Green Growth: A Double-Edged Sword
The moral reason for serious green investment proposals is the urgency of climate change mitigation. But since climate scientists’ warnings have proven insufficient grounds for action, political strategists espouse green industrial policy only insofar as it’s a boon for economic growth and recovery. Consequently, climate finance has repeatedly faced fierce opposition not only because of allegedly bad climate science, but because of doubts about the accuracy of green job creation projections.
Appealing to job creation as a justification for climate action, even with good intentions, has been a counterproductive red herring. This fact should be apparent to anyone monitoring the tedious debates surrounding nearly every clean energy sector subsidy and regional high-speed rail project from California to Birmingham, England. Nevertheless, the distraction persists, and it is worth understanding why.
The ILO 2012 annual report warns that the world faces the “urgent challenge” of creating 600 million new jobs over the next decade in order to curtail cross-national economic contraction and social strife. With only six of thirty-six economically advanced countries (Austria, Germany, Israel, Luxembourg, Malta, and Poland) having increased employment rates since 2007, the ILO is pessimistic about the prospects of meeting that challenge without a radical reversal of fiscal austerity schemes and a massive escalation of social spending. The last few months of dismal U.S. jobs reports, persisting even though Washington could be borrowing at only 1.45 percent interest, seem to accord with that pessimism. The private sector has exacerbated the crisis. Corporate managers are hoarding excess revenues and refusing to adequately reinvest in workers despite record profits, which now account for more than 10 percent of GDP for the first time in history.