By JR on Monday, October 17, 2011
The Labor Department’s green jobs training debacle unearthed by the Department’s own Inspector General reveals that the program has failed miserably to achieve its goals. The Labor Department initially claimed that 79,854 would get jobs, while only 8,035 found employment. Even worse, only 1,336 of the trainees who found employment still had the job six months later.
All at a $170 million price tag to the taxpayer.
The program is such a grotesque failure that the Inspector General recommended in his report that the Labor Department return as much of the remaining unused $327 million in grant money as possible back into the U.S. Treasury, rather than continuing to waste the money.
Not surprisingly, the Labor Department is fighting back claiming that the program’s performance will “significantly increase over time.”
Here’s the underlying problem both from a training and human perspective.
The reason the job training program failed is not necessarily because the grant recipients were not doing their jobs. It failed because they were training people for jobs that did not exist.
This is the hard reality of why the Obama green jobs economy has fallen flat in the United States just as it has elsewhere around the world. The green jobs economy depends upon a strong demand for green “products” at a price that makes them a “value.”
This basic consumer decision that every one of us makes when purchasing anything from broccoli to an automobile is what is dooming the green economy. Am I willing to pay what it costs for that product? If the answer is no, then the price needs to be lowered. If the price cannot be lowered any further and it still is rejected, then the product dies on the shelf.
General Motors Chevy Volt is a prime example of this principle and how it affects the “green” job economy. The base model of the 2011 Volt has a Manufacturer Suggested Retail Price of $40,280 with a dealer invoice price of $38,669 according to Edmunds.com.
GM’s Chevy Cruse Eco, an all-gasoline powered vehicle that is built on the same frame as the Volt is priced at $18,425 for the base model. I’ve driven both the Cruze and the Volt, and from a roominess and comfort perspective, they are the same car.
The Volt can go 35 miles on its battery power before converting to its 9.3 gallon gas tank reaching a total range of 379 miles. The Cruze gets an EPA rating of 28 mpg city/42 mpg highway with a range between 352 and 529 miles on its 12.6 gallon gas tank.
Of course, the Volt is electric for 35 miles, but you have to pay to plug it into the wall in your garage with an estimated cost by the Chevy dealer of $1.95 per charge on my home electric bill.
This illustration shows the challenge of the so-called green economy in creating jobs. Will most consumers in the market for a fuel-efficient vehicle to save a few dollars on gas, choose to pay $40,000 or $19,000 for essentially the same car, because one gives marginally better gas savings? The answer is obviously no.
This is why the Chevy Volt has only sold a total of 3,895 cars in the first three quarters of 2011, but many of the customers who come in curious about the Volt end up buying the Chevy Cruze. In fact, 187,524 Cruzes were sold by GM in the first nine months of the year.
General Motor’s CEO Mark Reuss admits this phenomenon in the Flint Journal where he says, “The Volt is leading to a lot of Cruze sales.”
While GM can easily see that the Volt is nothing more than a curiosity to bring in buyers. The Department of Labor’s green job training program is left in the unenviable position of training workers to work on the Volts of the economy, where there is not a demand rather than being trained to work on the Cruzes where there is.
The human cost of this policy choice is devastating as potential workers sacrifice their time and other productive options to get trained for jobs that are merely an Obama Administration pipe dream.
While the Solyndra-type scandals get the headlines, the real tragedy is the people who have their lives delayed once again by receiving officially sanctioned Labor Department training for jobs that everyone knows don’t exist. How do they get their time back? Are they going to be willing to engage in another job training program for a real job when this one was a political ruse?
These real people who have been effectively defrauded by the Obama Administration through the green jobs promise have a right to feel cheated.
At the very least, the House Appropriations Subcommittee on Labor should find a way to stop Obama’s Labor Department from wasting even more people’s time and money by rescinding all funding for the failed jobs training program.
After all, that is exactly what the Labor Department’s own Inspector General recommended.