The Withering Cost Of The Shiny, Green Jobs
355 Jobs For $10Bn ? Feel The Burn-Rate!
Drama ensued last Tuesday when Dr. Molly Sherlock enjoyed the career-enhancing experience of getting to testify before the House of Representatives on the 1603 grant program administered by the Department of Energy. This program was set up to fund the creation of so-called Green Jobs. Unfortunately for Dr. Sherlock, Congressman Cory Gardner (R, Colo) was the one wearing the green eyeshades. The relevant questioning follows below.
Dr. Molly Sherlock, the CRS specialist, first said the jobs total would depend on the type of job–and differentiated between “induced,” “direct,” and ”indirect” jobs–before Gardner asked for a straight number.
“I just want to know how many jobs were created,” Gardner said during the hearing.
“If you’re looking at the direct jobs, this one estimate has direct jobs created at 3,666 in the construction phase, and direct jobs created at 355,” Sherlock said. “Direct jobs would just be the construction jobs and the ongoing operations and maintenance jobs. But if you wanted to look at the supporting jobs in other industries then you’d want to look at the other figures.”
“So for direct jobs—just if we look at the first year, this is average jobs per year, it’s 355 jobs per year—in two years, 355 jobs created a year, $10 billion?” Gardner asked.
“That would be jobs per year going forward,” Sherlock responded, “so these would be jobs that would be retained, average jobs per year going forward, yes.”
“For $10 billion?” Gardner clarified.
“Yes,” Sherlock said.
Ok, so we are to assume that the Obama Administration just forked over $10Bn or so in outlays and funded the labor of 4,011 individuals in return for this largesse (355+3,666). We can further extrapolate that an additional unfunded requirement for 355 of these Green Jobs stretches on into perpetuity. Thus, we can make some basic inferences regarding the burn rates of said Green Jobs program and thereby ascertain a sense of just how efficiently our executive branch is governing America.
Contra Congressman Gardner, we calculate a burn rate per job using all 4,011 of the staffers who worked the program. Fear not, Good Congressman, it will still make anyone who has managed an operation beyond the complexity of a lemonade stand boil with righteous indignation. $2,493,143 per Fiscal Year will get you one green job.
Assuming these jobs are fairly standard civil service positions, the workers make about $100,000. We can use this ROM to further estimate a wrap rate. That is, it requires 2493.14% of salary to hire one bureaucrat to a green job under this particular program. So if you hire 355 of these Green Workers, you pay them $35,500,000 while expending $885,066,068 just to maintain these people on staff.
We can’t completely quantify the extent to which this performance would flunk the standards applied to much of anything the government does that has standards without a leafy, green comparison to another part of the executive branch. I recently completed an estimate of labor costs for a defense contractor on a Major Defense Acquisition Program. They had a burden of 270% which meant it cost $250/ hour to hire a software engineer who worked for $85 per hour. Using a 1,823 hour labor year, we pay this individual $155K per year for his services and pay $418K for the pleasure of having she or he around the office. If there were 355 of these charming and talented people in our software shop, we would pay $149M to pay out $55M in salaries.
Of course The Department of Energy responded with righteous indignation to the charges that their program was somehow unecessary or even remotely mismanaged. A fine exercise in surreality follows below:
“The highly successful 1603 tax program has played a critical role in the dramatic expansion of America’s renewable energy industry over the past three years – supporting more than 30,000 renewable energy projects, leveraging more than $25 billion in private sector investments and creating tens of thousands of jobs in installation, construction and operation, as well as up and down the manufacturing supply chain,” said DOE spokesperson Jen Stutsman. “This program has helped to build infrastructure that will spur economic development and job creation in the country over the long-term and ensure the United States can compete in the global clean energy economy.”
If this is what success looks like tot he Obama Administration, cry the beloved country! I hope that by sharing this with you this fine afternoon that I have successfully explained why it is imperative to vote our current ineffective President out of office before he makes to many more important decisions regarding someone else’s monetary resources. Mitt Romney 2012. That is all.