File this one under “be careful what you wish for.” Rep. Ed Markey (D-Mass.) must have thought he was being very clever. At a recent House Energy and Commerce Committee meeting on legislation to authorize construction of the Keystone XL Pipeline, Markey introduced an amendment banning U.S. exports of petroleum products made from Keystone crude.
For Markey, the amendment was never a serious legislative proposal. For one thing, as explained on this site and MasterResource.Org, an export ban would violate U.S. treaty obligations under both the General Agreement on Tariffs and Trade (GATT) and the North American Free Trade Agreement (NAFTA). In addition, Markey knew Republicans could not support the ban without jeopardizing the long-term supply contracts that pipeline builder-operator TransCanada Corp. had negotiated with Gulf Coast refiners — contracts on which the project’s commercial viability depends.
In fact, Markey was counting on Republicans to vote against the ban, as that allegedly would expose them as duplicitous shills who care only about oil industry profits, not about reducing dependence on OPEC or alleviating pain at the pump. As also explained in the previous columns, Markey’s exposé is itself bogus, because (1) Keystone crude would displace OPEC crude whether the associated refined products were sold domestically or overseas, and (2) much of the refined product would likely be sold in the USA.
This just in: What Markey introduced as a rhetorical prop may be sprouting legislative wings in the Democrat-controlled Senate, where it could win votes to overturn President Obama’s rejection of Keystone XL. [click to continue…]
Pythagoras would have been proud of the math muscles The League of Conservation Voters flexed in the calculations for their annual National Environmental Scorecard, which was released last week. For the House of Representatives, more than 20 environmentalist organizations chose 35 votes that were scored for 435 Members. This week, the Cooler Heads Coalition issued our first ever scorecard, albeit with a relatively simple methodology: 100 – LCV score. So cue the graduation music as the Cooler Heads Coalition recognizes the members of the House who earned a perfect score as honorary Defenders of Economic Liberty:
Rep. Tom Graves of Georgia,
Rep. Mark Amodei and Rep. Dean Heller of Nevada, and
Rep. Bob Turner of New York
Green energy spending in the American Recovery and Reinvestment Act, a.k.a. the Stimulus, a.k.a., the Porkulus, has notched another failure: Energy Conversion Devices, a manufacturer of solar rooftop panel components and recipient of $13 million in Stimulus money, yesterday announced it is going bankrupt.
This blog repeatedly has warned that stimulus spending is a green albatross burdening the President. Indeed, I argue that the green jobs component of the Porkulus—about $60 billion in taxpayer giveaways—was doomed to failure. For starters, the whole idea of the Stimulus was to defibrillate the economy by spending a trillion dollars as fast as possible, and this is a recipe for waste. By way of example, the Energy Department received roughly double its normal budget, and was basically ordered to have the money out the door within two years and ten months. This was an overwhelming mandate. DOE had neither the time nor the manpower to properly vet outlays.
More fundamentally, government is terrible at picking horses. It’s nice to think of disinterested civil servants doing their best to safeguard taxpayer investments, but in reality, powerful political forces are doing everything in their power to influence how this money is spent. When Members of Congress aren’t pushing for pet projects in their respective districts, crony capitalists in the administration are guiding taxpayer money to their portfolios. The headline of an excellent Washington Post story from today says it all: “Venture capitalists play key role in Obama’s Energy Department.” Of course, political expediency and crony capitalism are poor investment strategies. As a result, green energy Stimulus spending is prone to embarrassment.
Solyndra is only the most spectacular failure. Nary a week passes without a politically favored green energy company hitting the skids. See: Amonix, Evergreen Solar, local reporting of “green jobs” training failures, Beacon Power, the ongoing Solyndra saga, underperforming electric vehicle sales, Ener1, Fisker Automotive…and now Energy Conversion Devices.
Mr. President, are you still sure that you want to “double down” on green energy giveaways?
The ideal of responsibility has endured a severe loosening under the current administration’s incessant touting it as something to be “shared.” We heard this rhetoric echoed throughout Obama’s speech introducing his 2013 budget: “We’ve got to renew the American values of fair play and shared responsibility. The budget that we’re releasing today is a reflection of shared responsibility.” This “shared responsibility” (i.e. socialism) has never been a traditional American value. Individual responsibility is the ancestral principle that has strengthened America into prosperous world power she is today. It is this concept that sets the stage for fair play. However, the Obama administration’s refusal to “walk away from the promise of clean energy” will require the continuous life-support of the American peoples’ shared tax dollars that it has never survived without. This is patently unfair.
One of the most irrational responsibilities Obama envisions to be shared for is manufacturing of electric vehicles. On the supply side, the President wants “America to be the world’s leading manufacturer of high tech batteries”; on the demand side, he aims to have million Americans driving electric vehicles by 2015. The problem is that he wants all 138 million taxpayers to pay for these goals. If consumers actually had a choice into which pork-piggy bank their taxes were allocated, their homework into the electric car industry would encounter several speed-bumps:
- Fisker Automotive, the California company that scored a $529 million government subsidy to produce the plug-in Karma, recently had to shut down operations due to their delivery quota failure.
- A123, Fisker’s lithium-ion battery supplier and winner of a $249 million DOE loan, is on pins and needles with their investment of at least $20.5 million into Fisker, their #1 client.
- Ener1 Inc., the parent company of EnerDel that received a $118 million DOE grant to make batteries for electric cars, filed for Chapter 11 bankruptcy.
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Because of the unproven notion that burning fossil fuels causes global warming, saving energy has become the cultural norm with the expectation that reducing the use of coal-fueled electricity and gasoline will help everyone. More and more wind and solar generation is being installed and cars use less and less gas, with some being all-electric. This should be a good thing, but it ends up costing everyone—and disproportionately penalizes the poor.
Installing an unsubsidized residential solar photovoltaic (PV) system is expensive and the payoff can be decades. As a result, they are typically purchased by only those with substantial disposable income. A few years ago, I participated in a “solar fiesta.” I live in rural New Mexico where we often have snow on the ground from late October through early March. Due to cost, I only heat my home to 58 degrees in the winter. I have a large south-facing roof surface. I figured I was a prime candidate for a solar PV system. I visited different vendors. When I asked about the payoff, one vendor looked down his nose and emphasized: “It is not about the payoff.” I could not afford to go solar. I still burn pellets in my stove and bundle up all winter.
Those, who can afford the up-front costs to take advantage of the free energy from the sun, can avoid paying their utility company anything. They may even feel smug that they have beat the system. With net metering, when they generate extra power, the meter may literally spin backward. When the sun isn’t shining, they use the power they’ve banked. The end of the month total can balance out.
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The Competitive Enterprise Institute, Reason Foundation, National Taxpayers Union, Taxpayers for Common Sense, and Natural Resources Defense Council sent a joint letter to members of Congress urging them reject the unprecedented linking of onshore and offshore oil and gas revenue with the Highway Trust Fund. In their letter, the groups note that creating this new revenue stream would undermine the longstanding user-pays/user-benefits highway funding principle that has guided infrastructure investment for nearly six decades. Further increasing the reliance of the Highway Trust Fund on revenue streams not connected to use, they argue, would threaten the future health of America’s highways. My colleague Marc Scribner has made the case against the “drilling for roads” proposal in a previous post.
The Environmental Protection Agency and the National Highway Transportation Safety Authority project that their proposed Model Year (MY) 2017 and later light-duty vehicle greenhouse gas (GHG) emissions and fuel economy standards will engender net benefits ranging from $262 billion (assuming a 7% discount rate) to $358 billion (assuming a 3% discount rate). These projections are based on assumptions regarding vehicle cost, fuel prices, and consumer acceptance that may or may not be borne out by events. Skepticism is justified. If the proposed standards are as beneficial to consumers and automakers as the agencies contend, why wouldn‘t consumers demand and profit-seeking manufacturers produce vehicles built to the same or similar standards without regulatory compulsion? Fuel economy regulation assumes that auto buyers do not want to avoid pain at the pump and automakers do not want to get rich. Experts will likely debate for years the net benefits of the rule as data become available regarding vehicle costs and sales and auto industry profits and employment. In a comment letter on the regulation I sent yesterday to the agencies, I examine a cost most experts have not addressed: the damage the Obama Administration‘s fuel economy agenda does to our constitutional system of separated powers and democratic accountability. Read the letter here.
Greenies hate civilization. Ergo, the Green War on our W.C.s.
Think about it: There is no greater symbol of civilization than the toilet and its various accoutrements. From Mohenjo-Daro to the Roman Empire, civilized life has gone hand in hand with running water and underground infrastructure to wash the refuse of humanity away from our homes and cities. Fire may be the most widespread symbol of Man’s rise from the Serengeti to Starbucks, but the most important is the plunger.
Thus, the Greenies desire to become the commodores of our commodes, from trying to tell us to use one square of toilet paper (which may be enough if all you eat is granola, but is wholly inadequate if your diet consists of, you know, human food), to the so-called “low flush” toilets that are designed to save water but end up wasting water because you have to flush the things a million times to properly exorcise your tank.
Now, those tiger-apologists at the World Wildlife Fund have targeted toilet paper itself. A new WWF report titled “Don’t Flush Tiger Forests: Toilet Paper, U.S. Supermarkets, and the Destruction of Indonesia’s Last Tiger Habitats” claims that, “Americans who use Paseo or Livi brands of toilet tissue are contributing to the destruction of the Indonesian rainforest and tiger habitat,” according to the Environment News Service.
“Consumers shouldn’t have to choose between tigers and toilet paper,” proclaims the WWF’s Linda Kramme. “We’re asking retailers, wholesalers and consumers not to buy Paseo or Livi products until APP stops clearing rainforests in Sumatra.”
Two things. First, tigers kill people. Regularly. Last year in one region in Bangladesh, 53 people were attacked by tigers, with 34 killed and 19 severely injured. In one week the tigers of this forest killed seven people. Shame on the WWF for defending these murderous beasts.
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Last November, I warned the President that he would come to regret green energy Stimulus spending, because venture socialism is inherently wasteful, and therefore prone to failed investments. I predicted that indications of failure would pop up every week in the run up to November 2012, like a slow drip media nightmare. And since I wrote that, I’ve been proven right (see: Amonix, Evergreen Solar, local reporting of “green jobs” training failures, Beacon Power, the ongoing Solyndra saga, underperforming electric vehicle sales, Ener1).
In only the last week:
- The House Committee on Oversight and Government Reform is reviewing the Port of Los Angeles’s decision to use $489,000 in green energy stimulus funds to retrofit the Angelena II, a 70-ft. Port-owned yacht used for publicity tours.
- Arizona-based First Solar announced plans to idle half of its German factory and put about 1,200 employees there on a part-time work schedule. The reason? Declining subsidies in Europe. This demonstrates the riskiness of predicating your business plan on favorable political winds. Forbes’s Ucilia Wang reports that First Solar stock fell 70 % in 2011. According to the Arizona Republic, First Solar received Stimulus-funded loan guarantees for the Antelope Valley Solar Ranch and the Desert Sunlight projects in California.
In light of the fact that green energy Stimulus spending has been a magnet for bad press, I was shocked two weeks ago during the State of the Union address, when the President announced that he would “double down” on green jobs spending. That’s like doubling down on a six when the dealer is showing an ace. I thought perhaps the President was merely rallying the base with empty rhetoric, but with today’s release of the White House budget, it seems that he is putting our money where his mouth is. According to Politico’s Morning Energy, the Department of Energy—whence the worst, most wasteful stimulus spending—is getting a raise:
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House Ratchets Up Probe of White House Involvement in Solyndra Scandal
Fourteen Republican members of the House Energy and Commerce Committee, led by Chairman Fred Upton (R-Mich.) and Oversight and Investigations Subcommittee Chairman Cliff Stearns (R-Fla.) sent a strongly-worded, five-page letter to the White House on 9th February setting a 21st February deadline for turning over documents related to the White House’s involvement in the Solyndra scandal. The letter also demands that five officials be made available for interviews by 17th February.
The letter notes that the Committee requested the relevant documents five months ago and has made every effort to accommodate the White House’s concerns. As to the reasons why the White House has refused to comply with the committee’s subpoena last fall, the letter notes that the White House has not claimed executive privilege for the withheld documents and demands that if executive privilege is going to be claimed the White House must let the committee know by 21st February.
The Department of Energy made the first renewable energy loan under the 2009 stimulus bill to solar panel maker Solyndra, which is based in Fremont, California. The entire $527 million of taxpayer money was lost in August when Solyndra declared bankruptcy. The largest private investor in Solyndra, George Kaiser, is a major Obama and Democratic Party donor and fundraiser and has been a frequent visitor to the White House during the Obama presidency.
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