In 2012, California voters were peppered with grandiose promises, such that they could not resist approving Proposition 39. The measure, created and backed by wealthy environmentalist Tom Steyer, sought to raise taxes on corporations and use the money to fund green energy projects in schools.
He promised it would create 11,000 new jobs each year. What could go wrong?
There are inherent problems with the idea of green public-works projects, and still more problems with tax hikes. But this plan had the benefit of at least being elegant and simple. All of the facilities slated for green-energy improvements would be government-owned and government-run. There would be no NIMBY-style community pushback, nor significant added costs to ratepayers. Districts could apply for funds and choose projects that met their needs. If any such program could work, this was it.
Naturally, it did not work at all. On Monday, the Associated Press reported that the program has “created” just 1,700 jobs in three years — just under 600 jobs per year or roughly five percent of what was promised, at the cost of $175,000 per job. Even that paltry figure fails to account for opportunity costs — i.e. jobs lost statewide because of the forced diversion of economic resources away from productive industries and toward green energy. The number of net jobs created is likely zero or less than zero, which is to say that probably a few hundred or a few thousand jobs have been destroyed so far at a cost of $300 million.
That’s not to say no one has benefited. More than half of the $297 million given to schools under the program so far, AP reports, has gone to “consultants and energy auditors.” The rest of California’s taxpayers have received no benefit, except the privilege of serving as their host organism.
Even the tax hike part of this plan isn’t working out so well. With companies limiting their exposure or even leaving California, the program has been bringing in just a little more than half of what was promised ($550 million each year) for the Clean Jobs Energy Fund.
Not that it matters much, because California schools have only managed to apply for half the money. The projected energy savings from their approved projects is far smaller than promised. For example, those pushing for the Clean Jobs fund claimed that the L.A. District would save $27 million annually from energy improvements. The projects that its schools have applied for so far would only save it $1.4 million annually. That’s assuming those projects are ever completed — not a single one has been so far.
Meanwhile, the commission charged with overseeing this program has not met once. There are no reliable numbers about how much energy it has created or saved.
In short, Steyer has handed California a fat lemon.
What can Californians do? We have a modest proposal for the short term: Purchase hundreds of electricity-producing treadmills and force Steyer and the green consultants and energy auditors who are currently making bank to run and generate electricity for schools.
For the long term, Californians should be more skeptical and vote “no” the next time political money-men come to them with big ideas of how government can create green jobs. Their state is now Exhibit A in the argument that it cannot.