Your Taxpayer Dollars at Work: Crony Green-Jobs Edition

by Veronique de Rugy

A new Wall Street Journal investigative report shows that once again there are discrepancies between the number of jobs claimed to have been created by the stimulus money and the actual number of jobs created. In this case, the Journal looks at the jobs created with $10 billion spent on renewable-energy companies for building wind farms, solar projects, and other alternatives to oil and natural gas under Section 1603 of the American Recovery and Reinvestment Act.

On paper the program claims to have created 102,883 jobs. That’s too few jobs considering the $10.7 billion paid to 5,098 businesses for 31,540 projects according to the Department of Treasury. That’s also $97,197 per job.

But it gets worse, because these jobs probably aren’t real. This reported number of jobs is a product of formulas, mathematics models, and reports by recipients of the money rather than actual counting of jobs. For instance, the Congressional Research Service last year alerted Congress that the recipient reports were full of errors and it recommended “that any job creation estimate be viewed with skepticism.” CRS also noted that the market response to these new facilities was mixed to say the least.

Now here is some of what we know for sure about the wind-farm jobs:

 — About 40 percent of the funding — roughly $4.3 billion — went to 36 wind farms. At the peak of employment, these firms employed 7,200 workers. But these were temporary jobs, as is almost always the case with stimulus money. Now these 36 farms employ 300 employees. If you do the math and calculate the cost per job, you may well fall off you chair.

 — Very few local people were employed in these “new jobs” because they lacked the technical skills to work in these high-tech factories. This is an increasingly well-documented story about why stimulus money doesn’t create as many jobs as it hopes to: High-skilled jobs require high-skilled workers, and you can’t just hire anyone from the unemployment lines to do these jobs.

 — The American Wind Energy Association successfully lobbied the government to get $7 billion of the Section 1603 funding between 2009 and 201, claiming it would create thousands of jobs. Yet, the industry payroll declined to 75,000 in 2011 from a peak of 85,000 in 2009.

Call it crony capitalism, call it spending taxpayers’ money under bogus claims of job creation — I think this quote at the end of the story says it all:

How so few jobs came out of a stimulus program mystified Joseph Mendiola, acting director of Laredo Development Foundation in Webb County.

“Green energy is a future for all communities we should embrace,” he said. “But they shouldn’t tell us it is for jobs.”

The whole thing is here.