Green Stimulus Money Costs More Jobs Than It Creates, Study Shows

By Josiah Ryan | April 10, 2009 | 3:51pm EDT

President Barack Obama exits Air Force One. (AP Photo)

( - Every “green job” created with government money in Spain over the last eight years came at the cost of 2.2 regular jobs, and only one in 10 of the newly created green jobs became a permanent job, says a new study released this month. The study draws parallels with the green jobs programs of the Obama administration.   
President Obama, in fact, has used Spain’s green initiative as a blueprint for how the United States should use federal funds to stimulate the economy. Obama's economic stimulus package,which Congress passed in February, allocates billions of dollars to the green jobs industry. 

But the author of the study, Dr. Gabriel Calzada, an economics professor at Juan Carlos University in Madrid, said the United States should expect results similar to those in Spain: 

"Spain’s experience (cited by President Obama as a model) reveals with high confidence, by two different methods, that the U.S. should expect a loss of at least 2.2 jobs on average, or about 9 jobs lost for every 4 created, to which we have to add those jobs that non-subsidized investments with the same resources would have created,” wrote Calzada in his report: Study of the Effects on Employment of Public Aid to Renewable Energy Sources.
Obama repeatedly has said that the United States should look to Spain as an example of a country that has successfully applied federal money to green initiatives in order to stimulate its economy.
“Think of what’s happening in countries like Spain, Germany and Japan, where they’re making real investments in renewable energy,” said Obama while lobbying Congress, in January to pass the American Recovery and Reinvestment Act. “They’re surging ahead of us, poised to take the lead in these new industries.”
“Their governments have harnessed their people’s hard work and ingenuity with bold investments — investments that are paying off in good, high-wage jobs — jobs they won’t lose to other countries,” said Obama. “There is no reason we can’t do the same thing right here in America. … In the process, we’ll put nearly half a million people to work building wind turbines and solar panels; constructing fuel-efficient cars and buildings; and developing the new energy technologies that will lead to new jobs, more savings, and a cleaner, safer planet in the bargain.”
Included in the stimulus package, for example, was $4.5 billion to convert government buildings into high-performance green buildings.
According to the Calzada’s study, Spain is a strong example of the government spending money on green ideas to stimulate its economy.
“No other country has given such broad support to the construction and production of electricity through renewable sources,” says the report. “The arguments for Spain’s and Europe’s ‘green jobs’ schemes are the same arguments now made in the U.S., principally that massive public support would produce large numbers of green jobs.”
But in the study’s introduction Calzada argues that the renewable jobs program hindered, rather than helped, Spain’s attempts to emerge from its recession.
“The study’s results show how such ‘green jobs’ policy clearly hinders Spain’s way out of the current economic crisis, even while U.S. politicians insist that rushing into such a scheme will ease their own emergence from the turmoil,” says Calzada. “This study marks the very first time a critical analysis of the actual performance and impact has been made."
Pat Michaels, professor of environmental sciences at the University of Virginia and senior fellow in environmental studies at the Cato Institute, a free market group,  told that the study’s conclusions do not surprise him. He added that the United States should expect similar results with the stimulus money it spends on green initiatives.
“There is no reason to think things will be any different here,” Michaels said.  “In the short run you have to ask who is doing the hiring, and in the long run how efficient is it to have people serving technology such as windmills. We are creating inefficiencies.”
Michaels also said he was not surprised by the study’s finding that only one out of 10 jobs were permanent.
“That doesn’t surprise me,” said Michaels. “When we see how imperfect wind energy is and how expensive it is to maintain -- I think many of those jobs will become impermanent here in the U.S. as well.”
Inquiries for comment to the Natural Resources Defense Council and the Center for American Progress were not answered before this story went to press.

MRC Store