The Market Fundamentalist

http://pajamasmedia.com/blog/breaking-anti-lobbyist-obama-administration-recruited-left-wing-lobbyists-to-sell-bogus-green-jobs/?singlepage=true

I have reported several times regarding studies done in Europe (Spain, Denmark, Germany) that have concluded that government subsidized “green jobs” actually destroy more productive jobs than they create.

Now unlike Bob, who has dismissed all three studies as somehow the product of big oil, the Obama administration has taken them quite seriously. Seriously enough that the anti lobbyist Obama administration has asked George Soros to help fund a rebuttal study backed by (not big oil of course) but by BIG WIND. BIG WIND is an entity known as the American Wind Energy Association which has as its funders not just corporate welfare seekers like GE but numerous EUROPEAN wind and solar power companies who are panicked that the European studies criticizing their domestic subsidies might not only hurt that welfare stream, but also that they could damage the potential huge new export market known as the USA. In fact, Germany, France and Italy have made some efforts to reduce feed in tariffs and other subsidies as their consumers suffer under high energy costs in a deep recession.

Which just goes to show that it is not lobbyists in general that the left doesn’t like, but only those lobbyists that pitch facts and figures that they don’t approve of.

So,

Big Oil lobbyists BAD. Big Wind lobbyists, GOOD.

The Freedom of Information Act has been used to ferret out the cozy ties between the Administration and BIG WIND. Some of the requests have been denied, and are on appeal. But the very reason for the denial is alarming. The administration has claimed it denied the requests because the email correspondence between the administration , ie

National Renewable Energy Laboratory (NREL) in Boulder, Colorado.

NREL is an extension of the Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE). EERE is run by Assistant Secretary of Energy Cathy Zoi, who, until assuming this post, served as CEO to Al Gore’s Alliance for Climate Protection. Zoi is responsible for many millions of the “green jobs” stimulus dollars pushed for and designed by Van Jones (this according to Jones himself).

and the Soros foundations is “inter agency correspondence”. In other words, between GOVERNMENT AGENCIES. Are we then to make of this that George Soros and his foundations ( especially the Center for American Progress ) are in fact government agencies? Very interesting.

Now there is a spat between the administration and NREL about who asked who to generate the rebuttal report, which was not written by economists, but by two activists in NREL. EERE says NREL took it upon themselves to write the rebuttal. NREL says EERE told them to.

Aside from the battle of the acronyms over who spilt the milk, the milk itself is curdling rapidly. The substance of the rebuttal report is not about the conclusions of the European studies trashing welfare for green energy, but about the methodology.

The Spanish paper suffered from a “lack of rigor.”

– The Spanish paper applied “consensus economics.”
What pray tell is “consensus economics”? Why, nothing more than the same economics that are applied in the real world to solve real problems about how to allocate resources. What would the Obama lefties prefer that the European studies used? Why it would be: input-output (or Leontief) methodology designed for central planning, in which all is assumed to be knowable, controllable, and static. This method has been discredited outside of social democratic government agencies and select associations

The problem with Leontief modeling is ( as I have posted a while ago) that it is similar to GLOBAL CLIMATE CHANGE modeling–that it is garbage in, garbage out. You have to have massive amounts of data input into a funnel that spews out predictions but, what if the data is incomplete? In global warming modeling, it is becoming more and more apparent that the data on water vapor was always woefully incomplete. For economic modeling, how can any central planner have enough knowledge in his mind when knowledge is dispersed throughout society in millions of minds ? What if real people in the real world do not react to the data as you assume they should?

All central planners believe they know enough to play God with real people. But, as ADAM SMITH said in the eighteenth century, people are not pieces on a chess board. There are all sorts of unintended consequences that cannot be modeled as real people react to real life incentives and barriers that they are confronted with by agencies backed by the guns of the state.

So, in real life government subsidies to industry, whether it is old established industry like big oil, or new industry like wind and solar, will produce unintended consequences that will lead to inefficiencies and waste.

Better to let the real people in the real world make their own decisions based on market choices than have technocrats try to decide what is best for them, and for some big abstraction, like “the planet”.

Brendan

This entry was posted on Thursday, March 4th, 2010 at 9:30 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.