Wednesday, April 30, 2008

Tom Friedman Needs to Stop Making Sense

From the NY Times.

...The McCain-Clinton gas holiday proposal is a perfect example of what energy expert Peter Schwartz of Global Business Network describes as the true American energy policy today: “Maximize demand, minimize supply and buy the rest from the people who hate us the most.”

Good for Barack Obama for resisting this shameful pandering.

But here’s what’s scary: our problem is so much worse than you think. We have no energy strategy. If you are going to use tax policy to shape energy strategy then you want to raise taxes on the things you want to discourage — gasoline consumption and gas-guzzling cars — and you want to lower taxes on the things you want to encourage — new, renewable energy technologies. We are doing just the opposite.

Are you sitting down?

Few Americans know it, but for almost a year now, Congress has been bickering over whether and how to renew the investment tax credit to stimulate investment in solar energy and the production tax credit to encourage investment in wind energy. The bickering has been so poisonous that when Congress passed the 2007 energy bill last December, it failed to extend any stimulus for wind and solar energy production. Oil and gas kept all their credits, but those for wind and solar have been left to expire this December. I am not making this up. At a time when we should be throwing everything into clean power innovation, we are squabbling over pennies.

These credits are critical because they ensure that if oil prices slip back down again — which often happens — investments in wind and solar would still be profitable. That’s how you launch a new energy technology and help it achieve scale, so it can compete without subsidies.

The Democrats wanted the wind and solar credits to be paid for by taking away tax credits from the oil industry. President Bush said he would veto that. Neither side would back down, and Mr. Bush — showing not one iota of leadership — refused to get all the adults together in a room and work out a compromise. Stalemate. Meanwhile, Germany has a 20-year solar incentive program; Japan 12 years. Ours, at best, run two years.

“It’s a disaster,” says Michael Polsky, founder of Invenergy, one of the biggest wind-power developers in America. “Wind is a very capital-intensive industry, and financial institutions are not ready to take ‘Congressional risk.’ They say if you don’t get the [production tax credit] we will not lend you the money to buy more turbines and build projects.”

It is also alarming, says Rhone Resch, the president of the Solar Energy Industries Association, that the U.S. has reached a point “where the priorities of Congress could become so distorted by politics” that it would turn its back on the next great global industry — clean power — “but that’s exactly what is happening.” If the wind and solar credits expire, said Resch, the impact in just 2009 would be more than 100,000 jobs either lost or not created in these industries, and $20 billion worth of investments that won’t be made.

While all the presidential candidates were railing about lost manufacturing jobs in Ohio, no one noticed that America’s premier solar company, First Solar, from Toledo, Ohio, was opening its newest factory in the former East Germany — 540 high-paying engineering jobs — because Germany has created a booming solar market and America has not.

In 1997, said Resch, America was the leader in solar energy technology, with 40 percent of global solar production. “Last year, we were less than 8 percent, and even most of that was manufacturing for overseas markets.”

The McCain-Clinton proposal is a reminder to me that the biggest energy crisis we have in our country today is the energy to be serious — the energy to do big things in a sustained, focused and intelligent way. We are in the midst of a national political brownout.

5 comments:

Anonymous said...

sixerzguy here,

Morty, this gets to why I don't think Obama can't do much about energy - big oil has too much influence with people in power. If Obama is our next president and he can push through a great energy strategy, then in my (short) lifetime, he'd be the greatest president ever. I know a few people in the oil industry, and they have this very solid confidence in their company, like these American (and one Asian) oil companies are invincible.

Sarah said...

This is one of those issues where I have the most hope for Obama. Gas prices aren't going back down to where they were, there will be a bottom up demand for better energy policy, and Obama will be the best positioned to take advantage of that for better policy. Clinton is shameless with the gas tax "holiday." McCain just might not know and/or care.

MM Partners, LLC said...

fucking ridiculous! friedman 100% on point.

Anonymous said...

[url=http://moncleruko.co.uk/]moncler sale[/url] iddnv [url=http://jkpoloralphlauren.co.uk/]http://jkpoloralphlauren.co.uk/[/url] vzbew [url=http://abercrombiex.co.uk/]abercrombie[/url] vgyqj [url=http://mmuggbootssale.co.uk/]ugg[/url] ltygm

Anonymous said...

[url=http://www.fcburberry.com/]Trench Burberry[/url] bvqvw [url=http://www.abercrombiefrssc.net/]abercrombie[/url] durww [url=http://www.abercrombiefrssc.net/]abercrombie paris[/url] pcnzd [url=http://www.uggbotsfr.com/]ugg pas cher[/url] dxgdp