The report claims that implementing this plan, far from costing money, will actually make money.  It asserts, "the Plan will benefit California's economy above and beyond the business-as-usual projections, in 2020, by: 

  • Increasing production activity by $33 billion
  • Increasing overall Gross State Product by $7 billion
  • Increasing overall personal income by $16 billion
  • Increasing per capita income by $200
  • Increasing jobs by more than 100,000

As a result of this and many other public statements, the concept of "green jobs" has generated a great deal of enthusiasm, particularly as the economy has suffered.  The idea is that cleaning up the environment and limiting pollutants can be made into a business that employs people and contributes to our national and global "economic well-being."  In fact, part of the new administration's plan for economic recovery involves stimulating industries that will be involved in this effort with the aim of creating jobs. 

But as Robert Murphy pointed out in a recent column at,2outside experts came down on California's economic analysis with both feet.  For example, the Legislative Analyst's Office of California called the economic evaluation "inconsistent and incomplete" and said that there was no information in the report to show how people were going to make money by cleaning up the

Robert Stavins, the Director of the Environmental Economics Program at Harvard University, who formerly served as chairman of the Economic Environmental Advisory Committee of the Environmental Protection Agency, called the analysis "terribly deficient in critical ways."

Similarly, the federal government's green vision also appears filled with "pie in the sky" optimism, backed up with very little hard analysis.  In a recent article, the editors of Investor's Business Daily4 expressed doubt that the new administration's plan to stimulate the economy with green investments will work...

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