It’s hard to keep up with the Biden debacles. While we wait for the administration to explain the latest fiasco, the raid on Trump’s Florida residence, we need to continue evaluating Build Back Better, oops, the Inflation Reduction Act. While the Congressional Budget Office (C.B.O.) points out that the legislation does nothing to reduce inflation, the claim is it will save the planet. Just ask the New York Times columnist, Paul Krugman.
Too bad the $380 billion spent on this march to the Green New Deal will make no noticeable difference in the earth’s temperature by the end of the century. Wall Street Journal contributor Bjorn Lonberg ran the numbers and found that the most optimistic case lowers the temperature by 0.028 degrees Fahrenheit. The pessimistic case is 0.0009.
This result is understandable once you realize nothing we in the U.S. does will make any difference in the earth’s temperature as long as the third world, China, and India continue to expand the use of fossil fuels massively. Nations desiring to improve the lives of their people understand the need for cheap reliable energy. Suppose it’s locally sourced; so much the better. That isn’t the windmills and solar panels we’re pushing.
To make the pain equal worldwide, The World Bank is lobbying for a single world carbon tax. Even though this idea has support in some quarters, the National Bureau of Economic Research (NBER) finds a slight increase in world G.D.P. at the turn of the next century from a lower temperature wouldn’t be worth the pain getting there.
It’s not enough to realize that the enormous expenditures for windmills, solar panels, electric vehicles, and storage batteries won’t make a difference. We must look at what we aren’t acquiring with the billions.
Based on the highest cost estimate for the eight nuclear attack subs the Australians are buying, $380 billion spent on green energy would provide us with a fleet of at least 17 of these powerhouses. These boats would extend our undersea advantage, giving China reason to reevaluate its aggressive behavior n the Taiwan Strait and in the South chia Sea.
Krugman may differ, but war is far more damaging than climate change. The horrors in Ukraine are evidence, and we’re not actively engaged. A confrontation with China could be existential.
Which would take more lives, a few degrees more heat, or a war? Keep in mind more people die from the cold than from heat. The U.S. needs a strong military to deter aggression before firing shots. Even if we don’t need so many more subs, we need to replace what we’ve given to Ukraine and will send to Taiwan.
With significant national security needs, we’re spending hundreds of billions that won’t lower the temperature or reduce inflation. When added to the additional spending on veterans and chips, the trillion dollars is likely to add to inflation.
The Act’s promoters claim it will create jobs here. The subsidies included in the bill mostly go for solar panels, windmills, electric vehicles, and storage batteries. Presently the U.S. isn’t a leading producer of any of these. Only by using taxpayer money to subsidize production here can we compete. The rub is this is inflationary. They wouldn’t need subsidies if they weren’t more expensive than the competition.
The ultimate goal of the legislation is to replace fossil fuels. If we can’t compete without subsidies, it is doubtful we will overtake our rivals. After all, the present leaders already have smooth supply lines. These products need a wide variety of minerals. Opening up any new mines in the U.S. face a lengthy and complex road.
The Oil and gas industry supports 9.8 million jobs, or 6% of U.S. Employment. Given our handicaps, it’s doubtful we’ll replace them with green power jobs. China is well ahead in these fields and will prosper. Again we’re handing an enemy a club with which to beat us.
What can we do? This answer may shock, but my advice is to do nothing. Stop subsidizing and interfering in the market. Quit trying to pick winners. Right now, there are plenty of entrants to power the future. We all know their virtues and drawbacks. Nobody knows which one or combination will become dominant. Nuclear, fission and fusion, hydrogen, and other sources are drawing capital worldwide. Carbon capture shows promise.
Level the playing field and see what gives us the most cost-efficient source or sources. Do I know which is best? Not but you don’t either. Germany chose wind, solar, and using Russian gas while transitioning. Do we want to repeat that fiasco?
Transportation Secretary Pete Buttigieg advises everyone to get an electric vehicle (E.V.). Battery power isn’t suitable for longer-range heavy transport. Is this a good idea even if you can afford the $60,000 average price tag?
Ships, trucks, plains, and trains are looking at hydrogen. While more expensive now, its cost is falling with new ideas. If trucks use hydrogen, pumps will span the nation without subsidy. With ready availability and ease of use, cars could follow. Electric cars might be as quaint as the Stanley Steamer. This outcome could leave a massive amount of stranded investment at taxpayer expense.
Our elites must put their egos on hold and let free minds and capital find the best solutions. What we end up with may surprise us, but we will be better for it.