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Green Jobs, or Pink Slips?

Op-Eds and Articles

Jim Doyle last week unveiled his marquee energy initiative, the Clean Energy Jobs Act. He says the legislation would create “green jobs,” but it is much more likely to generate pink slips.

The legislation would mandate more green energy, such as wind and solar power. Of course, forcing people to use green energy creates jobs in the green energy industry, but it’s not that simple. Green energy is expensive energy, which is bad news for Wisconsin’s energy-intensive industrial base. Doyle’s mandate might create some jobs in the solar panel installation business, but it’s going to destroy just as many, and probably more, paychecks in the manufacturing business.

Doyle also wants to spend public money on green energy. This is a good idea only if you think the government is well-suited to choose worthwhile investments. To put it another way, whom do you trust to handle your money: Jim Doyle or Charles Schwab?

To Doyle’s credit, his energy ideas aren’t all bad. The Clean Energy Jobs Act includes a relaxation on Wisconsin’s moratorium on new nuclear power plants. The state’s nuclear fleet is aging. Loosening the nuclear moratorium is a good start.

If Doyle wants to create jobs and save the planet, he should get government out of the energy business. Consider the state’s “monopoly franchise” law, by which government grants a monopoly to a single electricity distributor in each service area. Micro-generation technologies, including solar and wind power, could make the provision of electricity greener, cheaper and more reliable, but their development is impossible as long as the state outlaws competition in the business of distributing electricity.

As a historical aside, this anti-innovation law is Wisconsin’s curse on the rest of America. At the peak of the Badger State’s Progressive fever in 1907, the Legislature concluded that electricity provision is a “natural monopoly,” despite the existence of robust competition among electricity distributors in many cities. The Legislature’s ironic solution was a government-certified monopoly. Since then, the authority to grant “monopoly franchise” to utilities (and, by extension, the authority to control the electricity business) has been seized by every state legislature in the country. Without competition, however, there is no incentive to improve, which is why the American electricity industry, the lifeblood of the country’s economy, hasn’t changed fundamentally in a hundred years.

Government creates jobs by ending ill-advised market manipulations. To stimulate Wisconsin’s economy, Doyle should deregulate the energy industry.