New CEA Chair

The president has named a new head of the Council of Economic Advisers:

Green Jobs

A number of political leaders have discussed "green jobs" as a way of fostering economic growth and protecting the environment -- a trade-on instead of a trade-off. So far, the idea has been a disappointment. The New York Times reports:

A study released in July by the non-partisan Brookings Institution found clean-technology jobs accounted for just 2 percent of employment nationwide and only slightly more — 2.2 percent — in Silicon Valley. Rather than adding jobs, the study found, the sector actually lost 492 positions from 2003 to 2010 in the South Bay, where the unemployment rate in June was 10.5 percent.

Federal and state efforts to stimulate creation of green jobs have largely failed, government records show. Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.

The weatherization program was initially delayed for seven months while the federal Department of Labor determined prevailing wage standards for the industry. Even after that issue was resolved, the program never really caught on as homeowners balked at the upfront costs.

“Companies and public policy officials really overestimated how much consumers care about energy efficiency,” said Sheeraz Haji, chief executive of the Cleantech Group, a market research firm. “People care about their wallet and the comfort of their home, but it’s not a sexy thing.”

Austan Goolsbee on Politics and Academia

At The Atlantic, Megan McArdle profiles Austan Goolsbee, outgoing chair of the president's Council of Economic Advisers:

But really, people place absurd demands on academics who become political advisers: They want former professors to publicly criticize their boss’s policies as if in an academic seminar. And they grouse if the politicians don’t make policy as if they, too, were living inside a theoretical model. This is not reasonable—and criticizing people who can’t meet this impossible goal seems likely to diminish the quality of the advice, not improve the quality of the policy.

“There’s a certain kind of academic that comes to Washington and can’t survive,” Goolsbee said. “They’re the ones starting each sentence with ‘The economic model says.…’ They are prone to silver-bullet-style answers, which demonstrate very sophisticated thinking about the model but very unsophisticated thinking about the real world.” The model may be missing a few things that are found in the real world—not least, the institutional and political obstacles that make some problems silver-bullet-proof. “If you’re going to be an academic who’s involved in the world of policy, you have to be involved in the world that exists,” Goolsbee told me. “I was always a data guy, not a theorist. Theorists can maintain total purity. The data are always messy.”

Goolsbee expects to take some heat for his administration’s actions, and for his loyalty, especially because he’s going back to the University of Chicago—where a graduate-school applicant once said during an interview that he wanted to do public finance and was told, “At Chicago, we don’t consider that a field.” Goolsbee seems unfazed by the prospect. “I have no doubt that there will be some heated arguments in the seminar rooms and in the hallways. But in some sense, that’s why I want to get back to Chicago. If you want to be repeatedly told by your own allies, ‘Oh, yes, we are 100 percent right; those other guys are crazy,’ then Washington is more for you.”