Tag Archives: economics

They Don’t Know What They’re Doing?

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Or is that they’re just riding the Climate Funding Industry Hobby Horse?

East Coast wind projects are in jeopardy after a decision by New York regulators Thursday to deny requests from renewable energy developers to charge customers billions of dollars more.
Offshore wind developers say they have been struggling against record inflation, supply chain issues, and interest rate hikes. Facing these pressures, Orsted, BP, and Equinor and other renewable developers requested that contracts for four offshore projects and 86 land-based projects be renegotiated, according to Reuters.
The offshore developers asked the New York Public Service Commission to alter its long term contracts and raise purchase prices to a level that would have let them collect an additional $38 billion from ratepayers.

They missed—badly—their initial financing and execution estimates, and they failed badly in their early adjustments following actual execution. The supply chain problems about which they complain have been extant since the depths of the Wuhan Virus situation. The inflation that has them in such an uproar has been a problem for the last three years. The rising interest rates have been an inevitable outcome of the inflation.

Do these guys—at the top of the top companies in their industry—really not know what they are doing?

Or are they just trying to rake in the money from their shadow industry of global warming hysteria funding, and some jurisdictions are starting to get tired of being taken for granted as cash cows?

False Choices

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The Wall Street Journal‘s Editors are correct that, as their subheadline says,

Helping Kyiv won’t rob weapons to fight Hamas or Hezbollah.

This is in response to some otherwise reasonably intelligent politicians insist on that false choice—that it’s either Ukraine or Israel. Senator Josh Hawley (R, MO), for instance:

Israel is facing existential threat. Any funding for Ukraine should be redirected to Israel immediately[.]

This is a foolishly false dichotomy, for all that, in Hawley’s case, it centers on his disdain for Ukraine and his lack of understanding of the threat the Russian barbarian hordes present.

The false choice representation is broader than that, though.

It’s also a false choice between either Israel or Ukraine, and our southern border, and it’s a false choice between any of those and supporting the Republic of China in deterring the People’s Republic of China or in fighting the PRC if they go ahead and invade.

What’s necessary—and more generally beneficial—is a reallocation of existing expenditures. That requires the Progressive-Democratic Party Representatives and Senators to either get out of the way or work with Republicans in a serious manner to do the reallocations.

It also requires timid Republican Senators to get out of the way or work seriously within their party and for the Republican House caucus to deal, with finality, with the Chaos Gang led by Florida’s Matt Gaetz and Texas’ Chip Roy and get serious about leading the House.

Racing to the Bottom

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So far, Ireland is winning, and that’s paying off big for the Irish.

In the past eight years, the country of five million has watched its corporate tax income triple to the tune of 22.6 billion euros last year, equivalent to almost $24 billion—giving it a budget surplus last year of a comfortable €8 billion euros when many governments are suffering from a postpandemic debt hangover.

And

Ireland became a hot spot for US companies by slashing its corporate tax rate from 40% to 12.5% starting in the late 90s, and offering a well-educated workforce and a tariff-free way into the European Union.

That’s a lower rate than the European Union wants, and it’s lower than the 15% tax, globally applied and agreed among some 136 countries, and that Yellen is so desperate to get the US trapped into.

The Irish, though, are raking in the tax revenues because of—not despite—their lower tax rate regime: they’re leaving business’ profits increasingly in the hands of those businesses for business use, they’re attracting foreign businesses, and all that lower tax-induced increasing economic activity produces, on net, more revenue for the Irish government.

This is the wealth and prosperity that Progressive-Democrat President Joe Biden, his Progressive-Democrat Treasury Secretary Janet Yellen, and the rest of the Progressive-Democratic Party cronies want to deny us ordinary Americans as they demand United States’ participation in a global tax cabal that lets the cabal avoid economic competition in favor of power.

One more thing: the Irish are considering throwing all of their prosperity into a cocked hat in favor of joining the high-tax cabal; they’ll do that at their own severe economic peril.

Energy Subsidies

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This table shows the size of the subsidy for the indicated energy source along with the size of the subsidy per trillion BTU produced by that energy source.

Million$/ TrillionBTU Million $ Trillion BTU
Solar 4.153 7,522 1,811
Geothermal 1.665 353 212
Wind 0.947 3,592 3,791
Coal 0.072 873 12,033
Biomass 0.06 312 5,171
Nuclear 0.048 390 8,065
Oil & Nat Gas 0.033 2,304 68,804

The table is constructed from data in the EIA report, Federal Financial Interventions and Subsidies in Energy in Fiscal Years 2016–2022.

Notice that the Solar subsidy is orders of magnitude greater than those for coal or for oil and natural gas. The wind subsidy is similarly bloated.

Despite these actual facts, the Mainstream Left keeps pushing the myth of too much subsidy for hydrocarbons.

 

H/t: DrBob2 at The Motley Fool.

Why Lend?

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How can a financial entity lend? Progressive-Democrat President Joe Biden now is moving to hide individuals’ medical debt from potential lenders.

[P]roposed regulations would prohibit consumer reporting companies from including medical debts and collecting information on consumer reports that creditors use to make underwriting decisions. Creditors would also be barred from using medical collections information when evaluating borrowers’ credit applications.

This on the heels of his constant attempts to render student debt holders unaccountable for their debt.

Since lenders are increasingly being denied recourse, and now they’re to be denied useful information about a potential “borrower’s” ability to repay a debt a priori, why—how—could any lender make a decision to lend, other than to raise its interest rate very high, commensurate with the very high risk being inflicted on that lender by Government?

Look for the Biden administration to start trying to cap lending interest rates, next.