Green Collars

I had mentioned the futility of going into debt to finance home energy improvement projects under deflation; it doesn't make much sense to do it if I can defer it, particularly if deflation impacts the price of energy.

It might be cheaper in the future to purchase goods and services. Future energy might be cheaper such that the goal of an energy improvement project (that is, saving money) is negated. And paying interest on debt is much more corrosive during a deflation.

But man! The nominal cost of borrowing money is so low! I could refinance my existing mortgage of $37,800 plus another $20,000 and take care of a great many things: AC, duct sealing, attic insulation, low-e windows, hot water recirc pumps, envelope sealing, water heater, and the nominal rate would likely be around 5%! Lower than my current 5.625%.

But...I will defer. Energy is now too cheap to save. If deflation continues it is better not to take on any more debt, and to focus on paying down existing debt. And as I hoard my dollars, the economy slows. The HVAC guys will have one less job to do. It's a fascinating dynamic.

I wrote all that to say this: if someone like myself, who proclaims to give a shit about energy consumption, won't ignore these deflationary costs, then who would? I consider my direct cost, to be sure, but within a basket of other considerations; non-renewable resource depletion, global warming, military adventures expenditures, air quality, etc. I am willing to consider a great many other hidden social benefits, and very few people would...so if I won't take the plunge to reduce my energy use, who would?

Remember, Obama wants 5 million green jobs. My home projects would employ green workers. He wants 5 million green jobs in a nation that employs 1.5 million jobs in the non-renewable energy sector -- when gas is a buck fifty, when there's a 16 year payback on solar panels, and when people like myself are not debt-financing improvements and not hiring green collar workers...is this possible?