Saturday, October 25, 2008

Green tech

Although I have already discussed the subject of "green jobs" before I think it needs to be revisited. The drumbeat on the subject grows ever louder with Barack Obama, John McCain, Thomas "E.T." Friedman, various think tank scholars and the UN Secretary General among others all proclaiming a need for government policies to promote environmentally friendly industries to save us from an impending ecological nightmare.

Anyone paying even a cursory amount of attention to the presidential campaign has probably heard Barack Obama talk about how he is going to help create 5 million jobs that help secure a more environmentally friendly future. As his website states his energy plan will:
  • Help create five million new jobs by strategically investing $150 billion over the next ten years to catalyze private efforts to build a clean energy future.
There are two key flaws here. The first is that five millions jobs will result from Obama's initiave. We know this is false if for no other reason that anytime you hear a politician quote some nice round number like five million you can be sure they pretty much pulled it out of thin air. Equally falacious is the notion of the government "strategically investing" $150 billion. This conjures up images of brilliant government workers pouring over large reams of data and making careful unbiased decisions about what technologies present the best option to advance our renewable energy future.

This is fantasy.

The notion that government workers will make better decisions about where to invest taxpayer money than either venture capitalists or people who actually work in the energy sector investing their own money is ludicrous on its face. Furthermore, with $150 billion at stake you can be sure that the lobbyists will swarm to grab their slice of the government pie. The fact that Obama is oblivious to this reality speaks to either vast ignorance on his part, a willfull desire to mislead the public, or an arrogant belief that someone the government on his watch will function differently than every other one in the course of history. For a more thorough description of the flaws presented here I strongly urge a quick read of this.

Obama, however is hardly alone with John McCain also eagerly jumping on the eco-bandwagon. As states:
Climate change is the single greatest environmental challenge of our time. The facts of global warming demand our urgent attention, especially in Washington...We can no longer deny our responsibility to lead the world in reducing our carbon emissions.

John McCain has announced The Lexington Project, a comprehensive energy and climate strategy to provide America with secure sources of energy, ensure our continued prosperity, and address global climate change. This plan includes the elements necessary to achieve these objectives by: producing more power, pushing technology to help free our transportation sector from its use of foreign oil, cleaning up our air, addressing climate change, and ensuring that Americans have dependable energy sources.
Not that differences don't exist, but they aren't exactly night and day.

Attending an event at the Center for Strategic and International Studies this week I listened to one representative from the Brookings Institution describe renewable energy as a "huge economic opportunity." A scholar at CSIS spoke of the "unfolding drama and tragedy of climate change" while a senior member of Japan's Ministry of Foreign affairs invoked the scenario described in the movie The Day After Tomorrow as a very real possiblity.

No less than the UN Secretary General has called for a Green New Deal this week to help ward off environmental catastrophe while simultaneously promoting job growth:
At a time when the global economy is sputtering, we need growth. At a time when unemployment in many nations is rising, we need new jobs. At a time when poverty threatens to overtake hundreds of millions of people, especially in the least developed parts of the world, we need the promise of prosperity. This possibility is at our fingertips.

Economists at the UN call for a Green New Deal, a deliberate echo of the energising vision of US president Franklin Roosevelt during the Great Depression of the 1930’s. Thus, the UN Environment Programme is launching a plan for reviving the global economy while dealing simultaneously with the defining challenge of our era, climate change.

The plan urges world business and political leaders, including a new US president, to help redirect resources away from the speculative financial engineering at the root of today’s market crisis and into more productive, growth-generating, and job-creating investments for the future.

This new ‘Green Economy Initiative’, backed by Germany, Norway, and the European Commission, arises from the insight that the most pressing problems we face are interrelated. Rising energy and commodity prices helped create the global food crisis, which fed the financial crisis. This, in turn, reflects global economic and population growth, with resulting shortages of critical resources such as fuel, food, and clean air and water.
While rhetoric about how a food crisis led to the current financial crisis and praise for the "energizing New deal" suggests that those with a deep skepticism of the UN are entirely correct, more disturbing is the continuing notion at work here that governments should be picking and choosing industry winners.

Meanwhile, amidst all the talk, the price of oil has plummeted to around $70 per barrel. But the narrative about disappearing fossil fuels and impending shortages has already been written, and I have no expectations that this development will change anything.

Perhaps the really funny thing here is that Obama, Friedman, various government officials and think tank scholars along with the UN Secretary General all favor profound government interventions despite a history suggesting that this would be nothing more than another boondoggle. The Japanese official I mentioned even cited a piece of visual fiction to help illustrate the gravity of the situation.

But Sarah Palin is the dangerous idiot.

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