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Study: Funding Progressive Domestic Priorities Creates At Least 50 Percent More Jobs Than Military Spending

Facing deep spending cuts, the Department of Defense, including Secretary Leon Panetta, and military-industrial trade associations have complained that tightening the U.S. security budget will cause greater unemployment. And even while toeing the (dubious) conservative line that government spending cannot create jobs, right wingers like Rep. Buck McKeon (R-CA) insist that military spending must stay high to keep unemployment from increasing.

But a new study (PDF) from the University of Massachusetts, Amherst, highlighted by economist Dean Baker shows that, contra the conservative talking point, non-military spending can create more jobs than money going to defense programs. The study’s authors, economists Robert Pollin and Heidi Garret-Peltier of the Political Economy Research Institute, used statistics from the U.S. Department of Commerce, the Bureau of Labor Statistics and other sources to deduce how many jobs are created by public spending in various arenas. Among them, military spending was the lowest, creating fewer jobs per billion dollars spent than even consumer-oriented tax cuts.

Here’s a chart from the study showing how many jobs each area produced from a billion dollars in spending:

Averaged between the three domestic spending priorities of clean energy, health care, and education, those areas create about twice as many jobs per dollar spent as military expenditures. The lower numbers for clean energy and health care spending still create 50 percent more jobs than the military category, and results from putting money into education will mean vastly more employment opportunities.

The paper also weighs the distribution of jobs created over different income levels. Especially with benefits factored in, non-military spending creates jobs at more varied compensation levels, low-, mid- and high-paying jobs. Because spending on the domestic priorities creates so many more jobs, that money will still create plenty of high-paying jobs. The authors conclude that “spending on clean energy, health care, and education will all create many more jobs overall, at all pay levels, than spending on the military.”

Economist Dean Baker, the co-director of the Center for Economic and Policy Research, commented on the University of Massachusetts study on his blog:

In other words, if the point of spending is to create jobs, then the military is the last place that we would want to put our dollars. But, many in Washington believe in the military spending fairy who blesses the dollars spent on the military with unmatched job creating power that has no basis in normal economic analysis.

It turns out that pouring money into the military is not the only way to use public spending to create jobs. It’s also not even close to the best way: Spending on domestic progressive priorities like clean energy, health care, and education could actually accomplish this more effectively.

Climate Progress

Climate Denier Dick Lindzen Accuses Colleagues Of ‘Overt Cheating’

In written testimony for a congressional hearing on the state of climate science that comes on the one-year anniversary of the hacking of climate scientist emails, Dr. Dick Lindzen of the Massachusetts Institute of Technology accuses his colleages of academic corruption. Lindzen, a right-wing ideologue who has also argued on behalf of corporations that cigarettes are safe and CFCs don’t hurt the ozone layer, was asked to testify by the Republican minority, dominated by global warming deniers.

Lindzen cites “climategate” as proof of “overt cheating” and claims “so-called climate science” is actually “science in the service of politics.” Although he concedes that manmade global warming is “trivially true,” Lindzen essentially argues that as long as you ignore the data that indicates CO2-driven global warming, you can’t find CO2-driven global warming.

Other lowlights of Lindzen’s testimony:

– Argues that the deceased Steven Schneider, one of the most influential climate researchers up to the time of his death this year, was not an “active contributor” to climate science

– Calls the global surface temperature anomaly an “obscure statistical quantity.”

– Claims “so-called climate science” is actually “science in the service of politics.”

– Says climate science “has become a quasi-religious issue.”

– Says “climategate” is one of several “instances of overt cheating.”

– “I am quite willing to state that unprecedented climate catastrophes are not on the horizon.”

Of course, Lindzen’s testimony somehow manages to ignore the crushing weight of scientific research finding dramatic, unprecedented changes in the natural world in all realms, including (for just one example) the freak Russian heat wave and associated Asian monsoon which killed over 60,000 people this summer during the hottest year on record.

Lindzen’s own work carries all the hallmarks of the crimes he plants on the rest of his colleagues — science designed to get pre-determined results driven by political ideology.

Climate Progress

Rep. Louie Gohmert Bashes Economist John Reilly: ‘He May Go To M-I-T But He Is An N-U-T’

Louie GohmertRep. Louie “InterContinental Shelf” Gohmert (R-TX) has bashed an MIT economist for daring to say Republicans are “just wrong” about his work on clean energy policy. Dr. John Reilly, a co-author of the 2007 “Assessment of U.S. Cap-and-Trade Proposals,” has criticized the repeated misuse of his work to fabricate a “$3100 lightswitch tax” for setting global warming standards with a cap-and-trade system as “misleading,” “unrealistic,” and “silly.” In an interview with the right-wing outlet CNS News, Gohmert, a two-term representative from the Dallas area, attacked Reilly’s sanity:

Anyone who thinks you can pay $3,100 to the federal government and thinks you can get that money back completely in services — like I said — he may go to M-I-T but he is an N-U-T.

Gohmert’s uncontrolled emission is consistent with the behavior of his fellow conservatives, willfully refusing to admit they’ve been caught in a lie. Every time Reilly attempts to explain the error of their ways, starting over a month ago, the GOP and the right-wing machine redouble their efforts. The Republicans for Environmental Protection, a group of conservative conservationists, have offered one possible explanation why so many leading Republicans, from House whip Eric Cantor (R-VA) to Budget Committee ranking minority member Sen. Judd Gregg (R-NH), keep on lying:

Few except special interests and politicians who do their bidding would argue that limiting emissions that put human health and the environment at risk puts a burdensome “tax” on American families and businesses.

In his two terms, Gohmert has received $22,500 in contributions from the coal sector and $212,313 from Big Oil — enough to pay a mythical $3100 tax for 76 years.

Update

In a remarkable coincidence, a pollution front group, the American Energy Alliance, is running radio ads targeting swing Democrats on the House Energy and Commerce Committee, repeating the MIT lie:

The AEA ads erroneously state that draft legislation proposed by Reps. Henry Waxman (D-Calif.) and Edward Markey (D-Mass.) “could cost our family’s [sic] more than $3,100 per year in new taxes.”


Update

,As a commenter pointed out, Gohmert is from Tyler, a Dallas suburb, not the city of Dallas proper.

Climate Progress

Weekly Standard Compounds $3100 GOP Lie With A $3900 Lie

Reilly Letter
John Reilly’s April 14th letter to Rep. John Boehner (R-OH). Reilly explains that the GOP continues to misrepresent his study, which found that annual price for the average household for strong cap and trade would start at $65 in 2015, averaging “about $800″ through 2050.

Accusing Massachusetts Institute of Technology economist John Reilly of using “fuzzy math” and “fuzzy logic,” the Weekly Standard has further distorted an MIT study of the economics of carbon regulation. By making an economically unsupportable assumption, Weekly Standard editor John McCormack transforms a $3100 lie promulgated by House Republicans into a $3900 lie:

While $800 is significantly more than Reilly’s original estimate of $215 (not to mention more than Obama’s middle-class tax cut), it turns out that Reilly is still low-balling the cost of cap and trade by using some fuzzy logic. In reality, cap and trade could cost the average household more than $3,900 per year.

In reality, the energy economist from the Massachusetts Institute of Technology who co-authored the “Assessment of U.S. Cap-and-Trade Proposals” report does a better job of interpreting “reality” than McCormack. It’s McCormack’s logic that is “fuzzy.”

THE $3100 LIE

The MIT study estimates the average value of the carbon market over a thirty-five year period to be $366 billion per year. If you were to divide that value by the number of households in America, you get $3,128 per household. Asserting that the value of the market is equivalent to the economic cost of the policy – which one has to do to claim that the cost of cap and trade is $3100 per household — requires the assumption that this revenue stream magically disappears somewhere. Reilly attempted to explain this to the Weekly Standard:

It is not really a matter of returning it or not, no matter what happens this revenue gets recycled into the economy some way. In that regard, whether the money is specifically returned to households with a check that says “your share of GHG auction revenue”, used to cut someone’s taxes, used to pay for some government services that provide benefit to the public, or simply used to offset the deficit (therefore meaning lower government debt and lower taxes sometime in the future when that debt comes due) is largely irrelevant in the calculation of the “average” household. Each of those ways of using the revenue has different implications for specific households but the “average” affect is still the same.

For example: Exxon Mobil became the largest corporation in the world by raking in $442.9 billion in revenue in 2008, “costing” the average American household $3,785.

Is the existence of Exxon Mobil a $3,800 tax on American families? No, because most of its revenues are redistributed in the economy — as oil rig employment, petroleum products (which fuel transportation and trade), and of course, multimillion-dollar salaries for its top executives and massive profits for its shareholders.

THE $3900 LIE

The MIT study of the economic effects of cap and trade did estimate the “welfare cost” of the transition from an unsustainable pollution-based economy to a clean-energy economy. As Reilly explained to McCormack (to no avail), this “cost to the economy involves all those actions people have to take to reduce their use of fossil fuels or find ways to use them without releasing [greenhouse gases]“:

So that might involve spending money on insulating your home, or buying a more expensive hybrid vehicle to drive, or electric utilities substituting gas (or wind, nuclear, or solar) instead of coal in power generation, or industry investing in more efficient motors or production processes, etc. with all of these things ending up reflected in the costs of good and services in the economy.

The MIT study found that this “welfare cost” is tiny with respect to the size of the economy, even with strong reductions in global warming pollution and a very high price for carbon permits. The change in total welfare is less than one-tenth of one percent in 2015, never rising above two percent for the forty-year run of their model. Averaging out the “price” of a clean-energy economy versus the status quo over those forty years, Reilly found the cost for “the average household just in 2015 is about $80 per family, or $65 if more appropriately stated in present value terms,” and the “present value cost per average current household through 2050″ is “about $800.”

McCormack decided to add $3100 to $800 and get $3900, even though Reilly told him one has to assume the carbon market value gets flushed down the toilet:

If you took the revenue and flushed it down the toilet or burned it, the cost would then be the Republican estimate plus the cost I estimate. But that is quite unrealistic, as the auction revenue will be recycled into the economy some way.

Using McCormack’s logic, we could take our $3,800 Exxon Mobil “tax” and then add in, say the $855 per household per year spent on the war in Iraq (given a lowball estimate of $100 billion in total expenditures per year) as the welfare cost of the existence of Exxon Mobil. Adding $3785 to $855 returns a figure of $4640 per average household.

Saying “Exxon Mobil is a $4640 tax” would be silly and intellectually irresponsible. But that’s essentially what McCormack is doing, as is the once-respected Heritage Foundation, who is promoting McCormack’s nonsensical $3900 figure. Read more

Climate Progress

Editor: ‘I’m Embarrassed’ I Published Bachmann’s Lying Column

Michele BachmannDespite refusing to run a correction, the opinion page editor of the Minneapolis Star Tribune is now “embarrassed” he published a GOP lie about energy reform without checking it first. On April 8, Rep. Michele Bachmann (R-MN), a notorious global warming denier, attacked green economy legislation in the Minneapolis Star Tribune, claiming that “cap and trade” is really “cap and tax”:

According to an analysis by the Massachusetts Institute of Technology, the average American household could expect its yearly energy bill to increase by $3,128 per year.

This was a flat lie, as a letter to the editor published the very next day by the Star Tribune pointed out. In fact, Bachmann’s lie had been debunked publicly by MIT’s John Reilly with Politifact.com on Tuesday, March 24th. On April 1st, ThinkProgress published a letter from Reilly to the Republican leadership denouncing the fabricated figure.

Eric Ringham, the opinion page editor of the Minneapolis Star Tribune, recognizes now that the MIT lie was fully debunked before the column was submitted by Bachmann:

It wasn’t on my radar. I’m embarrassed to have let it go unchallenged.

In an interview with the Wonk Room, Ringham explained his decision to run Bachmann’s column without checking its veracity, despite her record of extreme anti-environmentalism and promotion of conspiracy theories about international finance and Islamic terrorism. With both the limited resources he has and the role of the opinion page as a forum for argument, he argued it is “an uncomfortable role” for an op-ed editor to run corrections after a column’s publication. “I’m not equipped – or really inclined – to go, after the fact, probing someone’s assertions.”

Ringham does try to do some fact-checking ahead of time: “What we do is check the facts that smell. This one didn’t to me.” He considers the strongly worded letter to the editor as a sufficient response, because: “The best remedy to offensive speech is more speech.” The policy that he follows as an opinion page editor is that “sunlight is the best disinfectant.”

“You can rest assured this study is never going to be represented in the paper again,” Ringham concluded, “without confirmation it’s being accurately portrayed.”

On April 10th, the Star Tribune reported on Bachmann’s anti-cap-and-trade forum without noting she had lied in its own pages that same week.

Climate Progress

Top Obama Officials To Testify Next Week On Behalf Of Clean Energy Legislation

John HoldrenRep. Ed Markey (D-MA), chair of the Energy and Environment Subcommittee, announced that top Obama officials will testify next week on the immediate need for clean energy legislation. Speaking at an event on building a clean energy economy hosted by the Massachusetts Institute of Technology, Rep. Markey said that Secretary of Energy Steven Chu, Secretary of Transportation Ray LaHood, and Environmental Protection Agency Administrator Lisa Jackson will testify in hearings on the Waxman-Markey American Clean Energy and Security Act, beginning on Tuesday, April 21.

John Holdren, director of the White House Office of Science and Technology Policy, told attendees that “significant harm to human well-being is already occurring” from global warming — including agricultural impacts from monsoon changes in China, greater floods “on practically every continent,” increased drought and soil drying, increased wildfires, worse air pollution and heat stress, and timber losses from Alaska to Colorado due to pest explosion — and “worse is yet to come.”

The MIT event is being webcast live.

Climate Progress

‘Liar, Liar, Pants On Fire’: Maddow Covers The ‘Really Crazy’ GOP MIT Tax Lie

Last night, MSNBC’s Rachel Maddow and Eugene Robinson discussed the “really crazy” lie that GOP leaders like Rep. John Boehner (R-OH) and Sen. Mitch McConnell (R-KY) have been spreading that an MIT study says cap-and-trade legislation is a $3100 tax. “‘It’s just wrong. It’s wrong in so many ways, it’s hard to begin,’” Maddow quoted MIT economist John Reilly. “That is MIT-economist-speak for, ‘Liar, liar, pants on fire.’” After she noted that Rep. Michelle Bachmann (R-MN) repeated the lie in a Minnesota Star Tribune editorial, the Washington Post’s Eugene Robinson weighed in:

That’s just making stuff up. That $3,128 figure does not appear in the report. It’s not there. It is arrived at by taking an irrelevant number and dividing it by another irrelevant number and coming up with a number that means nothing. The actual calculation would be more like $340, although that wouldn’t show up on your electric bill, it would include all sorts of other costs that you wouldn’t necessarily see as energy costs, but they would be in there. But that’s a factor almost of ten. They just made it up. It’s really crazy.

Watch it:

In reality, the MIT report actually finds that clean energy policy that includes a fair cap-and-trade system would save us from our pollution-fueled path of job destruction, plummeting wages, skyrocketing energy prices, and catastrophic climate disasters.

One might surmise that’s why Republicans have to lie about the numbers.

Update

Eugene Robinson also went after his fellow Washington Post columnist, George Will, saying that he thought his global warming distortions crossed the line.

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