Would you rather be green or have some green(backs)?
This seems a rather common dilemma these days. In Employment, Environment at Odds, (wsj.com sub. required) an example of this dilemma is discussed. An Indian power company wanted to purchase $600 million worth of coal mining machinery from a U.S. company.
However, the common process for financing large export deals like this is to fund the deal through the U.S. Export-Import Bank, a federally-backed loan guarantor. But since this order was for coal mining materials and the Obama administration is all for Greener Energy, the loan was denied. As a result, the U.S. company lost that order that would have created (or saved) about 1,000 jobs in the U.S. The Indian company continued on with their coal mining expansion and purchased the equipment from an international competitor with export financing from a less-squeamish government agency.
If an action like this by the U.S. Export-Import Bank actually caused the Indian company to drop the mining project in favor of a greener energy source like solar or wind, this wouldn’t be such a big deal, but this decision actually caused an American business, their shareholders and employees to lose business while at the same time doing nothing for the environment since the customer placed their order elsewhere for mining equipment, which was the (misplaced) moral basis to decline the offer.
Given the current economic state in recent years (10% unemployment), these jobs are certainly jobs we cannot afford to do without. Also, it would have helped not just those 1,000 people working at the plant, but their families and communities as well.
Despite this example, there doesn’t have to be a tradeoff between green and jobs or between green and making $. Our research has shown there are consequences to lowering costs and reduced spending and our blogging has shown that there are consequences to bad policy.
