Rewiring America is an organisation that wants to deal with climate change by electrifying everything in America. OK, deal with climate change, good idea, electrifying everything to do so maybe not. But certainly exploring the concept seems sensible.
Well, it’s sensible until we see what it is that they write about it. For they’ve failed the most basic of tests of their knowledge of economics. They’re claiming that jobs are a benefit of their schemes when all sensible people know that jobs are a cost.
Jobs are a cost, not a benefit.
And if you’re going to write about matters economic but get that bit wrong then you’er going to write some miserably bad economics.
It was the kid at Vox that alerted to the error although he too doesn’t recognise it:
A physicist, engineer, researcher, inventor, serial entrepreneur, and MacArthur “genius” grant winner, Griffith’s recent work spans two organizations. First, he is founder and chief scientist at Otherlab, an independent research and design lab that has mapped the energy economy.
And alongside Alex Laskey, co-founder of Opower, he recently started Rewiring America, which will develop and advocate for policies to rapidly decarbonize the US through electrification. (The organization is going to release a book called — be still my heart — Electrify Everything.)
Wouldn’t the world be a better place if geniuses grasped the basics? So, here’s the report they’ve done on jobs:
Mobilizing for a zero carbon America:
Jobs, jobs, jobs, and more jobs
We might be able to take that as their being in favour of more jobs, eh?
Based on an extensive industrial and engineering analysis, our new report demonstrates that an aggressive national commitment to electrify all aspects of our economy would create up to 25 million good-paying American jobs over the next 15 years and 5 million sustained jobs by mid-century. This is the first analysis of the job opportunities that would result from a rapid and total decarbonization of the economy as a whole.
Yep, they’re in favour of these more jobs. They’re claiming them as a benefit rather than the cost they actually are.
Increasing employment under the transition to a zero–carbon is driven by the requirement
for more labor in manufacturing, installation, and maintenance of renewables than their
counterpart fossil fuel technologies. It takes more people to install and keep a wind farm
running than it does to drill a well and keep it pumping for the same amount of energy over
time. Renewables get their fuels for free, whereas fossil fuels cost money. It takes more labor
and maintenance to access those free renewable fuels.
Yep, more labour intensive methods of production are a good idea.
Jobs are a cost not a benefit of doing something.
Clearly a job is a cost to the person doing it. That’s why they demand wages for having to do it – their benefit. Equally, all like having an income so as to be able to consume and going to work is the cost of having that income to be able to consume. For employers the contention that a jobs is a cost should not be too hard to understand – they do pay out cash for them. Finally, for society as a whole a job is a cost.
We live in a universe of scarce resources. Human labour is one such scarce resource. We can test this – find how may people will come mow your lawn for free. None is it? Then that’s some job that can be done by human labour which the human labour is scarce to do. Now add paying someone to do it, plenty of candidates. Great, we’ve just shown that the job of getting the lawn mown is a cost to both you and the person doing it.
If we have a scarce resource then we have opportunity costs. If someone is now doing this thing then they can’t be doing that other. The cost of our doing the first thing is therefore the second thing not being done. When Joe Biden became VP he could not be a Senator – the cost of Joe being VP was his not being a Senator.
So, we’re going to put 25 million people to work on green stuff, this is a cost of doing all that green stuff. Sure, it might be the best thing we can do with all of that labour. I’m sure happy with the idea of dealing with climate change once and for all. But even if that’s all true it is still also true that the labour of 25 million people is a cost of this scheme, not a benefit of it.
But how much of a cost is it?
And then this:
So, if we send 25 million people off to dig ditches in the Glorious Green New Deal Mines then we’ve just taken away all the labour that the entirety of the American industrial economy – goods producing, which is “production” in the terminology, meaning construction, mining and manufacturing.
Actually, it’s all that labour plus all the Federal government and the entire education system. Sure, that latter will mean all the Marxists in the country are now employed with pick and shovel which we might take to be a benefit but it is still obviously a cost, right?
And when we’ve done all that build out then we can have manufacturing again but we still lose the Feds and K12. Still good on that score then.
The cost of having 25 million people working on the Green New Deal is the death – for real this time – of American manufacturing. Although of course it won’t be quite like that, some will come from there, some others from K12, some from tending bar, some from being diversity advisers. Meaning that the cost of the Green New Deal’s labour demands is a less educated, thirstier and more racist country. For we really do, if we go send 15% of the current labour force off to the Green gulag, end up with 15% less of the labour force to do all the other things we like and desire.
Because jobs are a cost of doing something, not a benefit.
Oh, and no, we can’t just go send the coal miners to do this. The 25 million jobs is on top of the current employment in the energy system. The report specifies this.
So, we’re left with our folks advertising the glory of their scheme by promoting how expensive it is. Dunno really, perhaps the epithet “genius” along with the grants so named should go to people who have a clue? Or is it really that difficult to understand that jobs are a cost, not a benefit?