Aldy concludes green stimulus was worth it, even if federal clean-energy loan guarantee program wasn't
The federal clean-energy loan guarantee program that gave you Solyndra wasn’t just a multibillion-dollar political debacle – it also didn’t create jobs, didn’t reduce carbon emissions and ran up financial risk for taxpayers.
And yet, the program wasn’t enough of a bust to outweigh the job-creation and emissions-reducing successes of the complete $90 billion “green stimulus” the Obama administration built into the $800 billion American Recovery and Reinvestment Act four years ago, as the country was plunging deeper into recession.
These are the conclusions Harvard University economist Joseph Aldy reaches in a new research paper on the economic and environmental effects of the Recovery Act, just published online by the Review of Environmental Economics and Policy. They’re notable – particularly the harsh critique of the loan guarantees – because Aldy helped craft the act from inside the White House. (Here is an earlier version of the same paper available without a subscription.)
His top-line, and unsurprising, takeaway is that the green stimulus was worth it – perhaps not optimally cost-effective, but still important for both jobs and carbon, even if neither unemployment nor emissions levels are where America needs them to be today.
