In a related article, I described how even Progressive Europe recognizes the retreat of the US from the global stage and from our responsibilities as a major power. Yet we have the economic and resource capacity to do so much better, as Spiegel International Onlinenotices. Fracking provides an example of both our capacity and of our willful impotence.
The United States is sitting on massive natural gas and oil reserves that have the potential to shift the geopolitical balance in its favor. Worries are increasing in Russia and the Arab states of waning influence and falling market prices.
There was sort of a debate presented in The Wall Street Journal a few days ago concerning the efficacy of Federal subsidies for solar and wind energy companies. I say “sort of” because the Mark Muro’s arguments in favor of the subsidies demonstrate an utter cluelessness of the basics of economics as well as of how well the subsidies have already performed.
For instance, the WSJ‘s lede cites generic proponents as saying in all seriousness,
Has German Chancellor Angela Merkel figured out something Barack Obama hasn’t? As recently as last June, her government had set a goal that by 2020, renewable energy (vis., wind and solar) would comprise 35% of Germany’s electricity production. In the first half of 2012 (ending that June), Germany already was generating 25% of its electricity from wind and solar, among other renewables.
Then some other things became apparent. Germany’s Renewable Power Act requires power companies to buy wind- and solar-originated electricity in significant quantities. Their largest industrial electricity users consume 18% of the electricity produced, However, they pay only 0.3% of the extra costs generated by those required buys—German taxpayers pay the difference.
Amid claims by the Obama administration that we need to reduce our dependence on foreign oil—and actual Republican and conservative efforts actually to do so by opening up access to our own gas and oil supplies, protect our coal producers, and their failed effort to facilitate American purchase of Canadian oil—we get this, from The New York Times, no less.
The United States is increasing its dependence on oil from Saudi Arabia, raising its imports from the kingdom by more than 20 percent this year, even as fears of military conflict in the tinderbox Persian Gulf region grow.
Here are some data taken from the US Energy Information Administration’s reportDirect Federal Financial Interventions and Subsidies in Energy in Fiscal Year 2010.
The following table is excerpted from the EIA report’s Table ES4, and it shows the amount of subsidy that each energy source received along with the per centage of the total of nearly $12 billion in subsidies handed out that each energy source received.
Here are some minor facts concerning a particular subsidy, courtesy of an The Wall Street Journalop-ed.
USDA lowered its 2012 corn forecast by 13% from last year’s, to 10.8 billion bushels, the shortest harvest since 2006, even though the planted acreage is the highest since 1937 and 4% more than last year.
only 24% of the corn crop is in good or excellent condition in the 18 major corn belt states, down from 72% just since June.
USDA’s world agricultural outlook board estimated that global corn consumption will be reduced by 38.9 million tons, with US problems responsible for ¾ of the shortage.
Paul H Rubin, Professor of Economics at Emory University, had some thoughts on President Obama’s “You didn’t build that” oratory. After giving Obama the benefit of the doubt and allowing that he really meant, without denigrating the accomplishments of entrepreneurs and other businessmen, that government needed to help private enterprise with infrastructure, Professor Rubin added a few items of interest in the infrastructure milieu.
the Obama administration, in its first three years, adopted 106 major regulations that cost over $100 million, compared with 28 such regulations in the Bush the Younger administration, and it has 144 more in the pipeline.
We’re getting an empirical lesson in the effectiveness of an economy whose energy is intended to come entirely from “green” sources. The Obama administration would do well to observe closely the in-progress German demonstration.
Germany’s electricity prices have risen 10% in the last few years, since the beginning of the German push to rely exclusively on these sources and to walk away from coal, which Germany has in abundance. That might not seem like much of an increase, but it hurts.
We get over half our national electricity supply from coal. Nevertheless, President Obama is intent on shutting down our coal-based electricity through his EPA regulations. This has been commented on by lots of folks.