By Arnold Kling
Environmental policy is not driven by tree-hugging activists, earnest liberal bloggers, or ecologically minded citizens. Instead, it flows from the lobbyists and executives of well-connected multinational corporations and built-for-subsidy startups that see profit in the loan guarantees, handouts, mandates, and tax credits Congress creates in the name of saving the planet.
This is a most depressing topic. The latest issue of Technology Review has a cover story on the editors’ selection of the 50 most innovative companies. It is heavily weighted toward firms involved in green energy, and these are in turn heavily weighted toward companies that enjoy subsidies and loan guarantees from the taxpayers.
In reality, much of the increase in energy demand over the next ten years will be met by natural gas, which is cheap, abundant, and relatively “clean” in terms of carbon emissions. The subsidized forms of energy will be a net drain on the economy.
Yet TR’ energy blogger, Kevin Bullis, writes,
Obama, with his proposed multi-billion dollar increases for renewable energy research has the right idea, although this could go further (more research into cleaner hydrofracking technology for natural gas, for example, would likely prove a wise investment). Cheap, clean energy that doesn’t come from oppressive dictators and enemies of the United States should have strong bipartisan support.
Of course, nobody is opposed to cheap, clean, domestically-produced energy. But the political attempt to provide it will only result in expensive energy, with unseen environmental costs (biofuels), and increases in budget deficits that will harm, rather than enhance, America’s strategic position.
The Department of Energy was established during the Carter Administration. As far as I know, no one has ever suggested that we have benefited from its existence. The other night, Ron Bailey pointed out that its original goal was “synfuels,” which not only were ridiculously expensive but would have greatly increased the carbon emissions of our transportation system.
Still, if you suggest that America should not have an energy policy, everybody other than a hardcore libertarian will dismiss you as a crackpot. Energy policy is a triumph of faith over experience.