by Hillary Clinton has talked about what making the Green Corps a central part of her environmental initiatives.
The idea, of course, is to reduce America’s dependency on foreign oil and reduce pollutant emissions, and thereby reverse or lessen climate change, by relying on wind, solar, and bio-fuels as sources of energy.
Sounds great. Too bad the movement is not really taking off in numbers. Can green energy companies sustain themselves and compete with other forms of energy production?
The NY Times says that there are about 8.5M so-called "green jobs" in the U.S. But what is a green job? No one seems to know how to define the term, let alone how many of these jobs there are – or could be. Steve Greenhouse of the Times wondered in the Back Story audio clip if the 8.5M number could be skewed. It’s worth noting that the study the article refers to was funded by the American Solar Energy Society.
Green jobs are especially good “because they cannot be easily outsourced, say, to Asia,” said Van Jones, president of Green for All, an organization based in Oakland, Calif., whose goal is promoting renewable energy and lifting workers out of poverty. “If we are going to weatherize buildings, they have to be weatherized here,” he said. “If you put up solar panels, you can’t ship a building to Asia and have them put the solar panels on and ship it back. These jobs have to be done in the United States.”
That’s something to consider. But in the end I don’t find that to be a compelling argument in favor of Hillary Clinton’s plan to confiscate energy companies’ profits to jumpstart industries that would employee green workers.
Why? First, consider that it’s the "prime directive" of energy companies to make money. Take the money that they make away and you encourage these companies to invest in other business opportunities, the profits from which will not be taken away by the government.
Second, the profit motive would lead energy companies to invest in the green sector if there were significant money to be made there. Since this is not happening at scale, it’s a fairly safe assumption that they expect profit margins to be lower in that field. They could be wrong, of course. But it’s their job to be right and they probably are.
Third, that profit motive is also well-known to companies that have not traditionally participated in the energy market. Again, if there are real dollars to be made in green energy the market will allocate investment to that business sector "automatically".
If the money Hillary wants to take away from Exxon, et al, is invested in green energy it’s very likely that the returns on that investment will be lower than if the money was left with the energy companies.
So I’m suspicious when Clinton and other Dems start talking about green jobs as though its some sort of previously untapped phenomenon that they discovered. They aren’t. It’s simply one more technology shift – one that is slow coming to boot – that provides new opportunities to workers with the right skills.
Time has this to say about the Green Corps:
Today there are 1.5 million Americans between 18 and 24 who are neither employed nor in school. These young men and women could address America’s well-documented infrastructure problems. The Green Corps could reclaim polluted streams and blighted urban lots; repair and rehabilitate railroad lines, ports, schools and hospitals; and build energy-efficient green housing for elderly and low-income people.
All of which is well and good. I’d certainly rather put these people to work than provide them with welfare. But that’s probably not a real choice, which means it’s a distraction.
So, the question again: Can companies sustain themselves in the green energy industry, scale their businesses, and compete with other forms of energy production?
My opinion is no, not at this time. The market’s failure to direct significant capital to the sector indicates that it is not ready yet. That’s why Hillary feels that she has to champion the idea to make it happen – because market conditions are not ready for green energy to blossom naturally.
