There would be no Green Energy Industry if there were no Green Energy Subsidies

Posted by PITHOCRATES - March 15th, 2014

Week in Review

Green energy investments are a horrible investment.  The only reason why anyone is building green energy projects is because of taxpayer subsidies.  If you take away the subsidies the green energy industry is just going to stop building these bad energy projects.  Which is what’s happening now (see Here Are The 10 Best States For Clean Energy Jobs In 2013 by Aaron Tilley posted 3/12/2014 on Forbes).

Clean energy investments had it rough in 2013, and US job growth in that sector is having a bit of trouble too.

That’s at least according to evidence in a new report out today from Environmental Entrepreneurs (E2),an environmental advocacy organization for businesses. While the clean energy industry made plans to add an additional 78,000 new jobs at 260 projects in 2013, that’s a 30% dip from the 110,000 job announcements in the previous year. (E2 has only been tracking clean energy job growth for the past two years…)

The biggest reason for the 30% drop in job growth over last year is due to ongoing regulatory uncertainty around federal tax credits and state renewable energy mandates, says E2 communications director Bob Keefe. Congress let the generous tax credits the wind energy industry had enjoyed for more than two decades expire in December–and it looks unlikely they’ll be reinstated in 2014. And four major energy efficiency tax credits and initiatives expired at the end of last year too. On top of that, several states, including North Carolina and Kansas, have attempted to roll back mandates on renewable energy requirements for their utility grids.

If anyone bemoans a cut in government spending in some government program don’t blame the Republicans.  Blame the Democrats.  And their green energy cronies.  The Democrats are taking money away from other programs to pay for these white elephants just so they and their crony friends can get rich.

These projects cost a fortune to build.  And the return on investment just isn’t there.  Which is why it takes hundreds of millions in taxpayer subsidies to build them.  That’s a lot of money to spend when these projects accomplish nothing. They don’t allow us to shut down one coal-fired power plant.  Because we’ll need those coal-fired power plants to provide electric power when the sun doesn’t shine and when the wind doesn’t blow.  And they take up so much real estate that they’re displacing wildlife from their natural habitat.  While wind farms are hacking American Bald Eagles and other birds to death.  So they’re not helping the environment.

And they’re not improving the reliability of our electric power.  Or lowering the cost.  Every time they shut down a coal-fired power plant they increase our electric bills.  And increase the brownouts and blackouts we have to endure when we have to rely on less reliable power that costs more (we have to pay more for our electric power to pay for those subsidies) than the more reliable power.  This is our government when Democrats are in power.  And just imagine how they will run our health care.  Who do you think they’ll make rich?  And how much will they increase our health care costs?  While giving us an inferior health care system?  It’s going to happen.  Because that’s what happens when Democrats are in power.


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Oil Trains Derail as President Obama tries to Enrich his Rich Billionaire Friends

Posted by PITHOCRATES - January 4th, 2014

Week in Review

If there are two things President Obama doesn’t like they are rich people and oil.  Well, at least he acts that way.  Espousing more concern for the working man.  And clean energy.  Which is why President Obama said “no” to the Keystone XL pipeline.  Or could there have been another reason (see BNSF opens North Dakota track as oil by rail faces more scrutiny by Nicholas Sakelaris posted 1/2/2014 on the Dallas Business Journal)?

Burlington Northern Santa Fe re-opened the double track Thursday morning outside Casselton, N.D., where an oil train collided with a grain train, causing a massive fireball-like explosion earlier this week…

Fort Worth-based BNSF hauls an estimated 750,000 barrels of crude oil per day. The railroad carried an estimated 100 million barrels of crude oil out of the Bakken in 2012, a massive increase from previous years.

You know who owns Burlington Northern Santa Fe (BNSF)?  Warren Buffett.  For BNSF is a wholly owned subsidiary of Berkshire Hathaway.  So Warren Buffet is profiting greatly from President Obama’s rejection of the Keystone XL pipeline.  One can’t help to wonder if that has anything to do with the Buffett Rule (see Buffett would profit from Keystone cancellation by Dave Boyer posted 1/24/2012 on The Washington Times).

Warren Buffett, whom President Obama likes to cite as a fair-minded billionaire while arguing for higher taxes on the wealthy, stands to benefit from the president’s decision to reject the Keystone XL oil pipeline permit.

Mr. Buffett’s Berkshire Hathaway Inc. owns Burlington Northern Santa Fe LLC, which is among the railroads that would transport oil produced in western Canada if the pipeline isn’t built…

If completed, the $7 billion Keystone XL would deliver 700,000 barrels a day of crude from oil sands in Canada to Texas refineries on the coast of the Gulf of Mexico. It would traverse about 1,600 miles.

The State Department’s review of the project said shipping oil via rail is more costly than delivering it to refineries by pipeline.

Mr. Obama often cites Mr. Buffett as an example of a civic-minded billionaire because the entrepreneur has said he should pay a higher tax rate than his secretary. Mr. Buffett and the president like to tell the story of how Mr. Buffett pays a 15 percent effective tax rate, while his secretary pays a higher rate even though she earns only a fraction of what he does.

The president has called his push for higher taxes on the wealthy the “Buffett rule.”

Funny.  Warren Buffett says we should tax rich people more and the Keystone XL pipeline doesn’t get built.  Instead that oil goes on Buffett’s trains.  Making him a lot of money.  Just like the president’s rich friends on Wall Street are making a lot of money.  Who have all gotten richer under the Obama presidency while median family income fell for Main Street.  So more oil is traveling across the country.  Some of which is derailing and soaking into our pristine environment.  Or exploding.  While rich people are getting richer.  And President Obama would have us believe he’s for the working man and clean energy.

It would seem President Obama is more for getting Democrat supporters rich than helping Main Street.


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President Obama’s Green Initiatives did not Create Jobs or Save the Planet

Posted by PITHOCRATES - June 2nd, 2012

Week in Review

If the Energy Department was a private corporation it would be the ideal bailout target for a company like Bain Capital.  Inept management, poor investments and bad strategic policy.  It has everything.  So much so that it would be easier for the bailout team to ask them at Energy what actually worked.  It would keep the initial meeting much shorter (see Difference Engine: To and from the grid posted 6/1/2012 on The Economist).

Since then, interest rates have fallen, while the price of solar panels has tumbled even more so—thanks to Chinese overcapacity. Meanwhile, electricity rates (at least those in southern California) have risen noticeably. Your correspondent reckons photovoltaic solar systems now cost half as much as they did four years ago.

Two things could make or break America’s affair with solar power. One concerns the ushered in by the economic stimulus bill of 2009. Many of those temporary tax credits are now coming to an end. If nothing is done to extend them, the incentives will fall from a peak of over $44 billion in 2009 to $16 billion this year and $11 billion by 2014. That could bring the solar-installation business to a screeching halt and wipe out tens of thousands of green jobs. The industry’s future depends largely on the outcome of the November election….

The irony is that those who invest their own money to generate clean electricity from solar panels on their rooftops are likely to be the last to benefit from it environmentally. Nowadays, most people work outside the home during the day and consume the bulk of their residential electricity in the evening and during the night. In California, that is when the state—which meets only 70% of its electricity requirement from its own resources—relies heavily on cheap electricity imported from dirty coal-fired power stations elsewhere in the country. This situation will only be exacerbated if, as expected, plug-in battery vehicles, needing to be recharged overnight, account for an increasing share of the Californian fleet.

That aside, all your correspondent now has to worry about is whether the 31% anti-dumping tariff recently imposed on Chinese solar-panel makers really does deter them. Having seen such trade spats play out many times before, he suspects the tariffs will only spur Chinese firms to acquire the few remaining American solar-panel makers so that they can carry on manufacturing in low-cost Wuxi or Shanghai and do their final assembly in middle America (presumably with local subsidies to boot).

So solar panels have never been cheaper thanks to the Chinese.  Which is good.  These lower prices will encourage people to save the planet by installing solar panels onto their roofs.  Unless the government raises these low prices with a 31% anti-dumping tariff.  Hmm.  Looks like you have to choose between saving the planet.  And providing green jobs.  For as this anti-dumping tariff clearly shows you can’t have both.

And because jobs are more important than the environment the government is subsidizing the clean energy industry.  Let’s crunch some numbers.  They say we could lose “tens of thousands of green jobs.”  So let’s assume there were 80,000 jobs created in the first year.  And they declined by 10,000 every year to reflect with the growing number of bankruptcies in the green energy sector.  Dividing the incentive by the cost in the first year you get a cost of about $550,000 for each job created.  If do the same for the last year you also get a cost of about $550,000 for each job created.  That’s a lot of money to pay someone.  And I’m guessing that the Chinese aren’t paying their employees a half million each in wages and benefits.  Not when they’re making these solar panels so cheap that the U.S. has to slap an anti-dumping tariff on them.

Of course these numbers don’t include the $500 billion the government blew on Solyndra.  Or the other Solyndras out there.  Which when you factor all of these in these green jobs are costing the taxpayer probably in excess of a million dollars each.  For what?  To pay someone a $50,000 wage on an assembly line so he or she can take these earnings and stimulate the economy?  Talk about a negative return on investment.  And the president is attacking Mitt Romney’s Bain Capital past?  If Bain Capital took over the United States government to turn it around to get a sensible return on tax dollar investments guess who would be the first fired from his job?  The incompetent chief executive that spent a million dollars plus to get $50,000 worth of stimulus.

And the kicker is that none of this matters.  When solar power is available people are at work.  When people are home cranking up their air conditioners and plugging in their electric cars for the night the sun is down and coal-fired power plants are meeting this peak demand.  So we get nothing.  No jobs.  And we don’t even save the planet.  We just get higher taxes and more debt.  A pretty crappy deal if you ask me.  We have coal.  We should just use coal.  And not demonize it.  We’d arrive at the same outcome.  Only with fewer taxes and less debt.  And cheaper electricity.  Because we’d be bringing more coal-fired plants on line.  Now that is a smart turnaround plan.  The kind of turnaround that could end up in the win column at Bain Capital.


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The Australian Government avoids using ‘Carbon Tax’ in Television Ads

Posted by PITHOCRATES - May 27th, 2012

Week in Review

You know a tax is unpopular when you buy advertising to sell the subsidies you can get to avoid paying that tax.  Without mentioning that tax by name (see Tax focus groups don’t test the c-word by AAP posted 5/28/2012 on The Australian).

THE Gillard government did not test the term carbon tax in focus groups for a television advertisement promoting its household assistance package.

The government is spending $36 million over two years on print, radio and television ads to sell the package, which aims to cushion the financial impacts of the carbon tax.

Assistance payments already have begun to land in bank accounts even though the tax does not begin to operate until July 1…

The department’s deputy secretary, Felicity Hand, said the government decided the campaign should primarily focus on the payments.

“There had been a lot of public relations activity previously that had linked household assistance package to clean energy future and carbon pricing,” she said.

Contextual information about the carbon tax was available at a website and if people phoned the hotline number.

Focus group testing.  Imagine that.  The carbon tax is so toxic and unpopular that the government is desperately trying to cushion the financial impact of it.  With some pretty commercials.  I guess to make you feel like you’re making a difference while you’re sitting at home with less of your earnings to spend because of that new carbon tax.  But they dare not mention the c-word.  Because, apparently, the people don’t want anything to do with that environmental BS.  The Australians are a hearty breed.  And more than a few got their ass kicked by the outback.  And yet that environment is so fragile that watching television at night might kill it.  Unless they pay a carbon tax on their electric bill. 

Amazing how all of government’s solutions come down to this.  Taking away our earnings for our own good.  And, of course, lying to us.  For the focus group testing tells them that telling us the truth will make us reject them and their silly policies.


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Destroying the Economy, Destroying Health Care – Obama Trying to Surpass Jimmy Carter in Destruction

Posted by PITHOCRATES - October 16th, 2011

We Need 14 million Jobs to Break Even Now and a 6.8% Growth Rate on 100,237 Green Jobs just ain’t Going to Do It

According to President Obama, this is our future.  Clean energy.  Renewable energy.  Green energy.  These are the high-tech, high-paying jobs of the future.  And look how they are growing (see California has 1 in 4 U.S. solar energy jobs, study says by Marc Lifsher posted 10/17/2011 on the Los Angeles Times).

One in every four solar energy jobs in America is held by a Californian, and growth in the clean-tech industry is burgeoning nationwide, a new study said.

In August, California had an estimated 25,575 solar-related jobs out of 100,237 for all 50 states, according to the National Solar Jobs Census 2011…

Nationally, employment in all parts of the solar industry, including manufacturing, installation, residential, commercial and large-scale power generation, grew 6.8% in the 12 month period ended in August.

Wow.  Imagine that.  There’s a total of 100,237 solar energy jobs in the country.  Of course, that number is not so impressive when you consider there are approximately 14 million people unemployed right now.

So these solar energy jobs represent jobs for approximately 0.716% of the unemployed.  For these clean energy jobs to be in fact our future they are going to have to do better than 6.8% growth.  Just to put these 14 million unemployed back to work they’re going to have to grow that 100,237 by 13,866.7%.  That’s a lot of growth.  And it’s never going to happen.

It’s funny how President Obama is all for a mix when it comes to deficit reduction.  Spending cuts AND tax increases.  Has to be a mix.  Because he says you just can’t cut the deficit by spending cuts alone.  Which is preposterous.  When you’re spending too much spending less ALWAYS works.  But that’s another story for another time.

Clean energy.  Renewable energy.  Green energy.  These aren’t our future.  They may be part of our future.  But they aren’t going to be THE future.  Unless you don’t care to have jobs in that future.  Which, of course, we need.  Desperately need.  So, at best, these clean jobs can only be a small part of the mix.  A very small part.  Because we need 14 million jobs to break even now.  And we’ll need more to handle normal population growth.  And a 6.8% growth on 100,237 just ain’t going to do it.

Nothing ever Good Happens to those Being Enticed by Bait (Entangling Federal Grants)

It would be hard for the Obama economic policies to be any more wrong.  But they can be.  Thanks to Obamacare.  Whose regulatory costs have frozen business growth.  And it gets worse (see Mackinac Center: No rush for legislators to create health insurance exchange by Jack McHugh posted 10/16/2011 on the Detroit Free Press).

Gov. Rick Snyder is urging lawmakers to create a state health insurance exchange, which some supporters soft-pedal as a Travelocity or Orbitz for health care. Simultaneously, the Snyder administration is pursuing strings-attached federal grants that increasingly commit the state to something very different — a full-blown exchange compliant with regulations mandated by the new federal health care law. That means the resulting entity won’t be an exchange at all, but rather the agency through which the federal Patient Protection and Affordable Care Act’s mandates, subsidies and regulations will be administered by the state…

But Heritage itself has exploded claims of kinship with Affordable Care Act exchanges. Heritage scholar Ed Haislmaier wrote recently, “Rather than serving as a mechanism for expanding health insurance choice, variety and competition … Congress has perverted the exchange concept into a bureaucratic tool for federal subsidization, standardization and micromanagement.” Haislmaier recommends that states refuse the entangling federal grants that the Snyder administration is pursuing.

Sigh.  The siren song of federal money.  Can no one resist it?

There’s another word for ‘entangling federal grants’.  Bait.  Ever have a problem with raccoons?  Cute little things.  But not in your backyard.  Because they can do quite the damage.  So you call your friendly trap and release animal control specialist.  To trap these cute little critters and release them in the country where they belong.  And do you know how they get these clever little things into these traps?  Bait.  That’s right, you trick them with something that seems really good to them.  Once they enter the trap the door closes.  And they are then at the mercy of the animal control specialist.  Much like any state that takes these federal grants that come with all those federal strings.

Nothing ever good happens to those being enticed by bait.  Some animals learn to avoid traps.  Being human, it should be easier for us to avoid these traps.  Because we can think.  And should know better.

So it’s Bad on the Jobs Front and it’s no Better on the Health Care Front

The only jobs policies we have are bad policies.  Pouring money into industries that can’t grow fast enough to reduce unemployment.  Meanwhile, we hinder job creation by throwing Obamacare at our job creators.  They have no idea what that thousand-plus-page law will cost.  So they’re doing the only thing they can.  Don’t hire.  Don’t grow.  And sit on cash.  Until the uncertainty goes away.  Or Obamacare is repealed.

So it’s bad on the jobs front.  And it’s no better on the health care front.  Obama is working stealthily to entrench this most unpopular legislation as best as he can.  Whether we want it or not.

Destroying the economy.  Destroying health care.  Looks like he really wants to replace Jimmy Carter in the history books as the worst president of all time.


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President Obama: Worse President than George W. Bush? Or Worst President Ever?

Posted by PITHOCRATES - July 8th, 2011

Obama Rolling up his Sleeves and Wagging his Finger

President Obama has taken out his wagging finger.  And he has wagged it.  Scolding Republicans to grow up and be like his daughters.  It is interesting he referred his daughters for an example of responsible behavior.  And not himself.  Because his track record on acting responsibly hasn’t been all that good as Charles Krauthammer points out and lists some of his failings (see The Elmendorf Rule by Charles Krauthammer posted 7/8/2011 on The Washington Post).

• Ignored the debt problem for two years by kicking the can to a commission.

• Promptly ignored the commission’s December 2010 report.

• Delivered a State of the Union address in January that didn’t even mention the word “debt” until 35 minutes in.

• Delivered in February a budget so embarrassing — it actually increased the deficit — that the Democratic-controlled Senate rejected it 97 to 0.

• Took a budget mulligan with his April 13 debt-plan speech. Asked in Congress how this new “budget framework” would affect the actual federal budget, Congressional Budget Office Director Doug Elmendorf replied with a devastating “We don’t estimate speeches.” You can’t assign numbers to air.

Not even a modicum of responsibility there.  So he’s rather like the pot calling the kettle black.  He should perhaps have said “do as I say and not as I do even though I do not do as I say you should do but that’s okay because I’m smarter than you so there.  When will all of you finally get this?”

But the Republicans, insolent as they are, refuse to budge.  So Obama had to bring out the wagging finger to discipline these insolent children.  Advising them to be more like his own children.  Who do their homework in a timely manner.

My compliments. But the Republican House did do its homework. It’s called a budget. It passed the House on April 15. The Democratic Senate has produced no budget. Not just this year, but for two years running. As for the schoolmaster in chief, he produced two 2012 budget facsimiles: The first (February) was a farce and the second (April) was empty, dismissed by the CBO as nothing but words untethered to real numbers.

Obama has run disastrous annual deficits of around $1.5 trillion while insisting for months on a “clean” debt-ceiling increase, i.e., with no budget cuts at all. Yet suddenly he now rises to champion major long-term debt reduction, scorning any suggestions of a short-term debt-limit deal as can-kicking.

That’s right, neither the Democrats nor Obama has done any responsible fiscal legislating/governing for the past two years.  Looks like the responsible shoe is on the other foot.  And those deficits?  They’re records.  Over 5 times larger than those world-ending Reagan deficits.  Yet he has the audacity to wag that finger at the Republicans for not being responsible?  Perhaps he should be wagging that finger at himself. 

And what have been Obama’s own debt-reduction ideas? In last week’s news conference, he railed against the tax break for corporate jet owners — six times.

I did the math. If you collect that tax for the next 5,000 years — that is not a typo — it would equal the new debt Obama racked up last year alone. To put it another way, if we had levied this tax at the time of John the Baptist and collected it every year since — first in shekels, then in dollars — we would have 500 years to go before we could offset half of the debt added by Obama last year alone.

Obama’s other favorite debt-reduction refrain is canceling an oil-company tax break. Well, if you collect that oil tax and the corporate jet tax for the next 50 years — you will not yet have offset Obama’s deficit spending for February 2011.

It is clear the president is in reelection mode.  Because he’s stoking the fires of class warfare.  Rich people fly jets.  And own oil companies.  Rich people are getting sweetheart tax deals.  Saving them billions.  And he wants to put a stop to this unfairness.  And make it fair.  It won’t help to erase the deficit at all.  But it gives you something to campaign on.  Which he needs.  Because his policies have been an economic train wreck. 

The June Jobs Report is worse than May’s

How bad have those policies been?  The June jobs report is in.  And it’s worse than May’s (see June Jobs Report Lands With A Thud: Up Just 18,000 by Steve Schaefer posted 7/8/2011 on Forbes).

In a stark reminder that the U.S. economy has been mired in slow growth, the Labor Department reported Friday that nonfarm payrolls added just 18,000 jobs in June and unemployment came in at 9.2%…

The stunning lack of improvement in June’s report – April’s payrolls figure was revised to 217,000 from 232,000 and May’s cut by more than half to 25,000 from 54,000 – rocked Wall Street Friday morning, as index futures sharply reversed after indicating small opening gains earlier. The Dow Jones industrial average, S&P 500 and Nasdaq were all signaling a red start to the trading session after solid gains Thursday.

And as bad as the May report was, the current report revises the May numbers down.  Fewer jobs were added than originally reported.  April’s, too.  It’s a trend.  Both a downward trend in job creation.  And the revising of previous reports.  Which means the anemic 18,000 jobs reported in June will likely be revised down in the July report.  There’s no good economic news out there.  The stimulus spending failed in a big way.  Which is why Obama is resorting to class warfare.  Because economically he has been an utter and absolute failure.

The June Jobs Report is even worse than it Says

And as bad as the June report was, it’s worse (see Without Dropouts, Jobless Rate Would Be Over 11% by Phil Izzo posted 7/8/2011 on The Wall Street Journal).

The share of the population in the jobs market, called the labor-force participation rate, fell to 64.1% last month — the lowest level since 1984 when women were still just beginning to enter in full force… The participation rate was 66% at the start of the recession and 65.7% when the recovery started in June 2009. If the participation rate were still at that level, the unemployment rate would be more than 11% right now…

There’s also a problem of underemployment. A comprehensive gauge of labor underutilization, known as the “U-6″ for its data classification by the Labor Department, accounts for people who have stopped looking for work or who can’t find full-time jobs. That number shot up in June to 16.2% from 15.8% a month earlier.

If we count the people who have given up looking for a job the actual unemployment rate would be as a high as 11%.  If you add in all those only working part-time because they can’t find a full-time job the unemployment rate jumps up to 16.2%.  These are horrible numbers.  How horrible?  These are more Great Depression numbers than George W. Bush numbers.

The Green Energy Bubble

America became the world’s largest economy thanks to the innovation of the private sector.  Great entrepreneurs like Andrew Carnegie, John D. Rockefeller and Henry Ford took risks.  The government didn’t have to tell them how to make steel better, more plentiful and cheaper.  Or how to make gasoline better, more plentiful and cheaper.  Or how to make automobiles better, more plentiful and cheaper.  That’s capitalism in the free market.  The private sector takes risks in pursuit of profits.  And when it does it makes things better, more plentiful and cheaper.  When people like Carnegie, Rockefeller and Ford are left alone to do what they know how to do best.  Create wealth.  And jobs.

Obama, on the other hand, believes he knows best.  That he’s smarter than these entrepreneurs.  And that he can direct the private sector to do his bidding.  Which, of course, in his Ivy League world, should result with economic activity.  And jobs.  Even if you’re telling people to build stuff the market doesn’t want (see The Coming Clean Tech Crash by Devon Swezey posted 7/7/2011 on Forbes).

The global clean energy industry is set for a major crash. The reason is simple. Clean energy is still much more expensive and less reliable than coal or gas, and in an era of heightened budget austerity the subsidies required to make clean energy artificially cheaper are becoming unsustainable.

Clean tech crashes are nothing new. The U.S. wind energy industry has collapsed three times before, first in the mid 1990s and most recently in 2002 and 2004 when Congress failed to extend the tax credit that made it profitable. But the impact and magnitude of the coming clean tech crash will far outstrip those of past years.

After one of the worst housing bubbles in U.S. history we now have a green energy bubble.  That’s about to pop.  And you know what happens when a bubble pops?  You get a recession.  To correct for all that malinvestment (to borrow a little Austrian School vernacular).  Which is pretty bad considering we’re still trying to recover from the first bubble.  And may very well still be in a recession despite all the massaging of economic data to say otherwise.  So if we’re still in a recession perhaps the pop of this bubble will push us into depression.  If we’re not in one already.  Based on those god-awful employment numbers.

As part of its effort to combat the economic recession, the federal government pumped nearly $80 billion in direct investment and tax credits into the clean energy sector, catalyzing an unprecedented industry expansion. Solar energy, for example, grew 67% in the United States in 2010. The U.S. wind energy industry also experienced unprecedented growth as a result of the generous Section 1603 clean energy stimulus program. The industry grew by 40% and added 10 GW of new turbines in 2009. Yet many of the federal subsidies that have driven such rapid growth are set to expire in the next few years, and clean energy remains unable to compete without them.

The crash won’t be limited to the United States. In many European countries, clean energy subsidies have become budget casualties as governments attempt to curb mounting deficits. Spain, Germany, France, Italy and the Czech Republic have all announced cuts to clean energy subsidies.

Can’t compete without them?  So what was the point in giving them all of those subsidies in the first place?  Were we forever going to pay for a more costly energy while less costly energy (i.e., fossil fuel) was available?  Apparently so.   Being that the life-blood of an economy is energy that would have just raised the cost of all businesses.  And the price of all consumer goods.  Less disposable income means less demand.  Less demand means fewer jobs.  Not a good plan, really.  Unless your goal is to put the country into a depression.

And the problem is global.  So the coming economic crisis will be global.  As if the European Union didn’t have enough financial crises on their hands already.  This could even hurt those emerging markets of China, India and Brazil.  Who depend on these export markets.  As we depend on them.  To buy our debt.

The U.S. has tried this clean energy before.  And all of these attempts ended in failure.  For the reasons already noted.  But if we’ve tried this so many times before, why haven’t we figured out how to do it right?  To find that innovation that makes it cost-competitive with fossil fuels?

Why is the United States still locked in this self-perpetuating boom-bust cycle in clean energy? The problem, according to a new essay by energy experts David Victor and Kassia Yanosek in this week’s Foreign Affairs, is that our system of clean energy subsidization is jury-rigged to support the deployment of only the least-risky and most mature clean energy technologies, while lacking clear incentives for continual innovation that could make clean energy competitive on cost with conventional energy sources. Rather, we should “invest in more innovative technologies that stand a better chance of competing with conventional energy sources over the long haul.” According to Victor and Yanosek, nearly seven-eighths of global clean energy investment goes toward deploying existing technologies that aren’t competitive without subsidy, while only a small share goes to encouraging innovation in existing technologies or developing new ones.

Oh, that’s why.  Because the government is in the business of picking winners and losers when it comes to the lottery of free government money.  Which is par for the course.  For government spending is about political cronyism.  That money is spent based on political forces.  Not market forces.  Which is a shame.  Because spending that money isn’t necessary.  Because there is an incentive to create cost-competitive green energy.  Unfortunately, that incentive is being distorted by the government subsidies.

It is clear that the current budgetary environment in the United States presents challenges to the viability of the fast-growing clean energy industry. But it also presents an opportunity. By repurposing existing clean energy policies and investing in clean energy innovation, the United States can be the first country to make clean energy cheap and reliable, a distinction that is sure to bring major economic benefits in a multi-trillion dollar energy market.

Get rid of all that malinvestment and that multi-trillion dollar energy market will provide the necessary incentive for the private sector to solve the green energy problem. Making it cost competitive with fossil fuels.  For whoever cracks that nut will be the next Carnegie.  The next Rockefeller.  The next Ford. 

You want to create a green energy market?  Okay, I’ll tell you how to do it.  Step one, get government the hell out of the way.  Step two, eliminate the capital gains tax.  That will motivate people to spend money on solving the problem because if they’re successful they’ll be richer than the Kennedys.  Step three, enjoy your green energy.

Barack Obama and his Keynesian Economics have Failed

President Obama has no chance of reelection if he has to run on his economic record.  Because his economic record may prove to be the worst of all time.  And he knows it.  Hence the finger wagging.  And the class warfare.  He has spent more than any other president.  And not just a little more.  A lot more.  Before him the worst post-war federal deficits were around $200-400 billion.  Since Obama they’re around $1.5 trillion.  And yet he scolds Republicans for being irresponsible because they refuse to raise the debt limit without getting real spending cuts.  As if the Republicans spent all of that money.  Not him.  Or his Democrats.  If he was so worried about defaulting on American debt obligations he shouldn’t have spent money his administration didn’t have.  But he did.  And now he’s wagging his finger at Republicans.

And what did we get for all that spending?  Further proof that he and his administration are economically incompetent.  Government spending doesn’t create jobs.  And government doesn’t know better than the private sector.  He can talk with all the righteous indignation and all-knowing condescension he wants but it doesn’t change that fact.  America’s greatest economic achievements and innovation was done without Government butting into the private sector.

Barack Obama and his Keynesian economics have failed.  Time to try something new.


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Anti-Nuclear Crowd yearns for Chernobyl in Japan

Posted by PITHOCRATES - March 13th, 2011

Enough of Exploiting Japan’s Disaster for Political Gain

First it was an environmentalist saying global warming caused the 8.9 magnitude earthquake.  A sure grasping of straws in their quest to move man back into the cave.  Then it was anti-nuclear power Rep. Edward Markey of Massachusetts, the senior Democrat on the House Natural Resources Committee, who said we should learn from Japan’s near Chernobyl-like disaster.  And move back into the cave.  And now it’s Senator Joe Lieberman, chairman of the Senate Homeland Security and Governmental Affairs Committee, chiming in (see “Put the brakes” on nuclear power plants: Lieberman by Will Dunham posted 3/13/2011 on Reuters).

“I don’t want to stop the building of nuclear power plants,” independent Senator Joe Lieberman, chairman of the Senate Homeland Security and Governmental Affairs Committee, said on the CBS program “Face the Nation.”

“But I think we’ve got to kind of quietly put, quickly put the brakes on until we can absorb what has happened in Japan as a result of the earthquake and the tsunami and then see what more, if anything, we can demand of the new power plants that are coming on line,” Lieberman added.

Put the brakes on?  What, he wants to slow down from the breakneck speed we’re building new nuclear power plants and bringing them on line?  That’s going to be pretty hard to do considering the speed we’re going at.  I mean, when was the last time we built a nuclear power plant in the United States?

It’s not about what happened at the Fukushima Power Plant, it’s about what hasn’t Happened

We’re missing the big picture here.  The nuke plants didn’t kill or wipe out cities yet.  Like the earthquake-tsunami one-two punch has.  Let’s not lose sight of that little fact (see Nuclear Overreactions posted 3/14/2011 on The Wall Street Journal).

Part of the problem is the lack of media proportion about the disaster itself. The quake and tsunami have killed hundreds, and probably thousands, with tens of billions of dollars in damage. The energy released by the quake off Sendei is equivalent to about 336 megatons of TNT, or 100 more megatons than last year’s quake in Chile and thousands of times the yield of the nuclear explosion at Hiroshima. The scale of the tragedy is epic.

Yet the bulk of U.S. media coverage has focused on a nuclear accident whose damage has so far been limited and contained to the plant sites. In simple human terms, the natural destruction of Earth and sea have far surpassed any errors committed by man.

So in the grand scheme of things, the Japanese nuclear plants are minor players in this great tragedy.  Even that embellishes their role.  Much of Japan lies in waste.  Because of the earthquake and the tsunami.  The nukes so far have been innocent bystanders in the death and destruction.  But it’s all we focus on.  Even though they haven’t really done anything yet.  But under the right set of circumstances that don’t currently exist…they could.   So we use the big ‘what if’ to further shut down the already shutdown American nuclear power industry.  Why?  Simple.  Because congress can’t place a moratorium on earthquakes or tsunamis.

So back to that question.  When was the last time we built a nuclear power plant in the United States?

But more than other energy sources, nuclear plants have had their costs increased by artificial political obstacles and delay. The U.S. hasn’t built a new nuclear plant since 1979, after the Three Mile Island meltdown, even as older nuclear plants continue to provide 20% of the nation’s electricity.

So Senator Joe Lieberman wants to tap the breaks on a car that’s been parked and in the garage since 1979.  How does he do it?  Where does the genius come from?

No coal.  No oil.  And now no nukes.  Translation?  No power.  I guess we should practice our hunting and gathering skills.  Because we’re going to need them when we move back into the cave.  Of course, we’ll have to eat our food cold.  You know.  Carbon footprint.  From those foul, nasty, polluting campfires.

In America, Coal, Oil and Nuclear Power all Wear Black Hats

Some in Congress just love the planet so much.  They want to get rid of coal and oil and replace them with clean energy.  Which means nuclear power.  Because windmills and solar panels just won’t produce enough power.  Especially when they want us all driving tiny little electric cars that are going to suck more juice off our strained electrical grid.  And just how strained is our electric grid?  Remember the Northeast Blackout of 2003

High summer currents caused power lines to sag into untrimmed trees.  As lines failed some power plants dropped off the grid.  This strained other power plants.  And other power lines.  More lines failed.  More plants dropped off the grid.  This cascade of failures didn’t end until most of New York, Pennsylvania, Ohio, Michigan and Ontario lost power.  It was huge.  And if you experienced that hot, stifling, August blackout, you know that windmills wouldn’t have helped.  There was no breeze blowing.  And solar panels wouldn’t have helped you sleep at night.  Because there’s no sun at night.  No.  What would have helped was some big-capacity power generation.  Like a coal plant.  An oil plant.  Or a nuke plant.

Energy demands increase with population.  And with electric cars.  We need more generation capacity.  And the only viable green solution is nuclear power.  And now we’re dilly dallying about the dangers of clean nuclear power because of what didn’t happen in Japan (see Japan Does Not Face Another Chernobyl by William Tucker posted 3/14/2011 on The Wall Street Journal).

Rep. Ed Markey (D., Mass.), a longtime opponent of nuclear power, has warned of “another Chernobyl” and predicted “the same thing could happen here.” In response, he has called for an immediate suspension of licensing procedures for the Westinghouse AP1000, a “Generation III” reactor that has been laboring through design review at the Nuclear Regulatory Commission for seven years.

Talk about the irony of ironies.  The Soviet-era nuclear reactor at Chernobyl was the most dangerous ever used.  That reactor went ‘Chernobyl’ because of its design.  A graphite core that caught fire.  And no containment vessel that let plumes from that fire spread radioactive fallout throughout western Russia and Europe.  If the Soviets had used the type of reactor that’s getting all the media attention in Japan, there would have been no Chernobyl disaster.  And now the irony.  Rep. Markey wants to suspend licensing of the world’s safest nuclear reactor (the Generation III) by citing the world’s most dangerous reactor that Japan doesn’t even use. 

But facts don’t matter when you’re just against nuclear power.  No matter how safe the Generation III design is.  Or the fact that it doesn’t even need cooling pumps. 

On all Generation II reactors—the ones currently in operation—the cooling water is circulated by electric pumps. The new Generation III reactors such as the AP1000 have a simplified “passive” cooling system where the water circulates by natural convection with no pumping required.

Despite this failsafe cooling system, there are calls to stop the licensing.  To put the brakes on.  To move back into caves.  All because of what didn’t happen at Fukushima.  What didn’t happen at Three Mile Island.  But what did happen in a Hollywood movieThe China Syndrome.  (But that’s a whole other story.)

If a meltdown does occur in Japan, it will be a disaster for the Tokyo Electric Power Company but not for the general public. Whatever steam releases occur will have a negligible impact. Researchers have spent 30 years trying to find health effects from the steam releases at Three Mile Island and have come up with nothing. With all the death, devastation and disease now threatening tens of thousands in Japan, it is trivializing and almost obscene to spend so much time worrying about damage to a nuclear reactor.

What the Japanese earthquake has proved is that even the oldest containment structures can withstand the impact of one of the largest earthquakes in recorded history. The problem has been with the electrical pumps required to operate the cooling system. It would be tragic if the result of the Japanese accident were to prevent development of Generation III reactors, which eliminate this design flaw.

Looking at Japan with Awe and Reverence

Japan has been nuclear since 1966.  They now have some 53 nuclear reactors providing up to a third of their electricity.  Yes, Japan lies on the Ring of Fire.  Yes, Japan gets hit by a lot of tsunamis.  And, yes, they now have a problem at a couple of their reactors.  But the other 50 or so reactors are doing just fine.  Let’s stop attacking their nuclear program.  So far they’ve done a helluva job.  And the Japanese know a thing or two about nuclear disasters.  They lived through two.  Hiroshima.  And Nagasaki.  Which make Chernobyl look like a walk in a park.  If anyone knows the stakes of the nuclear game, they do.  And it shows.

We should be looking at Japan with awe and reverence.  If they can safely operate nuke plants on fault lines and in tsunami alley, then, by God, we should be able to do it where things aren’t quite as demanding.  And should.  It is time we put on our big-boy pants and start acting like men.  Before we give up on all energy and move back into the cave.  And down a notch or two on the food chain.


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