Monday, May 28, 2012

More clean energy babble from the NY Times

Cleaner Energy

The NY Times editorial page is again writing about the need for congressional subsidies for "clean energy" aka wind, solar, geothermal etc.

Basic economics says that subsidies are only (potentially) desirable if there is some divergence between the private marginal benefit of the business or individual and the social marginal benefit to society.

Many people argue that this divergence exists in the form of the benefits to the U.S. as a whole of weaning ourselves off foreign oil. They argue that this benefit is not accounted for by the energy companies, and thus the energy companies do not value clean energy enough. This is the stance taken by the NY Times writers in this article.

But most of the energy that the U.S. gets from foreign sources comes from friendly sources. The top 4 countries are Canada, Mexico, Saudi Arabia, and Venezuela. Out of those 4 countries only Venezuela has anything close to a hostile relationship with the U.S., and they are certainly not a military threat.

The NY Times argues that we need to subsidize clean energy to rid ourselves of these imports, but if ridding ourselves of imports is truly the most important reason (though I am not sure why it would be considering who we import from) they why not just use the abundant coal and natural gas that we have in this country? Those fuels need no subsidies and could easily do the job, or at least take the place of countries like Venezuela.

The truth is that people who say this do not  primarily care about relieving us of our dependence on foreign oil. What they really care about is shutting down the production of fossil fuels in order to save the environment. In particular they want to save us from global warming. If this is not the case, it seems odd that they would want to take money that they could spend on their other pet projects and divert it towards subsidies for "clean energy" when they could just argue for more coal and natural gas to solve the dependency problem.

So the next time you hear someone talking about ridding our gas pumps of foreign oil through clean energy remember that what they really want to do is rid us of our gas pumps.

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