Another Close Call

It is a wonder that the wind industry is not only surviving attacks from the political right and its wealthy supporters but is doing remarkably well under the circumstances.

In the recent battles over the “fiscal cliff” the relatively meager subsidies from the Federal government barely escaped the sharp knife that is constantly wielded by those who would prefer to see the country go the way of Big Oil. In fact, there has been an ongoing battle against alternative energy funded by an array of opposition groups supported by billionaire oilmen Charles and David Koch. This movement hides behind such seemingly respectable names as the “Manhattan Institute” and the “American Energy Alliance” and is geared toward promoting the agenda of Big Oil and bringing the growth of clean energy to a halt — regardless of how many lies and deceptions it requires.

Australian Canunda Wind Farm. South Australia         (Wikipedia)

Australian Canunda Wind Farm. South Australia (Wikipedia)

One such lie is that wind energy will not really help climate change. In fact, as we can read in this month’s Sierra magazine, “the Renewable Energy Laboratory says otherwise, finding that every gigawatt of wind power annually offsets 2.6 million tons of CO2. The Department of Energy estimates that if the United States could generate 20 percent of its power through wind by 2030 it would eliminate 825 million tons of green house emissions.”

In their attempt to shut down the clean energy movement, the Koch brothers have put pressure on Congress to eliminate the subsidies that were initiated by President George H.W. Bush and are essential for any industry starting up. For example, while the clean energy industry must beg for renewals of Federal subsidies on a year-to-year basis, the oil industry has enjoyed guaranteed subsidies for many years: between 2002 and 2008 these subsidies for Big Oil amounted to $70.2 billion while a mere $12.2 billion went to all renewables combined.

Fearing the discontinuance of subsidies during the recent fiscal cliff fiasco, the wind energy industry, which previously employed 75,000 people, had to lay off hundreds of employees while the near-miss spooked investors, slowed down production, and brought new wind farm projects to a grinding halt. As mentioned above, it is remarkable that the industry has survived at all. Given the serious need for alternative energies to offset our reliance on foreign oil, not to mention the need to save the planet, one can only wonder how successful this country might be if the Congress had given clean energy the sort of support the fossil fuel industries have enjoyed in the past.

Because of wind energy’s close call this past year and the slow-down that followed, 2013 will not be as remarkable a year for clean energy as was 2012. But since the tax credits will be extended beyond this year for projects started this year, 2014 promises to be a much better year. Now, if only the Congress would make a ten-year commitment, as they have done with Big Oil, things would really start to take off. We might even catch up with Germany and China.

But I do believe that the will and determination to reverse the current trend is there and that it will eventually win out. It’s just a question of time. But that time is running out and it would come so much faster if people like the Koch brothers were to wake up, realize that theirs is a finite resource and that clean energy can not only create thousands of jobs — as it has already shown — but also make the investors a ton of money. Just ask smart investors like Warren Buffett, T. Boone Pickens, and Al Gore.

Rebuttal!

I recently (June 7th) posted a blog titled “Repercussions” dealing with the fact, as I supposed then, that the energy companies would be forced to raise the costs of energy to the poorer customers who cannot afford solar panels if the wealthier (and more socially aware) customers continue to go solar. It seemed reasonable to me at the time (it was based on a New York Times article, after all!), and I simply hoped aloud that the energy companies would have enough sense to realize that they should climb aboard the clean energy bandwagon and become part of the solution instead of remaining part of the problem. But it turns out I bought a line of rhetoric the energy companies themselves are spewing and I want to clear up the mess.

In an article online recently David Sirota deals directly with the claim summarized above:

Also misleading is the implicit notion that Big Energy would somehow be forced to jack up rates in order to recover the small amount of revenue allegedly lost to solar panel owners. A perusal of the profit margins of the fossil fuel and electric utility sector shows how absurd that idea is. These are the opposite of destitute industries subsisting on razor-thin margins; they have plenty of profit cushion to absorb an infinitesimal loss of revenue from solar panels. That means when they raise rates, they are protecting those eye-popping margins, not being forced into anything by any economic circumstance.

In a word, the energy companies will claim that they need to raise costs to poorer customers in order to try to justify future increases and create an atmosphere of doubt and confusion — as was the case in my blog. I daresay there may be higher costs to non-solar customers on their way but they are not necessary: they will be an attempt on the part of the power companies to profit from the situation and to weaken the clean energy industry. I should have known. Given the terrible track record of the large corporations when it comes to assaulting the environment and their fixation on increasing profits no matter what, it should have been obvious that their claim that rates will necessarily have to rise if people keep going solar is the little boy crying “wolf.” There is no wolf: there is simple greed and it is not new; we have grown used to it.

I do think it would be sound business for the energy companies to stop crying “wolf” and to get on board the solar and wind energy bandwagon. If Warren Buffett has enough confidence in the clean energy business to invest a good deal of his money, it would make sense for the energy companies to simply buy into the industry and become partners instead of trying to compete by means of deceit and deception — as when David K. Owens, executive vice president of the Edison Electric Institute announced publicly, “Low-income customers can’t put on solar panels – let’s be blunt. So why should a low-income customer have their rates go up for the benefit of someone who puts on a solar panel and wants to be credited the retail rate?” Sirota has a rejoinder:

. . . the utilities’ argument is first and foremost undermined by the reality of the consumer market for solar power. The fact is, many solar integrators are now offering  zero-dollars-down lease packages for homes to go solar — packages that save ratepayers money over the long haul and eliminate a major income barrier to going solar. Yes, it’s certainly true that one typically has to own a home (and thus a roof) to go solar, and that therefore home ownership unto itself is an income threshold. However, the blanket statement that “low income customers can’t put on solar panels” is, to say the least, misleading.

Deceit and deception seem to be matters of course for large corporations these days — anything in the name of profit.  But I will continue to hope that eventually some (at least) of the large companies will realize that ethics and business can be conjoined and need not be forever at loggerheads.

Just Plain Stupid!

Aside from the fact that the Republicans seem intent upon trashing the public education system in this country, there are two items high on their agenda that are just plain stupid. The first is the urge to cut-taxes-at-all-cost mentality that ignores the fact that many of the programs under the axe are essential to the health and well-being of this country and its citizens. At the extreme right end of this pole are the TEA partiers who simply want to slash taxes with no thought for tomorrow. But, as a fellow blogger pointed out in a recent blog, the Democrats are not without blame, either. since they failed to support a bill that would have increased taxes along with the cuts in a 1 to 10 ratio. ” last summer’s Obama/ Boehner 10 to 1 compromise [should have passed] in a heartbeat. . . . That should have been a no brainer..” Clearly, there is waste and there should be cuts. But we must also be willing to pay for the benefits we receive and in many cases desperately need.

The second stupid item on the agenda is the attack on the environment in the name of good business. This is stupid because it rests on the false dichotomy: either we protect the environment or we save jobs. We can do both. But as a recent item in the Sierra magazine points out, this Republican Congress is “the most anti-environmental Congress in history.” It has passed 209 anti-environmental bills in the name of business, while the clean energy industry waits patiently for a sign that they will also receive some of the government’s largess.

But the news is not all bad, as it happens. The American citizens may be waking up slowly. And this is a good thing, because we may not have much time if even the most optimistic predictions of the scientific community are correct. The good news, as also reported in the Sierra magazine, is that electric cars and hybrids are selling at record rates. In addition, electricity generated from coal has “dropped to 36.7 percent in February, the lowest level since 1973.” And in “five states electricity generation from wind now equals or exceeds 10 percent. In South Dakota [of all places!] the figure is 22 percent.” Further, we read that Warren Buffett has thrown his considerable weight and influence behind investing in solar energy. There is hope, and clearly there is also money to be made in clean energy.

That is why these items on the Republican agenda are so stupid: they are short-sighted at a time when we need enlightened leadership and long-term planning to help save the planet and all life on it. The Republicans need to wake up. But so do the Democrats. It is time for the politicians in this country to realize that our priorities in the past have run their course and we need to turn in another direction before it is too late.

Doing Some Good

I have been giving the infamous 1% in this country a hard time in my blogs. To be sure, for the most part they deserve it as they continue to amass wealth while the world around them and many of the people in it struggle. But there is at least one billionaire, Louis Bacon, who is capable of doing good while doing well. He has recently donated 90,000 acres of his ranch in Colorado to conservation. A recent story from USA News on MSNBC reports:

A billionaire hedge-fund manager on Friday pledged to protect 90,000 acres of his Colorado ranch from further development as part of a much larger planned conservation area. The Obama administration said it would be the “largest single conservation easement” ever provided to the federal government.

The easement will allow ranching and hunting, but no development. It is part of Bacon’s 172,000 acre ranch and is reported to be one of the most beautiful spots in the country and alive with wildlife. It is a most generous gift though the cynic in me keeps nagging: why on earth would a man want a 172,000 acre ranch in the first place? But I told that part of me to shut up and just enjoy the moment: not all of the obscenely wealthy people in this country are blindly piling up ever more wealth at any cost. After all, Ted Turner, who does a great deal of good with his money, has a ranch near Bacon’s that is 600,000 acres. And if he can justify owning all that land, surely Bacon can find a way to justify his ownership of a ranch only about a quarter as large — or if not “justify” it, at least rationalize it, which is not the same thing at all.

Bear in mind that Bacon’s generosity, while it is admirable, does not put food on the table of hungry and destitute families; it does not put clothes on the backs of poor children, or roofs over the heads of the homeless; it does not undo the damage done by unscrupulous bankers (as described in this excellent blog:http://musingsofanoldfart.wordpress.com/). But it will protect some of our vanishing wilderness from the ravages of developers and oil exploration, at least for a time. And this is a good thing. One wishes there were more of the wealthy who chose to do even this much good.

Indeed, if the wealthy in this country weren’t intent on getting more tax breaks (yes, Bacon will get those from his gift) and watching their “disposable” income grow beyond one’s wildest imaginings, and if they were determined to not only preserve wild places and protect animal and fish life, but also help their fellow humans who are in need, it would be fairly easy to make a case that these people are entitled in some way to their wealth because of the immense good they are determined to do with it. But that isn’t happening.

Bear in mind that 1% of the population of this country amounts to slightly over three million people each of whom is worth countless millions of dollars. Think of the immense good they could do if they chose to do so. That is, if more of the privileged 1% acted with a social conscience, they (and their not-quite-so-rich friends) wouldn’t have to rail against an over-sized government grown large out of their indifference to the plight of the planet and its inhabitants. But few of them seem to have a conscience at all: the number of folks like Ted Turner, Bill Gates, Warren Buffett, and Louis Bacon in the group of the 1% is very small. Unfortunately.

Life’s Not Fair

It was not surprising, though certainly disappointing, to read that a Senate Committee killed the so-called “Buffett Rule” that would have required the wealthy to pay 30% of their income in taxes each year instead of the miniscule amount they now pay with the many tax breaks they enjoy. Warren Buffett tried to call the bluff of the wealthy, but the wealthy Senators (who obviously have a hidden agenda) killed the rule before it could get killed by the House of Representatives. Buffett must have known the Senate was playing with a crooked deck.

The argument by the Senators is interesting for its twisted logic. It is buried in a brief story  recently that also addresses the concern in Washington over the cost of Defense Secretary Leon Panetta’s numerous trips home to California last year — at a cost of $860,000 — and the G.S.A. Vegas junket that cost tax payers nearly as much.  Let’s take a look:

Any discussion of federal budgets is doomed to the obfuscation of scale: We can vaguely imagine what we’d do on an $800,000 trip to Vegas. It’s harder to fathom what we could do with $1 billion, especially on the scale of huge governmental deficits and debts. To help paint that picture, the opponents of the Buffett Rule were quick to point out how the new revenues would be less than 1 percent of the projected debt under Obama’s 2013 budget proposal.

Logicians call this a non-sequitor. More precisely, it’s a red herring. The issue is whether or not the wealthy pay their fair share of taxes, not whether or not it would help to lower the national debt. Clearly it would help somewhat, but not enough to make any real difference. But that’s not the point. The fact remains that we all pay our fair share so why shouldn’t the wealthy? If we follow the logic of those who voted down the Buffett rule, none of us should pay taxes since none of us pays enough to make a real dent in the national debt. That’s where their argument leads. It is fallacious and even absurd. But it won the day because it was a foregone conclusion and the Buffett Rule was defeated before it got a fair airing in the public arena. I dare say logic has no place in politics. Neither does common sense.

I have to believe the public would love to see the wealthy pay their fair share of taxes. We all worry each year at this time about the amount we have to pay out of our limited income — will the dreaded I.R.S. will allow that $230.00 deduction for my kid’s dancing lessons? — and it is galling to realize that those with the largest incomes in this country not only control the strings attached to the politicians, but they get to keep most of their filthy lucre. And despite the fact that it would not make a dent in the national debt, the wealthy in this country should start paying their fair share.

Calling Buffett’s Bluff?

In a recent Time magazine article, Warren Buffett jousts with Congressional Republicans over their determination to continue giving tax breaks to the wealthy. He has gone public before, and incurred the wrath of these folks on this topic, but in the course of pleading his case in the Time article, Buffet makes the following interesting remark:

“We need a tax system that takes very good care of people who just really aren’t as well adapted to the market system, and to capitalism, but are nevertheless just as good citizens, and are doing things that are of use in society.”

This is interesting for a number of reasons, but primarily (in my view) because it reveals the hidden assumption, shared by many, that one must embrace capitalism in order to be a good American citizen. In fact, democracy is a political system, whereas capitalism is an economic system. Economic and political systems can be joined in strange ways — as in a democratic/capitalistic system, a socialistic/democratic system, a capitalistic/autocratic system, and so forth. There are numerous countries that embrace both socialism and democracy — such as England, for example. Many in this country think this is impossible, but they are wrong. Some even argue that socialism maximizes human freedom, whereas capitalism restricts freedom to the very rich.

Americans can be good citizens of this democracy (which is in fact not a democracy, but a Republic with representative government) without caring one whit for capitalism, or knowing the first thing about it. Citizenship entails the willingness to pay taxes and obey the laws, serve on a jury if requested while also participating in the election process from time to time. It should also mean knowing something about how the process works. It does not, in any case, mean having a fat wallet, checking the stock markets, or owning at least two homes while spending vacations on the Riviera. Good citizenship has nothing whatever to do with being a staunch capitalist, as Buffett points out.

But that will doubtless be challenged as was his claim that Congress should raise taxes on the wealthy so they are paying their fair share. The response of Republican lawmakers to that proposal was to make it possible for Buffet himself (or anyone else) to pay more if he chose to do so. This is amusing, but it also lets the lawmakers off the hook with a snicker. It’s really not a game. Perhaps these people should take lessons in good citizenship. Generally speaking, it has not been the role of the wealthy in this country to “take care of people.” And when steps are taken to try to assist those in need through legislation there are cries of “socialism,” and the mantra of self-help is heard in the air: They’re just lazy. If they wanted to improve their lot, there’s nothing stopping them! Nonsense. This attitude is downright smug, and even a bit stupid. There are those who want to help themselves and can do nothing because society has dealt them a losing hand. In a Christian nation, as some would have it, one hardly need point out that we should all do what we can to help those in need. And in a democratic country good citizenship means allowing the majority to rule, not the very wealthy 1%.