Thursday, June 9, 2011
Random ruminations from your resident curmudgeon...
Right now, green energy is the latest sexy fad. There is much attention being paid to solar, wind, and biomass sources of energy, and currently, green energy provides 3.6% of all our energy needs in the United States. The stated goal of many in Washington is to replace our dependence on fossil fuels with renewable sources. The question we should all be asking is "What will a move to green energy cost?" According to Vaclav Smil, an energy expert, going totally green will cost our country upwards of $4 TRILLION over the next 10 years. These are the estimated costs to replace our current energy system with renewable sources. Here is the truth about green energy. Going totally green is going to put our economy at a decided disadvantage. There are five reasons why. First, green energy is very diffuse, meaning simply that it takes an enormous amount of land and material to generate even a small amount of energy. Jesse Ausubel, director of the Program for the Human Environment at Rockefeller University calculates that the entire state of Connecticut would need to be devoted to wind turbines just to provide enough power to meet the needs of New York City. Second, green energy is extremely costly. For instance, wind energy is 80% more costly to produce than gas fired electrical generators. Third, green energy is unreliable. Wind power is dependent on, well, the wind, which doesn't blow consistently. Fourth, renewable sources of energy are scarce. Massive amounts of land are needed to grow biomass crops or to establish wind farms. The availability of real estate next to population centers is limited and costly. Finally, electricity produced by the sun or wind cannot be efficiently stored because battery technology is not advanced enough to meet this requirement. While we are all concerned about the environment, going totally green is a canard that will severely damage our economy. Remember that the next time a politician touts a "green" economy.
I have stopped fighting my inner demons. We are on the same side now.
This week, Government, uh, General Motors CEO Dan Akerson said he wanted to see the federal gas tax raised by $1.00 per gallon. Why? To force consumers to buy more fuel efficient cars. The arrogance of that idea is surpassed only by its idiocy. According to Akerson, he believes that that the higher tax will move consumers to buying smaller, more fuel efficient cars rather than the cars consumers want to purchase. "People will start buying more Cruzes and they will start buying less Suburbans," said Akerson. Here is a thought, Dan. If GM made quality small cars that met the needs of the consumer, there would be no need for a higher tax to FORCE people to buy something they either do not want or does not meet their needs. Akerson's statement embodies one of the fundamental problems that has plagued American automobile makers throughout the years, and that is that the car companies have not made a product that appeals to consumers nor meets their needs. Dan, the market works, and the market is telling you that they don't want your small car product. When you understand the markets and how they work, you will have made a major step toward making GM a viable car company.
Isn't the term "criminal lawyer" a redundant statement?
Here is the painful truth about the financial situation that we face in our country: our unfunded obligations- what we owe for what our country has promised in entitlement payments- now stands at $61.6 TRILLION dollars. That amounts to $534,000 per household. Now, in the discussion of our nation's bleak financial picture, you will hear that we have a deficit of $1.5 trillion, not the $61.6 trillion I just referenced. The $1.5 trillion is the CURRENT year deficit. If the government had to account for all of its obligations, like every business in this country does, the real number becomes the $61.6 trillion figure. These payments are owed to seniors under the Social Security program along with Medicare and Medicaid payments for which the government is obligated as well as federal retirement programs. As Washington dallies with adopting real solutions, our problem is only going to get worse. With a debt of this magnitude, the only solutions are real structural changes to these programs that will be painful. And the longer that Washington waits to craft these solutions, the worse it will be for all taxpayers.
My mind is not twisted, just sprained.
And that, my friends, is my view.