One hopes, as Obama constructs his energy and climate policy, that someone points him to an interesting article by Stephen Moore in the Wall Street Journal. In the article, Moore points out something that I experienced first-hand in California and that, in fact, guided me into a career in economic and environmental policy. What I noticed, while doing my doctoral intership at Hughes Aircraft, was that California’s environmental policies virtually always failed cost-benefit tests unless those tests were rigged, with benefits inflated and costs under-estimated. I also noticed that the regulations, despite the blue-sky analysis of the state environmental regulators, was hollowing out California’s economy and driving major industries, such as the aerospace sector, largely out of the state.
What Moore points out is that going green is not a low-cost venture, in terms of either jobs lost, or industries lost:
California’s unemployment rate hit 9.3% in December, up from 4.9% in December 2006. There are now 1.5 million Californians out of work. The state has the fourth-highest housing foreclosure rate in the nation, has lost more businesses than any state in recent years, and is facing a $40 billion deficit.
Let’s hope that Obama is paying attention to the real lessons learned from California—that excessive haste on going green is a great way to push one into a lot of red ink.