The global debate over climate change entered into a new and more dangerous stage this past week. Two American corporate icons, Microsoft and BlackRock, have committed themselves to resisting what they perceive as the unacceptable risks of global warming. Microsoft has announced that it will be “carbon negative by 2030,” and that by 2050 it will have removed from the environment all of its carbon emissions dating back to its founding. It has also pledged one billion dollars to a climate innovation fund to deal with global warming—peanuts for a firm with over $125 billion in annual revenues.
Not to be outdone, BlackRock, the world’s largest asset manager with over $7 trillion in assets under management, has proudly declared through its Chairman and CEO Larry Fink that it will “place sustainability at the center of our investment approach, including: making sustainability integral to portfolio construction and risk management; existing investments that present a high sustainability-related risk, such as thermal coal producers; launching new investment products that screen for fossil fuels. . . .”
To Fink, there is no real conflict for his company between its social responsibility and its financial performance, as he is convinced that “incorporating environmental, social and governance (ESG) factors into investment analysis and decision-making. . . can provide better risk-adjusted returns for investors.” Ironically, if that point were true, he would have no need to depart from traditional investment standards, as all firms would flock to the new BlackRock standard.
These powerful initiatives are driven by the proposition that climate change poses the greatest threat to humankind society has ever faced. Without any documentation or meaningful argument, Microsoft and Blackrock accept that the accumulation of carbon dioxide in the earth’s atmosphere will result in elevated global temperatures. In making these statements, both companies write as if all the “world’s climate experts” within the “scientific community” speak with one voice in concluding that the release of greenhouse gases since the beginning of the industrial revolution is the source of this alleged mortal peril.
However, a close reading of these two corporate statements shows the dangers of consensus thinking around climate change, which can lead to lazy and incomplete arguments. The first issue concerns the supposed magnitude of the risk. It is clear that carbon dioxide levels have increased over time, especially over the past seventy or so years. But it is important to remember that the increase in temperatures began before the concentration of carbon dioxide in the atmosphere reached 350 parts per million in 1987, a level which has, without justification, been posited as the tipping point for climate catastrophe. Notably, this means that much of the temperature increase over the past five decades took place in low carbon dioxide environments.
The Microsoft statement claims that “the average temperature on the planet has risen by 1 degree Celsius during the past 50 years and that carbon dioxide emissions have been a primary driver of this.” Yet that is at odds with a report from the NASA Earth Observatory which concluded “the average global temperature on Earth has increased by about 0.8 Celsius (1.4 Fahrenheit) since 1880. Two-thirds of the warming [0.53°C] has occurred since 1975, at a rate of roughly 0.15-0.20°C per decade.” Indeed, the situation is even more complex because of the high degree of annual variability. As a result, much turns on the choice of the first and last year of the desirable interval. One recent study reported a decline of 0.16 Celsius between April 2018 and May 2019.
In any event, the explanation that carbon dioxide emissions are the sole driver of climate change is surely contestable, given that a complete account must also take into consideration population increases, solar flares, ocean currents and volcanic activity, among a vast array of other factors. The graphs included in Microsoft’s announcement duly record the huge increases in carbon dioxide emissions over the last 30 years, but those trends only weakly correlate to the modest temperature increases over that interval, including a sharp decline that extends as late as May 2019.
Thus the graph below for the 41 years from 1978 to May 2019 shows a net increase of just under 0.8 degrees centigrade. It is of course possible to present other data sets that might be susceptible to alternative interpretations, but either way, there is no rock-solid scientific consensus of the sort that Microsoft and BlackRock posit.
Microsoft and Blackrock’s presentations also suffer from other key defects. These corporate pledges assume that their proposed changes in carbon policy will reduce the increase in global temperatures, perhaps by as much as 1 degree Celsius. But what is missing from these projections is any estimate about either the financial costs of these innovations or their net impact on global temperature. If the sources of temperature changes are multi-causal, why should anyone believe that the ingenious efforts of companies like Microsoft to cleanse their supply chains of excess carbon dioxide will have more than a trivial effect on global temperatures, even if such actions are imitated by other firms?
And moreover, these effects could be totally undone if China or India decides to boost coal production in ways that more than offset any small reductions in carbon outputs by American firms. Thus, it is possible to spend billions of dollars on potential mitigation with little or nothing to show for it.
To make matters worse, there are better targets for intervention. The greatest causes of carbon dioxide emission in the past two years were the huge forest fires in Northern California and Australia. The recent California fires released about 68 million tons of carbon dioxide, or roughly the level of emissions needed to provide electricity for the state for an entire year. Taking effective steps to stop these consistent fires would dwarf anything that Microsoft can do through its supply chains or BlackRock through its sustainable investment policy. Nonetheless, A-list celebrities regularly champion the causes of global warming without once thinking about the dangerous management strategies adopted by the modern environmental movement that have contributed to such fires, a movement which opposes the removal of dead wood or the use of controlled burns to reduce fire risk. It would be far better for Microsoft and BlackRock to lobby for government reforms in forest management, a topic on which they remain silent.
Even supposing, however wrongly, that all the temperature increases and observed fires were exclusively attributable to carbon dioxide, the case for massive corporate intervention is still weak. BlackRock’s Larry Fink suggests with a straight face that the market for municipal bonds and home mortgages will collapse “if lenders can’t estimate the impact of climate risk over such a long timeline, and if there is no viable market for flood or fire insurance in impacted areas.”
Get real. These risks will exist whether or not Blackrock’s policies are implemented, and no matter what the carbon dioxide levels are. And the view that there should always be a viable market for flood or fire insurance ignores the huge moral hazard that is created when subsidized insurance is provided to persons who build too close to combustible forests or on coastal properties in hurricane zones.
Worse still, the fears that drive both BlackRock and Microsoft have not yet been observed over the past decade. Markets are supposed to price long-term risk into capital assets, but there is no sign that real estate, agricultural, insurance, or financial markets price this alleged climate risk in. Why is this, when our ability to forecast has never been better given the available quantitative estimates of climate-related risk?
One explanation is a recent study from climate scientists Giuseppe Formetta and Luc Feyen which concluded that: “Results show a clear decreasing trend in both human and economic vulnerability, with global average mortality and economic loss rates that have dropped by 6.5 and nearly 5 times, respectively from 1980-1989 to 2007-2016. We further show a clearly negative relationship between vulnerability and wealth, which is strongest at the lowest income levels.” The study’s abundant graphs all show the same downward projections, whether one looks at floods, heat, cold or wind related damages. In other words, the historical decline of these various risks also have to be priced into any long-term financial instrument.
A similar attack on the BlackRock-Microsoft position was also launched by Marlo Lewis, whose thesis is contained in his title: “Warmest Decade – Climate Crisis Still a No Show.” In stark contrast to the data-free presentations of both companies, Lewis tracks the key worldwide indicators of long-term global health—life expectancy, crop yields, per capita income, and climate related deaths. His data tells the same story as the study—everything is better today than it has ever been. The increases in societal wealth accumulation have inured to the benefit of all, rich and poor alike.
The cavalier attitude toward any contrary scientific evidence has led Microsoft and BlackRock to endorse proposals that will do little, if anything, to stop global warming, but which will, if widely followed, reduce the ability of societies around the world to deal with global warming or any other climate calamity, should one occur. There are real social and human costs to following BlackRock and Microsoft’s lead.
A bipartisan plan to erase barriers to equity ownership would be productive and beautiful.
It’s an article of liberal faith: Thanks to President Donald Trump’s $1.5 trillion Tax Cuts and Jobs Act, the prosecco is popping on Wall Street, while the unsold Pepsi gathers dust on Main Street, where Americans are too poor to buy soft drinks.
“Workers are delivering more, and they’re getting a lot less,” former vice president Joe Biden told the Brookings Institution last summer. “There’s no correlation now between productivity and wages.”
Americans “are sick and tired of the income and wealth inequality that sees the rich getting much richer,” Senator Bernie Sanders (I., Vt.) told CapitalAndMain.com last month.
“Wages have largely stagnated,” the campaign website of Senator Elizabeth Warren (D., Mass.) complains, while “fundamental changes in our economy have left millions of working families hanging on by their fingernails.”
These grim, lachrymose myths cannot mask this incredibly upbeat fact: The sparkling wine is flowing on Wall and Main streets, and it’s running more rapidly on Main, where take-home pay is expanding the most among those with the least.
Never mind the liberal lies. Hard data reveal this reality. The Atlanta Federal Reserve Bank’s monthly Wage Growth Tracker shows that Americans are making more money, particularly those who have been forgotten for decades.
Between November 2018 and November 2019, overall median wage growth climbed 3.6 percent, a healthy pace that should lift spirits, too. Those in the bottom 25 percent saw wages advance 4.5 percent, while the top 25 percent lagged, with pay rising just 2.9 percent. This is the 180-degree exact opposite of what Democrats relentlessly bellow. They have equal access to the Atlanta Fed’s website. This confirms their rank dishonesty.
For further sanguine results of Trumponomics, see Sentier Research’s analysis of the Census Bureau’s Current Population Survey. Sentier clocked U.S. median household income last November at $66,043 — $5,070 higher than this key metric’s position when President Trump was inaugurated on January 20, 2017: $60,973. This 8.3 percent increase in middle-class income in less than three years crushes the two-term, eight-year performances of Obama ($1,043, up 1.7 percent) and G. W. Bush (an emaciated $401, or a paltry 0.7 percent boost).
Today’s Employment Situation also is encouraging. As the Bureau of Labor Statistics reported at 8:30 a.m., the unemployment rate remains steady at 3.5 percent, maintaining the lowest joblessness level since 1969 — Richard Nixon’s first year in office. Employers created 145,000 new jobs last month, a healthy, if not breathtaking, number. And 2.9 percent wage growth, from December 2018 to December 2019, lags the Atlanta Fed’s figures but still approximates the 3 percent mark that seems to trigger warmth and toastiness. Scarlett O’Hara’s words should soothe any naysayers here: “Tomorrow is another day.”
Democrats should stop loathing Trump long enough to show some love for the poor people they claim to represent. Democrats should stop lying to themselves and the country about low-income wages lagging those of the affluent. This is not happening. Democrats should acknowledge the wonders that Trump and Republicans have done via tax reduction, regulatory relief, and a pro-business tone in Washington.
Then, Democrats should make this challenge to Republicans. The 55 percent of Americans who are in the stock markets, per Gallup, are seeing their portfolios soar, as the S&P 500, Dow Jones Industrial Average, and Nasdaq break records. Since Trump’s victory, these markets have rocketed 53 percent, 58 percent, and 77 percent, respectively, as of Thursday’s highest-ever closing bells.
But the 45 percent of Americans who own no stocks — directly or as part of 401(k)s or IRA accounts — are missing this bonanza.
Democrats should ask Republicans to work with them to make it as easy as possible for those not invested in the stock market to buy in. A bipartisan plan to erase barriers to equity ownership would be productive and beautiful.
Conversely, Democrats can keep weeping among themselves as their have-not base actually grows richer more swiftly than the haves the Democrats love to hate.
How good is the U.S. economy? So good that even CNN, the monomanically anti-Trump television network, was forced to admit it last week.
“As 2019 comes to a close, the US economy earns its highest ratings in almost two decades,” CNN reported, dourly relaying findings of a poll it commissioned. “Overall, 76% rate economic conditions in the US today as very or somewhat good, significantly more than those who said so at this time last year (67%). This is the highest share to say the economy is good since February 2001, when 80% said so. Almost all Republicans (97%) say economic conditions are good right now, as do 75% of independents and 62% of Democrats. Positive ratings are up across parties compared with August of this year, when 91% of Republicans, 62% of independents and 47% of Democrats said the economy was in good shape.”
It’s no surprise that Americans are pleased with their economic situation this holiday season. Consider the data: The unemployment rate is 3.5 percent, indicating essentially full employment. Anyone who wants a job can get one, in other words. Wage growth, long stagnant, is ticking up, likely because of full employment — and, perhaps because illegal immigration has been somewhat curtailed. Total gross domestic product is chugging along, growing at more than 2 percent annually. The stock market is stratospheric, buoying not only individual investors but also anybody who has a retirement account. What’s all the more striking is that earlier this year there was plenty of loose talk about a looming recession. Sure, that could still happen (and eventually it will), but it doesn’t seem to be on the immediate horizon.
The strength of the economy can be chalked up to Republican tax cuts (which unfortunately also contributed to yawning federal deficits), deregulation and the unrelenting optimism of the American consumer. Some 70 percent of U.S. GDP is attributable to consumer spending, so the economy rises and falls with it. That Americans are spending on everything from houses to cars to dinners out contributes to economic growth and healthy jobs figures — which in turn likely contribute to more consumer spending. This is a classic virtuous cycle.
The strength of the economy no doubt has political effects as well. President Donald Trump will certainly benefit. Even CNN conceded that Americans’ bulging wallets will “[potentially boost] President Donald Trump in matchups against the Democrats vying to face him in next year’s election.”
“As perceptions of the economy have brightened, the poll also shows matchups between the top Democrats vying for the 2020 nomination and Trump tightening. In October, four Democrats tested in hypothetical head-to-head contests with Trump among registered voters led by anywhere from 6 to 10 percentage points, all advantages outside that poll’s margin of sampling error,” CNN continued. “Now, just two of those candidates hold edges at or above the error margin: former Vice President Joe Biden leads Trump nationally 49% to 44%, and Vermont Sen. Bernie Sanders tops Trump 49% to 45%. Massachusetts Sen. Elizabeth Warren and South Bend, Indiana, Mayor Pete Buttigieg each run about even with the President.”
Mr. Trump will face significant headwinds in next year’s election to be sure: a fired up opposition, various global crises and an intemperate personality that many Americans, understandably, find distasteful. But he will no doubt delight in asking Americans: “Are you better off than you were four years ago?” For large majorities, the answer will be yes.
A first in human history: Anxious about their future on a hotter planet and angry at world leaders for failing to arrest the crisis, masses of young people poured into the streets on every continent on Friday for a day of global climate protests. Organizers estimated the turnout to be around four million in thousands of cities and towns worldwide. (Somini Sengupta, New York Times, September 20, 2019) (Below: Youth March for Climate Change (New York City, Sept.20, 2019)
What is the motivating force which could impel such an amazing reaction of youngsters all over the world (except China)? Clearly, the threat of extinction is taken so seriously by so many youths that they felt compelled to participate in this effort. What has convinced so many in so many places simultaneously?
Apparently, it is the vision of the planet earth being baked into destruction by the sun’s rays. This vision seems to have originated from the speculations of climate scientists as interpreted and simplified by activists. Cold, neutral, formulaic science has never elicited such emotional reactions. Those ideas had to be interpreted and simplified by propagandists. Eventually, the vision emerged with its dramatic impact and its ability to inspire visceral fear. It is this vision which has motivated a youthful passion which thirsts for a cause to believe in.
In that sense, climate change advocacy demonstrates many of the same characteristics as religion. It is an unquestioning belief in an unseen event; it inspires an ethic requiring sacrifice to achieve; and it thrives on communal events. Thus, it meets the traditional characteristics of religion: creed, code, and cult.
This phenomenon also raises the question, “Why are these folks (young and old) so open to a new religion?” Why are they not dedicated to the traditional religions of their elders? Or, more concretely, why has the Western world witnessed such a precipitous decline of traditional religious practice in recent generations?
The answer to these questions lies in the disconnect between the common life experience of our modern culture and the world view of traditional religions. As one way of approaching this topic, we might look at the differences in the epistemology (the way of understanding) between what religion teaches us compared to that of our everyday life.
Traditionally, religion proclaims that another invisible world exists in addition to this visible world. The invisible world is better than this world. This vision has brought comfort and peace to many millions of people through the ages. It has served as a reason for us to behave in certain ways which are conducive to the common good and it has given us hope to reach heaven and eternal peace when we die.
Common life experience in the 21st century exhibits a quite different vision. First of all, we live in a world of constant discovery. While many aspects of this world are invisible, such as thoughts and emotions and happiness, it is also true that our science is based on the presumption that all reality is ultimately physical, even if it is too small to be seen (atoms), too large to be understood (the universe), or discoverable only through its effect on things that can be measured (neutrons). As a culture, we have come to believe that all reality is knowable, even if we don’t yet know it. We keep learning new things all the time, only to discover more things we don’t know. Nevertheless, the thrill of learning is one of our cultural goals.
It is the task of the theologians to conceptualize and explain the spiritual dimensions of our human experience and the connections between our life experience and our traditional beliefs. It appears that today’s theologians are asleep at the switch. Our culture cries out for an ethic which takes the world we live in much more seriously than does traditional religion. To achieve that ethic, a new vision must be developed – one which understands the beauty of the universe, the world we live in, the body we have been given, and the ways in which this visible world must be treated in order for us to achieve happiness and satisfaction in our interactions with this world, our community and ourselves.
In such a vision, we see technology as an extension of our body – machines to take us farther and faster than our legs could carry us, to make our minds more agile, our imaginations more original, our views more expansive. We see our love extended to other races and places beyond our natural limits, our talents challenged by new plateaus, and our world enriched by the newness of our life on earth. This is a vision which will allow us to seek the transcendent meaning of life as the sum of all the good and evil we can see with our sharpened insights and to find our personal path to virtue, happiness and holiness.
As our lives are enriched by the colors and textures of this world which God has provided for us, we are also confronted with new responsibilities and obligations. which have been ignored in the past, to maintain that world. Some examples: while the absolute need for cheap and plentiful energy is granted, how do we justify digging coal at the risk of black lung disease for the miners? How do we justify burying nuclear waste which will take 3000 years to dissipate? How do we preserve our planet’s suitability for human life? How do we balance the harm of nuclear weapons against the cost in human life? What do we owe to trees and wildlife? And, what are the ethical norms by which we are to measure such answers?
Religion, like life itself, must evolve to meet the very real spiritual needs of real people. If organized religions fail in this fundamental obligation, people will substitute whatever they can find in order to satisfy the primal need we all share for spiritual nourishment – even if it is as flimsy as climate change.
Raising concern “about the direction the health care policy debate is moving” – particularly among conservative lawmakers – the National Center for Public Policy Research has joined with more than 70 other conservative and free-market organizations to warn Congress about the dangers of price fixing.
In trying to remedy the issue of surprise medical bills for out-of-network emergency treatment, and insurers balking at covering all of such costs, some typically conservative politicians are favoring proposals to essentially enact price controls on these health care services. This would prohibit doctors and hospitals from setting their own rates and potentially make them operate at a loss.
Senator Rand Paul has explained that this could compromise the quality of American health care by driving people out of the medical field. “If you fix the price that ER doctors work at,” he said, “you will get a shortage.” He suggested that what has happened to the economy in Venezuela could happen in the United States as a result of such changes to the marketplace.
In a letter to conservative lawmakers on Capitol Hill, the National Center and others note:
[W]hat is troubling is how often otherwise right-of-center policymakers are resorting to one of the key pillars of the Medicare for All playbook – government imposed price controls. Whether it is called price fixing, rate setting, subsidy capping or inflation capping, government price controls have wormed their way into the healthcare reform plans of too many of our friends in Washington.
The National Center is joined on the letter by organizations including Americans for Tax Reform, the Competitive Enterprise Institute, Frontiers of Freedom, the Discovery Institute, the Institute for Policy Innovation and Eagle Forum.
The coalition letter concludes:
This was a bad idea a half century ago with gasoline line rationing, and it’s a bad idea today in health care. Something can only be affordable if it’s available to buy in the first place.
To read the entire letter and see all of its signers, click here.
Column: A weak and unstable China is also more dangerous
You see it in the maps. In 2015, 1.4 million Hong Kongers voted in elections in which pro-Beijing candidates swept the city’s 18 district councils. Last week, 2.9 million Hong Kongers voted and pro-democracy candidates won every district but one. That is an increase in turnout of more than 100 percent and a stunning rebuke both of Beijing and of chief executive Carrie Lam, who has failed to respond adequately to the demands of the pro-democracy movement that has disrupted Hong Kong for the past six months. Maps of the city once shaded pro-mainland blue are now pro-liberty yellow.
Yes, the vote was symbolic. The councils have little say in the operations of government. But symbols matter. For Hong Kongers to express discontent with their rulers through one of the last vehicles for accountability is no trifle. Beijing was surprised. It had counted on a supposed “silent majority” of voters tired of the upheaval and violence to legitimize the mainland’s authority. That was a mistake. The prefabricated copy that Communist propagandists had been ready to spread was abandoned. “The problem is that under the increasingly paranoid regime of Xi Jinping, even these internal reports have become much more geared toward what the leadership wants to hear,” writes James Palmer, who a decade ago worked for the pro-China Global Times.
Hong Kong is the most visible reminder of the tenuous nature of Communist rule. The city has become a postmodern battleground where masked protesters wield social media and lasers to avoid armor-clad police and facial recognition technology powered by artificial intelligence. When one looks at Hong Kong one sees a possible future where champions of freedom the world over employ desperate measures against the overwhelming resources of a mechanized Leviathan. One also sees the brittleness, confusion, and embarrassment of despotism when challenged by subjects assumed to be grateful for growth and security and immune to the will to freedom.
What is happening in Hong Kong is not isolated. The China model of authoritarian development is damaged and scarred. What seemed as sturdy and invulnerable as a Borg Cube looks more like a fragile and wobbly mobile by Alexander Calder. The regime of Xi Jinping is under economic and political and diplomatic pressure that it is not handling well. This beleaguered combatant in an era of great power competition is more dangerous to the United States than before.
What legitimacy the Communist Party possessed was based on the decades of economic growth inaugurated by Deng Xiaoping in 1978. But growth has slowed to its lowest level in decades as the Chinese workforce ages, low-hanging investment opportunities disappear, and the trade war with the United States reduces manufacturing output and sends supply lines to Vietnam and Mexico. Capital is fleeing China at a record pace as the bourgeoisie hedge against stagnation and turmoil.
For all of the Chinese government’s much publicized investments in research and development and defense, and despite the size of its economy, per capita gross domestic product is $10,000, slightly less than that of the Russia Federation ($11,000) and a fraction of that of the United States ($65,000). Recent weeks have brought an uptick in bank runs. The government’s response to slowdown has been to tighten state control. “Between 2012 and 2018, assets of state companies grew at more than 15 percent annually, well over twice the pace of expansion of China’s GDP and double the pace of growth of gross domestic capital formation,” writesNicholas R. Lardy of the Peterson Institute for International Economics. This is not state capitalism. It’s statism.
The Chinese authorities use mechanisms of repression to maintain control over what can only be described as an internal empire. The New York Times recently published a horrifying and damning trove of documents relating the extent of Beijing’s efforts to detain, imprison, intimidate, and reeducate Uighurs, Kazakhs, and other minorities in western Xinjiang Province. China wants to override the Dalai Lama’s choice of successor in its continuing efforts to police Tibetan Buddhism and aspirations to sovereignty. China leads the world in the number of political prisoners, its Great Firewall has become more difficult to penetrate, and its influence operations in Taiwan, Australia, and other democracies more sophisticated. Defector Wang Liqiang has told Australian officials of his personal involvement in the disappearance of five Hong Kong booksellers who had the temerity to advocate democracy.
These are not the moves of a regime confident in its ability to win the allegiance of a multi-ethnic population of 1.4 billion people. They are the policies of an insular and jittery faction whose uncertainty toward a changing economic and demographic landscape has made it suspicious of and opposed to even the slightest hints of liberal democracy. The ambitions of Chairman Xi for a Eurasia integrated under the Belt and Road Initiative, where the preponderance of the latest equipment in key sectors is manufactured, are both grand and mismatched for a nation whose leaders are concerned most with the operation of the surveillance state that keeps them in power.
The resistance to Beijing is both domestic and foreign. Lost in all the predictions of Chinese dominance were the voices of China’s neighbors in the Pacific. Neither Japan, nor Vietnam, Taiwan, the Philippines, nor Australia want to live in a Chinese lake. Most extraordinary has been the response of the United States. Within four years, the American elite has swapped its belief in China’s “peaceful rise” for the recognition that it may be in the opening phase of a Second Cold War whose outcome will determine the ideological character of the 21st century. While Tariff Man wages his trade war, opposing Chinese theft of intellectual property and arguing for structural changes to China’s state owned enterprises, Vice President Mike Pence, Secretary of State Mike Pompeo, and Secretary of Defense Mark Esper speak of the political and security challenges presented by Chinese authoritarians who become more willing to lash out as they lose their grip.
Senator Josh Hawley spoke for the emerging consensus when he wrote in the November 24 Wall Street Journal: “And everywhere, in every region, we must ask whether our actions are contributing to the great task of this era, resisting hegemony in the Asia-Pacific.” A few days before Hawley’s op-ed, Congress passed the Hong Kong Human Rights and Democracy Act of 2019. Though the president already may possess the authorities to sanction Chinese officials granted him by Congress, the bill remains both a powerful statement of American support for the principles of liberty and democracy and a sign of American resolution before the specter of autocracy.
Good for President Trump to have signed the Democracy Act—and better still if he would link human rights to trade and refrain from speaking of his “friend,” the “incredible guy” who seeks nothing less than the defeat and displacement of the United States.
Any extension, expansion or enlargement of the electric vehicle tax credit is a profoundly bad idea and essentially robs the taxpayers to pad the pockets of the wealthy who can afford the best lobbyists money can buy.
When the original legislation giving tax credits and subsidies for electrical vehicles passed more than a decade ago, its sponsors promised that it would be temporary and were only designed to help new technologies gain a foothold in the marketplace. Now more than a dozen years later, some irresponsible legislators are ready to move away from temporary, limited subsidies and are headed towards a permanent and almost unlimited subsidies.
This is both bad policy, and dangerous. Government’s power to tax should not be used to transfer wealth to those who can afford the best lobbyists. Single parents working two jobs to make ends meet should not be forced to take an extra shift so that they can support this sort of wasteful spending. If rich car purchasers want to buy new expensive electric sports cars, they should be free to do so. But the idea that they should be able to reach into the wallet of the single parent struggling to make ends meet is unconscionable!
Virtually 80 cents of every dollar spent on subsidies went to households with more than $100,000 of income. And, of course, all of the taxpayer provided cash benefits wealthy and profitable car companies — like Tesla and its billionaire founder Elon Musk. It is revealing that almost 1/2 of all the subsidies for electric vehicles go to just one state — California.
This is a wealth transfer from the working poor and middle class to the wealthy. And it is a wealth transfer from 49 states to 1 state. Before anyone votes for these wealth transfers, they must provide an explanation. Why is this good for America? Why is this good for taxpayers? I know it is good for Mr. Musk and Tesla. But why is it good for that single parent who is working so hard to provide her children with a better life?
There is no need to extend, expand or continue subsidies for electric vehicles. Sales of electric cars have been on the increase for years. The original rationale was that the temporary aide would help them get established and build economies of scale that would drive prices down. Twelve years is more than enough time.
Some argue that the subsidies are justified because electric cars are “zero emission” vehicles. But that is a lie. Electric cars are plugged into the power grid to recharge and whatever emissions were created while generating the electricity needed to recharge the car are the car’s emissions. Nationally, that won’t be anything close to zero. Moreover, recent studies indicate that full life-cycle emissions from electrical vehicles may exceed those from new internal combustion engines. So it is unlikely that electric vehicles provide the environmental benefits promised.
Since there is no longer any plausible or rational reason for the subsidies, the real reason is laid bare — car companies want more taxpayer cash and they’ve lobbied Congress hard to get it. Mr. Musk and Tesla and others who receive the benefits of this taxpayer provided subsidy would love to extend and expand it. But that isn’t a good reason to give them more taxpayer cash or to reach into a single parent’s wallet so that some rich guy can get some help to buy that very cool electric car.
Moreover, the public doesn’t support the idea of taxpayers helping people buy expensive and trendy electrical cars. By landslide proportions, 2 in 3 Americans oppose these subsidies, and with good reason.
The truth is most people would love to receive a perpetual gift of cash. There’s an old saying, “A government that robs Peter to pay Paul can always count on the support of Paul.” That’s what we have here. Paul is in favor of Paul getting millions of dollars provided by Peter. This is clearly just based on greed.
Even more important, our constitutional system cannot devolve into a system in which one group gets to vote itself cash from another group. But that’s what we have here. Nothing more. A vote to extend, expand, or enlarge this subsidy is a grotesque violation of the public trust.
Cartels in Mexico aren’t just fighting over drugs, they’re fighting over industries, and it might well trigger a new and much bigger migrant crisis on the U.S. border.
Two important and interrelated news stories largely passed under the radar Wednesday as the House impeachment hearings continued to dominate the headlines. Both stories concern the deteriorating state of affairs in Mexico and have huge implications for immigration, the southwest border, and U.S. national security. It’s a shame more Americans aren’t paying attention.
The first was a report from BuzzFeed that as of Wednesday the Trump administration began carrying out a controversial plan to deport asylum-seekers from El Salvador and Honduras—not to their home countries, but to Guatemala, which the administration has designated a “safe third country,” meaning that migrants from those countries must first apply for asylum in Guatemala before seeking asylum in the United States.
The move is part of the administration’s broader strategy to reduce the number of Central Americans seeking asylum at the southwest border, which last year saw a dramatic increase in illegal immigrationlargely driven by families and minors from the so-called Northern Triangle countries of Guatemala, Honduras, and El Salvador.
The second story was a Los Angeles Times dispatch from the Mexican state of Michoacán, where rival cartels are waging war not over drug trafficking routes but over control of the multibillion-dollar avocado industry. More than a dozen criminal groups are fighting over the avocado trade in and around Uruapan, the capitol of Michoacán, “preying on wealthy orchard owners, the laborers who pick the fruit and the drivers who truck it north to the United States,” writes reporter Kate Linthicum. Organized crime in Mexico, she explains, is diversifying—it isn’t just about drugs anymore:
In parts of Guerrero state, cartels control access to gold mines and even the price of goods in supermarkets. In one city, Altamirano, the local Coca-Cola bottler closed its distribution center last year after more than a dozen groups tried to extort money from it. The Pepsi bottler left a few months later.
In Mexico City, bar owners in upscale neighborhoods must pay taxes to a local gang, while on the nation’s highways, cargo robberies have risen more than 75% since 2016.
Compared with drug trafficking, a complex venture that requires managing contacts across the hemisphere, these new criminal enterprises are more like local businesses. The bar to entry is far lower.
The report also notes that homicides are at an all-time high in Mexico, and that cartels have taken control of migrant smuggling in the state of Tamaulipas, which borders the Texas’s Rio Grande Valley, the busiest stretch of the border for illegal immigration.
All this comes on the heels of the massacre of an American family in Mexico, including three women and six children, earlier this month by cartel gunmen, as well as the defeat of a detachment of the Mexican National Guard by cartel forces in the city of Culiacan last month. Mexican President Andres Manuel Lopez Obrador has no strategy to reduce cartel violence and no intention of fighting the cartels.
So what do these two news stories from Wednesday have to do with one another, and why would they have major implications for the United States? Simply put, what has happened in Central America is now happening in Mexico. The difference is, when asylum-seekers from Mexico start turning up on our border we won’t be able to deport them to a third country or easily turn them away. If you thought the border crisis was bad last year, wait until hundreds of thousands of families in Michoacán and Tamaulipas decide to flee the cartels and seek asylum in the United States.
To really appreciate the gravity of the situation in Mexico you have to understand some of the dynamics behind the border crisis, which has been driven by Central Americans fleeing societies that are in a state of collapse. Widespread extortion, kidnapping, and violence from gangs throughout the Northern Triangle, combined with grinding poverty and scarce economic opportunities, has prompted hundreds of thousands of Central American families to head north.
One of the reasons this mass exodus turned into a crisis is that unlike earlier waves of illegal immigration, these migrants weren’t single adults from Mexico who could be quickly deported under U.S. law. They were migrant families and minors seeking asylum from noncontiguous countries, which meant they had to go through an entirely different legal process that takes much longer.
The Trump administration, like the Obama administration before it, faced a choice: either release large numbers of people who had crossed the border illegally or detain them in inadequate facilities that were never designed to hold children and families. The administration responded with a host of new policies, some of which have been struck down by the courts, designed to deter Central American asylum-seekers and reduce illegal border-crossings.
Designating Guatemala as a safe third country is one of those policies, despite the reality that Guatemala is by no means a “safe” country (like El Salvador and Honduras, it’s one of the most violent countries in the world). The Migrant Protection Protocols, also known as “remain in Mexico,” is another such policy, which forces asylum-seekers to await the outcome of their case in Mexico, often in dangerous border cities where they are vulnerable to exploitation by cartels and corrupt officials.
The upshot is that as Mexico descends into warlordism marked by widespread criminality and gang warfare, we should expect ordinary Mexicans to respond the way ordinary Central Americans have. Eventually, they’ll leave. Many of them, perhaps hundreds of thousands, will at some point head north and claim asylum. When they do, the border crisis that we’ve been dealing with for the past year will seem insignificant—a prelude to a much larger and intractable crisis, for which there will be no easy fix.
A survey of 2,504 French adults found that 69 percent of respondents would not buy products labeled ‘made in Israel.’
Europe’s highest court isn’t exactly telling everybody to boycott Israeli food and wine. But they’re doing their darnedest to ensure Europeans don’t buy them.
For anyone who missed the news, the Court of Justice of the European Union (CJEU) ruled last week that food and wine produced by Jewish Israelis beyond the Green Line must be explicitly marked: “‘Israeli settlement’ or equivalent needs to be added, in brackets, for example. Therefore, expressions such as ‘product from the Golan Heights (Israeli settlement)’ or ‘product from the West Bank (Israeli settlement)’ could be used.”
Eugene Kontorovich, director of the Center for International Law in the Middle East at George Mason University Scalia Law School, considers the new labels “a new kind of Yellow Star on Jewish-made products.” He told The Federalist that the CJEU’s labeling requirements “are not geographic—they are not about where something was made but by whom.” Kontorovich added, “They’re not even pretending that the rules they’re applying to Israel are the rules they’re applying to the rest of the world.”
Readers may recall that when the court’s advocate general suggested such labeling earlier this year, his reasoning was that consumers needed “neutral and objective information.” But this outcome is neither neutral nor objective. As Marc Greendorfer, president of Zachor Legal Institute, which battles Israel boycotts, emailed, “That the court contravened established principles of international law to wrongly stipulate the status of the disputed areas (as occupied) exposes the fact that this ruling was about taking sides in a political dispute.”
“Labels are not the place to engage in political debate,” Brooke Goldstein, executive director of the Lawfare Project, which participated in this case, told The Federalist.Indeed, product labeling is supposed to be about health and safety. Labels also help consumers shop “ethically” or “responsibly.” But if a consumer factors politics into those decisions and wants to avoid Israeli goods, why is it so important to specify where in Israel those goods are produced?
According to a 2017 poll conducted by Opinion Way for the Lawfare Project, a survey of 2,504 French adults found that 69 percent of respondents would not buy products labeled “made in Israel.” That number rose to 75 percent if labels read “West Bank, Israeli colony/settlement.” So more detailed labeling would clearly shift some shoppers’ habits, but those figures are already startlingly high.
While the CJEU may not be declaring a boycott with this ruling— after all, it remains legal to import Israeli goods — they are nudging consumers in that direction. Even the U.S. State Department, which typically avoids criticizing allies, expressed “deep concern,” calling “the circumstances surrounding the labeling requirement . . . suggestive of anti-Israel bias.” They also rightly noted that “this requirement serves only to encourage, facilitate, and promote boycotts, divestments, and sanctions (BDS) against Israel,” a movement Germany’s own parliament considers antisemitic, and even Nazi-like.
This decision is not focused on informing consumers about unconscionable behavior across the globe (e.g., the Chinese government’s treatment of Uyghurs) or highlighting the world’s many disputed territories (see: Western Sahara, Cyprus, and Crimea for starters). It is about ostracizing the world’s only Jewish nation and unilaterally redrawing Israel’s borders via economic pressure.
The aforementioned French survey underscores just how widespread popular prejudice against Israel is in France, long home to Europe’s largest Jewish community. Rather than calm that prejudice, the CJEU panders to it, inflames it, and now embeds it in law. So it won’t be surprising if antagonism to Israel keeps rising in France and the rest of Europe. Stigmatizing Israel now has the gloss of official, legal respectability.
The whole episode is offensive. Consider, this long-awaited decision was scheduled for release on November 12. The U.S. Holocaust Memorial Museum reminds us that date is significant, as “just 2 days after the end of Kristallnacht [in 1938], the Nazi government issued the Decree on the Elimination of the Jews from Economic Life. Banned from owning shops or selling any kind of good or service, most Jews lost their livelihoods entirely.”
Further, by establishing a unique standard for Israel, this decision fits the internationally accepted definition of antisemitism, cited in the United Nations’ recent report on global antisemitism. So it’s rich for the European Commission to tell Fox News, “Any suggestion that indication of origin on products coming from Israeli settlements in the occupied Palestinian territory or in the occupied Golan has anything to do with targeting Jews or anti-Semitism is unacceptable. The EU stands strongly and unequivocally against any form of anti-Semitism.”
Check out that loaded word choice. Then consider that such critiques are fair game. The EU does not stand unequivocally against antisemitism. There are bright spots, like Austria’s second largest city banning support for BDS. However, European Jews are acutely aware that antisemitism is widespread and dangerous.
EU officials like Michael O’Flaherty, director of the European Union’s Fundamental Rights Agency, know that in spite of the many reported antisemitic crimes across the EU, 80 percent remain uncounted. “As one person asked [O’Flaherty], ‘Why would I report antisemitism to an antisemite?’” Over in Britain, which has not quite left the EU, nearly half of British Jews have said they “would ‘seriously consider’ emigrating if [Labour Party leader Jeremy] Corbyn is elected prime minister [in December].”
Seventy-four years after the Holocaust’s end, the EU is no haven for Jews. Nor is it a particularly reliable friend to Israel. Calling the decision “disgraceful,” Sen. Ted Cruz (R-TX) told The Federalist, “This labeling singles out Jews who live in communities where Europeans don’t think they should be allowed to live and identifies them for boycotts. It is reminiscent of the darkest moments in Europe’s history.”
Indeed, the CJEU may have forgotten, but world Jewry hasn’t. We also know that discrimination and other harms that start with Jews never end with us. So whether or not the timing was coincidental, Secretary of State Mike Pompeo’s announcing a reversal of Obama-era policy regarding Israel’s settlements certainly looks fortuitous, because this fight is far from over.
Dear Chairman Simons,
The Federal Trade Commission (“FTC” or “Commission”) should open an investigation into Ring—a subsidiary of Amazon—and its data-sharing practices with law enforcement officials. Ring’s conduct raises a number of concerns, including fears that (1) the emerging technology may result in discriminatory law enforcement activity, (2) sensitive consumer data may be jeopardized as a result of misuse by Amazon and (3) consumers may be subjected to heightened physical security risks. Given these concerns, which are outlined in greater detail below, and Amazon’s history of data mishandling, the FTC should more deeply examine the damaging effects of these practices.
While innovative, Ring’s home security doorbell and its use of consumer data are cause for significant concern as this conduct has the potential to result in considerable consumer harm. So-called “smart home” technology, still very much in its infancy, and its misuse have the potential to cause lasting damage to consumers if the necessary precautions are not taken.
Despite the potential benefits of “smart home” technology like the Ring “smart” doorbell, the data collected by Amazon opens consumers to exposure under the promise of additional security. As a result, not only is consumer data made more vulnerable, but their physical safety is put at unprecedented risk.
As the Commission is well aware, as more data is collected by Amazon, potential data breaches become more damaging. A data breach of consumers’ home security system by nefarious actors could have direct consequences on consumer physical safety. For example, should home security video footage fall into the wrong hands, consumers’ daily routines—including when they leave home and when they are alone and most vulnerable—would be easily discernible by criminals intending to cause harm.
According to reports, Ring has already misled consumers about its data handling practices. The Washington Post reports that Ring has partnered with over 400 police departments in the U.S., “granting them potential access to homeowners’ camera footage.” Amazon was able to secure hundreds of partnerships by capitalizing on artificially low prices funded through taxpayer resources. Making matters worse, Ring engages in these partnerships without first informing its users. This deceptive practice raises, at best, tremendous ethical concerns.
Amazon’s record on data security is already cause for concern. Recently, two prominent senators have asked the Commission to investigate Amazon’s role in the Capital One data breach, which affected nearly 100 million customers. Given Amazon’s potential involvement in this historic breach and its reckless handling of consumer data captured through Ring, it would be unwise to allow this activity to continue without at least some examination from the Commission.
In addition to the data security concerns, Ring’s video-sharing arrangement raises questions about the potential for profiling. In an open letter to lawmakers, more than 30 civil rights action groups described the threat to civil liberties posed by Ring’s partnership with law enforcement. In the letter, the organizations explain the dangers of this arrangement:
“With no oversight and accountability, Amazon’s technology creates a seamless and easily automated experience for police to request and access footage without a warrant, and then store it indefinitely. In the absence of clear civil liberties and rights-protective policies to govern the technologies and the use of their data, once collected, stored footage can be used by law enforcement to conduct facial recognition searches, target protesters exercising their First Amendment rights, teenagers for minor drug possession, or shared with other agencies […].”
These sentiments were echoed by another prominent senator in a letter to Amazon CEO Jeff Bezos. In the letter, the lawmaker outlined the privacy and civil liberty concerns noted above. Amazon has not yet responded to this letter—a clear indication that, unless pressured by government officials, the company will only act in accordance with its own interests, rather than address the genuine threats expressed here. Because of this, it would be wise for the FTC to act before the situation spirals out of control.
Inaction in light of these facts would subject consumers to risks that are all too dangerous. As the top “cop on the beat,” the FTC has a public responsibility to protect consumers from unfair and deceptive business practices. Given the data security and civil liberty concerns, it would be wise for the FTC to undertake a review of the partnership between Amazon and Ring and law enforcement authorities.
This issue—that of data security and physical safety—is bipartisan in nature. In fact, it transcends politics entirely.
Thank you for your attention to this matter.
 Harwell, D. (2019, August 28). Doorbell-camera firm Ring has partnered with 400 police forces, extending surveillance concerns. Retrieved October 24, 2019, from https://www.washingtonpost.com/technology/2019/08/28/doorbell-camera-firm-ring-has-partnered-with-police-forces-extending-surveillance-reach/.
 Guariglia, M. (2019, August 30). Five Concerns about Amazon Ring’s Deals with Police. Retrieved October 24, 2019, from https://www.eff.org/deeplinks/2019/08/five-concerns-about-amazon-rings-deals-police.
 Fight for the Future (2019, October 7). Open letter calling on elected officials to stop Amazon’s doorbell surveillance partnerships with police. Retrieved October 24, 2019, from https://www.fightforthefuture.org/news/2019-10-07-open-letter-calling-on-elected-officials-to-stop/.
There are uncountable narratives when it comes to the actual and perceived domestic as well as international predicaments of the newly independent state of Ukraine. As a rule, known facts are mixed with unsubstantiated rumors, which, in turn, give birth to fantastic conjectures, ungrounded intuitions, and outright lies in the service of partisan political interests. In reality, the Ukraine question is extremely complex. Yet in the United State of America, both politicians and the media present this complexity to the public from a one sided, exclusively distorted American perspective.
Meanwhile, successive and mostly short-lived Ukrainian governments have tumbled from ever escalating crises to misguided revolutions and repeated implosions in predictable intervals. First the two high ranking former communists dubbed the “Red Barons”, former President Leonid Kravchuk and former President Leonid Kuchma, made half-hearted attempts at the privatization of the state owned economy. Called the “voucher privatization” and originally aimed at distributing state assets judiciously among all Ukrainians, this privatization scheme resulted in the creation of the Ukrainian oligarchy. This development, in turn, deepened the already pervasive corruption that was the essence of the Soviet Union.
Then, following a badly botched presidential election, came the “Orange Revolution” that brought forth the allegedly enlightened and pro-Western Victor Yushchenko. Paralyzed by his petty and incessant bickering with Prime Minister Yulia Tymoshenko, he lost badly to his main rival, the pro-Russian Viktor Yanukovych. The latter was chased from office before his term expired by what was termed by the Kremlin as a coup d’etat but was viewed by the West as a popular revolution against Yanukovych’s vacillation to sign an association agreement with the European Union in Vilnius on November 28, 2013.
Almost immediately after the foiled signing of the association agreement, protests against President Yanukovych commenced. What later was elevated to the mythical heights of the “Revolution of Dignity” forced President Yanukovych to flee Ukraine. In the subsequent presidential election of May 2014, Ukrainians elected with overwhelming majority one of their country’s oligarchs, the “Chocolate King” Petro Poroshenko. In the interim, Russia invaded and then annexed the Crimea. To add insult to injury, Russia also has triggered an armed uprising in eastern Ukraine that has a significant concentration of ethnic Russians.
True to the past of the sovereign state of Ukraine, President Poroshenko did fail in an abysmal fashion, too. In the second round of the presidential election, on April 21, 2019, 73% of the Ukrainian voters chose a non-politician by the name of Volodymyr Zelensky as their new president. Clearly, the vast majority of Ukrainians decided to close the book on almost three decades of arrogant incompetence and shameless corruption by their politicians and oligarch allies. Finally, they expressed their desire to live and raise their children in a normally functioning, peaceful, and transparent state, politically as well as economically.
Although the lion’s share of the blame must be assigned to the Ukrainians themselves, American policy toward the independent sate of Ukraine was burdened by glaring incompetence, unrealistic illusions, erratic oscillations between Russia and Ukraine, and outright idiocy. Instead of assisting the newly independent Ukraine to establish the political and economic foundations of a unified state by harmonizing the old and new forces, the late President George H. W. Bush and President Bill Clinton paid little if any attention to the troubled country. The formers son and his successor President Barrack Obama’s, attempts at interference in Ukraine’s domestic affairs generally only made the situation worse. Especially, the Obama administration’s role in the early and violent removal of President Yanukovych proved to be a double edged sword. On the one hand, President Poroshenko was unable to accomplish the objectives of the Maidan revolution. On the other hand, it triggered Russia’s direct intervention in the Ukrainian mess. Moreover, Vice President Joe Biden’s private diplomacy to help his son Hunter Biden enrich himself and the family gave license to President Poroshenko and the oligarchs to continue unabated their corrupt and destructive activities within and outside Ukraine.
As a result, President Volodymyr Zelensky has inherited a situation in which the oligarchic system was discredited and the democratic values of the United State of America have become objects of ubiquitous scorn. Presently, Ukrainian society is completely traumatized and gripped by an existential fear of enormous proportions.
What can and needs to be done? One does not have to look further for a possible solution that to the almost identical history of the Republic of Finland and its troubled relations with imperial Russia, the Soviet Union and today’s Russian Federation. For centuries, Finland had managed to balance its relationship with Russia and its loyalty to the rest of Europe. From the Grand Duchy of Finland within the Russian Empire to the wars against the Soviet Union in 1939 and in 1944, which resulted in Finnish territorial losses, the country survived the Cold War’s Finlandization period. Presently as a full member of the European Union and a close cooperating state with NATO, Finland follows highly pragmatic policies vis-a-vis the Russian Federation. In a recent interview with Bloomberg: Business News, Finnish President Sauli Niinisto described his country’s attitude toward its powerful neighbor thus: “A Cossack takes everything that is loose. You have to be very clear and not let things become loose.”
President Zelensky would be well advised to follow this old Finnish wisdom. He will have to show firmness and resolve with Russia. Furthermore, he must be practical. He must know Ukraine’s strengths and limitations. Becoming a member of the European Union is clearly attainable. Full membership in NATO presently is not. However, being prepared for future Russian aggressions is within the capabilities of Ukraine. To achieve these goals, the Zelensky administration will have to move ever closer to the West by relentlessly promoting Western values inside Ukraine and simultaneously maintaining normal relations with Moscow.
Peace, stability, and prosperity have always been the Sisyphean endeavors of mankind. No doubt, President Zelensky will have to show real leadership. Otherwise, he and Ukraine will end up on the dust heaps of history.
The good times are back. The U.S. economy is performing at levels not seen in more than a decade, with unemployment at its lowest level in a lifetime.
Still, it wasn’t all that long ago when crude was selling for more than $100 a barrel and people were talking seriously about the problem of “peak oil.” The growing global demand for energy made from fossil fuels has U.S. policymakers pushing hard for subsidies intended to accelerate the development and commercialization of energy alternatives mace from agricultural products and coming from the wind and the sun.
The American faith in technology is almost never misplaced. The fracking revolution has turned the U.S. into a net energy exporter. The explosion in the use of natural gas and the development of microgrids powered by it in liquid form have made cheap power a reality once again, without the widespread adoption of renewables. Policymakers, though, have yet to come to grips with the reality and are, under pressure from special interests, trying to keep Bush/Obama-era energy policies in place that do more harm than good.
In 2005, the U.S. Congress adopted the Solar Investment Tax Credit with an eye to speeding the commercial adoption of energy from the sun as a way to heat and cool the nation’s homes and businesses. Whether it helped or not is debatable yet there are calls, even now, to ensure its renewal past its intended expiration at the end of the year.
The renewable lobby is politically powerful, especially given the nexus between those invested in and those who make generous contributions to elected officials. Remember Solyndra? And yet, despite its spectacular failure – which left taxpayers on the hook for who really knows how much – the ITC was already reauthorized in 2015 for solar PV, solar water heating, solar space heating and cooling, and solar process heat.
Right now, under current law, the industry is set to benefit from a 30 percent tax credit extended to consumers who purchase systems used in both residential and commercial properties that are under construction before 2020. Beginning in 2022 the credit decreases, dropping to 10 percent and useful only in commercial settings.
That’s what policymakers agreed to in 2015 to mollify the demands of the green groups who still believe, or at least claim they do, that the nation’s base power needs can be met by renewables without utilizing either nuclear or fossil fuels.
Science tells us that is a pipe dream and will remain one until the technology to store the energy generated by solar fields over the medium term (never mind the long) exists. Battery technology has not yet caught up to the increases the solar and wind energy industries have managed to achieve, meaning lots of generated power is left stranded and unused.
Nonetheless, the demand for another increase in the ITC as well as an expansion of what is covered is being pressed on legislators. The last extension was part of the deal that allowed for the U.S. to enter the crude export market which, while bad policy, makes it worth the price paid.
There are no such opportunities for a similar trade on the table now. The greens will never drop their opposition to energy exploration in the Arctic National Wildlife or the construction of new pipelines to move crude and natural gas produced by fracking to market. And since there’s no opportunity to trade for good policy, the ITC should be allowed to expire, especially since there’s plenty of evidence it’s no longer needed.
Solar, the web site GreenTechMedia reports, “will soon be able to out-compete gas-fired plants around the world on a levelized cost basis.” Large investments from foreign-based solar module manufacturing companies such as Hanwha Q Cells have led to the opening of manufacturing facilities in the United States. And solar energy experienced explosive growth between 2010 and 2016.
According to GTM Research, annual installations grew from just 849 MW in 2010, to more than 15,000 MW in 2016, a record-breaking year when the U.S. solar market nearly doubled its annual record for installations – while tax incentives are factored into the growth, efficiency and affordability have driven the adoption of the technology.
If the ITC worked as intended, as there’s evidence to suggest it did, it’s not needed anymore. And if it didn’t work as those who voted for and voted to extend it planned, it’s also not needed anymore. Either way, it’s time for it to be allowed to expire, if for no other reason than to show members of Congress they can allow special interest tax breaks to disappear and survive when they run for re-election.