Free Markets, Free People

Daily Archives: August 19, 2011


Green jobs? There’s just no market

If you don’t believe me, look at the California experience to this point.   If there’s any state in the union more amenable to and focused on providing green jobs, it has to be the Golden State.   Governor Jerry Brown pledged to create 500,000 of them by the end of the decade.

But as often the case when the central planners make their pledges, they are woefully ignorant of what the market wants.  And so rarely does what they envision ever come to fruition.  Green jobs in CA is a good example.

Remember Van Jones?  Well, when Jones left the Obama cabinet as his “Green Jobs Czar” he landed in California and has been what the NY Times calls an “Oakland activist” apparently pushing for the creation of green jobs.   And it’s not like California hasn’t tried.   It has simply failed.

For example:

A study released in July by the non-partisan Brookings Institution found clean-technology jobs accounted for just 2 percent of employment nationwide and only slightly more — 2.2 percent — in Silicon Valley. Rather than adding jobs, the study found, the sector actually lost 492 positions from 2003 to 2010 in the South Bay, where the unemployment rate in June was 10.5 percent.

Federal and state efforts to stimulate creation of green jobs have largely failed, government records show. Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.

So a “stimulus” program that spent over $93 million dollars to create 538 jobs.  Why so little in terms of takers?  Well it seems the market wasn’t interested.

The weatherization program was initially delayed for seven months while the federal Department of Labor determined prevailing wage standards for the industry. Even after that issue was resolved, the program never really caught on as homeowners balked at the upfront costs.

“Companies and public policy officials really overestimated how much consumers care about energy efficiency,” said Sheeraz Haji, chief executive of the Cleantech Group, a market research firm. “People care about their wallet and the comfort of their home, but it’s not a sexy thing.”

You don’t say … the government didn’t have a clue at what the market potential of their boondoggle actually had, so they ended up spending $172,862 for each job.  And you wonder where the money goes?

Example two:

Job training programs intended for the clean economy have also failed to generate big numbers. The Economic Development Department in California reports that $59 million in state, federal and private money dedicated to green jobs training and apprenticeship has led to only 719 job placements — the equivalent of an $82,000 subsidy for each one.

“The demand’s just not there to take this to scale,” said Fred Lucero, project manager atRichmond BUILD, which teaches students the basics of carpentry and electrical work in addition to specifically “green” trades like solar installation.

Richmond BUILD has found jobs for 159 of the 221 students who have entered its clean-energy program — but only 35 graduates are employed with solar and energy efficiency companies, with the balance doing more traditional building trades work. Mr. Lucero said he considered each placement a success because his primary mission was to steer residents of the city’s most violent neighborhoods  away from a life of crime.

You see you can fund all the job training centers in the world and run umpthy-thousands through it.  But if there is no market for the jobs, you end up spending a whole lot of money for nothing.   Again, ignorance of the market and its demands means expensive mistakes.  Of course Mr. Lucero thinks the program is a success – he got to spend free money, was employed and it didn’t cost him squat.  It cost you.

Example three:

At Asian Neighborhood Design, a 38-year old nonprofit in the South of Market neighborhood of San Francisco, training programs for green construction jobs have remained small because the number of available jobs is small. The group accepted just 16 of 200 applicants for the most recent 14-week cycle, making it harder to get into than the University of California. The group’s training director, Jamie Brewster, said he was able to find jobs for 10 trainees within two weeks of their completing the program.

Mr. Brewster said huge job losses in construction had made it nearly impossible to place large numbers of young people in the trades. Because green construction is a large component of the green economy, the moribund housing market and associated weakness in all types of building are clearly important factors in explaining the weak creation of green jobs.

Market timing is pretty important too, isn’t it?  If you introduce a product into a market in the middle of a market downturn, chances are slim you are going to be successful.  While it may all look good on paper and sound good in the conference room, the “buy” decision is still made in the market place, and in this case it is obvious that the market has no room for these workers.  Something which should have been, well, obvious.  In fact, there is precious little market for traditional construction jobs in a “moribund housing market”.   Yet there they are spending money we don’t have on job skills that are simply not in demand.

Finally there’s this bit of word salad to feast upon:

Advocates and entrepreneurs also blame Washington for the slow growth. Mr. Jones cited the failure of so-called cap and trade legislation, which would have cut carbon pollution and increased the cost of using fossil fuel, making alternative energy more competitive. Congressional Republicans have staunchly opposed cap-and-trade.

Mr. Haji of the Cleantech Group agrees. “Having a market mechanism that helps drive these new technologies would have made a significant difference,” he said. “Without that, the industry muddles along.”

You have to admire someone who tries to cloak central planning jargon in “market speak”.  Imposing a tax on thin air to drive, from above, a behavior government wants is not a “market mechanism”.  And beside, California passed it’s own version of this “market mechanism” with AB 32 in 2006.  How’s that working out?

This is how:

A SolFocus spokeswoman, Nancy Hartsoch, said the company was willing to pay a premium for the highly-skilled physicists, chemists and mechanical engineers who will work at the campus on Zanker Road, although the solar panels themselves will continue being made in China. Mayor Reed said he continued to hope that San Jose would attract manufacturing and assembly jobs, but Ms. Hartsoch said that was unlikely because “taxes and labor rates” were too high to merit investment in a factory in Northern California.

Irony … central planning fails in CA while jobs end up in increasingly capitalistic China.  Again, ignorance of the market causes disappointing results.  Somehow I feel this came as a surprise to Mayor Reed … after he’d spent whatever of your money he’d committed to this project.

~McQ

Twitter: @McQandO


Fratricide — The left defending Obama from the left

A couple of things have popped up on the radar screen concerning discontent on the left with Obama.  It has gone from being a simmering thing discussed among the leftists to something that is becoming more commonly and openly expressed by Democrats.   Two examples serve to make the point.

One came out of New Mexico where a Obama campaign Obama for America (OFA) New Mexico State Director Ray Sandoval let loose on critics of Obama, to include Paul Krugman and progressive bloggers he calls “Firebaggers” (most likely from the name FireDogLake, an extreme left “progressive” blog).  A sample:

Paul Krugman is a political rookie. At least he is when compared to President Obama. That’s why he unleashed a screed as soon as word came about the debt ceiling compromise between President Obama and Congressional leaders – to, you know, avert an economic 9/11. Joining the ideologue spheres’ pure, fanatic, indomitable hysteria, Krugman declares the deal a disaster – both political and economic – of course providing no evidence for the latter, which I find curious for this Nobel winning economist. He rides the coattails of the simplistic argument that spending cuts – any spending cuts – are bad for a fragile economy, ignoring wholeheartedly his own revious [sic] cheerleading for cutting, say, defense spending. But that was back in the day – all the way back in April of this year. [...]

No, the loudest screeching noise you hear coming from Krugman and the ideologue Left is, of course, Medicare. Oh, no, the President is agreeing to a Medicare trigger!!! Oh noes!!! Everybody freak out right now! But let’s look at the deal again, shall we? [...]

Now let’s get to the fun part: the triggers. The more than half-a-trillion in defense and security spending cut "trigger" for the Republicans will hardly earn a mention on the Firebagger Lefty blogosphere. Hell, it’s a trigger supposedly for the Republicans, and of course, there’s always It’sNotEnough-ism to cover it.

This is an example, I think, of the level of frustration this early on that the campaign is experiencing.  Paul Krugman, other than thinking the administration should have spent much more on stimulus, has been a pretty reliable water carrier for those folks.  He can’t catch a break.  Vilified and fisked regularly by the right, he’s now being denounced by the left.   And you have to love the irony of the first sentence.  If ever there was a political rookie in way over his head, it’s Sandovol’s boss.   It’s obvious and it is the driver of much of the frustration.

However, on the other side of that, what Democratic Representative Peter Defazio (D – OR) said should be even more disconcerting to the Obamians.   He’s pretty frank in his appraisal of the man in the White House.  And his appraisal is one shared by many, at least those without political blinders on:

In his Eugene office Wednesday, Defazio accused the President of lacking the will to fight for the promises he made to get elected

“Fight? I don’t think it’s a word in his vocabulary,” said DeFazio. “ I mean come on he pledged as a candidate to make the Bush tax cuts for people making over $250,000. He repeatedly said that as president. Then the Republicans telegraphed to him they were going to use a fake crisis over the debt limit in order to muscle some major spending reductions or other things on to him. And that was in December. And what happens? Suddenly he flip flops and concedes everything to the Republicans.” DeFazio said.

Asked whether he thought the President had a shot at re-election, Defazio was skeptical.

“At this point it pretty much depends on how far out there the Republican nominee is. You know with a respectable, someone who is a little bit toward the middle of the road Republican nominee, he’s going to have a very tough time getting re-elected,” said DeFazio.

Now again, DeFazio would fall in what Sandovol calls the “It’sNotEnough” [sic] crowd.  However, the real point is the fact that regardless of where anyone is coming from in their denunciation of Obama, they almost universally agree he isn’t much of a fighter, or leader.  If you’re running for re-election, that is not something you want hung around your neck.

DeFazio also hits on a truism for the GOP – the “further out” the GOP candidate is, the more likely that Obama, warts and all, has a shot at re-election. 

But back to DeFazio’s musings:

He’s also not convinced the President will do well in Oregon.

“I believe Oregon is very much in play. I mean we are one of the harder hit states in the union, particularly my part of the state. I’ve just done six town hall meetings, have seven to go but people are shaking their head and saying ‘I don’t know if I’d vote for him again.’” Defazio said.

Asked if he was surprised, the congressman shrugged.

“Not at all. One guy asked me … give me 25 words what he’s about and what he’s done for me. I’m like … ‘it could have been worse?’” DeFazio said.

If Oregon is really in play, Obama has major problems.

I have to admit, had I been the reporter doing the interview, the next question that would have come to my mind, given his 25 words is, “Really?  How”?

~McQ

Twitter: @McQandO


Ignoring the law to buy votes

One of the bits of genius installed by the founders of this country was three co-equal branches of government, each responsible for a different part of the governing turf.  And the function of the three is not only to be the primary governmental institution in its explicit area of control, but to serve as a "check” on the others and provide “balance” by not letting one branch get more powerful than another.

In the area of immigration, to this point, the executive branch, under Barack Obama, has mostly done that with notable exceptions.   But now, it appears, all appearances of following the law as laid down by Congress seems to have been thrown under the bus.   The Obama administration has, for all intents and purposes, decided what how the law will be interpreted whether Congress likes it or not.   After all, there’s an election in the offing, activist groups to be satisfied and votes to be bought:

Bowing to pressure from immigrant rights activists, the Obama administration said Thursday that it will halt deportation proceedings on a case-by-case basis against illegal immigrants who meet certain criteria, such as attending school, having family in the military or having primary responsible for other family members’ care.

The move marks a major step for President Obama, who for months has said he does not have broad categorical authority to halt deportations and said he must follow the laws as Congress has written them.

But in letters to Congress on Thursday, Homeland Security Secretary Janet Napolitano said she does have discretion to focus on “priorities” and that her department and the Justice Department will review all ongoing cases to see who meets the new criteria.

“This case-by-case approach will enhance public safety,” she said. “Immigration judges will be able to more swiftly adjudicate high-priority cases, such as those involving convicted felons.”

Right … and to totally ignore cases against illegal immigrants who meet the arbitrary standards the administration finds to be “acceptable”.

This, of course, makes it clear to any illegal immigrant what the bare minimum is necessary to avoid deportation.  It’s a government sponsored “okay” to stay illegally.  Just meet one of the criteria (or appear too) and we’ll ignore the law for you.

However you feel about illegal immigration, we’ve always featured ourselves as a nation of laws, not men.   A nation of laws is one which follows laws and, if they don’t like the law, feel it is fair, or whatever, go through the process of changing the law or abolishing it.   What a nation of laws doesn’t do is ignore the law or arbitrarily pick and choose the parts it will follow.   Imagine, if you will, deciding that you weren’t going to follow certain laws because you felt they were unfair.  Say, doing 25 in a school zone.  You tell the officer who stops you that doing 25 is not fuel efficient and you’ve chosen to ignore it and do 45.  How far do you think that would get you in terms of avoiding a ticket?

In this case we have an administration that has decided to pick and choose what part of laws it will enforce.  It isn’t the first.  But this sort of blatant disregard for enforcing the law is both dangerous and something which needs to be stopped and stopped now.

If the executive branch finds a law to be something it has concerns or problems with, it’s recourse should be changing it through the legislative body, per the Constitution.   Or taking it to the Judicial branch for a Constitutional check, if that’s appropriate.  What it must not do is precisely what it is doing – ignoring Congress and literally taking the law into its own hands. 

That is the law of men – arbitrary, selective, dangerous and wrong. 

~McQ

Twitter: @McQandO

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