Green Jobs vs. Blue Jobs – Which Jobs Are Better for America?

An article in The Wall Street Journal this week discusses the fact that despite considerable hype over green jobs and government spending, green jobs are just plain scarce.  Indeed, renewable energy rhetoric has run into real world reality!  Is anyone surprised?

The President wants to create millions and millions of green jobs, and in fact, some money from the $787B stimulus spending package specifically targets green job creation.  Earlier this year, a new $100M government program was also announced for the purpose of giving out renewable energy job-training grants.  Yet, few green jobs have been created.  So, where are all these green jobs?  What’s the problem?

America does need new jobs.  Since the beginning of the Great Recession, we have lost about 11,000,000 jobs.  That’s terrible, especially if you or a family member have been impacted.  The answer is not government spending and it’s not green jobs.  The answer is blue jobs.  Blue jobs are the jobs created by the Free Market.  (Blue is the color associated with Freedom.  It’s the color of blue skies.  It’s the color of optimism.)

Government spending in the form of job-training grants or temporary tax credits does not create a market in renewable energy.  That’s not how you create jobs.  That’s not how you create a Free Market.  Simply throwing money at a problem does not make the problem go away.  But, it does waste a lot of money.  Keynesian economics and government-created demand in the view of many economists has been thoroughly repudiated.  Government attempts at creating green jobs or any jobs, let alone high-paying, productive jobs, will always fail to meet the needs of consumers.  Government spending has a lower economic multiplier than private sector spending.

In sharp contrast, the Free Market gives consumers (not government bureaucrats) the economic freedom to decide what’s best for themselves and their families.  The Free Market also gives entrepreneurs the opportunity and economic freedom to develop better, faster, and less expensive products and services to best meet the needs of consumers.  All of this is fueled by private investment.  Yes, rich people invest.  But, so do grandmothers and workers.  Most everyone is an investor at some level, through savings accounts, insurance policies, pensions, annuities, IRAs, and 401(k)s.  These are all investment vehicles for bringing investors together to create new businesses, new products and services, and to create new blue jobs!  Blue jobs are better at meeting the needs of individuals and better at utilizing scarce economic resources.

How do we get blue jobs today?  We need to cut personal income tax rates, we need to cut taxes on investments, and we need to cut corporate tax rates.  Cutting income tax rates gives consumers more economic freedom to meet their needs.  Cutting capital gains taxes gives savers and investors the opportunity to create more new businesses and more new jobs.  Cutting corporate taxes gives businesses the incentive to keep jobs in the U.S. and not outsource jobs.  (Note that we currently have the second highest corporate tax rate in the world.)

Next time someone touts government green jobs as a panacea for our problems, tell them you prefer blue jobs.  Blue jobs are much better from an economic viewpoint.