It warmed my heart when Sen. Jim DeMint (R-SC) spearheaded a bill last February that would roll back a bunch of the energy-related tax credits that riddle our tax code and distort free-market signals in our energy sector. Tax credits are just one of the forms that subsidies can take, but all subsidies encourage rent-seeking behavior over customer-oriented behavior and allow the federal government to handpick winners and losers based on political favoritism rather than merit.
For some industries in particular, free-market competition is a little too pedestrian, and they resent that they should have to deign to convince people to buy their product and actually turn a profit. It’s just so… distasteful. Via Tim Carney:
The Tea Party has weakened the clout of the wind lobby, and imperiled the industry’s prized political possession — a billion-dollar “Production Tax Credit.” …
The American Wind Energy Association’s 2011 annual report and related documents were quietly posted on the Internet last week by a wind power opponent upset by windmills’ negative impact on birds. The documents show the lobby’s efforts to frame its opponents as tax hikers, and to use opposition research against subsidy critics, some of whom it classifies as “libertarian free-market fundamentalists.” …
“AWEA’s message and champions have largely resided on the left,” the Revolution Agency stated in a strategy memo included in AWEA’s 2011 annual report. So the 2010 elections required AWEA to “pivot” from “green energy and Obama to jobs, manufacturing, business investment, and Conservative Republicans,” while still “taking care not to erode base support from the left.”
One core problem, the memo explained: The “debt-strapped, partisan, and Tea Party-infused Congress is reflexively skeptical of subsidies and many outside the windy red states have an inherently negative sentiment toward renewable energy.” …
AWEA plans “continued deployment of opposition research through third parties to cause critics to have to respond,” the battle plan states. In other words: When people attack AWEA’s subsidies, AWEA might feed an unflattering story on that person to some ideological or partisan media outlet or activist group.
Ahh, the seedy underbelly of the DC lobbying-scene. It’s kinda’ cute that greenie-hippie types think that by abiding by the dictates of environmental trendiness, they think they’re somehow ‘fighting the man’ and thwarting corporate/establishment interests. ‘Cause in reality, the environmental movement boasts one of the most intractable lobbies around.
The AWEA only got it half-right, however: conservatives are ‘reflexively skeptical of subsidies,’ but they get a bum rap for harboring ‘inherently negative sentiments’ for renewable energy. If a form of renewable energy can start up its own ventures in the private sector and make a product that people willingly buy, then great! But as for the federal government ostensibly “making an investment” on behalf of public welfare, what incentives do bureaucrats have to be judicious in their “investments” when they’re gambling with other people’s money?
If wind energy didn’t have as much sunshine-and-rainbows, green-is-glamorous, in-theory support with the unthinking eco-trendy crowd, it wouldn’t have much else going for it. Turbines are environmentally costly and expensive to make; wind power doesn’t deliver much bang for its buck and isn’t very reliable; and comparing energy forms in terms of real energy-output, wind and solar together receive the lion’s share of government subsidies and they still don’t compete. From Environmental Trends:
The relevant question is, which form of energy is more subsidized on a per-unit-of-energy basis. The charts below show what the subsidy situation looks like when you calculate it on the much more relevant subsidy per-kilowatt-hour basis. As you can see, on that apples-to-apples basis, wind and solar power receive far higher subsidies than conventional energy forms.
So, yes — please, forgive us darned free-market fundamentalists for understanding that the freedom of small government should trump the inefficiencies of big government. I just hope most of the GOPers stay strong on this one, and don’t give in to the wiles of the wind lobby. I’d wager that at least Sen. DeMint can be counted upon to hold fast:
Freedom is the only political principle that cannot be bent to serve special interests. Remember how 7-Up used to call itself the un-cola? Well, freedom is the un-special interest.
Freedom, protected by the Constitution and the rule of law, works for everyone. It allows everyone — left or right, young or old, rich or poor — to make their own choices according to their own values.
Government’s job shouldn’t be to tilt the field for one team or another, but to guarantee a level playing for everyone.
That’s why I’m against forcing workers to join unions, congressional earmarks for favored groups, government bailouts of Wall Street, and energy subsidies — both for oil companies and for green energy.