A recent article described a brief dispute during a confirmation hearing between Senator Ted Cruz and President Biden’s pick for Secretary of Transportation, Pete Buttigieg. In response to Cruz complaining that Biden’s executive order killing the Keystone XL pipeline eliminated 11,000 jobs, Buttigieg is described as responding, and an accompanying video confirms the characterization that “Biden’s climate agenda will create a net increase in jobs.” The problem is, good as it sounds, Buttigieg’s response, commonly given by climate activists when challenged on jobs, is pure, unmitigated, economic balderdash. Here’s why.
What makes the climate job-loss deniers sound almost reasonable, and a source of their faith that green technology will create jobs, is that new technology has generally done exactly that. Buttigieg and others like him presume, therefore, that any new technology, regardless of its origin, will do the same. After all, every time big new innovations, from steam engines to robotics, have come along, some have worried that people would be put out of work. As it turns out, these innovations have been disruptive, but any job losses were temporary. History teaches that new innovations ultimately create more opportunity. More opportunity leads to even more jobs and higher standards of living. If this were not so, with all the innovations over the past century, we’d have record unemployment instead of the record employment prior to the COVID epidemic.
There is a key feature of innovations that expand opportunity and jobs, though. They make production cheaper.
Prior to the steam engine, industrial motive force came from wind, water, and animal (including human) muscle. Steam developed into a motive force that yielded greater power, flexibility, and reliability as well as less labor intensity in production processes. The lower cost freed capital to expand into other industries and minds to do likewise. And over the years, new innovations have caused resources like fertile minds in less than the strongest bodies to have been increasingly tapped, creating new goods, services, and markets that have kept us all busy and increasingly prosperous.
True growth-inducing innovations, like steam, the Bessemer process for producing steel, and refining and burning fossil fuels for energy are always a chance to lower costs. Consequently, they are adopted voluntarily and without government mandates or inducements. There is never any need for governments to force, bribe (through grants and subsidies), or tax advantage companies into adopting innovations that are truly beneficial – that is, that lower costs and consequently produce a higher standard of living on top of more jobs for us all.
So if green policies are to produce, on net, more jobs, as Pete Buttigieg alleges, why do they have to be forced on everyone? Obviously, it’s because they are more expensive, not less so. The companies that have been foolish enough to take on the additional costs of going green where they can are anxious to foist the same costs on everyone else. Claims that wind and solar power are cheaper are only true if wider considerations like the cost of building wind turbines and solar panels, the expanses of land they must occupy, the costs of adding to the grid, and less electrical reliability are all ignored. Some German manufacturers are concerned that Germany’s grid is becoming less reliable, with some looking to relocate facilities to the United States. There are California-based manufacturers who are at least considering leaving that state in search of reliable power.
If they’ve read to this point, environmentalist green advocates are screaming, “You’re not accounting for the costs of destroying the environment and the ultimate destruction of prosperity!” That’s true. But this matters if, and only if, apocalyptic predictions of man’s impact on the environment from burning fossil fuels are correct. On this question, experts disagree. Not only have green advocates’ predictions regarding climate, weather, ice melt, and sea levels been repeatedly incorrect, the claim that the vast bulk of climate scientists agree has been debunked. So, it seems justified to ignore the hysterics of doomsayers who appear best at scaring the bejeebers out of people while utterly incapable of issuing an accurate prediction.
On the other hand, it must be admitted that the case made here against Buttigieg’s jobs assertion is somewhat overstated. After all, it is possible to create more jobs in a situation where government is artificially inflating costs with green policies. If everyone is paid significantly less and the average standard of living goes down considerably, it is, in fact, possible for there to be more jobs, on net, as a result of environmental policy run amok. It’s a familiar message from green advocates. We have to become poorer to stay rich. No, wait, that obviously makes no sense. We have to become poorer for them to stay rich. That’s it.
The opinions expressed in this blog are those of the author, and do not necessarily reflect the official position of 1889 Institute.