President Obama did what some of us have counseled one should expect when the Republicans wedded themselves to the inane “all of the above” slogan to characterize or, alternately, substitute for an argument for fixing the woes caused by misguided government energy policies, programs and schemes: Namely, he used it to argue for more handouts to the welfare-case black holes like wind and solar which have been around since the ’60s—the 1860’s—and have received government supports for the past five decades.

That’s the problem with such slogans in lieu of educating and principle: “All of the above” is intended to be a blank slate on which voters can cast their own notions, yet it draws no line to exclude the inane, wasteful or outright economically destructive.

Sure, it implies more support for that which works, and the first rational step is for the federal government to cease its war on American energy *that works*. But it didn’t reveal the nerve to actually say it, to defend it.

And thus President Obama seized the slogan, saying last night that, “This country needs an all-out, all-of-the-above strategy that develops every available source of American energy, a strategy that’s cleaner, cheaper and full of new jobs.”

Just as putative Republican standard-bearer Mitt Romney faces circumstances and widespread calls to meet the challenge of defending larger principles over bromides, so should all Republicans who desire a rational energy policy but, to date, have not shown the nerve to demand one.

The Wall Street Journal has a long piece today about the prospect of using the state to move part of the U.S. transportation fleet from oil to natural gas. It gives prominent voice to the massive public affairs campaign of T. Boone Pickens to add billions to his natural gas fortune as a swansong to a prosperous career.

This campaign takes the form of a bill embraced by ostensible fiscal hawks, causing an uproar from those conservatives who took umbrage at Members abandoning their pledges of fiscal sobriety at the drop of a billionaire’s phone call. This enabled the media to describe the Republicans’ ‘circular firing squad.’ Well played, gentlemen.

The vehicle was not Pickens’ first choice. His first choice was a windmill mandate, transparently pushed by a handful of gas interests, including Chesapeake Energy’s Aubrey McClendon, to put a green hat on their efforts to use the state to displace coal’s market. In this effort, they found natural allies in environmentalist special interests.

I happened to be in the room in 1997 with the American Gas Association, BP, and Enron as they worked with green pressure groups, as radical as the Union of Concerned Scientists as well as more mainstream, anti-coal activists like NRDC, to get a global warming treaty and a domestic cap-and-trade scheme. I couldn’t believe my ears and said so, which in a matter of weeks led to us parting ways.

When Pickens was pitching his Plan A in an off-the-record meting a few years ago, I congratulated him on discovering my old boss Ken Lay’s business plan: he had some gas interests, bought a bunch of windmills on the cheap because they aren’t economic investments, then set about to use his lobbying muscle to make them not economically viable, but rather, as President Obama is given to saying, “the profitable kind of energy.”

The windmill mandate flopped. So Pickens unloaded his windmills and reached up another sleeve. Now, the argument goes: (1) we have lots of natural gas, thanks to the hydraulic fracturing revolution in production; (2) oil is expensive; (3) therefore, we should move transportation onto natural gas, although this cannot happen without robbing taxpayer Peter to pay gassy Paul, according to anyone cited in the WSJ article.

Of course, we also have vast quantities of oil, likely all of it recoverable at a per-barrel price around half of where it stands today. So that’s not really much of an argument for such wrenching, expensive, uneconomic intervention, now is it?

But this is the sort of advocacy that bad ideas are forced to employ. As my CEI colleague Myron Ebell wrote:

Why are billions of dollars of taxpayer-funded subsidies needed?  According to T. Boone Pickens’s web site, it’s because natural gas vehicles are cheaper to operate than gasoline or diesel vehicles:  “Even with higher initial costs (which will disappear as manufacturing ramps up) the life-cycle costs of NGVs [natural gas vehicles] are significantly lower.  Fuel costs are at least 15 percent less using natural gas rather than gasoline or diesel.”

So people need to be paid in order to make them want to buy vehicles that will save them money.  Yes, that makes sense: I always prefer the more expensive product unless there is a government rebate for the cheaper one.

Given all of this, we have three takeaways from today’s Journal piece.

First, here is the chart of countries this idea seeks to have us be more like.

Message: be more like Third-World countries. But for Italy, which has long directed nearby North African gas into its economy, no other OECD country is big into this old idea. I know that history of saying “look at Spain” didn’t work out to well about the windmills, but countries without oil, like, say, über-green Germany, aren’t on the list. Why?

Second, the article acknowledges these countries have been doing this for a long time. Yet the Wall Street Journal’s pull-quote gives us the $5-$9 Billion Quote of the Day: “T. Boone Pickens on subsidies for natural-gas truckers: The government should provide five years of subsidies, ‘and then get the hell out of it.  It flies by then, or it’s a bad idea.’”

Yeah. Once you build a subsidy, and the constituencies dependent upon it, even if it doesn’t work Washington is pretty good about letting it expire. It hasn’t worked anywhere with decades of support. A clever man, Mr. Pickens.

Finally, the story admits that this very scheme was one of the ‘stimulus’ schemes. Mr. Pickens is calling for the ‘stimulus’ to continue, for his investments in the uneconomic, for 5 more years.

Stimulus. Subsidy. Can’t say it too many times. That’s what this is. Republicans, wise up.

My former CEI colleague and now academic Jonathan Adler has an unfortunate post over on The Volokh Conspiracy manifesting a fundamental misunderstanding of how cap-and-trade is expected to work, how it has worked in Europe, and what the documents, received under FOIA from the Department of Treasury and causing his fellow academics so much angst, represent.

You can read Jonathan’s frustration for yourself (and the slightly better informed commenters’ thoughts, as well) here.

I have already addressed the 100% auctioning is irrelevant can’t we move on that’s old news line of, for lack of a better word, argumentation. The same revenue projections from 100% auctioning made by the administration in February were in the administration’s mid-session review published about three weeks ago: that is, it remains 100% the administration’s policy to 100% auction. Ok, the House passed a bill. That wasn’t the subject of the Treasury memos setting forth the administration’s expectations. Nice try.

Well, not that great, actually. That bill, Waxman-Markey may not arrange to sell 100% of the ration coupons — when it kicks in, it is three-fourths, not the 15% you are being distracted with — but it does require 100% of them be bought. That’s a distinction without a difference to the people who have to buy them, and to the consumer/ratepayer/taxpayer. The distinction is that the state gives away a quarter of the ration coupons to folks who are not covered by the law and have no use for them but to sell them to poor saps who are covered by the law. To the people that matter, trust me, that makes no difference. It is a phony argument at worst and a distraction at best.

Nor does it make any difference even if 100% were given away. At least, if you take Obama’s budget director at his word. You can read current OMB director and former CBO director Peter Orszag saying just that — on numerous occasions in several slightly different ways here among numerous other places:

Under a cap-and-trade program, firms would not ultimately bear most of the costs of the allowances but instead would pass them along to their customers in the form of higher prices. Such price increases would stem from the restriction on emissions and would occur regardless of whether the government sold emission allowances or gave them away

Also, in Europe, we see that the ration coupons were given away for free, just as Waxman-Markey — again, not the focus of the Treasury documents– largely does as well for the scheme’s first few years. In Europe, prices of electricity and that which has electricity or energy embedded in it (everything) went up. Period. To claim, as Waxman-Markey proponents do, that they’ll just avoid Europe’s experience by telling local distribution companies to make sure the cost is not passed on to the ratepayer though emissions (energy use) must go down, flies in the face of practice and economic theory. This later case is made in a forthcoming paper, which to be thorough and fair I will note here, referencing this post.

Jonathan has waded in on matters on the side of the greens before and I have always enjoyed how the repartee ends up, so I welcome this foray, too. The more opportunity we have to correct silly distractions, misstatements and misunderstandings, the better.