Mitt Romney got the Left all atwitter by making the analogy between his layoffs at firms in which Bain Capital had taken a stake and the, ah, unpleasantness that occurred with entities in which President Obama unsuccessfully gambled taxpayer money, taking a stake in entities like Solyndra and Beacon Power which the private capital markets had eschewed.
The analogy is perfectly apt. Both pumped money into existing, struggling companies, making demands of company management. One (Solyndra) was so bad the Bains of the world wouldn’t touch it, but was the politicians’ marquee pick, and collapsed, laying everyone off; the other’s picks mostly survived thanks to the (private) intervention.
Except Obama’s folly is worse. His policies — which he formerly boasted were imported from Europe, if not so much, anymore — throw per-job fortunes at “creating” these positions (say, $355,555 according to his Council of Economic Advisors), but they are inherently temporary jobs which last only so long as the wealth transfer continues.
Erstwhile Obama model Spain proved this. When spokesman Robert Gibbs was called out about Spain’s failure, Obama continued giving the same speech but, implausibly, swapped out Spain for Denmark as the model for our energy system and new economy.
It apparently occurred to no one at the White House how silly it is to cite as our model a country with half the population of Manhattan which sits on a tiny spit of land that happens to be the world’s most hospitable for wind. But these were the same people who saw nothing wrong with pretending they could simply conjure an industry that has failed since the ‘80s. The 1880s.
Denmark was then also proved to not be the claimed success story. And today the Financial Times writes this story, “An awkward start to Denmark’s EU presidency,” noting that, “when it came to today’s official handoff of the EU reins to Danish prime minister Helle Thorning-Schmidt, there was a slight hiccup: Denmark’s Vestas, the world’s largest maker of wind turbines, chose the same day to announce it was cutting 2,335 jobs — most of them in its home country.”
This is only Vestas’s most recent layoff announcement, incidentally. And the Dane handled this much like Obama, saying “This feels today like an enormous setback, but this setback should not make us change our strategy. We need to be world leaders in energy efficiency, new technologies, green technologies, because we think it is not only good for the environment but it is also good business for Europe.”
EU Commission president Barrosso chimed in claiming it was all the economy — “most likely, it would be a reflection of the overall crisis of Europe…The reason behind the crisis in Europe is not because of the investment in green technology.” Which is the same line biofuels rent-seekers employed here this month, blaming “[t]he state of the economy, the state of the financial world, the state of the banks” [behind a Politico paywall] for the fact that despite a mandate that gallons of cellulosic ethanol be produced, well, none had.
Oddly, people producing real energy sources in the Bakken and Marcellus deposits, Poland’s shale gas, and some folks who I understand are trying to bring a pipeline down here aren’t reduced to such backfilling.
Regardless, this announcement is standard procedure in the “green economy’ (see Solyndra, Beacon Power, and so on). Theirs are phony jobs, existing only because politicians said, ok, sure, we don’t make or the use the following (unspoken: for quite rational reasons); but we should.”
And when they inevitably disappear, politicians are scolded for killing jobs. Like, say, this UK Telegraph headline, “Government accused of ‘destroying 25,000 green jobs’”. Or the Guardian story that cutting the support schemes “will kill solar industry stone dead” (for those who care, there is also the body count from these policies, “Fuel poverty ‘will claim 2,700 victims this winter’”).
Then the trouble really begins. Not only do we then see this, as in the Independent (UK), “UK face threat of legal action over [cutting] solar subsidy”, but these notional workers become real voters who can show up at rallies, vote or, gasp, give interviews with tales of woe.
Politicians get stupid over the notion of jobs that they can point to as having “created”, tossing billions of other peoples’ money in the vainglorious pursuit flying in the face of history since at least Frederic Bastiat’s time. Their spines hardly stiffen once they create the constituencies to lobby them for more. Wouldn’t want to “kill jobs” now, would you?”
As one might hear at the movie theater, “don’t go in there!” The truth is that amid all of the EU wreckage of these policies, not one country has figured out a politically acceptable way of unwinding what they created, once these people become real voters. So, as is their habit, they just keep squandering money, going deeper into debt promising it will get fixed. Later.
We can’t afford this.