Free Markets, Free People

jobs proposal

Is Obama’s jobs proposal just an old, tired, costly and failed rerun?

So what will the much anticipated jobs proposal by President Barack Obama look like? Will it be big, bold and audacious? Or a tired rerun?

Well if the hints coming out of the administration are to be taken seriously, it will be something along the lines of a giant Works Progress Administration project.  The WPA was a depression era jobs program that essentially tried to keep the unemployed busy with make-work infrastructure projects.  It appears the same sort of project will be the center piece of the Obama proposal:

White House aides gave some clues Wednesday when they revealed the president had discussed with his Jobs and Competitiveness Council an initiative aimed at having construction workers retrofit commercial buildings to make them more energy efficient.

Both Obama and former president Bill Clinton have touted the retrofitting concept as a way to create up to 1 million jobs, according to the Jobs Council.

Obama talked about those plans Wednesday on a conference call with General Electric Chief Executive Jeffrey Immelt and American Express Chief Executive Ken Chenault, who co-chair the jobs council, said deputy White House press secretary Josh Earnest.

“They discussed a number of the proposals that the Jobs Council has been developing,” Earnest told reporters during his daily briefing in Martha’s Vineyard, where Obama is vacationing with his family. “And the president solicited their input on the policy — again, on the policy process that’s underway related to the major economic address that the President will deliver after Labor Day.”

The project would put people to work and improve the environment, Immelt and Chenault wrote in a June op-ed in the Wall Street Journal.

That’s right, construction workers would be put to work improving the “energy efficiency” of commercial businesses.  Absolutely no opportunity there for waste, fraud and abuse, is there?  And, of course, where the dire need for jobs lies – the private sector – this will have little effect.  And if California’s experience with the same sort of program is any indication, this sort of program will have little effect as well.  You see, it’s been tried before in another form with stimulus money.  Results?

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.

[…]

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.”

$93 million or so dollars later, 538 jobs were created.  Epic fail, right?   A perfect reason to do it again, apparently.  And why will it most likely fail again?

Well, here’s a clue:

“More than two million construction workers don’t have work,” they wrote. “Every city in America has commercial buildings that can be made more energy efficient. Both the private and public sectors can step up to create good jobs and save energy.”

The clue? Underlined in the emphasized quote. Is there an actual market for the plan? In other words, is the "private sector" willing to spend the money necessary to upgrade its energy efficiency or not? Obviously, as in California, the central planners haven’t a clue. They’ve done no market research.  So I suspect the outcome of such a program will be much like that experienced in perhaps the greenest state of the union – a failure.

Oh, and big idea 2? 

Earnest said the president also discussed ideas aimed at increasing the number of engineers who graduate from U.S. colleges and universities.

That’ll certainly impress the millions not unemployed as something that will directly and quickly benefit them.

Finally:

It is not clear how much either of these two proposals would cost or how they would be paid for. But with a new Congressional Budget Office report released this week showing unemployment remaining above 8 percent through 2014, there will be pressure on Obama to be bold in his jobs plan.

You really don’t need the CBO to score this turkey, we’ve seen this all before and we know the outcome.  It will cost billions and billions, will have little or no effect and Obama will try to tar the Republicans who point out what a loser of an idea this is as extremists who aren’t concerned with jobs.

However, anyone who seriously looks at the two proposals – a WPA project which will require private investment and more engineers in college – will recognize this is just more of the Obama smoke and mirrors regime.  There is nothing that seriously addresses the long-term structural unemployment problem in this country or addresses the need to provide incentive to the private sector to hire and expand.  It is again the left’s usual answer – expensive and marginal government programs that end up time after time failing because those proposing them haven’t a clue about how markets really work.

I recognize that there may be other proposals included in the president’s total package, and, in fact, he may cover some of the things I’ve noted as missing.  If so, I’ll analyze them when they’re made public.   But these are the proposals the White House felt it was important to leak to the press prior to the Obama Labor Day jobs speech.  If these are the center pieces of his jobs proposals, then the administration has nothing new to offer and is running on empty.

But many of us have noted that for quite some time.  This would only make it official.

~McQ

Twitter: @McQandO