Small Cars Are Dangerous Cars. By Sam Kazman
Fuel economy zealots can kill you.
CEI, Apr 17, 2009
The super-high efficiency minicar has become the Holy Grail for many environmentalists. But on Tuesday, a new study on minicar safety tossed some cold water on the dream. The Insurance Institute for Highway Safety (IIHS) reported that in a series of test crashes between minicars and midsize models, minis such as the Smart car provided significantly less protection for their passengers.
The tests did not involve the much ballyhooed mismatches between subcompacts and Hummers, but measured the effect of relatively modest differences in size and weight. Even though the Smart car and other minis such as the Honda Fit and the Toyota Yaris have fared relatively well in single-car crash tests, they performed poorly in these two-car frontal offset collisions. In the words of IIHS president Adrian Lund, "though much safer than they were a few years ago, minicars as a group do a comparatively poor job of protecting people in crashes, simply because they're smaller and lighter."
That difference is reflected in the real world. The death rate in minis in multi-vehicle crashes is almost twice as high as that of large cars. And in single-vehicle crashes, where there's no oversized second vehicle to blame, the difference is even greater: Passengers in minis suffered three times as many deaths as in large cars.
Given the nonstop pronouncements we've been hearing about the green promise of high-efficiency cars, these results were shocking to some. But not to IIHS. The Institute has long been reporting similar results from other tests, and its publications candidly advise that, when it comes to safety, larger and heavier cars are generally better.
That's not what advocates of higher fuel-economy standards want to hear. Greater weight may increase crashworthiness, but it also decreases miles per gallon, so there's an inevitable trade-off between safety and efficiency. A 2002 National Research Council study found that the federal Corporate Average Fuel Economy (CAFE) standards contributed to about 2,000 deaths per year through their restrictions on car size and weight. But amazingly, with the exception of IIHS, there's practically no one else providing information on the size-safety issue:
- Not the National Highway Traffic Safety Administration, which has a highly dubious track record on CAFE. In a 1992 lawsuit filed by the Competitive Enterprise Institute, and Consumer Alert, a federal appeals court found the agency guilty of using "mumbo jumbo" and "legerdemain" to conceal CAFE's lethal effects.
- Not the Environmental Protection Agency, which is about to become a major partner in setting CAFE standards. EPA is often fixated on minute risks, such as radon in drinking water, but don't expect it to admit to CAFE's dangers. Its official mission may be "to protect human health and the environment," but its operating philosophy seems to be "not necessarily in that order."
- Not Ralph Nader and his allied traffic safety groups, which are often CAFE's most energetic cheerleaders. Decades ago, Mr. Nader and his colleagues repeatedly warned of the hazards of small cars. The Center for Auto Safety's 1972 book "Small -- On Safety," noted "the inherent limitations" that "small size and light weight" impose on crashworthiness. But in the 1990s both Mr. Nader and the Center reversed their position. Why? Because CAFE presented them with a stark choice between more government power and more safety. They went for more power.
- Not Consumer Reports, which has consistently failed to mention the importance of size and weight in discussing how to choose a safer car. Though it is regarded as the information bible by many car buyers, not a single one of its annual auto issues in the last five years has touched on this topic.
As the National Research Council reported, the current CAFE program -- 27.5 mpg for passenger cars -- contributed to about 2,000 deaths. But driving is going to get even more lethal over the next decade: CAFE standards will be raised to a 35 mpg combined average for cars and light trucks. And with the notable exception of IIHS, information about those risks may be hard to come by.
Mr. Kazman is general counsel of the Competitive Enterprise Institute.
Friday, April 17, 2009
Real Chinese middle class and the McKinsey paper
Real Chinese middle class and the McKinsey paper
China Solved, Apr 16, 2009
If you haven’t read the McKinsey paper on China’s Wealthy – take a look. It’s a beautiful publication – and really reinforces the notion of China as the new super-consumer. The paper is full of tasteful shots of young, attractive Chinese people buying wine together and enjoying one another’s company in shopping malls.
But what caught my eye was on page 9 - the size of wealthy population. Less than 1% of urban Chinese households are wealthy – compared to 10% in US, Germany and Japan. But the Chinese are growing their wealthy component fast – around 16% per year. So we can expect China’s wealthy to rise to maybe 2% the population in 5 years. McKinsey says 4 million households by 2015. It’s not a huge number – but China is a developing economy and maybe McK set the bar too high.
How do they define ‘wealthy’ in China? In a footnote on page 8, McKinsey identifies as wealthy the 1.6 million Chinese earning 250,000 rmb per year or more. Unless I get my basic arithmetic wrong (and it’s been known to happen) we’re talking about people earning upwards of 20,800 rmb per month – or just shy of US$40 K a year.
The hopes of the commercial universe are riding on them – this small band of brave uber-consumers.
The Real Chinese Middle Class vs. the Imagined Chinese Middle Class
It may not have been their intent, but the McKinsey report demonstrates just how thin the upscale Chinese market is. If your business model used to be tailored to a ‘middle class expat’ market that is rapidly disappearing, then you’re already finding that the ‘middle class Chinese’ market is both unwilling and unable to fill the void. McKinsey’s “wealthy Chinese” aren’t packing that much of a punch in terms of numbers or spending potential.
Many westerners leaf through McKinsey type reports and conclude that China can support a lot more high-end spending than it really can. China per capita GDP for 2008 was in the neighborhood of US$3,000. They’re doing great – when I first came here it was barely $1800. Kudos to you China. Kudos.
But we’ve got to be careful which myths we allow ourselves to believe. The notion that an army of Chinese super-spenders with piles of disposable income saving are mobilizing to rescue the global economy – and our favorite little Shanghai bistro – is just wishful thinking. If your China business model still includes lots of foot traffic from “middle class Chinese earning 50 or 60,000 rmb / month “, then you’ve got to go back to the drawing board. Those days are over – and they are not likely to come back any time soon.
China Solved, Apr 16, 2009
If you haven’t read the McKinsey paper on China’s Wealthy – take a look. It’s a beautiful publication – and really reinforces the notion of China as the new super-consumer. The paper is full of tasteful shots of young, attractive Chinese people buying wine together and enjoying one another’s company in shopping malls.
But what caught my eye was on page 9 - the size of wealthy population. Less than 1% of urban Chinese households are wealthy – compared to 10% in US, Germany and Japan. But the Chinese are growing their wealthy component fast – around 16% per year. So we can expect China’s wealthy to rise to maybe 2% the population in 5 years. McKinsey says 4 million households by 2015. It’s not a huge number – but China is a developing economy and maybe McK set the bar too high.
How do they define ‘wealthy’ in China? In a footnote on page 8, McKinsey identifies as wealthy the 1.6 million Chinese earning 250,000 rmb per year or more. Unless I get my basic arithmetic wrong (and it’s been known to happen) we’re talking about people earning upwards of 20,800 rmb per month – or just shy of US$40 K a year.
The hopes of the commercial universe are riding on them – this small band of brave uber-consumers.
The Real Chinese Middle Class vs. the Imagined Chinese Middle Class
It may not have been their intent, but the McKinsey report demonstrates just how thin the upscale Chinese market is. If your business model used to be tailored to a ‘middle class expat’ market that is rapidly disappearing, then you’re already finding that the ‘middle class Chinese’ market is both unwilling and unable to fill the void. McKinsey’s “wealthy Chinese” aren’t packing that much of a punch in terms of numbers or spending potential.
Many westerners leaf through McKinsey type reports and conclude that China can support a lot more high-end spending than it really can. China per capita GDP for 2008 was in the neighborhood of US$3,000. They’re doing great – when I first came here it was barely $1800. Kudos to you China. Kudos.
But we’ve got to be careful which myths we allow ourselves to believe. The notion that an army of Chinese super-spenders with piles of disposable income saving are mobilizing to rescue the global economy – and our favorite little Shanghai bistro – is just wishful thinking. If your China business model still includes lots of foot traffic from “middle class Chinese earning 50 or 60,000 rmb / month “, then you’ve got to go back to the drawing board. Those days are over – and they are not likely to come back any time soon.
Hayden & Mukasey: The President Ties His Own Hands on Terror
The President Ties His Own Hands on Terror. By Michael Hayden and Michael B Mukasey
The point of interrogation is intelligence, not confession.
WSJ, Apr 17, 2009
The Obama administration has declassified and released opinions of the Justice Department's Office of Legal Counsel (OLC) given in 2005 and earlier that analyze the legality of interrogation techniques authorized for use by the CIA. Those techniques were applied only when expressly permitted by the director, and are described in these opinions in detail, along with their limits and the safeguards applied to them. AP
The release of these opinions was unnecessary as a legal matter, and is unsound as a matter of policy. Its effect will be to invite the kind of institutional timidity and fear of recrimination that weakened intelligence gathering in the past, and that we came sorely to regret on Sept. 11, 2001.
Proponents of the release have argued that the techniques have been abandoned and thus there is no point in keeping them secret any longer; that they were in any event ineffective; that their disclosure was somehow legally compelled; and that they cost us more in the coin of world opinion than they were worth. None of these claims survives scrutiny.
Soon after he was sworn in, President Barack Obama signed an executive order that suspended use of these techniques and confined not only the military but all U.S. agencies -- including the CIA -- to the interrogation limits set in the Army Field Manual. This suspension was accompanied by a commitment to further study the interrogation program, and government personnel were cautioned that they could no longer rely on earlier opinions of the OLC.
Although evidence shows that the Army Field Manual, which is available online, is already used by al Qaeda for training purposes, it was certainly the president's right to suspend use of any technique. However, public disclosure of the OLC opinions, and thus of the techniques themselves, assures that terrorists are now aware of the absolute limit of what the U.S. government could do to extract information from them, and can supplement their training accordingly and thus diminish the effectiveness of these techniques as they have the ones in the Army Field Manual.
Moreover, disclosure of the details of the program pre-empts the study of the president's task force and assures that the suspension imposed by the president's executive order is effectively permanent. There would be little point in the president authorizing measures whose nature and precise limits have already been disclosed in detail to those whose resolve we hope to overcome. This conflicts with the sworn promise of the current director of the CIA, Leon Panetta, who testified in aid of securing Senate confirmation that if he thought he needed additional authority to conduct interrogation to get necessary information, he would seek it from the president. By allowing this disclosure, President Obama has tied not only his own hands but also the hands of any future administration faced with the prospect of attack.
Disclosure of the techniques is likely to be met by faux outrage, and is perfectly packaged for media consumption. It will also incur the utter contempt of our enemies. Somehow, it seems unlikely that the people who beheaded Nicholas Berg and Daniel Pearl, and have tortured and slain other American captives, are likely to be shamed into giving up violence by the news that the U.S. will no longer interrupt the sleep cycle of captured terrorists even to help elicit intelligence that could save the lives of its citizens.
Which brings us to the next of the justifications for disclosing and thus abandoning these measures: that they don't work anyway, and that those who are subjected to them will simply make up information in order to end their ordeal. This ignorant view of how interrogations are conducted is belied by both experience and common sense. If coercive interrogation had been administered to obtain confessions, one might understand the argument. Khalid Sheikh Mohammed (KSM), who organized the Sept. 11, 2001 attacks, among others, and who has boasted of having beheaded Daniel Pearl, could eventually have felt pressed to provide a false confession. But confessions aren't the point. Intelligence is. Interrogation is conducted by using such obvious approaches as asking questions whose correct answers are already known and only when truthful information is provided proceeding to what may not be known. Moreover, intelligence can be verified, correlated and used to get information from other detainees, and has been; none of this information is used in isolation.
The terrorist Abu Zubaydah (sometimes derided as a low-level operative of questionable reliability, but who was in fact close to KSM and other senior al Qaeda leaders) disclosed some information voluntarily. But he was coerced into disclosing information that led to the capture of Ramzi bin al Shibh, another of the planners of Sept. 11, who in turn disclosed information which -- when combined with what was learned from Abu Zubaydah -- helped lead to the capture of KSM and other senior terrorists, and the disruption of follow-on plots aimed at both Europe and the U.S. Details of these successes, and the methods used to obtain them, were disclosed repeatedly in more than 30 congressional briefings and hearings beginning in 2002, and open to all members of the Intelligence Committees of both Houses of Congress beginning in September 2006. Any protestation of ignorance of those details, particularly by members of those committees, is pretense.
The techniques themselves were used selectively against only a small number of hard-core prisoners who successfully resisted other forms of interrogation, and then only with the explicit authorization of the director of the CIA. Of the thousands of unlawful combatants captured by the U.S., fewer than 100 were detained and questioned in the CIA program. Of those, fewer than one-third were subjected to any of the techniques discussed in these opinions. As already disclosed by Director Hayden, as late as 2006, even with the growing success of other intelligence tools, fully half of the government's knowledge about the structure and activities of al Qaeda came from those interrogations.
Nor was there any legal reason compelling such disclosure. To be sure, the American Civil Liberties Union has sued under the Freedom of Information Act to obtain copies of these and other memoranda, but the government until now has successfully resisted such lawsuits. Even when the government disclosed that three members of al Qaeda had been subjected to waterboarding but that the technique was no longer part of the CIA interrogation program, the court sustained the government's argument that the precise details of how it was done, including limits and safeguards, could remain classified against the possibility that some future president may authorize its use. Therefore, notwithstanding the suggestion that disclosure was somehow legally compelled, there was no legal impediment to the Justice Department making the same argument even with respect to any techniques that remained in the CIA program until last January.
There is something of the self-fulfilling prophecy in the claim that our interrogation of some unlawful combatants beyond the limits set in the Army Field Manual has disgraced us before the world. Such a claim often conflates interrogation with the sadism engaged in by some soldiers at Abu Ghraib, an incident that had nothing whatever to do with intelligence gathering. The limits of the Army Field Manual are entirely appropriate for young soldiers, for the conditions in which they operate, for the detainees they routinely question, and for the kinds of tactically relevant information they pursue. Those limits are not appropriate, however, for more experienced people in controlled circumstances with high-value detainees. Indeed, the Army Field Manual was created with awareness that there was an alternative protocol for high-value detainees.
In addition, there were those who believed that the U.S. deserved what it got on Sept. 11, 2001. Such people, and many who purport to speak for world opinion, were resourceful both before and after the Sept. 11 attacks in crafting reasons to resent America's role as a superpower. Recall also that the first World Trade Center bombing in 1993, the attacks on our embassies in Kenya and Tanzania, the punctiliously correct trials of defendants in connection with those incidents, and the bombing of the USS Cole took place long before the advent of CIA interrogations, the invasion of Saddam Hussein's Iraq, or the many other purported grievances asserted over the past eight years.
The effect of this disclosure on the morale and effectiveness of many in the intelligence community is not hard to predict. Those charged with the responsibility of gathering potentially lifesaving information from unwilling captives are now told essentially that any legal opinion they get as to the lawfulness of their activity is only as durable as political fashion permits. Even with a seemingly binding opinion in hand, which future CIA operations personnel would take the risk? There would be no wink, no nod, no handshake that would convince them that legal guidance is durable. Any president who wants to apply such techniques without such a binding and durable legal opinion had better be prepared to apply them himself.
Beyond that, anyone in government who seeks an opinion from the OLC as to the propriety of any action, or who authors an opinion for the OLC, is on notice henceforth that such a request for advice, and the advice itself, is now more likely than before to be subject after the fact to public and partisan criticism. It is hard to see how that will promote candor either from those who should be encouraged to ask for advice before they act, or from those who must give it.
In his book "The Terror Presidency," Jack Goldsmith describes the phenomenon we are now experiencing, and its inevitable effect, referring to what he calls "cycles of timidity and aggression" that have weakened intelligence gathering in the past. Politicians pressure the intelligence community to push to the legal limit, and then cast accusations when aggressiveness goes out of style, thereby encouraging risk aversion, and then, as occurred in the wake of 9/11, criticizing the intelligence community for feckless timidity. He calls these cycles "a terrible problem for our national security." Indeed they are, and the precipitous release of these OLC opinions simply makes the problem worse.
Gen. Hayden was director of the Central Intelligence Agency from 2006 to 2009. Mr. Mukasey was attorney general of the United States from 2007 to 2009.
The point of interrogation is intelligence, not confession.
WSJ, Apr 17, 2009
The Obama administration has declassified and released opinions of the Justice Department's Office of Legal Counsel (OLC) given in 2005 and earlier that analyze the legality of interrogation techniques authorized for use by the CIA. Those techniques were applied only when expressly permitted by the director, and are described in these opinions in detail, along with their limits and the safeguards applied to them. AP
The release of these opinions was unnecessary as a legal matter, and is unsound as a matter of policy. Its effect will be to invite the kind of institutional timidity and fear of recrimination that weakened intelligence gathering in the past, and that we came sorely to regret on Sept. 11, 2001.
Proponents of the release have argued that the techniques have been abandoned and thus there is no point in keeping them secret any longer; that they were in any event ineffective; that their disclosure was somehow legally compelled; and that they cost us more in the coin of world opinion than they were worth. None of these claims survives scrutiny.
Soon after he was sworn in, President Barack Obama signed an executive order that suspended use of these techniques and confined not only the military but all U.S. agencies -- including the CIA -- to the interrogation limits set in the Army Field Manual. This suspension was accompanied by a commitment to further study the interrogation program, and government personnel were cautioned that they could no longer rely on earlier opinions of the OLC.
Although evidence shows that the Army Field Manual, which is available online, is already used by al Qaeda for training purposes, it was certainly the president's right to suspend use of any technique. However, public disclosure of the OLC opinions, and thus of the techniques themselves, assures that terrorists are now aware of the absolute limit of what the U.S. government could do to extract information from them, and can supplement their training accordingly and thus diminish the effectiveness of these techniques as they have the ones in the Army Field Manual.
Moreover, disclosure of the details of the program pre-empts the study of the president's task force and assures that the suspension imposed by the president's executive order is effectively permanent. There would be little point in the president authorizing measures whose nature and precise limits have already been disclosed in detail to those whose resolve we hope to overcome. This conflicts with the sworn promise of the current director of the CIA, Leon Panetta, who testified in aid of securing Senate confirmation that if he thought he needed additional authority to conduct interrogation to get necessary information, he would seek it from the president. By allowing this disclosure, President Obama has tied not only his own hands but also the hands of any future administration faced with the prospect of attack.
Disclosure of the techniques is likely to be met by faux outrage, and is perfectly packaged for media consumption. It will also incur the utter contempt of our enemies. Somehow, it seems unlikely that the people who beheaded Nicholas Berg and Daniel Pearl, and have tortured and slain other American captives, are likely to be shamed into giving up violence by the news that the U.S. will no longer interrupt the sleep cycle of captured terrorists even to help elicit intelligence that could save the lives of its citizens.
Which brings us to the next of the justifications for disclosing and thus abandoning these measures: that they don't work anyway, and that those who are subjected to them will simply make up information in order to end their ordeal. This ignorant view of how interrogations are conducted is belied by both experience and common sense. If coercive interrogation had been administered to obtain confessions, one might understand the argument. Khalid Sheikh Mohammed (KSM), who organized the Sept. 11, 2001 attacks, among others, and who has boasted of having beheaded Daniel Pearl, could eventually have felt pressed to provide a false confession. But confessions aren't the point. Intelligence is. Interrogation is conducted by using such obvious approaches as asking questions whose correct answers are already known and only when truthful information is provided proceeding to what may not be known. Moreover, intelligence can be verified, correlated and used to get information from other detainees, and has been; none of this information is used in isolation.
The terrorist Abu Zubaydah (sometimes derided as a low-level operative of questionable reliability, but who was in fact close to KSM and other senior al Qaeda leaders) disclosed some information voluntarily. But he was coerced into disclosing information that led to the capture of Ramzi bin al Shibh, another of the planners of Sept. 11, who in turn disclosed information which -- when combined with what was learned from Abu Zubaydah -- helped lead to the capture of KSM and other senior terrorists, and the disruption of follow-on plots aimed at both Europe and the U.S. Details of these successes, and the methods used to obtain them, were disclosed repeatedly in more than 30 congressional briefings and hearings beginning in 2002, and open to all members of the Intelligence Committees of both Houses of Congress beginning in September 2006. Any protestation of ignorance of those details, particularly by members of those committees, is pretense.
The techniques themselves were used selectively against only a small number of hard-core prisoners who successfully resisted other forms of interrogation, and then only with the explicit authorization of the director of the CIA. Of the thousands of unlawful combatants captured by the U.S., fewer than 100 were detained and questioned in the CIA program. Of those, fewer than one-third were subjected to any of the techniques discussed in these opinions. As already disclosed by Director Hayden, as late as 2006, even with the growing success of other intelligence tools, fully half of the government's knowledge about the structure and activities of al Qaeda came from those interrogations.
Nor was there any legal reason compelling such disclosure. To be sure, the American Civil Liberties Union has sued under the Freedom of Information Act to obtain copies of these and other memoranda, but the government until now has successfully resisted such lawsuits. Even when the government disclosed that three members of al Qaeda had been subjected to waterboarding but that the technique was no longer part of the CIA interrogation program, the court sustained the government's argument that the precise details of how it was done, including limits and safeguards, could remain classified against the possibility that some future president may authorize its use. Therefore, notwithstanding the suggestion that disclosure was somehow legally compelled, there was no legal impediment to the Justice Department making the same argument even with respect to any techniques that remained in the CIA program until last January.
There is something of the self-fulfilling prophecy in the claim that our interrogation of some unlawful combatants beyond the limits set in the Army Field Manual has disgraced us before the world. Such a claim often conflates interrogation with the sadism engaged in by some soldiers at Abu Ghraib, an incident that had nothing whatever to do with intelligence gathering. The limits of the Army Field Manual are entirely appropriate for young soldiers, for the conditions in which they operate, for the detainees they routinely question, and for the kinds of tactically relevant information they pursue. Those limits are not appropriate, however, for more experienced people in controlled circumstances with high-value detainees. Indeed, the Army Field Manual was created with awareness that there was an alternative protocol for high-value detainees.
In addition, there were those who believed that the U.S. deserved what it got on Sept. 11, 2001. Such people, and many who purport to speak for world opinion, were resourceful both before and after the Sept. 11 attacks in crafting reasons to resent America's role as a superpower. Recall also that the first World Trade Center bombing in 1993, the attacks on our embassies in Kenya and Tanzania, the punctiliously correct trials of defendants in connection with those incidents, and the bombing of the USS Cole took place long before the advent of CIA interrogations, the invasion of Saddam Hussein's Iraq, or the many other purported grievances asserted over the past eight years.
The effect of this disclosure on the morale and effectiveness of many in the intelligence community is not hard to predict. Those charged with the responsibility of gathering potentially lifesaving information from unwilling captives are now told essentially that any legal opinion they get as to the lawfulness of their activity is only as durable as political fashion permits. Even with a seemingly binding opinion in hand, which future CIA operations personnel would take the risk? There would be no wink, no nod, no handshake that would convince them that legal guidance is durable. Any president who wants to apply such techniques without such a binding and durable legal opinion had better be prepared to apply them himself.
Beyond that, anyone in government who seeks an opinion from the OLC as to the propriety of any action, or who authors an opinion for the OLC, is on notice henceforth that such a request for advice, and the advice itself, is now more likely than before to be subject after the fact to public and partisan criticism. It is hard to see how that will promote candor either from those who should be encouraged to ask for advice before they act, or from those who must give it.
In his book "The Terror Presidency," Jack Goldsmith describes the phenomenon we are now experiencing, and its inevitable effect, referring to what he calls "cycles of timidity and aggression" that have weakened intelligence gathering in the past. Politicians pressure the intelligence community to push to the legal limit, and then cast accusations when aggressiveness goes out of style, thereby encouraging risk aversion, and then, as occurred in the wake of 9/11, criticizing the intelligence community for feckless timidity. He calls these cycles "a terrible problem for our national security." Indeed they are, and the precipitous release of these OLC opinions simply makes the problem worse.
Gen. Hayden was director of the Central Intelligence Agency from 2006 to 2009. Mr. Mukasey was attorney general of the United States from 2007 to 2009.
Black liquor, paper industry and Congressional rewards for the right behavior
Alternative Fuel Folly. By Kimberley A Strassel
WSJ, Apr 17, 2009
Every so often Washington throws out a controversy that brilliantly illustrates everything wrong with Washington. Consider the brewing outrage over "black liquor."
This is the tale of how a supposedly innocuous federal subsidy to encourage "alternative energy" has, in a few short years, ballooned into a huge taxpayer liability and a potential trade dispute, even as it has distorted markets and led to greater fossil-fuel use. Think of it as a harbinger of the unintended consequences that will accompany the Obama energy revolution.
Back in 2005, Congress passed a highway bill. In its wisdom, it created a subsidy that gave some entities a 50-cents-a-gallon tax credit for blending "alternative" fuels with traditional fossil fuels. The law restricted which businesses could apply and limited the credit to use of fuel in motor vehicles.
Not long after, some members of Congress got to wondering if they couldn't tweak this credit in a way that would benefit specific home-state industries. In 2007, Congress expanded the types of alternative fuels that counted for the credit, while also allowing "non-mobile" entities to apply. This meant that Alaskan fish-processing facilities, for instance, which run their boilers off fish oil, might now also claim the credit.
What Congress apparently didn't consider was every other industry that might qualify. Turns out the paper industry has long used something called the "kraft" process to make paper. One byproduct is a sludge called "black liquor," which the industry has used for decades to fuel its plants. Black liquor is cost-effective, makes plants nearly self-sufficient, and, most importantly (at least for this story), definitely falls under Congress's definition of an "alternative fuel."
All of which has allowed the paper industry to start collecting giant federal payments for doing nothing more than what it has done for decades. And in fairness, why not? If Congress is going to lard up the tax code with thousands of complex provisions designed to "encourage" behavior, it shouldn't be surprised when those already practicing said behavior line up for their reward, too.
In March, International Paper announced it had received $71 million from the feds for a one-month period last fall. The company is on track to claim as much as $1 billion in 2009. Verso took in nearly $30 million from the operation of just one mill in one quarter of last year. Other giants are gearing up to realize their own windfalls. Wall Street has gone wild, pushing paper-company stocks up dramatically in recent weeks.
Happy as industry is to have this new federal lifeline in the middle of a recession, it is the only one smiling. Foreign competitors are screaming that the subsidy is unfairly propping up the U.S. industry in tough times. They claim the U.S. industry is ramping up production simply to realize more tax money. Canadian forestry firms are already demanding their government file a trade complaint.
In order to qualify for the credit, alternative fuel must be mixed with a taxable one. (The government might want to encourage alternative fuels, but not to the extent that it loses its gas-tax revenue.) This means that to qualify, the paper industry must mix some diesel with its black liquor. This has sent environmentalists around the bend. They have accused the industry of burning fossil fuels that it didn't used to burn, simply to get the tax dollars. (The industry has not been clear on whether it is, in fact, using more diesel.)
And then there's Congress, which is suddenly looking at billions more in red ink than expected. In 2007 it estimated a 15-month extension of the credit would cost taxpayers $333 million. It has since revised those numbers to take into account black liquor and is now figuring a one-year cost of more than $3 billion. Wall Street analysts are talking $6 billion. Senate Finance Committee bosses Max Baucus and Charles Grassley are reportedly aware of the issue, none too happy, and they are working to bar the paper industry from receiving the credit.
But this, in turn, has tossed up uncomfortable questions. The paper industry argues that if the government is going to be in the business of rewarding good behavior, it ought to do it equally. Is green policy only to be aimed at dirty or economically unviable actors? Is black liquor any less useful than ethanol or biodiesel, and if so why? If not, shouldn't Washington encourage its use? Isn't every green subsidy in fact the basis for a trade dispute? These are questions Congress has no interest in confronting, since it would expose the muddle that is its entire green-energy program.
All of this is highly amusing, if not surprising. Every government attempt to manage energy markets has resulted in similar disarray. Look at the havoc that came from the energy price controls, regulations and subsidies of the 1970s. Or look, more recently, at the ethanol fiasco, and the accompanying soaring food costs. Energy powers the economy. Mess with energy markets, and mess with everything else. When will Washington learn?
WSJ, Apr 17, 2009
Every so often Washington throws out a controversy that brilliantly illustrates everything wrong with Washington. Consider the brewing outrage over "black liquor."
This is the tale of how a supposedly innocuous federal subsidy to encourage "alternative energy" has, in a few short years, ballooned into a huge taxpayer liability and a potential trade dispute, even as it has distorted markets and led to greater fossil-fuel use. Think of it as a harbinger of the unintended consequences that will accompany the Obama energy revolution.
Back in 2005, Congress passed a highway bill. In its wisdom, it created a subsidy that gave some entities a 50-cents-a-gallon tax credit for blending "alternative" fuels with traditional fossil fuels. The law restricted which businesses could apply and limited the credit to use of fuel in motor vehicles.
Not long after, some members of Congress got to wondering if they couldn't tweak this credit in a way that would benefit specific home-state industries. In 2007, Congress expanded the types of alternative fuels that counted for the credit, while also allowing "non-mobile" entities to apply. This meant that Alaskan fish-processing facilities, for instance, which run their boilers off fish oil, might now also claim the credit.
What Congress apparently didn't consider was every other industry that might qualify. Turns out the paper industry has long used something called the "kraft" process to make paper. One byproduct is a sludge called "black liquor," which the industry has used for decades to fuel its plants. Black liquor is cost-effective, makes plants nearly self-sufficient, and, most importantly (at least for this story), definitely falls under Congress's definition of an "alternative fuel."
All of which has allowed the paper industry to start collecting giant federal payments for doing nothing more than what it has done for decades. And in fairness, why not? If Congress is going to lard up the tax code with thousands of complex provisions designed to "encourage" behavior, it shouldn't be surprised when those already practicing said behavior line up for their reward, too.
In March, International Paper announced it had received $71 million from the feds for a one-month period last fall. The company is on track to claim as much as $1 billion in 2009. Verso took in nearly $30 million from the operation of just one mill in one quarter of last year. Other giants are gearing up to realize their own windfalls. Wall Street has gone wild, pushing paper-company stocks up dramatically in recent weeks.
Happy as industry is to have this new federal lifeline in the middle of a recession, it is the only one smiling. Foreign competitors are screaming that the subsidy is unfairly propping up the U.S. industry in tough times. They claim the U.S. industry is ramping up production simply to realize more tax money. Canadian forestry firms are already demanding their government file a trade complaint.
In order to qualify for the credit, alternative fuel must be mixed with a taxable one. (The government might want to encourage alternative fuels, but not to the extent that it loses its gas-tax revenue.) This means that to qualify, the paper industry must mix some diesel with its black liquor. This has sent environmentalists around the bend. They have accused the industry of burning fossil fuels that it didn't used to burn, simply to get the tax dollars. (The industry has not been clear on whether it is, in fact, using more diesel.)
And then there's Congress, which is suddenly looking at billions more in red ink than expected. In 2007 it estimated a 15-month extension of the credit would cost taxpayers $333 million. It has since revised those numbers to take into account black liquor and is now figuring a one-year cost of more than $3 billion. Wall Street analysts are talking $6 billion. Senate Finance Committee bosses Max Baucus and Charles Grassley are reportedly aware of the issue, none too happy, and they are working to bar the paper industry from receiving the credit.
But this, in turn, has tossed up uncomfortable questions. The paper industry argues that if the government is going to be in the business of rewarding good behavior, it ought to do it equally. Is green policy only to be aimed at dirty or economically unviable actors? Is black liquor any less useful than ethanol or biodiesel, and if so why? If not, shouldn't Washington encourage its use? Isn't every green subsidy in fact the basis for a trade dispute? These are questions Congress has no interest in confronting, since it would expose the muddle that is its entire green-energy program.
All of this is highly amusing, if not surprising. Every government attempt to manage energy markets has resulted in similar disarray. Look at the havoc that came from the energy price controls, regulations and subsidies of the 1970s. Or look, more recently, at the ethanol fiasco, and the accompanying soaring food costs. Energy powers the economy. Mess with energy markets, and mess with everything else. When will Washington learn?
Thursday, April 16, 2009
Statement of President Barack Obama on Release of OLC Memos
Statement of President Barack Obama on Release of OLC Memos
White House, Apr 16, 2009
The Department of Justice will today release certain memos issued by the Office of Legal Counsel between 2002 and 2005 as part of an ongoing court case. These memos speak to techniques that were used in the interrogation of terrorism suspects during that period, and their release is required by the rule of law.
My judgment on the content of these memos is a matter of record. In one of my very first acts as President, I prohibited the use of these interrogation techniques by the United States because they undermine our moral authority and do not make us safer. Enlisting our values in the protection of our people makes us stronger and more secure. A democracy as resilient as ours must reject the false choice between our security and our ideals, and that is why these methods of interrogation are already a thing of the past.
But that is not what compelled the release of these legal documents today. While I believe strongly in transparency and accountability, I also believe that in a dangerous world, the United States must sometimes carry out intelligence operations and protect information that is classified for purposes of national security. I have already fought for that principle in court and will do so again in the future. However, after consulting with the Attorney General, the Director of National Intelligence, and others, I believe that exceptional circumstances surround these memos and require their release.
First, the interrogation techniques described in these memos have already been widely reported. Second, the previous Administration publicly acknowledged portions of the program – and some of the practices – associated with these memos. Third, I have already ended the techniques described in the memos through an Executive Order. Therefore, withholding these memos would only serve to deny facts that have been in the public domain for some time. This could contribute to an inaccurate accounting of the past, and fuel erroneous and inflammatory assumptions about actions taken by the United States.
In releasing these memos, it is our intention to assure those who carried out their duties relying in good faith upon legal advice from the Department of Justice that they will not be subject to prosecution. The men and women of our intelligence community serve courageously on the front lines of a dangerous world. Their accomplishments are unsung and their names unknown, but because of their sacrifices, every single American is safer. We must protect their identities as vigilantly as they protect our security, and we must provide them with the confidence that they can do their jobs.
Going forward, it is my strong belief that the United States has a solemn duty to vigorously maintain the classified nature of certain activities and information related to national security. This is an extraordinarily important responsibility of the presidency, and it is one that I will carry out assertively irrespective of any political concern. Consequently, the exceptional circumstances surrounding these memos should not be viewed as an erosion of the strong legal basis for maintaining the classified nature of secret activities. I will always do whatever is necessary to protect the national security of the United States.
This is a time for reflection, not retribution. I respect the strong views and emotions that these issues evoke. We have been through a dark and painful chapter in our history. But at a time of great challenges and disturbing disunity, nothing will be gained by spending our time and energy laying blame for the past. Our national greatness is embedded in America’s ability to right its course in concert with our core values, and to move forward with confidence. That is why we must resist the forces that divide us, and instead come together on behalf of our common future.
The United States is a nation of laws. My Administration will always act in accordance with those laws, and with an unshakeable commitment to our ideals. That is why we have released these memos, and that is why we have taken steps to ensure that the actions described within them never take place again.
White House, Apr 16, 2009
The Department of Justice will today release certain memos issued by the Office of Legal Counsel between 2002 and 2005 as part of an ongoing court case. These memos speak to techniques that were used in the interrogation of terrorism suspects during that period, and their release is required by the rule of law.
My judgment on the content of these memos is a matter of record. In one of my very first acts as President, I prohibited the use of these interrogation techniques by the United States because they undermine our moral authority and do not make us safer. Enlisting our values in the protection of our people makes us stronger and more secure. A democracy as resilient as ours must reject the false choice between our security and our ideals, and that is why these methods of interrogation are already a thing of the past.
But that is not what compelled the release of these legal documents today. While I believe strongly in transparency and accountability, I also believe that in a dangerous world, the United States must sometimes carry out intelligence operations and protect information that is classified for purposes of national security. I have already fought for that principle in court and will do so again in the future. However, after consulting with the Attorney General, the Director of National Intelligence, and others, I believe that exceptional circumstances surround these memos and require their release.
First, the interrogation techniques described in these memos have already been widely reported. Second, the previous Administration publicly acknowledged portions of the program – and some of the practices – associated with these memos. Third, I have already ended the techniques described in the memos through an Executive Order. Therefore, withholding these memos would only serve to deny facts that have been in the public domain for some time. This could contribute to an inaccurate accounting of the past, and fuel erroneous and inflammatory assumptions about actions taken by the United States.
In releasing these memos, it is our intention to assure those who carried out their duties relying in good faith upon legal advice from the Department of Justice that they will not be subject to prosecution. The men and women of our intelligence community serve courageously on the front lines of a dangerous world. Their accomplishments are unsung and their names unknown, but because of their sacrifices, every single American is safer. We must protect their identities as vigilantly as they protect our security, and we must provide them with the confidence that they can do their jobs.
Going forward, it is my strong belief that the United States has a solemn duty to vigorously maintain the classified nature of certain activities and information related to national security. This is an extraordinarily important responsibility of the presidency, and it is one that I will carry out assertively irrespective of any political concern. Consequently, the exceptional circumstances surrounding these memos should not be viewed as an erosion of the strong legal basis for maintaining the classified nature of secret activities. I will always do whatever is necessary to protect the national security of the United States.
This is a time for reflection, not retribution. I respect the strong views and emotions that these issues evoke. We have been through a dark and painful chapter in our history. But at a time of great challenges and disturbing disunity, nothing will be gained by spending our time and energy laying blame for the past. Our national greatness is embedded in America’s ability to right its course in concert with our core values, and to move forward with confidence. That is why we must resist the forces that divide us, and instead come together on behalf of our common future.
The United States is a nation of laws. My Administration will always act in accordance with those laws, and with an unshakeable commitment to our ideals. That is why we have released these memos, and that is why we have taken steps to ensure that the actions described within them never take place again.
US State Dept on Moldova: Aftermath of Protests
Moldova: Aftermath of Protests. By Robert Wood, Acting Department Spokesman
US State Dept, Thu, 16 Apr 2009 16:38:10 -0500
The United States is concerned about the situation in Moldova following the violence on April 7. Although order has been restored and subsequent demonstrations have been peaceful, we have received reports from civil society and international observers of mistreatment of those detained by Moldovan authorities. We are also troubled by reports that students and journalists have been intimidated by government officials. President Voronin’s announcement of an amnesty for many of those detained is an encouraging step toward reconciliation.
We urge the government to act in accordance with Moldovan law and its international obligations when dealing with the opposition, protesters, and the media. All parties need to conduct themselves responsibly. It is also important that the government reach out to opposition parties and address their concerns about the April 5 election in a cooperative and transparent manner. We stress that there is no excuse for violence, such as took place on April 7. The United States remains committed to working closely with Moldova and its people as the country continues down the path of European integration. Respect for the rule of law and human rights are key elements in our relationship.
###
PRN: 2009/340
US State Dept, Thu, 16 Apr 2009 16:38:10 -0500
The United States is concerned about the situation in Moldova following the violence on April 7. Although order has been restored and subsequent demonstrations have been peaceful, we have received reports from civil society and international observers of mistreatment of those detained by Moldovan authorities. We are also troubled by reports that students and journalists have been intimidated by government officials. President Voronin’s announcement of an amnesty for many of those detained is an encouraging step toward reconciliation.
We urge the government to act in accordance with Moldovan law and its international obligations when dealing with the opposition, protesters, and the media. All parties need to conduct themselves responsibly. It is also important that the government reach out to opposition parties and address their concerns about the April 5 election in a cooperative and transparent manner. We stress that there is no excuse for violence, such as took place on April 7. The United States remains committed to working closely with Moldova and its people as the country continues down the path of European integration. Respect for the rule of law and human rights are key elements in our relationship.
###
PRN: 2009/340
Libertarian: A Bold Plan B for North Korea
A Bold Plan B for North Korea, by Ted Galen Carpenter
Cato, April 15, 2009
North Korea's announced withdrawal Tuesday from the six-party talks in response to the UN Security Council's tepid reaction to the April 5 missile test raises a disturbing possibility. The US and the governments of East Asia have proceeded on the assumption that a diplomatic solution to North Korea's nuclear program is feasible. That settlement would entail Pyongyang's renunciation of its nuclear ambitions in exchange for diplomatic and economic concessions.
But what if the underlying assumption is wrong?
What if, for six years, Kim Jong Il's regime has been merely stalling for time while building nuclear warheads and perfecting a reliable missile delivery system? It would have been relatively easy for Pyongyang to ignore the UN's condemnation and remain in the six-party talks. The Security Council's action Monday was utterly anemic, since the outcome was not even a binding resolution. It was merely a statement from the council president condemning the missile launch and admonishing member states to more effectively enforce the hardly robust sanctions imposed in 2006 following the North's nuclear test. Yet North Korea used the council's response as an excuse to quit the talks.
It is time to ask what the US and North Korea's neighbors in East Asia plan to do if Pyongyang is not willing to abandon its nuclear ambitions. In other words, what is "Plan B" if the six-party talks fail? Since military action against North Korea is far too dangerous, there appear to be only three other options, and none is entirely appealing or without risk.
The first option would be to follow the suggestion of former US ambassador to the UN John Bolton and other hard-liners to impose far stronger multilateral economic sanctions. That strategy has a big defect, however. Both Beijing and Moscow are vehemently opposed to enhanced sanctions. China's opposition is crucial because without Chinese cooperation, coercive economic measures would have little impact on Pyongyang. And given the dependence on Beijing's willingness to continue funding the soaring US treasury debt, American officials are not in a good bargaining position to pressure China into endorsing robust sanctions.
The second option would be to accept North Korea as a nuclear weapons state and rely on deterrence to prevent aggressive behavior. There is a credible argument for that approach. After all, the US has deterred other nuclear bad actors in the past, most notably the Soviet Union and Maoist China, and the vast US strategic arsenal probably could deter the likes of Kim Jong Il.
But being able to deter an outright attack still leaves room for dangerous North Korean mischief. Pyongyang's proliferation activities are especially worrisome. North Korea's apparent nuclear assistance to Syria makes one wonder what other countries – or even more troubling, nonstate actors – might also be beneficiaries of such aid. Living with a nuclear-capable North Korea would be, at the least, a nerve-wracking experience.
There is a final option that deserves consideration. It would amount to inducing (bribing) China to remove Kim Jong Il's regime and install a more pragmatic government in Pyongyang, along with the explicit condition of keeping the country nonnuclear. Part of the bargain also ought to be a commitment from Beijing to promote the reunification of the two Koreas within the next generation. During my visit to China last year, policymakers there professed loyalty to Beijing's longtime ally, but there was also a distinct undertone of exasperation with Pyongyang.
If the price were right, Chinese leaders might be bold enough to topple Kim with a palace coup. But the price would certainly not be cheap. At the least, Beijing would want a commitment from the US to end its military presence on the Korean Peninsula and, probably, to phase out its security alliance with South Korea. In all likelihood, Chinese leaders also would want US concessions on the Taiwan issue.
Those steps might not be easy for US policymakers. But American – and East Asian – leaders must ask themselves whether such sacrifices might be a necessary price to end the North Korean nuclear threat.
In any case, US and East Asian officials need to be thinking about a Plan B now. It is not a prudent strategy simply to hope that the six-party talks will produce an enforceable, effective solution. Given North Korea's record, that is merely the triumph of hope over experience.
Cato, April 15, 2009
North Korea's announced withdrawal Tuesday from the six-party talks in response to the UN Security Council's tepid reaction to the April 5 missile test raises a disturbing possibility. The US and the governments of East Asia have proceeded on the assumption that a diplomatic solution to North Korea's nuclear program is feasible. That settlement would entail Pyongyang's renunciation of its nuclear ambitions in exchange for diplomatic and economic concessions.
But what if the underlying assumption is wrong?
What if, for six years, Kim Jong Il's regime has been merely stalling for time while building nuclear warheads and perfecting a reliable missile delivery system? It would have been relatively easy for Pyongyang to ignore the UN's condemnation and remain in the six-party talks. The Security Council's action Monday was utterly anemic, since the outcome was not even a binding resolution. It was merely a statement from the council president condemning the missile launch and admonishing member states to more effectively enforce the hardly robust sanctions imposed in 2006 following the North's nuclear test. Yet North Korea used the council's response as an excuse to quit the talks.
It is time to ask what the US and North Korea's neighbors in East Asia plan to do if Pyongyang is not willing to abandon its nuclear ambitions. In other words, what is "Plan B" if the six-party talks fail? Since military action against North Korea is far too dangerous, there appear to be only three other options, and none is entirely appealing or without risk.
The first option would be to follow the suggestion of former US ambassador to the UN John Bolton and other hard-liners to impose far stronger multilateral economic sanctions. That strategy has a big defect, however. Both Beijing and Moscow are vehemently opposed to enhanced sanctions. China's opposition is crucial because without Chinese cooperation, coercive economic measures would have little impact on Pyongyang. And given the dependence on Beijing's willingness to continue funding the soaring US treasury debt, American officials are not in a good bargaining position to pressure China into endorsing robust sanctions.
The second option would be to accept North Korea as a nuclear weapons state and rely on deterrence to prevent aggressive behavior. There is a credible argument for that approach. After all, the US has deterred other nuclear bad actors in the past, most notably the Soviet Union and Maoist China, and the vast US strategic arsenal probably could deter the likes of Kim Jong Il.
But being able to deter an outright attack still leaves room for dangerous North Korean mischief. Pyongyang's proliferation activities are especially worrisome. North Korea's apparent nuclear assistance to Syria makes one wonder what other countries – or even more troubling, nonstate actors – might also be beneficiaries of such aid. Living with a nuclear-capable North Korea would be, at the least, a nerve-wracking experience.
There is a final option that deserves consideration. It would amount to inducing (bribing) China to remove Kim Jong Il's regime and install a more pragmatic government in Pyongyang, along with the explicit condition of keeping the country nonnuclear. Part of the bargain also ought to be a commitment from Beijing to promote the reunification of the two Koreas within the next generation. During my visit to China last year, policymakers there professed loyalty to Beijing's longtime ally, but there was also a distinct undertone of exasperation with Pyongyang.
If the price were right, Chinese leaders might be bold enough to topple Kim with a palace coup. But the price would certainly not be cheap. At the least, Beijing would want a commitment from the US to end its military presence on the Korean Peninsula and, probably, to phase out its security alliance with South Korea. In all likelihood, Chinese leaders also would want US concessions on the Taiwan issue.
Those steps might not be easy for US policymakers. But American – and East Asian – leaders must ask themselves whether such sacrifices might be a necessary price to end the North Korean nuclear threat.
In any case, US and East Asian officials need to be thinking about a Plan B now. It is not a prudent strategy simply to hope that the six-party talks will produce an enforceable, effective solution. Given North Korea's record, that is merely the triumph of hope over experience.
A weaker U.S. military will undermine stability in Asia
Coming to Asia's Defense. By Dan Blumenthal
A weaker U.S. military will undermine stability in the region.
WSJ, Apr 16, 2009
Former President George W. Bush's critics liked to say that during his term America was "getting its derriere kicked" by China. By this the critics presumably meant that the war in Iraq was a big distraction and that the United States was not attending enough Asian multilateral conferences and showing off its "soft power."
While the case was never overwhelming, it contained a kernel of truth. Beijing did gain regional influence at Washington's expense under former President Bush's watch. Now President Barack Obama is doing his predecessor one better: By imposing draconian defense cuts, heavily targeted on high-technology weapons systems and "power-projection" platforms essential to preserving U.S. military superiority in the Pacific, America may not have much of a derriere left in Asia at all.
Though "soft power" and "smart power" are all the rage in foreign-policy circles, Asia remains a dangerous place where good, old-fashioned "hard power" still matters. Certainly China and North Korea think so. Pyongyang poses a major conventional threat to South Korea and is inching closer to obtaining delivery systems for nuclear weapons that can pose a threat both to Japan and the continental U.S. Pyongyang's ballistic missile launch this month is only the latest sign of its growing threat to regional security.
China has built up its military across the board. Its submarine fleet has grown faster than any other in the world, it now has a large and lethal arsenal of conventional cruise and ballistic missiles, and it has announced plans to deploy aircraft carriers. Worrying about China is far from a case of what Defense Secretary Robert Gates calls "next war-itis." The U.S. isn't in a war with China -- mercifully -- but there is a military competition. China has already changed the military balance in the Asia-Pacific region to the great consternation of America's key allies, such as Japan and India.
The point is not that Washington is poised to go to war with North Korea and China. To the contrary, only by maintaining its role as Asia's security guarantor can the U.S. hope to secure an enduring peace in this dynamic region.
That is why the Obama administration's defense cuts are so detrimental to American strategy. The day after North Korea's long-range missile test, the U.S. announced deep cuts to missile defense and satellite programs. The Airborne Laser program that Mr. Obama axed is not only the most promising and immediate method for intercepting ballistic missiles in the early "boost" phase, shortly after launch, but also the first significant use of directed energy, a technology that may prove to be yet another revolutionary change in warfare sparked by American ingenuity.
There are further implications for Asia in the Obama defense cuts: The decision to reduce production of stealthy F-22s ends any hope that Japan can buy this air supremacy aircraft and add to its own deterrent. Nor can American dominance of the skies, historically the cornerstone of U.S. military superiority, be assured.
Also missing from the defense budget is any increase in the submarine or surface fleet. The Navy set a goal of a 313-ship fleet only a few years ago, up from around 280 today (roughly half of the total at the end of the Cold War), yet the Obama plan falls well short of that number.
Indeed, the yin of American cuts is almost perfectly reflected in the yang of China's skyrocketing investments in its own fleet. This will inevitably chip away at America's ability to track the Chinese deployment of submarines throughout the Western Pacific and Indian Ocean. Just last month China demonstrated its newfound military muscle when its warships harassed an American surveillance vessel conducting lawful missions in the South China Sea.
Worse still, growing Chinese dominance of Pacific waterways will begin to affect maritime commerce and will soon become a factor in America's strategic calculus in the region. Chinese military attack boats and ballistic missile submarines that carry the means for nuclear attack cannot be easily dismissed if the U.S. is to maintain its status as keeper of the peace in the Pacific. And regional commanders, presented with the reality of this growing imbalance between the U.S. and China, will be forced to give up important regional missions, from presence and security cooperation in South East Asia to deterring aggression and defending allies in North Asia.
In announcing his defense cuts, Mr. Gates stated that he was making "a virtue of necessity," conceding that the Obama plan was an exercise in budget cutting to pay for favored domestic programs. Mr. Gates promises that he will explain his judgments about "balancing risks" sometime soon, but a risk assessment is no substitute for a strategy. If Mr. Obama wants to continue America's strategy of guaranteeing Asia's security, his defense plan will not give him the means.
In the near future, Mr. Obama will announce his policies toward China and North Korea and they will, in some way, continue those of his predecessors. He will undoubtedly want to "engage" China and "hedge" against a downturn in relations. He will pronounce a nuclear North Korea unacceptable to the U.S. The problem is that without the military power to back up America's diplomatic goals, these policy proclamations ring increasingly hollow. America's allies know it. And, even worse, China and North Korea know it. The question is, can Congress find the political will to stop these cuts and the blow they strike to U.S. objectives in Asia?
Mr. Blumenthal is a resident fellow in Asian Studies at the American Enterprise Institute in Washington, D.C.
A weaker U.S. military will undermine stability in the region.
WSJ, Apr 16, 2009
Former President George W. Bush's critics liked to say that during his term America was "getting its derriere kicked" by China. By this the critics presumably meant that the war in Iraq was a big distraction and that the United States was not attending enough Asian multilateral conferences and showing off its "soft power."
While the case was never overwhelming, it contained a kernel of truth. Beijing did gain regional influence at Washington's expense under former President Bush's watch. Now President Barack Obama is doing his predecessor one better: By imposing draconian defense cuts, heavily targeted on high-technology weapons systems and "power-projection" platforms essential to preserving U.S. military superiority in the Pacific, America may not have much of a derriere left in Asia at all.
Though "soft power" and "smart power" are all the rage in foreign-policy circles, Asia remains a dangerous place where good, old-fashioned "hard power" still matters. Certainly China and North Korea think so. Pyongyang poses a major conventional threat to South Korea and is inching closer to obtaining delivery systems for nuclear weapons that can pose a threat both to Japan and the continental U.S. Pyongyang's ballistic missile launch this month is only the latest sign of its growing threat to regional security.
China has built up its military across the board. Its submarine fleet has grown faster than any other in the world, it now has a large and lethal arsenal of conventional cruise and ballistic missiles, and it has announced plans to deploy aircraft carriers. Worrying about China is far from a case of what Defense Secretary Robert Gates calls "next war-itis." The U.S. isn't in a war with China -- mercifully -- but there is a military competition. China has already changed the military balance in the Asia-Pacific region to the great consternation of America's key allies, such as Japan and India.
The point is not that Washington is poised to go to war with North Korea and China. To the contrary, only by maintaining its role as Asia's security guarantor can the U.S. hope to secure an enduring peace in this dynamic region.
That is why the Obama administration's defense cuts are so detrimental to American strategy. The day after North Korea's long-range missile test, the U.S. announced deep cuts to missile defense and satellite programs. The Airborne Laser program that Mr. Obama axed is not only the most promising and immediate method for intercepting ballistic missiles in the early "boost" phase, shortly after launch, but also the first significant use of directed energy, a technology that may prove to be yet another revolutionary change in warfare sparked by American ingenuity.
There are further implications for Asia in the Obama defense cuts: The decision to reduce production of stealthy F-22s ends any hope that Japan can buy this air supremacy aircraft and add to its own deterrent. Nor can American dominance of the skies, historically the cornerstone of U.S. military superiority, be assured.
Also missing from the defense budget is any increase in the submarine or surface fleet. The Navy set a goal of a 313-ship fleet only a few years ago, up from around 280 today (roughly half of the total at the end of the Cold War), yet the Obama plan falls well short of that number.
Indeed, the yin of American cuts is almost perfectly reflected in the yang of China's skyrocketing investments in its own fleet. This will inevitably chip away at America's ability to track the Chinese deployment of submarines throughout the Western Pacific and Indian Ocean. Just last month China demonstrated its newfound military muscle when its warships harassed an American surveillance vessel conducting lawful missions in the South China Sea.
Worse still, growing Chinese dominance of Pacific waterways will begin to affect maritime commerce and will soon become a factor in America's strategic calculus in the region. Chinese military attack boats and ballistic missile submarines that carry the means for nuclear attack cannot be easily dismissed if the U.S. is to maintain its status as keeper of the peace in the Pacific. And regional commanders, presented with the reality of this growing imbalance between the U.S. and China, will be forced to give up important regional missions, from presence and security cooperation in South East Asia to deterring aggression and defending allies in North Asia.
In announcing his defense cuts, Mr. Gates stated that he was making "a virtue of necessity," conceding that the Obama plan was an exercise in budget cutting to pay for favored domestic programs. Mr. Gates promises that he will explain his judgments about "balancing risks" sometime soon, but a risk assessment is no substitute for a strategy. If Mr. Obama wants to continue America's strategy of guaranteeing Asia's security, his defense plan will not give him the means.
In the near future, Mr. Obama will announce his policies toward China and North Korea and they will, in some way, continue those of his predecessors. He will undoubtedly want to "engage" China and "hedge" against a downturn in relations. He will pronounce a nuclear North Korea unacceptable to the U.S. The problem is that without the military power to back up America's diplomatic goals, these policy proclamations ring increasingly hollow. America's allies know it. And, even worse, China and North Korea know it. The question is, can Congress find the political will to stop these cuts and the blow they strike to U.S. objectives in Asia?
Mr. Blumenthal is a resident fellow in Asian Studies at the American Enterprise Institute in Washington, D.C.
Technically feasible, but economically unfeasible? - On UCS Report on Renewables
Flaws in the UCS Report on Renewables
IER, April 15, 2009
In the ongoing debate over “renewable energy,” one of the primary sticking points is the compliance costs that government mandates would impose on utilities, consumers and the broader economy. Critics of a federal electricity mandate have warned that the Southeast in particular would be hard-hit by proposals to produce a certain percentage of electricity from approved technologies.
In response, the Union of Concerned Scientists (UCS) has recently released a new study prepared by the Southern Alliance for Clean Energy.[i] The study surveys some of the literature and declares that:
The Southeast has the ingenuity and renewable energy resources to become more prosperous and energy independent. Utilities across eleven Southeastern states can tap homegrown clean energy resources to meet a significant percentage of electric power demands. Our analysis of renewable energy estimates in the region show sufficient resources to fulfill an aggressive national mandate for renewable energy.
Yet despite the triumphant conclusion, the UCS’s touted study does little to move the debate forward. For one thing, its projections of renewable “potential” rely on very optimistic assumptions, and pick only the most favorable estimates from among the spectrum of plausible forecasts. Perhaps more significant, because the study focuses on matters of engineering, rather than economics, it almost entirely misses the point: The issue is not whether a proposed renewable electricity mandate is technically feasible, the question instead is how much will it hurt the economy? Unfortunately, the UCS study contributes nothing to answering this crucial issue.
Rosy Scenarios
The UCS study explores the feasibility of a national renewable electricity mandate that requires 15% generation from renewables by 2015, 20% by 2020, and 25% by 2025. (It’s fortunate they did not attempt such legislation a few decades ago; one can imagine President Jimmy Carter signing a law requiring 85% renewables by 1985, 90% by 1990, and 95% by 1995…)
In achieving its optimistic projections for renewable electricity production in the Southeast, the UCS study relies on many assumptions. In its words:
Twenty-first century policies must prioritize actions that will achieve energy independence and minimize global warming pollution. In addition to a national Renewable Energy Standard (RES), the following policies are needed (and assumed in this analysis) to help achieve these goals:
Other renewable technologies are even more exaggerated in the study, relative to the government estimates. For example, EIA indicates about 7 gigawatts of offshore wind “potential” for Florida, which is in relatively deep water and of the lowest quality wind resource. Yet incredibly, the UCS study shows over 40 gigawatts of “potential” offshore wind resource in Florida with no indication regarding depth or wind quality, and claims that 612 megawatts are “feasible.” If offshore wind gets built in the U.S., it is unlikely to be built any further south than Cape Hatteras since the wind quality drops off quite precipitously in the south and decent quality wind is in very deep water. Costs would be prohibitively too high to access these lower quality wind resources and would not make economic sense unless there is a very severe push toward local renewable generating technologies. Further, the UCS study indicates that 14 gigawatts of onshore wind are “feasible,” while EIA analyses show that low quality wind resources in the West would be built before lower quality wind resources in the Southeast—a situation that would require the Southeast to buy credits from other states. Some federal lawmakers from the Southeast are quite worried about this potential wealth transfer from their region to other parts of the U.S.
Solar technology is another area of major discrepancy between the UCS report and official government projections. EIA does not believe that solar will be competitive for wholesale markets through 2030. In EIA’s renewable electricity analyses, solar energy penetration, which is all in end-use markets, reaches 20 gigawatts for the nation due to being awarded a “triple credit” in the proposed bill analyzed, meaning that distributed photovoltaics (PV) is awarded three times the credit price. That is, if renewable credits are trading at 2 cents per kilowatt-hour, end-use PV would be awarded a credit of 6 cents per kilowatt-hour. The UCS study believes that almost 80 gigawatts of solar are “feasible” in the Southeast alone, with a total “potential” of 545 gigawatts. While it is true that there is enough sunshine in the Southeast to serve energy needs several orders of magnitude in excess of expected demand, the economics for solar central station generation are not competitive with other renewable technologies, with its cost being more than three times higher than onshore wind and biomass and 1.5 times higher than offshore wind.[vii]
Finally, the UCS study also has extremely high values for total “potential” capacity for geothermal in the Southeast, at over 1,000 gigawatts, though they admit that the “feasible” capacity is zero. EIA’s analyses of renewable electricity mandates result in less than 10 gigawatts of geothermal capacity nationwide.
Engineering versus Economics
In the section above, we explained the numerous shortcomings in the study’s estimation of renewable potential. But even if we conceded the UCS study’s numbers, just for the sake of argument, it would still not follow that a national renewable electricity mandate is a good idea, or that the Southeastern economy would absorb the blow easily. This is because the UCS study has confused engineering with economics.
At best, all of the tables and citations in the UCS study prove only that it is physically possible for the utilities in Southeastern states to adapt to the renewable percentage mandates under a national renewable mandate. But so what? Just because something is technically feasible, does not make it economically efficient.
For an analogy, suppose that in an effort to reduce carbon emissions, the federal government mandates that 20 percent of every large corporation’s employees must ride bicycles to and from work. Business groups would of course complain that this would put an undue burden on large corporations and many employees would likely quit and seek work elsewhere. It would also impose huge new expenses on municipalities, who would have to completely revamp their roads to accommodate the huge surge in cyclists. Yes, these adaptations would be possible, but nonetheless, the draconian measure would still be incredibly costly. It would make business operations much less efficient and Americans on average would be poorer, because many workers would now be producing less output per day.
We face a similar situation when it comes to electricity generation. Currently, the United States only relies on the politically correct “renewable” technologies to produce 3% of its electricity.[viii] The reason for this isn’t some pro-fossil fuel bias on the part of the utilities; on the contrary, they rely on coal, oil, and natural gas because these are the most economical and dependable sources of power, at least with current technologies.
The marketplace is perfectly capable of fostering innovation. It didn’t take a federal tax on buggies or an annual cap on horse manure to force the U.S. transportation sector to switch over to automobiles in the early 20th century. By the same token, as wind, biomass, and other sources of electricity generation become more competitive with coal, oil and natural gas, then utilities will naturally expand their use. The UCS study had to assume “Extension and expansion of state and federal tax credits for renewable energy and efficiency through 2020” precisely because renewable energy sources can’t survive without government handouts.
An Energy Information Administration (EIA) report[ix] indicates that Federal subsidies for renewable generation for wind and solar in fiscal year 2007 were almost 100 times those for oil and gas-fired generation and over 50 times that of coal-fired generation. For example, EIA data show that solar power was subsidized at $24.34 per megawatt hour and wind power at $23.37 per megawatt hour for electricity generated in 2007. By contrast, traditional coal received 44 cents, natural gas and petroleum received 25 cents, hydroelectric power 67 cents, and nuclear power $1.59 per megawatt hour.[x] For wind power, these subsidies include a production tax credit of 2.0 cents per kilowatt-hour.[xi] However, they do not include accelerated depreciation (a five-year write-off), a favorable accounting treatment that wind developers receive.
As these facts indicate, for the UCS study to point to even the existing level of renewable electricity generation as proof that it “can work” misses the big picture: An operation isn’t efficient if it requires government support against its competition. If the government cut off its preferential treatment for wind and solar, these sources would become an even smaller portion of the current energy mix.
In a small section at its conclusion, the UCS study briefly addresses the economic impacts of a renewable electricity mandate. Yet here the study informs the reader that an additional set of government constraints will help the economy. In its words:
A national Renewable Energy Standard (RES) that reaches a target of 25% by 2025 can play an important role in strengthening our region’s economy. Developing the Southeast’s renewable energy potential will create new economic opportunities and spur demand for a variety of skilled trades and professional careers.
This is quite simply a crude fallacy. There is nothing intrinsic to the argument here about “green” jobs. If this logic is correct, then any government mandate on business—for example, to put polka dot wallpaper up on all their offices—would “create new economic opportunities” and “spur demand.” Yet that analysis can’t possibly be right. It overlooks all of the jobs that would be destroyed by the new mandate. And in the same way, the UCS study is ignoring the jobs that are destroyed by an renewable electricity mandate. It cites studies purporting to show otherwise, but such studies often contain very basic methodological errors.[xii] They can’t disprove the commonsensical insight that the government doesn’t make the economy more efficient by imposing more hoops for businesses to jump through. If it really made economic sense for the solar panel and wind turbine industries to grow and attract new workers, then those industries would do so in a free market.
John Adams once said “Facts are stubborn things; and whatever maybe our wishes, our inclinations, or the dictates of our passion, they cannon alter the state of facts and evidence.” All too often, this important edict gets lost in the public debates on energy and environmental policy. By focusing on the technically “possible” and then claiming that new business regulations would boost the economy, the UCS study ignores the reality that certain and immediate economic harm would come from federal intervention into energy markets. And while some may support such a policy without regard to the costs, they cannot – and should not – be ignored.
References
[i] See “Yes We Can: Southern Solutions for a National Renewable Energy Standard,” available at: http://www.cleanenergy.org/images/stories/serenewables022309rev.pdf.
[ii] For example, see Energy Information Administration, “Impacts of a 15-Percent Renewable Portfolio Standard,” June 2007, www.eia.doe.gov/oiaf/servicerpt/prps/pdf/sroiaf(2007)03.pdf; and Energy Information Administration, “Energy and Economic Impacts of Implementing Both a 25-Percent RPS and a 25-Percent RFS by 2025,” September 2007, http://www.eia.doe.gov/oiaf/servicerpt/eeim/policy.html
[iii] Energy Information Administration, “Regional Generation Impacts of a 15-Percent Renewable Portfolio Standard,” August 2007, http://www.eia.doe.gov/oiaf/servicerpt/prps/regional_generation.html?slide=13
[iv] The UCS study defines a feasible resource as “one that can be developed without compromising an obvious restriction or and under a reasonable (but perhaps aggressive) policy scenario.”
[v] According to the UCS study, “total potential capacity indicates the potential maximum peak output if all resources identified in the study were used to generate power.
[vi] EIA’s Southeast region includes Maryland and West Virginia, which are not in the UCS’s Southesat region.
[vii] Energy Information Administration, “Annual Energy Outlook 2009,” levelized generation costs.
[viii] Energy Information Administration, Monthly Energy Review, Table 7.2a, http://www.eia.doe.gov/emeu/mer/pdf/pages/sec7_5.pdf.
[ix] Energy Information Administration, Federal Financial Interventions and Subsidies in Energy Markets 2007, http://www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/chap5.pdf, Table 35.
[x] For more information on renewable subsidies, see http://www.instituteforenergyresearch.org/2008/07/30/energy-subsidies-study/.
[xi] Energy Information Administration, Assumptions to the Annual Energy Outlook 2008, page 155, http://www.eia.doe.gov/oiaf/aeo/assumption/pdf/renewable.pdf
[xii] For a critique of several leading “green jobs” proposals, see: “Green Jobs: Fact or Fiction?” at: http://www.instituteforenergyresearch.org/green-jobs-fact-or-fiction/.
IER, April 15, 2009
In the ongoing debate over “renewable energy,” one of the primary sticking points is the compliance costs that government mandates would impose on utilities, consumers and the broader economy. Critics of a federal electricity mandate have warned that the Southeast in particular would be hard-hit by proposals to produce a certain percentage of electricity from approved technologies.
In response, the Union of Concerned Scientists (UCS) has recently released a new study prepared by the Southern Alliance for Clean Energy.[i] The study surveys some of the literature and declares that:
The Southeast has the ingenuity and renewable energy resources to become more prosperous and energy independent. Utilities across eleven Southeastern states can tap homegrown clean energy resources to meet a significant percentage of electric power demands. Our analysis of renewable energy estimates in the region show sufficient resources to fulfill an aggressive national mandate for renewable energy.
Yet despite the triumphant conclusion, the UCS’s touted study does little to move the debate forward. For one thing, its projections of renewable “potential” rely on very optimistic assumptions, and pick only the most favorable estimates from among the spectrum of plausible forecasts. Perhaps more significant, because the study focuses on matters of engineering, rather than economics, it almost entirely misses the point: The issue is not whether a proposed renewable electricity mandate is technically feasible, the question instead is how much will it hurt the economy? Unfortunately, the UCS study contributes nothing to answering this crucial issue.
Rosy Scenarios
The UCS study explores the feasibility of a national renewable electricity mandate that requires 15% generation from renewables by 2015, 20% by 2020, and 25% by 2025. (It’s fortunate they did not attempt such legislation a few decades ago; one can imagine President Jimmy Carter signing a law requiring 85% renewables by 1985, 90% by 1990, and 95% by 1995…)
In achieving its optimistic projections for renewable electricity production in the Southeast, the UCS study relies on many assumptions. In its words:
Twenty-first century policies must prioritize actions that will achieve energy independence and minimize global warming pollution. In addition to a national Renewable Energy Standard (RES), the following policies are needed (and assumed in this analysis) to help achieve these goals:
- National carbon dioxide “cap-and-trade” or equivalent policy.
- Third party suppliers of electricity paid at market-based cost of service, reflecting off-peak and peak system value.
- A solar “carve-out,” feed-in tariff, or other policy that provides a premium value for investment in solar energy (to the extent that this value is not already reflected in payments at a market-based cost of service).
- Complementary government biofuel policies.
- Responsible and predictable permitting for low-impact hydro, onshore wind, offshore wind and biomass power plants.
- Extension and expansion of state and federal tax credits for renewable energy and efficiency through 2020.
- Moderately high fossil fuel costs.
- Relatively low capital costs for renewable energy projects that are sustained from recent experience.
- Biomass resources proven to be available at the higher end of resource potential range.
- Relatively rapid rate of technology adoption.
Other renewable technologies are even more exaggerated in the study, relative to the government estimates. For example, EIA indicates about 7 gigawatts of offshore wind “potential” for Florida, which is in relatively deep water and of the lowest quality wind resource. Yet incredibly, the UCS study shows over 40 gigawatts of “potential” offshore wind resource in Florida with no indication regarding depth or wind quality, and claims that 612 megawatts are “feasible.” If offshore wind gets built in the U.S., it is unlikely to be built any further south than Cape Hatteras since the wind quality drops off quite precipitously in the south and decent quality wind is in very deep water. Costs would be prohibitively too high to access these lower quality wind resources and would not make economic sense unless there is a very severe push toward local renewable generating technologies. Further, the UCS study indicates that 14 gigawatts of onshore wind are “feasible,” while EIA analyses show that low quality wind resources in the West would be built before lower quality wind resources in the Southeast—a situation that would require the Southeast to buy credits from other states. Some federal lawmakers from the Southeast are quite worried about this potential wealth transfer from their region to other parts of the U.S.
Solar technology is another area of major discrepancy between the UCS report and official government projections. EIA does not believe that solar will be competitive for wholesale markets through 2030. In EIA’s renewable electricity analyses, solar energy penetration, which is all in end-use markets, reaches 20 gigawatts for the nation due to being awarded a “triple credit” in the proposed bill analyzed, meaning that distributed photovoltaics (PV) is awarded three times the credit price. That is, if renewable credits are trading at 2 cents per kilowatt-hour, end-use PV would be awarded a credit of 6 cents per kilowatt-hour. The UCS study believes that almost 80 gigawatts of solar are “feasible” in the Southeast alone, with a total “potential” of 545 gigawatts. While it is true that there is enough sunshine in the Southeast to serve energy needs several orders of magnitude in excess of expected demand, the economics for solar central station generation are not competitive with other renewable technologies, with its cost being more than three times higher than onshore wind and biomass and 1.5 times higher than offshore wind.[vii]
Finally, the UCS study also has extremely high values for total “potential” capacity for geothermal in the Southeast, at over 1,000 gigawatts, though they admit that the “feasible” capacity is zero. EIA’s analyses of renewable electricity mandates result in less than 10 gigawatts of geothermal capacity nationwide.
Engineering versus Economics
In the section above, we explained the numerous shortcomings in the study’s estimation of renewable potential. But even if we conceded the UCS study’s numbers, just for the sake of argument, it would still not follow that a national renewable electricity mandate is a good idea, or that the Southeastern economy would absorb the blow easily. This is because the UCS study has confused engineering with economics.
At best, all of the tables and citations in the UCS study prove only that it is physically possible for the utilities in Southeastern states to adapt to the renewable percentage mandates under a national renewable mandate. But so what? Just because something is technically feasible, does not make it economically efficient.
For an analogy, suppose that in an effort to reduce carbon emissions, the federal government mandates that 20 percent of every large corporation’s employees must ride bicycles to and from work. Business groups would of course complain that this would put an undue burden on large corporations and many employees would likely quit and seek work elsewhere. It would also impose huge new expenses on municipalities, who would have to completely revamp their roads to accommodate the huge surge in cyclists. Yes, these adaptations would be possible, but nonetheless, the draconian measure would still be incredibly costly. It would make business operations much less efficient and Americans on average would be poorer, because many workers would now be producing less output per day.
We face a similar situation when it comes to electricity generation. Currently, the United States only relies on the politically correct “renewable” technologies to produce 3% of its electricity.[viii] The reason for this isn’t some pro-fossil fuel bias on the part of the utilities; on the contrary, they rely on coal, oil, and natural gas because these are the most economical and dependable sources of power, at least with current technologies.
The marketplace is perfectly capable of fostering innovation. It didn’t take a federal tax on buggies or an annual cap on horse manure to force the U.S. transportation sector to switch over to automobiles in the early 20th century. By the same token, as wind, biomass, and other sources of electricity generation become more competitive with coal, oil and natural gas, then utilities will naturally expand their use. The UCS study had to assume “Extension and expansion of state and federal tax credits for renewable energy and efficiency through 2020” precisely because renewable energy sources can’t survive without government handouts.
An Energy Information Administration (EIA) report[ix] indicates that Federal subsidies for renewable generation for wind and solar in fiscal year 2007 were almost 100 times those for oil and gas-fired generation and over 50 times that of coal-fired generation. For example, EIA data show that solar power was subsidized at $24.34 per megawatt hour and wind power at $23.37 per megawatt hour for electricity generated in 2007. By contrast, traditional coal received 44 cents, natural gas and petroleum received 25 cents, hydroelectric power 67 cents, and nuclear power $1.59 per megawatt hour.[x] For wind power, these subsidies include a production tax credit of 2.0 cents per kilowatt-hour.[xi] However, they do not include accelerated depreciation (a five-year write-off), a favorable accounting treatment that wind developers receive.
As these facts indicate, for the UCS study to point to even the existing level of renewable electricity generation as proof that it “can work” misses the big picture: An operation isn’t efficient if it requires government support against its competition. If the government cut off its preferential treatment for wind and solar, these sources would become an even smaller portion of the current energy mix.
In a small section at its conclusion, the UCS study briefly addresses the economic impacts of a renewable electricity mandate. Yet here the study informs the reader that an additional set of government constraints will help the economy. In its words:
A national Renewable Energy Standard (RES) that reaches a target of 25% by 2025 can play an important role in strengthening our region’s economy. Developing the Southeast’s renewable energy potential will create new economic opportunities and spur demand for a variety of skilled trades and professional careers.
This is quite simply a crude fallacy. There is nothing intrinsic to the argument here about “green” jobs. If this logic is correct, then any government mandate on business—for example, to put polka dot wallpaper up on all their offices—would “create new economic opportunities” and “spur demand.” Yet that analysis can’t possibly be right. It overlooks all of the jobs that would be destroyed by the new mandate. And in the same way, the UCS study is ignoring the jobs that are destroyed by an renewable electricity mandate. It cites studies purporting to show otherwise, but such studies often contain very basic methodological errors.[xii] They can’t disprove the commonsensical insight that the government doesn’t make the economy more efficient by imposing more hoops for businesses to jump through. If it really made economic sense for the solar panel and wind turbine industries to grow and attract new workers, then those industries would do so in a free market.
John Adams once said “Facts are stubborn things; and whatever maybe our wishes, our inclinations, or the dictates of our passion, they cannon alter the state of facts and evidence.” All too often, this important edict gets lost in the public debates on energy and environmental policy. By focusing on the technically “possible” and then claiming that new business regulations would boost the economy, the UCS study ignores the reality that certain and immediate economic harm would come from federal intervention into energy markets. And while some may support such a policy without regard to the costs, they cannot – and should not – be ignored.
References
[i] See “Yes We Can: Southern Solutions for a National Renewable Energy Standard,” available at: http://www.cleanenergy.org/images/stories/serenewables022309rev.pdf.
[ii] For example, see Energy Information Administration, “Impacts of a 15-Percent Renewable Portfolio Standard,” June 2007, www.eia.doe.gov/oiaf/servicerpt/prps/pdf/sroiaf(2007)03.pdf; and Energy Information Administration, “Energy and Economic Impacts of Implementing Both a 25-Percent RPS and a 25-Percent RFS by 2025,” September 2007, http://www.eia.doe.gov/oiaf/servicerpt/eeim/policy.html
[iii] Energy Information Administration, “Regional Generation Impacts of a 15-Percent Renewable Portfolio Standard,” August 2007, http://www.eia.doe.gov/oiaf/servicerpt/prps/regional_generation.html?slide=13
[iv] The UCS study defines a feasible resource as “one that can be developed without compromising an obvious restriction or and under a reasonable (but perhaps aggressive) policy scenario.”
[v] According to the UCS study, “total potential capacity indicates the potential maximum peak output if all resources identified in the study were used to generate power.
[vi] EIA’s Southeast region includes Maryland and West Virginia, which are not in the UCS’s Southesat region.
[vii] Energy Information Administration, “Annual Energy Outlook 2009,” levelized generation costs.
[viii] Energy Information Administration, Monthly Energy Review, Table 7.2a, http://www.eia.doe.gov/emeu/mer/pdf/pages/sec7_5.pdf.
[ix] Energy Information Administration, Federal Financial Interventions and Subsidies in Energy Markets 2007, http://www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/chap5.pdf, Table 35.
[x] For more information on renewable subsidies, see http://www.instituteforenergyresearch.org/2008/07/30/energy-subsidies-study/.
[xi] Energy Information Administration, Assumptions to the Annual Energy Outlook 2008, page 155, http://www.eia.doe.gov/oiaf/aeo/assumption/pdf/renewable.pdf
[xii] For a critique of several leading “green jobs” proposals, see: “Green Jobs: Fact or Fiction?” at: http://www.instituteforenergyresearch.org/green-jobs-fact-or-fiction/.
Wednesday, April 15, 2009
From DDT to Dursban (chlorpyrifos)
From DDT to Dursban, by Henry Payne
Planet Gore/NRO, Wednesday, April 15, 2009
Detroit, Mich. — Greens can take a bow: Bedbugs are back with a vengeance.
Responding to the biggest bedbug outbreak since World War II, the Environmental Protection Agency hosted its first-ever “bedbug summit” Tuesday outside Washington to address a widening public outcry. Some of the most vulnerable communities are inner cities like Detroit, and the major culprit, as it turns out, was the summit host.
Nine years ago, the zealots at Bill Clinton’s EPA banned the pesticide chlorpyrifos (to widespread media and environmentalist hosannas), the most commonly available household product in the world to address bedbugs, cockroaches, and other nuisances. Better known by its trade name, Dursban, chlorpyrifos had been available for 30 years in some 800 products in 88 countries around the world.
But despite widespread protest in the scientific community, EPA Chief Carol Browner erased Dursban from the shelves. “EPA has gone to great lengths to present a highly conservative, worst case, hypothetical risk based in large part on dubious extrapolations . . . and exaggerated risk estimates,” said Michigan State University toxicologist J. I. Goodman in a typical response.
Even Dr. Alan Hoberman, the principal researcher whose data Browner cited, told the Detroit News he disputed the agency's interpretation of his findings.
Such critics were also ignored by the press — as was evidence that the nation’s urban poor would be most vulnerable to a ban. Children insect-bite allergies and cockroach-induced allergens outnumber pesticide poisoning by 100:1. “Hardest hit will be lower-income families in cities like Detroit, who can ill afford a weekly house call from the Orkin man,” warned News writer Diane Katz, now with the Fraser Institute. “Yet that is precisely what the EPA is recommending as a substitute for a couple squirts from a can of bug spray.”
Nine years on, Greg Baumann — Senior Scientist at the National Test Management Association — confirms that the Dursban void has been largely unfilled, leaving millions to fight pests with less convenient preventative measures. Extermination, for example, costs between $400 and $900 — out of reach for low-income Detroit families.
And those accountable for this predictable disaster? The very media outlets who were cheerleading the EPA ban now feign ignorance. “Out of concern for the environment and the effects on public health, the EPA has banned many of the chemicals that were most effective in eradicating the bugs in the U.S.,” shrugs the AP in graph ten of its story.
And the EPA Administrator who approved the ban? Browner has been promoted to “climate czar” in the Obama administration.
Planet Gore/NRO, Wednesday, April 15, 2009
Detroit, Mich. — Greens can take a bow: Bedbugs are back with a vengeance.
Responding to the biggest bedbug outbreak since World War II, the Environmental Protection Agency hosted its first-ever “bedbug summit” Tuesday outside Washington to address a widening public outcry. Some of the most vulnerable communities are inner cities like Detroit, and the major culprit, as it turns out, was the summit host.
Nine years ago, the zealots at Bill Clinton’s EPA banned the pesticide chlorpyrifos (to widespread media and environmentalist hosannas), the most commonly available household product in the world to address bedbugs, cockroaches, and other nuisances. Better known by its trade name, Dursban, chlorpyrifos had been available for 30 years in some 800 products in 88 countries around the world.
But despite widespread protest in the scientific community, EPA Chief Carol Browner erased Dursban from the shelves. “EPA has gone to great lengths to present a highly conservative, worst case, hypothetical risk based in large part on dubious extrapolations . . . and exaggerated risk estimates,” said Michigan State University toxicologist J. I. Goodman in a typical response.
Even Dr. Alan Hoberman, the principal researcher whose data Browner cited, told the Detroit News he disputed the agency's interpretation of his findings.
Such critics were also ignored by the press — as was evidence that the nation’s urban poor would be most vulnerable to a ban. Children insect-bite allergies and cockroach-induced allergens outnumber pesticide poisoning by 100:1. “Hardest hit will be lower-income families in cities like Detroit, who can ill afford a weekly house call from the Orkin man,” warned News writer Diane Katz, now with the Fraser Institute. “Yet that is precisely what the EPA is recommending as a substitute for a couple squirts from a can of bug spray.”
Nine years on, Greg Baumann — Senior Scientist at the National Test Management Association — confirms that the Dursban void has been largely unfilled, leaving millions to fight pests with less convenient preventative measures. Extermination, for example, costs between $400 and $900 — out of reach for low-income Detroit families.
And those accountable for this predictable disaster? The very media outlets who were cheerleading the EPA ban now feign ignorance. “Out of concern for the environment and the effects on public health, the EPA has banned many of the chemicals that were most effective in eradicating the bugs in the U.S.,” shrugs the AP in graph ten of its story.
And the EPA Administrator who approved the ban? Browner has been promoted to “climate czar” in the Obama administration.
Costs of a government-run health-care program modeled on Medicare will likely be extraordinary
The Pauper Option, by Jeffrey H. Anderson
Costs of a government-run health-care program modeled on Medicare will likely be extraordinary.
The Weekly Standard, Apr 15, 2009 12:00:00 AM
Democrats frequently claim that government-run health care is more affordable than privately run health care. Too often, Republicans don't challenge this wild assertion. If they don't start doing so, the costs will likely be extraordinary--both to Americans' finances and to their freedom.
Congressional Democrats, with clear presidential support, have recently begun airing sneak-previews of their upcoming summertime health-care blockbuster. It will prominently feature a "public option," which would "compete"--on very uneven terms--with private health insurance. In practice, this "public option" would channel millions of Americans into government-run health care, thereby further contracting--rather than expanding and reinvigorating--the private market and gradually closing off the public's options.
This proposal, the centerpiece of the Democrats' strategy to overhaul the American health-care system, is set to premiere in July (just in time to commemorate our nation's founding). What exactly will it look like? In the words of Tom Daschle, the "public option" will be "a government-run insurance program, modeled after Medicare."
Meanwhile, the New York Times writes that, when it comes to health policy, "The president's main focus is on starting to reduce the soaring cost of health care."
So President Obama's main health-care concern is to control its soaring costs. And his, and Congress's, proposed remedy is to add more government-run health care. High costs are the problem, and a new Medicare-like program the solution. Rarely in the whole history of medicine has there been such a disconnect between the disease and the cure.
Since its launch in 1965, Medicare's costs have soared skyward like an Apollo rocket. But these skyrocketing costs have not generally been made available for public viewing; rather, they have largely been shielded from sight. So before we consider christening another Medicare-like program, let's take a look at Medicare's record.
By 1970, having been in existence for five years, Medicare was well-established. That year, its price-tag was $42 billion. By 2008, Medicare's cost had soared to over $468 billion--an 11-fold, or 1000 percent, increase. Given the effects of inflation, this might not seem too surprising. However, that's Medicare's cost-increase after having already accounted for inflation. So, for every $1 in inflation since 1970, Medicare's costs have risen by $1--and then by another $10. In actual dollars, we now spend $62 on Medicare for every $1 we spent in 1970.
True, more people are now enrolled in Medicare. During the span that Medicare's costs have risen more than 11-fold in real dollars, its beneficiaries have slightly more than doubled. Therefore, Medicare's per-beneficiary costs have more than quintupled--after accounting for inflation.
To be sure, other health-care costs have risen as well, although this hasn't happened in a vacuum. Medicare's artificially low, government-set payment-rates lead to rampant cost-shifting, as doctors and hospitals charge higher rates to private individuals and insurers to try to compensate for the below-market fees they receive from Medicare. A recent study by Milliman Inc, a prominent actuarial consulting firm, estimates that this has raised the cost of private health-care by $88 billion annually. In addition, cumbersome Medicare-mandated administrative tasks shackle private health-care providers with much additional work, which has to be paid for by someone--and it can't be Medicare, whose reimbursement rates are fixed.
Despite this rather significant handicap, privately run health-care has proven to be far, far less expensive than the government-run variety. What Medicare saves in lower reimbursement rates for any given service, it more than makes up for in extraordinarily poor coordination of care and good-old-fashioned bureaucratic waste. The numbers speak for themselves:
Since 1970, our overall national health expenditures (NHE) apart from Medicare and Medicaid have risen 83 percent in relation to the gross domestic product (GDP). Meanwhile, the cost of Medicare has risen 304 percent versus GDP--and that is without even counting the relatively new Medicare prescription drug benefit. The passage of decades hasn't notably improved the government's performance: Since 1990, NHE apart from Medicare and Medicaid has risen 19 percent versus GDP, while the cost of Medicare has risen 57 percent versus GDP.
So, while the costs of American health-care have increased greatly in recent decades, such costs haven't, by any stretch, increased evenly across the board. Since 1970, the cost of all health care in America apart from the two biggest government-run programs has not even doubled versus GDP. Over that same span, Medicare's cost versus GDP has more than quadrupled.
And yet the president and the Democratic Congress want to adopt more Medicare-like programs to cut costs?
Given the way that Medicare's costs have been kept in the dark, even a simple cost-to-cost comparison is illuminating: Since 1970, the cost of Medicare has risen almost two-and-a-half times as much as the cost of all health care in the United States apart from Medicare and Medicaid--the vast majority of which is run by the private sector. Since 1970, Medicare's per-beneficiary costs--even without counting the prescription drug benefit--have risen 50 percent more than our overall per-capita national health expenditures aside from Medicare and Medicaid. They have risen 8 percent more since the year 2000 alone.
But the truly amazing thing is this: Since Medicare's costs continue to rise exponentially, they are just beginning to embark on their spectacular path into orbit. Medicare's costs are projected to rise more in the next decade than they have risen in the previous four decades combined, reaching $1 trillion annually--after which, they are projected to rise still faster. And with the baby boomers retiring, the number of workers per beneficiary will drop within two decades from today's figure of just under four, to merely two and a half. As a result, far fewer and fewer people will bear far higher and higher costs.
Perhaps most dazzlingly of all, the United States now has $55 trillion in projected unfunded federal liabilities over the next 75 years. That's money we've already pledged to spend but which our projected budgets don't cover and which we have no plans for how to raise. Much of that is for Social Security or payments on the national debt--both of which pose massive challenges. But the vast majority of that figure--about $34 trillion of it--is for Medicare. To put $34 trillion into perspective, it's twice the size of the annual economic output (as measured by GDP) of Germany, Japan, Italy, Russia, Canada, France, and the United Kingdom--combined.
That's our future financial liability without adding to Medicare, and without adding another program like Medicare.
One wonders how the President and the Democratic Congress can possibly think that adding a new Medicare-like program is the way to reduce our health-care costs, or to make us more financially solvent as a nation. Perhaps they haven't seen the numbers. Or perhaps the allure of further centralization and consolidation of power in Washington under their control is just too tempting for them to resist.
Either way, Dr. Obama needs to find a new cure for his patient's affliction with soaring costs. If not, the American people should sue him for gross negligence and pursue a different course.
Jeffrey H. Anderson was the senior speechwriter for the U.S. Department of Health and Human Services and is a former Political Science professor at the U.S. Air Force Academy.
Costs of a government-run health-care program modeled on Medicare will likely be extraordinary.
The Weekly Standard, Apr 15, 2009 12:00:00 AM
Democrats frequently claim that government-run health care is more affordable than privately run health care. Too often, Republicans don't challenge this wild assertion. If they don't start doing so, the costs will likely be extraordinary--both to Americans' finances and to their freedom.
Congressional Democrats, with clear presidential support, have recently begun airing sneak-previews of their upcoming summertime health-care blockbuster. It will prominently feature a "public option," which would "compete"--on very uneven terms--with private health insurance. In practice, this "public option" would channel millions of Americans into government-run health care, thereby further contracting--rather than expanding and reinvigorating--the private market and gradually closing off the public's options.
This proposal, the centerpiece of the Democrats' strategy to overhaul the American health-care system, is set to premiere in July (just in time to commemorate our nation's founding). What exactly will it look like? In the words of Tom Daschle, the "public option" will be "a government-run insurance program, modeled after Medicare."
Meanwhile, the New York Times writes that, when it comes to health policy, "The president's main focus is on starting to reduce the soaring cost of health care."
So President Obama's main health-care concern is to control its soaring costs. And his, and Congress's, proposed remedy is to add more government-run health care. High costs are the problem, and a new Medicare-like program the solution. Rarely in the whole history of medicine has there been such a disconnect between the disease and the cure.
Since its launch in 1965, Medicare's costs have soared skyward like an Apollo rocket. But these skyrocketing costs have not generally been made available for public viewing; rather, they have largely been shielded from sight. So before we consider christening another Medicare-like program, let's take a look at Medicare's record.
By 1970, having been in existence for five years, Medicare was well-established. That year, its price-tag was $42 billion. By 2008, Medicare's cost had soared to over $468 billion--an 11-fold, or 1000 percent, increase. Given the effects of inflation, this might not seem too surprising. However, that's Medicare's cost-increase after having already accounted for inflation. So, for every $1 in inflation since 1970, Medicare's costs have risen by $1--and then by another $10. In actual dollars, we now spend $62 on Medicare for every $1 we spent in 1970.
True, more people are now enrolled in Medicare. During the span that Medicare's costs have risen more than 11-fold in real dollars, its beneficiaries have slightly more than doubled. Therefore, Medicare's per-beneficiary costs have more than quintupled--after accounting for inflation.
To be sure, other health-care costs have risen as well, although this hasn't happened in a vacuum. Medicare's artificially low, government-set payment-rates lead to rampant cost-shifting, as doctors and hospitals charge higher rates to private individuals and insurers to try to compensate for the below-market fees they receive from Medicare. A recent study by Milliman Inc, a prominent actuarial consulting firm, estimates that this has raised the cost of private health-care by $88 billion annually. In addition, cumbersome Medicare-mandated administrative tasks shackle private health-care providers with much additional work, which has to be paid for by someone--and it can't be Medicare, whose reimbursement rates are fixed.
Despite this rather significant handicap, privately run health-care has proven to be far, far less expensive than the government-run variety. What Medicare saves in lower reimbursement rates for any given service, it more than makes up for in extraordinarily poor coordination of care and good-old-fashioned bureaucratic waste. The numbers speak for themselves:
Since 1970, our overall national health expenditures (NHE) apart from Medicare and Medicaid have risen 83 percent in relation to the gross domestic product (GDP). Meanwhile, the cost of Medicare has risen 304 percent versus GDP--and that is without even counting the relatively new Medicare prescription drug benefit. The passage of decades hasn't notably improved the government's performance: Since 1990, NHE apart from Medicare and Medicaid has risen 19 percent versus GDP, while the cost of Medicare has risen 57 percent versus GDP.
So, while the costs of American health-care have increased greatly in recent decades, such costs haven't, by any stretch, increased evenly across the board. Since 1970, the cost of all health care in America apart from the two biggest government-run programs has not even doubled versus GDP. Over that same span, Medicare's cost versus GDP has more than quadrupled.
And yet the president and the Democratic Congress want to adopt more Medicare-like programs to cut costs?
Given the way that Medicare's costs have been kept in the dark, even a simple cost-to-cost comparison is illuminating: Since 1970, the cost of Medicare has risen almost two-and-a-half times as much as the cost of all health care in the United States apart from Medicare and Medicaid--the vast majority of which is run by the private sector. Since 1970, Medicare's per-beneficiary costs--even without counting the prescription drug benefit--have risen 50 percent more than our overall per-capita national health expenditures aside from Medicare and Medicaid. They have risen 8 percent more since the year 2000 alone.
But the truly amazing thing is this: Since Medicare's costs continue to rise exponentially, they are just beginning to embark on their spectacular path into orbit. Medicare's costs are projected to rise more in the next decade than they have risen in the previous four decades combined, reaching $1 trillion annually--after which, they are projected to rise still faster. And with the baby boomers retiring, the number of workers per beneficiary will drop within two decades from today's figure of just under four, to merely two and a half. As a result, far fewer and fewer people will bear far higher and higher costs.
Perhaps most dazzlingly of all, the United States now has $55 trillion in projected unfunded federal liabilities over the next 75 years. That's money we've already pledged to spend but which our projected budgets don't cover and which we have no plans for how to raise. Much of that is for Social Security or payments on the national debt--both of which pose massive challenges. But the vast majority of that figure--about $34 trillion of it--is for Medicare. To put $34 trillion into perspective, it's twice the size of the annual economic output (as measured by GDP) of Germany, Japan, Italy, Russia, Canada, France, and the United Kingdom--combined.
That's our future financial liability without adding to Medicare, and without adding another program like Medicare.
One wonders how the President and the Democratic Congress can possibly think that adding a new Medicare-like program is the way to reduce our health-care costs, or to make us more financially solvent as a nation. Perhaps they haven't seen the numbers. Or perhaps the allure of further centralization and consolidation of power in Washington under their control is just too tempting for them to resist.
Either way, Dr. Obama needs to find a new cure for his patient's affliction with soaring costs. If not, the American people should sue him for gross negligence and pursue a different course.
Jeffrey H. Anderson was the senior speechwriter for the U.S. Department of Health and Human Services and is a former Political Science professor at the U.S. Air Force Academy.
Tracking Progress and Security in Post-9/11 Afghanistan
Tracking Progress and Security in Post-9/11 Afghanistan
Brookings, Apr 15, 2009
The Afghanistan Index is a statistical compilation of economic, public opinion and security data. This resource will provide updated and historical information on various data, including crime, infrastructure, casualties, unemployment, Afghan security forces and coalition troop strength.
The index is designed to assemble the best possible quantitative indicators of the international community’s counterinsurgency and nation-building efforts in Afghanistan, to track them over time, and to offer an objective set of criteria for benchmarking performance. It serves as an in-depth, non-partisan assessment of American and international efforts in Afghanistan, and is based primarily on U.S. government, Afghan government and NATO data. Although measurements of progress in any nation-building effort can never be reduced to purely quantitative data, a comprehensive compilation of such information can provide a clearer picture and contribute to a healthier and better informed debate.
Jason H. Campbell and Jeremy Shapiro spearhead the Afghanistan Index project at Brookings, with assistance from Michael O’Hanlon. Jason H. Campbell is a research analyst in Foreign Policy at Brookings. Jeremy Shapiro is a fellow in Foreign Policy and research director of the Center on the United States and Europe. Michael O'Hanlon is a senior fellow in Foreign Policy.
Brookings, Apr 15, 2009
The Afghanistan Index is a statistical compilation of economic, public opinion and security data. This resource will provide updated and historical information on various data, including crime, infrastructure, casualties, unemployment, Afghan security forces and coalition troop strength.
The index is designed to assemble the best possible quantitative indicators of the international community’s counterinsurgency and nation-building efforts in Afghanistan, to track them over time, and to offer an objective set of criteria for benchmarking performance. It serves as an in-depth, non-partisan assessment of American and international efforts in Afghanistan, and is based primarily on U.S. government, Afghan government and NATO data. Although measurements of progress in any nation-building effort can never be reduced to purely quantitative data, a comprehensive compilation of such information can provide a clearer picture and contribute to a healthier and better informed debate.
Jason H. Campbell and Jeremy Shapiro spearhead the Afghanistan Index project at Brookings, with assistance from Michael O’Hanlon. Jason H. Campbell is a research analyst in Foreign Policy at Brookings. Jeremy Shapiro is a fellow in Foreign Policy and research director of the Center on the United States and Europe. Michael O'Hanlon is a senior fellow in Foreign Policy.
Conservative view: Federal President's New Plan to Decide Where Americans Live and How They Travel
President Obama's New Plan to Decide Where Americans Live and How They Travel. By Ronald D. Utt, Ph.D.
Heritage Backgrounder #2260
April 14, 2009
Heritage Backgrounder #2260
April 14, 2009
Title IX: What's good for women's basketball will be good for nuclear physics
A Threat in Title IX, by Christina Hoff Sommers
WaPo, Tuesday, April 14, 2009
What's good for women's basketball will be good for nuclear physics.
To most Americans, that statement will sound odd. To President Obama, it apparently does not. In an October letter to women's advocacy groups, he declared that Title IX, the law that requires universities to give equal funding to men's and women's athletics, had made "an enormous impact on women's opportunities and participation in sports." If pursued with "necessary attention and enforcement," the same law could make "similar, striking advances" for women in science and engineering.
That campaign pledge is hardening into policy, which ought to give people pause. In February, the Congressional Diversity and Innovation Caucusmet with academic deans and women's groups to plan for the new Title IX deployment. Nearly everyone present agreed that closing the gender gap in the laboratory is an urgent "national imperative." What they failed to consider, however, is how enforced parity might affect American science. To get a better idea, let's look at President Obama's statements:
"Title IX has had an enormous impact on women's opportunities and participation in sports." Indeed, Title IX has contributed to significant progress in women's athletics -- but at what cost to male student athletics? Consider the situation at Washington's Howard University. In 2007, the Women's Sports Foundation, a powerful Title IX advocacy group, gave Howard an "F" grade because of its 24-percentage-point "proportionality gap": Howard's student body was 67 percent female, but women constituted only 43 percent of its athletic program. In 2002, Howard cut men's wrestling and baseball and added women's bowling, but that did little to narrow the gap. Unless it sends almost half of its remaining male athletes to the locker room, Howard will remain blacklisted and legally vulnerable. Former Howard wrestling coach Wade Hughes sums upthe problem this way: "The impact of Title IX's proportionality standard has been disastrous because . . . far more males than females are seeking to take part in athletics."
Title IX could make "similar striking advances" for women in science and engineering. Indeed it could -- but at what cost to science? The idea of imposing Title IX on the sciences began gaining momentum around 2002. Then, women were already earning nearly 60 percent of all bachelor's degrees and at least half of the PhDs in the humanities, social sciences, life sciences and education. Meanwhile, men retained majorities in fields such as physics, computer science and engineering. Badly in need of an advocacy cause just as women were beginning to outnumber men on college campuses, well-funded academic women's groups alerted their followers that American science education was "hostile" to women. Soon there were conferences, retreats, summits, a massive "Left Out, Left Behind" letter-writing campaign, dozens of studies and a series of congressional hearings. Their first public victim? Larry Summers, who was forced to resign as president of Harvard University in 2006 after he dared to question the groups' assumptions and drew a correlation between the number of women in the sciences and gender differences implied in math and science test data.
Is it true that women are being excluded from academic science programs because of sexist bias? Some researchers agree that bias is to blame; others, perhaps a majority, suggest that biology and considered preference explain why men and women gravitate to different academic fields. But researchers who dispute the bias explanation played little or no role in the Title IX conferences, summits or congressional hearings.
Title IX must be pursued with "necessary attention and enforcement" in the sciences. This is nearly certain to happen. But the president should note the level of partisanship in the groups monitoring the enforcement. For example, in a 2008 briefing statement, the American Association of University Women, one of the more combative advocacy groups and a leader in the Title IX movement, issued a warning to "adversaries" who get in the way of its equity initiatives:
"Our adversaries know that AAUW is a force to be reckoned with. . . . We are issuing fair warning -- we ARE breaking through barriers. We mean it; we've done it before; and we are 'coming after them' again . . . and again and again, if we have to! All of us, all the time."
Federal officials have conducted occasional equity investigations of engineering and physics programs since 2006. But these have been haphazard and far less results-oriented than what Obama and Congress have in mind. The new Title IX initiative, modeled on athletics, will gratify women's advocacy groups. But will it help American science as much as it helped women's basketball?
Activist leaders of the Title IX campaign are untroubled by this question. Some seem to relish the idea of starkly disrupting what they regard as the excessively male and competitive culture of academic science. American scientific excellence, though, is an invaluable and irreplaceable resource. The fields that will be most affected -- math, engineering, physics and computer science -- are vital to the economy and national defense. Is it wise, to say nothing of urgent, for the president and Congress to impose an untested, undebated gender parity policy at this time?
Christina Hoff Sommers is a resident scholar at the American Enterprise Institute and editor of the forthcoming book "The Science on Women and Science" (AEI Press).
WaPo, Tuesday, April 14, 2009
What's good for women's basketball will be good for nuclear physics.
To most Americans, that statement will sound odd. To President Obama, it apparently does not. In an October letter to women's advocacy groups, he declared that Title IX, the law that requires universities to give equal funding to men's and women's athletics, had made "an enormous impact on women's opportunities and participation in sports." If pursued with "necessary attention and enforcement," the same law could make "similar, striking advances" for women in science and engineering.
That campaign pledge is hardening into policy, which ought to give people pause. In February, the Congressional Diversity and Innovation Caucusmet with academic deans and women's groups to plan for the new Title IX deployment. Nearly everyone present agreed that closing the gender gap in the laboratory is an urgent "national imperative." What they failed to consider, however, is how enforced parity might affect American science. To get a better idea, let's look at President Obama's statements:
"Title IX has had an enormous impact on women's opportunities and participation in sports." Indeed, Title IX has contributed to significant progress in women's athletics -- but at what cost to male student athletics? Consider the situation at Washington's Howard University. In 2007, the Women's Sports Foundation, a powerful Title IX advocacy group, gave Howard an "F" grade because of its 24-percentage-point "proportionality gap": Howard's student body was 67 percent female, but women constituted only 43 percent of its athletic program. In 2002, Howard cut men's wrestling and baseball and added women's bowling, but that did little to narrow the gap. Unless it sends almost half of its remaining male athletes to the locker room, Howard will remain blacklisted and legally vulnerable. Former Howard wrestling coach Wade Hughes sums upthe problem this way: "The impact of Title IX's proportionality standard has been disastrous because . . . far more males than females are seeking to take part in athletics."
Title IX could make "similar striking advances" for women in science and engineering. Indeed it could -- but at what cost to science? The idea of imposing Title IX on the sciences began gaining momentum around 2002. Then, women were already earning nearly 60 percent of all bachelor's degrees and at least half of the PhDs in the humanities, social sciences, life sciences and education. Meanwhile, men retained majorities in fields such as physics, computer science and engineering. Badly in need of an advocacy cause just as women were beginning to outnumber men on college campuses, well-funded academic women's groups alerted their followers that American science education was "hostile" to women. Soon there were conferences, retreats, summits, a massive "Left Out, Left Behind" letter-writing campaign, dozens of studies and a series of congressional hearings. Their first public victim? Larry Summers, who was forced to resign as president of Harvard University in 2006 after he dared to question the groups' assumptions and drew a correlation between the number of women in the sciences and gender differences implied in math and science test data.
Is it true that women are being excluded from academic science programs because of sexist bias? Some researchers agree that bias is to blame; others, perhaps a majority, suggest that biology and considered preference explain why men and women gravitate to different academic fields. But researchers who dispute the bias explanation played little or no role in the Title IX conferences, summits or congressional hearings.
Title IX must be pursued with "necessary attention and enforcement" in the sciences. This is nearly certain to happen. But the president should note the level of partisanship in the groups monitoring the enforcement. For example, in a 2008 briefing statement, the American Association of University Women, one of the more combative advocacy groups and a leader in the Title IX movement, issued a warning to "adversaries" who get in the way of its equity initiatives:
"Our adversaries know that AAUW is a force to be reckoned with. . . . We are issuing fair warning -- we ARE breaking through barriers. We mean it; we've done it before; and we are 'coming after them' again . . . and again and again, if we have to! All of us, all the time."
Federal officials have conducted occasional equity investigations of engineering and physics programs since 2006. But these have been haphazard and far less results-oriented than what Obama and Congress have in mind. The new Title IX initiative, modeled on athletics, will gratify women's advocacy groups. But will it help American science as much as it helped women's basketball?
Activist leaders of the Title IX campaign are untroubled by this question. Some seem to relish the idea of starkly disrupting what they regard as the excessively male and competitive culture of academic science. American scientific excellence, though, is an invaluable and irreplaceable resource. The fields that will be most affected -- math, engineering, physics and computer science -- are vital to the economy and national defense. Is it wise, to say nothing of urgent, for the president and Congress to impose an untested, undebated gender parity policy at this time?
Christina Hoff Sommers is a resident scholar at the American Enterprise Institute and editor of the forthcoming book "The Science on Women and Science" (AEI Press).
In the Age of Pirates
In the Age of Pirates. By Thomas L Friedman
TNYT, April 14, 2009
Excerpts:
[...]
I’m wondering if President Obama and Secretary of State Hillary Clinton aren’t those students, trying to deal with the leaders of Pakistan, Afghanistan, Iran and North Korea. I say that not to criticize but to sympathize. “Mama, don’t let your children grow up to be diplomats.”
This is not the great age of diplomacy.
A secretary of state can broker deals only when other states or parties are ready or able to make them. In the cold war, an age of great powers, grand bargains and reasonably solid client states, there were ample opportunities for that — whether in arms control with the Soviet Union or peacemaking between our respective client states around the globe. But this is increasingly an age of pirates, failed states, nonstate actors and nation-building — the stuff of snipers, drones and generals, not diplomats.
Hence the déjà vu all over again quality of U.S. foreign policy right now — the sense that when it comes to our major problems (Afghanistan and Pakistan and North Korea and Iran), we just go around and around, buying the same carpets from the same people, over and over, but nothing changes.
“We are dealing with states and leaders who either cannot deliver or will not deliver,” notes the Johns Hopkins University foreign policy professor Michael Mandelbaum. “The issues we have with them look less like problems that can be solved and more like conditions that we have to manage.”
The ones who can’t deliver — the leaders of Afghanistan and Pakistan — are the ones who promise to do all sorts of good things, and pull all sorts of levers, but at the end of the day the levers come off the wall because the governments in these countries have only limited powers. The ones who won’t deliver — Iran and North Korea — time and again tell us: “Yes, we need to talk.” But at the end of the day, their hostile relationships with America or the West are so central to the survival strategy of their regimes, so much at the core of their justifications for remaining in power, that it is not in their interest to deliver real reconciliation, but just to pretend to deliver it.
The only thing that could change this is a greater exercise of U.S. and allied power. In the case of Afghanistan and Pakistan, that power would have to be used to actually rebuild these states from the inside into modern nations. We would literally have to build the institutions — the pulleys and wheels — so that when the leaders of these states pulled a lever something actually happened, and the lever wouldn’t just break off in their hands.
And in the case of the strong states — Iran and North Korea — we would have to generate much more effective leverage from the outside to get them to change their behavior along the lines we seek. In both cases, though, success surely would require a bigger and longer U.S. investment of money and power, not to mention allies.
Instead, I fear that we are adopting a middle-ground strategy — doing just enough to avoid collapse but not enough to solve the problems. If our goal in Afghanistan and Pakistan is nation-building, so they will have self-sustaining moderate governments, we surely don’t have enough troops or resources inside devoted to either. If our goal is changing regime behavior in Iran and North Korea, we surely have not generated enough leverage from outside. North Korea’s defiant missile launch and Iran’s continued development of its nuclear capability testify to that.
So, in sum, we have four problem countries at the heart of U.S. foreign policy today that we don’t have the will or ability to ignore but seem to lack the leverage or the allies to decisively change. The big wild card — a critical mass of people who share our aspirations inside these countries, rising up and leading the fight, which is ultimately what tipped Iraq for the better — I don’t see. As such, I fear we are sliding into commitments in Afghanistan and Pakistan without a real national debate about the ends or the means or the exits. That is a recipe for trouble.
Given all that is on his plate, you cannot blame President Obama for looking for a middle ground — not wanting to abandon progressives and women in Afghanistan and Pakistan, but not wanting to get in too deeply. But history teaches that the middle ground can be a perilous place. Think of Iraq before the surge — not enough to win or lose, but just enough to be stuck.
TNYT, April 14, 2009
Excerpts:
[...]
I’m wondering if President Obama and Secretary of State Hillary Clinton aren’t those students, trying to deal with the leaders of Pakistan, Afghanistan, Iran and North Korea. I say that not to criticize but to sympathize. “Mama, don’t let your children grow up to be diplomats.”
This is not the great age of diplomacy.
A secretary of state can broker deals only when other states or parties are ready or able to make them. In the cold war, an age of great powers, grand bargains and reasonably solid client states, there were ample opportunities for that — whether in arms control with the Soviet Union or peacemaking between our respective client states around the globe. But this is increasingly an age of pirates, failed states, nonstate actors and nation-building — the stuff of snipers, drones and generals, not diplomats.
Hence the déjà vu all over again quality of U.S. foreign policy right now — the sense that when it comes to our major problems (Afghanistan and Pakistan and North Korea and Iran), we just go around and around, buying the same carpets from the same people, over and over, but nothing changes.
“We are dealing with states and leaders who either cannot deliver or will not deliver,” notes the Johns Hopkins University foreign policy professor Michael Mandelbaum. “The issues we have with them look less like problems that can be solved and more like conditions that we have to manage.”
The ones who can’t deliver — the leaders of Afghanistan and Pakistan — are the ones who promise to do all sorts of good things, and pull all sorts of levers, but at the end of the day the levers come off the wall because the governments in these countries have only limited powers. The ones who won’t deliver — Iran and North Korea — time and again tell us: “Yes, we need to talk.” But at the end of the day, their hostile relationships with America or the West are so central to the survival strategy of their regimes, so much at the core of their justifications for remaining in power, that it is not in their interest to deliver real reconciliation, but just to pretend to deliver it.
The only thing that could change this is a greater exercise of U.S. and allied power. In the case of Afghanistan and Pakistan, that power would have to be used to actually rebuild these states from the inside into modern nations. We would literally have to build the institutions — the pulleys and wheels — so that when the leaders of these states pulled a lever something actually happened, and the lever wouldn’t just break off in their hands.
And in the case of the strong states — Iran and North Korea — we would have to generate much more effective leverage from the outside to get them to change their behavior along the lines we seek. In both cases, though, success surely would require a bigger and longer U.S. investment of money and power, not to mention allies.
Instead, I fear that we are adopting a middle-ground strategy — doing just enough to avoid collapse but not enough to solve the problems. If our goal in Afghanistan and Pakistan is nation-building, so they will have self-sustaining moderate governments, we surely don’t have enough troops or resources inside devoted to either. If our goal is changing regime behavior in Iran and North Korea, we surely have not generated enough leverage from outside. North Korea’s defiant missile launch and Iran’s continued development of its nuclear capability testify to that.
So, in sum, we have four problem countries at the heart of U.S. foreign policy today that we don’t have the will or ability to ignore but seem to lack the leverage or the allies to decisively change. The big wild card — a critical mass of people who share our aspirations inside these countries, rising up and leading the fight, which is ultimately what tipped Iraq for the better — I don’t see. As such, I fear we are sliding into commitments in Afghanistan and Pakistan without a real national debate about the ends or the means or the exits. That is a recipe for trouble.
Given all that is on his plate, you cannot blame President Obama for looking for a middle ground — not wanting to abandon progressives and women in Afghanistan and Pakistan, but not wanting to get in too deeply. But history teaches that the middle ground can be a perilous place. Think of Iraq before the surge — not enough to win or lose, but just enough to be stuck.
Tuesday, April 14, 2009
Libertarian: Federal President's Preschool Emphasis Is Misdirected
President's Preschool Emphasis Is Misdirected. By Andrew J. Coulson
This article appeared on cato.org on April 13, 2009
"When it comes to our children's future," writes president Obama in his first budget, "we cannot waste dollars on methods, programs, and initiatives that are not effective and efficient." He's right, but his budget fails to heed his own dictum.
The president is proposing education policies that are neither the most effective nor the most efficient means of achieving his laudable goals. He plans to expand Head Start and double funding for Early Head Start — federal programs aimed at preschool children. Though the president appears convinced that such programs can save many times what is spent on them, the evidence for that view is weak.
Even economist James Heckman, whose work has influenced President Obama's thinking on the subject, is far more guarded. In 2007, Heckman identified three small preschool programs from the 1960s and 1970s that studies suggest have more than paid for themselves in lower subsequent welfare and criminal justice costs incurred by their participants. But Heckman cautioned that "a much more careful analysis of the effects of scaling up the model programs... has to be undertaken before these estimates can be considered definitive."
His caveat is well justified. The "Perry preschool" study which yielded the highest estimated return enrolled just 123 children. There is good reason to doubt that it can be replicated by the federal government nationwide. A large body of research on other Head Start programs finds that while they sometimes offer short term academic benefits, these generally disappear by the elementary school grades. The largest review of this literature, published by the Department of Health and Human Services, looked at more than 200 studies and concluded that there was no lasting academic advantage to participation in Head Start.
If spending on Head Start and other federal education programs had produced widespread, significant benefits since their inception in the mid 1960s, overall student achievement and graduation rates should have risen over time. The achievement gap between children of high-school dropouts and those of college graduates should have narrowed as well, because most federal education programs are targeted at disadvantaged students. None of these things occurred.
According to the National Assessment of Education Progress, the best available measure of academic trends, U.S. seventeen-year-olds score no better in math or reading today than they did nearly forty years ago. In science they perform slightly worse. The gap between children of dropouts and children of college graduates is unchanged in reading and science, and has decreased by only one percent in math. According to Heckman himself, the high school graduation rate peaked a few years after Head Start was passed and has declined by four or five points since then.
For these disappointing results, the federal government has spent roughly $1.85 trillion dollars on education programs since 1965. So while some small local preschool programs may have generated lasting, significant effects, the federal government cannot be counted on to reproduce those effects on a national scale.
If the president really wants effective, efficient programs, he should look at Florida's scholarship donation tax credit. Under this program, businesses can contribute to non-profit scholarship organizations that subsidize private k-12 tuition for needy families. For each dollar they donate, the businesses owe one fewer dollar in taxes. Last December, Florida's own government accountability office found that this education tax credit saves $1.49 for every dollar it reduces tax revenue. That is three times the largest return on investment for the preschool programs cited by Heckman —and it comes from a policy that is already serving 23,000 students statewide.
Giving at-risk children access to private schooling has been repeatedly shown to improve their educational attainment. Economist Derek Neal has found that Catholic schools raise the graduation rate of urban African Americans by 26 percentage points, and more than double their chances of graduating from college – even after controlling for differences in student background between the sectors. Half a dozen other scientific studies echo Neal's findings. Researchers from the U.S. and abroad also point to higher test scores for students when they attend private rather than public schools, after controlling for student and family background, as I report in a forthcoming global literature review in the Journal of School Choice.
While it would not be constitutional for the president to pursue a national school choice program, he could greatly accelerate the growth and adoption of such programs around the country by throwing his support behind them. He would not be the first Democrat to do so. Florida's scholarship tax credit was expanded last year with the support of one third of the state's Democratic caucus.
This article appeared on cato.org on April 13, 2009
"When it comes to our children's future," writes president Obama in his first budget, "we cannot waste dollars on methods, programs, and initiatives that are not effective and efficient." He's right, but his budget fails to heed his own dictum.
The president is proposing education policies that are neither the most effective nor the most efficient means of achieving his laudable goals. He plans to expand Head Start and double funding for Early Head Start — federal programs aimed at preschool children. Though the president appears convinced that such programs can save many times what is spent on them, the evidence for that view is weak.
Even economist James Heckman, whose work has influenced President Obama's thinking on the subject, is far more guarded. In 2007, Heckman identified three small preschool programs from the 1960s and 1970s that studies suggest have more than paid for themselves in lower subsequent welfare and criminal justice costs incurred by their participants. But Heckman cautioned that "a much more careful analysis of the effects of scaling up the model programs... has to be undertaken before these estimates can be considered definitive."
His caveat is well justified. The "Perry preschool" study which yielded the highest estimated return enrolled just 123 children. There is good reason to doubt that it can be replicated by the federal government nationwide. A large body of research on other Head Start programs finds that while they sometimes offer short term academic benefits, these generally disappear by the elementary school grades. The largest review of this literature, published by the Department of Health and Human Services, looked at more than 200 studies and concluded that there was no lasting academic advantage to participation in Head Start.
If spending on Head Start and other federal education programs had produced widespread, significant benefits since their inception in the mid 1960s, overall student achievement and graduation rates should have risen over time. The achievement gap between children of high-school dropouts and those of college graduates should have narrowed as well, because most federal education programs are targeted at disadvantaged students. None of these things occurred.
According to the National Assessment of Education Progress, the best available measure of academic trends, U.S. seventeen-year-olds score no better in math or reading today than they did nearly forty years ago. In science they perform slightly worse. The gap between children of dropouts and children of college graduates is unchanged in reading and science, and has decreased by only one percent in math. According to Heckman himself, the high school graduation rate peaked a few years after Head Start was passed and has declined by four or five points since then.
For these disappointing results, the federal government has spent roughly $1.85 trillion dollars on education programs since 1965. So while some small local preschool programs may have generated lasting, significant effects, the federal government cannot be counted on to reproduce those effects on a national scale.
If the president really wants effective, efficient programs, he should look at Florida's scholarship donation tax credit. Under this program, businesses can contribute to non-profit scholarship organizations that subsidize private k-12 tuition for needy families. For each dollar they donate, the businesses owe one fewer dollar in taxes. Last December, Florida's own government accountability office found that this education tax credit saves $1.49 for every dollar it reduces tax revenue. That is three times the largest return on investment for the preschool programs cited by Heckman —and it comes from a policy that is already serving 23,000 students statewide.
Giving at-risk children access to private schooling has been repeatedly shown to improve their educational attainment. Economist Derek Neal has found that Catholic schools raise the graduation rate of urban African Americans by 26 percentage points, and more than double their chances of graduating from college – even after controlling for differences in student background between the sectors. Half a dozen other scientific studies echo Neal's findings. Researchers from the U.S. and abroad also point to higher test scores for students when they attend private rather than public schools, after controlling for student and family background, as I report in a forthcoming global literature review in the Journal of School Choice.
While it would not be constitutional for the president to pursue a national school choice program, he could greatly accelerate the growth and adoption of such programs around the country by throwing his support behind them. He would not be the first Democrat to do so. Florida's scholarship tax credit was expanded last year with the support of one third of the state's Democratic caucus.
Government's Mistakes Have Deepened This Recession
Government's Mistakes Have Deepened This Recession. By Fred L. Smith, Jr.
Letter to the Editor in The Wall Street Journal
CEI, Apr 09, 2009
Steven Gjerstad and Vernon Smith suggest one unexplored aspect of our financial crisis: the role of egalitarian policies. To see this, note their distinction between the impacts of the $10 trillion loss in the 2000 stock market collapse and the $3 trillion loss of the recent housing collapse.
A driving force behind all this has been radical egalitarianism -- the idea that something that can be afforded by some should be made available to everyone. Our universal housing-ownership passion transformed the housing market. Under the egalitarian promotional housing policies of the last few decades (the Democrat's "affordable" housing goals; the Republican's "ownership society" obsession), banks became institutions that would loan you money even if you were unlikely to be able repay it. The moral hazard problems created by our bipartisan egalitarians (the Community Reinvestment Act, the mandates on Fannie Mae and Freddie Mac) enticed far too many Americans into purchasing homes priced beyond their means. There is a critical distinction between the democratizing tendency of the market and the coercive egalitarian policies of politics.
Many factors contributed to our financial crisis but as Messrs. Gjerstad and Smith suggest, we should add radical egalitarian policies to the list. As they note, these programs transformed the American Dream into the American Nightmare.
Fred L. Smith Jr. President Competitive Enterprise Institute Washington
Letter to the Editor in The Wall Street Journal
CEI, Apr 09, 2009
Steven Gjerstad and Vernon Smith suggest one unexplored aspect of our financial crisis: the role of egalitarian policies. To see this, note their distinction between the impacts of the $10 trillion loss in the 2000 stock market collapse and the $3 trillion loss of the recent housing collapse.
A driving force behind all this has been radical egalitarianism -- the idea that something that can be afforded by some should be made available to everyone. Our universal housing-ownership passion transformed the housing market. Under the egalitarian promotional housing policies of the last few decades (the Democrat's "affordable" housing goals; the Republican's "ownership society" obsession), banks became institutions that would loan you money even if you were unlikely to be able repay it. The moral hazard problems created by our bipartisan egalitarians (the Community Reinvestment Act, the mandates on Fannie Mae and Freddie Mac) enticed far too many Americans into purchasing homes priced beyond their means. There is a critical distinction between the democratizing tendency of the market and the coercive egalitarian policies of politics.
Many factors contributed to our financial crisis but as Messrs. Gjerstad and Smith suggest, we should add radical egalitarian policies to the list. As they note, these programs transformed the American Dream into the American Nightmare.
Fred L. Smith Jr. President Competitive Enterprise Institute Washington
Getting Real: The Oil Majors Move Away from Political Energy (Government-dependent wind, solar are not ready for prime time)
Getting Real: The Oil Majors Move Away from Political Energy (Government-dependent wind, solar are not ready for prime time). By Robert Bradley
Master Resource, April 9, 2009
A recent article in the New York Times, “Not So Green After All: Alternative Fuel Still a Dalliance for Oil Giants,” chronicled the move away from politically correct (but economically incorrect) wind and solar energy by the oil majors.
Royal Dutch Shell and BP, in particular, recognize wind and solar as what they are: dilute, intermittent energies that are not consumer friendly or economic. And their investment returns in the same have been lackluster. Shell and BP have found out what Exxon Mobil learned in the 1970s.
“Oil giants worldwide are skeptical that President Barack Obama’s plans to move the economy away from petroleum will be successful,” Jad Mouawad wrote in the Times. “Many of the oil companies are sticking to their hydrocarbon business model and some are backing away from commitments to renewable power.”
Mouawad summarizes the thinking from these three majors:
Royal Dutch Shell last month said it would freeze research in wind, hydrogen and solar power to devote all its renewable energy efforts to biofuels. The company had already sold much of its solar business and last year pulled out of a project to build the largest offshore wind farm near London.
BP has been trimming its renewables program, and U.S. oil companies, which have traditionally been more lukewarm to renewables than their European peers, are not budging either.
“In my view, nothing has really changed,” Rex W. Tillerson, the chief executive of Exxon Mobil, said after the election of President Obama. “We don’t oppose alternative energy sources and the development of those. But to hang the future of the country’s energy on those alternatives alone belies [the] reality of their size and scale.”
Indeed, the article goes on to note, the majors are focused on frontier hydrocarbons, such as tar sands and natural gas from shale. Such emphasis will warm the hearts of those who favor free-market capitalism over political capitalism.
Core Competency: “We Don’t Do it All”
The pullback from wind and solar is back-to-the-basics. As Shell’s CEO Jeroen van der Veer stated, “We don’t do it all.” Whatever the advantage of investing in wind and solar for public relations reasons, in the current economic climate such PR is no longer affordable. Perhaps these companies are also asking whether technologies that are forever dependent on government policy are really sustainable.
There is also the problem of scale, which Daniel Yergin spoke to in the Times article mentioned above. It is the same point that the former CEO ExxonMobil, Lee Raymond made so well back in 2004:
One of the difficulties people have, even some who work in this business, is understanding the scale and size of the energy industry. This is important to understand in order to put in perspective what some of the alternatives are and to judge if they are significant in the context of the whole.
There are many alternative forms of energy that people talk about that may be interesting. But they are not consequential on the scale that will be needed, and they may never have a significant impact on the energy balance. To the extent that people focus too much on that—for example, on solar or wind, even though they are not economic—what they are doing is diverting attention from the real issues.
And 25 years from now, even with double-digit growth rates, they will still be less than 1 percent of the energy supplied to meet worldwide demand. I am more interested in staying focused on the 99 percent than the 1 percent.
Wind and Solar: Failed Expectations
Wind and solar in almost all applications are a bust. Not even very generous government tax incentives (production tax credit, accelerated depreciation) have worked. As Texas proves, mandatory renewable-energy quotas are required. In 1999, that state enacted the Enron provision of an electricity restructuring bill that made Texas the nation’s leader in new windpower capacity and production. (Enron Wind Corporation, now part of General Electric, was the intended beneficiary of the deal made by Enron’s Ken Lay and then-governor George W. Bush.)
Consider the long history of failed competitiveness of wind and solar as shown by these quotations.
Worldwatch Institute in 1984:
“Tax credits have been essential to the economic viability of wind farms so far, but will not be needed within a few years.”[1]
American Wind Energy Association in 1986:
“The U.S. wind industry has … demonstrated reliability and performance levels that make them very competitive. It has come to the point that the California Energy Commission has predicted windpower will be that State’s lowest cost source of energy in the 1990s, beating out even large-scale hydro.“[2]
Barry Commoner in 1976:
“Mixed solar/conventional installations could become the most economical alternative in most parts of the United States within the next few years.”[3]
Solar Energy Industries Association in 1987:
“I think frankly, the—the consensus as far as I can see is after the year 2000, somewhere between 10 and 20 percent of our energy could come from solar technologies, quite easily.”[4]
Worldwatch Institute in 1987:
“In future decades, [photovoltaic technologies] may become standard equipment on new buildings, using the sunlight streaming through windows to generate electricity.”[5]
Lee Raymond, a rare energy realist in political times, was right.
References
[1] Statement of Michael L.S. Bergey, American Wind Energy Association in Renewable Energy Industries, Hearing before the Subcommittee on Energy Conservation and Power of the Committee on Energy and Commerce, House of Representatives, 99th Cong., 2nd sess. (Washington, D.C.: Government Printing Office, 1986), p. 129.
[2] Christopher Flavin, “Electricity’s Future: The Shift to Efficiency and Small-Scale Power,” Worldwatch Paper 61, Worldwatch Institute, November 1984, p. 35.
[3] Barry Commoner, The Poverty of Power (New York: Alfred A. Knopf, 1976), p. 151.
[4] Scott Sklar, Solar Energy Industries Association. Quoted in Solar Power, Hearing before the Subcommittee on Energy and Power of the Committee on Energy and Commerce, House of Representatives, 100th Cong., 1st sess. (Washington, D.C.: Government Printing Office, 1987), p. 12.
[5] Cynthia Shea, “Renewable Energy: Today’s Contribution, Tomorrow’s Promise,” Worldwatch Paper 81, Worldwatch Institute, January 1988, p. 44.
Master Resource, April 9, 2009
A recent article in the New York Times, “Not So Green After All: Alternative Fuel Still a Dalliance for Oil Giants,” chronicled the move away from politically correct (but economically incorrect) wind and solar energy by the oil majors.
Royal Dutch Shell and BP, in particular, recognize wind and solar as what they are: dilute, intermittent energies that are not consumer friendly or economic. And their investment returns in the same have been lackluster. Shell and BP have found out what Exxon Mobil learned in the 1970s.
“Oil giants worldwide are skeptical that President Barack Obama’s plans to move the economy away from petroleum will be successful,” Jad Mouawad wrote in the Times. “Many of the oil companies are sticking to their hydrocarbon business model and some are backing away from commitments to renewable power.”
Mouawad summarizes the thinking from these three majors:
Royal Dutch Shell last month said it would freeze research in wind, hydrogen and solar power to devote all its renewable energy efforts to biofuels. The company had already sold much of its solar business and last year pulled out of a project to build the largest offshore wind farm near London.
BP has been trimming its renewables program, and U.S. oil companies, which have traditionally been more lukewarm to renewables than their European peers, are not budging either.
“In my view, nothing has really changed,” Rex W. Tillerson, the chief executive of Exxon Mobil, said after the election of President Obama. “We don’t oppose alternative energy sources and the development of those. But to hang the future of the country’s energy on those alternatives alone belies [the] reality of their size and scale.”
Indeed, the article goes on to note, the majors are focused on frontier hydrocarbons, such as tar sands and natural gas from shale. Such emphasis will warm the hearts of those who favor free-market capitalism over political capitalism.
Core Competency: “We Don’t Do it All”
The pullback from wind and solar is back-to-the-basics. As Shell’s CEO Jeroen van der Veer stated, “We don’t do it all.” Whatever the advantage of investing in wind and solar for public relations reasons, in the current economic climate such PR is no longer affordable. Perhaps these companies are also asking whether technologies that are forever dependent on government policy are really sustainable.
There is also the problem of scale, which Daniel Yergin spoke to in the Times article mentioned above. It is the same point that the former CEO ExxonMobil, Lee Raymond made so well back in 2004:
One of the difficulties people have, even some who work in this business, is understanding the scale and size of the energy industry. This is important to understand in order to put in perspective what some of the alternatives are and to judge if they are significant in the context of the whole.
There are many alternative forms of energy that people talk about that may be interesting. But they are not consequential on the scale that will be needed, and they may never have a significant impact on the energy balance. To the extent that people focus too much on that—for example, on solar or wind, even though they are not economic—what they are doing is diverting attention from the real issues.
And 25 years from now, even with double-digit growth rates, they will still be less than 1 percent of the energy supplied to meet worldwide demand. I am more interested in staying focused on the 99 percent than the 1 percent.
Wind and Solar: Failed Expectations
Wind and solar in almost all applications are a bust. Not even very generous government tax incentives (production tax credit, accelerated depreciation) have worked. As Texas proves, mandatory renewable-energy quotas are required. In 1999, that state enacted the Enron provision of an electricity restructuring bill that made Texas the nation’s leader in new windpower capacity and production. (Enron Wind Corporation, now part of General Electric, was the intended beneficiary of the deal made by Enron’s Ken Lay and then-governor George W. Bush.)
Consider the long history of failed competitiveness of wind and solar as shown by these quotations.
Worldwatch Institute in 1984:
“Tax credits have been essential to the economic viability of wind farms so far, but will not be needed within a few years.”[1]
American Wind Energy Association in 1986:
“The U.S. wind industry has … demonstrated reliability and performance levels that make them very competitive. It has come to the point that the California Energy Commission has predicted windpower will be that State’s lowest cost source of energy in the 1990s, beating out even large-scale hydro.“[2]
Barry Commoner in 1976:
“Mixed solar/conventional installations could become the most economical alternative in most parts of the United States within the next few years.”[3]
Solar Energy Industries Association in 1987:
“I think frankly, the—the consensus as far as I can see is after the year 2000, somewhere between 10 and 20 percent of our energy could come from solar technologies, quite easily.”[4]
Worldwatch Institute in 1987:
“In future decades, [photovoltaic technologies] may become standard equipment on new buildings, using the sunlight streaming through windows to generate electricity.”[5]
Lee Raymond, a rare energy realist in political times, was right.
References
[1] Statement of Michael L.S. Bergey, American Wind Energy Association in Renewable Energy Industries, Hearing before the Subcommittee on Energy Conservation and Power of the Committee on Energy and Commerce, House of Representatives, 99th Cong., 2nd sess. (Washington, D.C.: Government Printing Office, 1986), p. 129.
[2] Christopher Flavin, “Electricity’s Future: The Shift to Efficiency and Small-Scale Power,” Worldwatch Paper 61, Worldwatch Institute, November 1984, p. 35.
[3] Barry Commoner, The Poverty of Power (New York: Alfred A. Knopf, 1976), p. 151.
[4] Scott Sklar, Solar Energy Industries Association. Quoted in Solar Power, Hearing before the Subcommittee on Energy and Power of the Committee on Energy and Commerce, House of Representatives, 100th Cong., 1st sess. (Washington, D.C.: Government Printing Office, 1987), p. 12.
[5] Cynthia Shea, “Renewable Energy: Today’s Contribution, Tomorrow’s Promise,” Worldwatch Paper 81, Worldwatch Institute, January 1988, p. 44.
WaPo Editorial: A Solution for Somalia
A Solution for Somalia. WaPo Editorial
What it will take to stop the threats of piracy and terrorism
WaPo, Tuesday, April 14, 2009; Page A16
SKILLFUL SHOOTING by U.S. snipers rescued an American ship captain from Somali pirates Sunday -- along with an Obama administration facing its first foreign emergency. Unfortunately, no silver bullets are available for the growing threat of piracy in the Indian Ocean or the toxic anarchy that has spawned it.
President Obama said in a statement Sunday that "we must continue to work with our partners to prevent future attacks, be prepared to interdict acts of piracy and ensure that those who commit acts of piracy are held accountable for those crimes." Those actions are certainly necessary, and they speak for themselves. But they don't begin to address the underlying problem, which is Somalia's long-standing status as a failed state and the desperation and extremism growing among its Muslim population.
Since the Clinton administration abandoned a U.N. mission in Somalia 15 years ago, the United States has tried ignoring the chaos there, using proxies to subdue it and targeting its worst elements with airstrikes. An international naval task force has been cruising along the coast for months to deter piracy. All along, the country's misery and the threat it poses to the United States and other Western countries have steadily worsened. It's not just the pirates, who have staged at least 66 assaults so far this year and hold more than a dozen ships and 200 foreign crew members hostage. As senior U.S. officials have repeatedly acknowledged, a radical Islamist militia that controls much of Somalia has ties to al-Qaeda, which has used its Somali base to stage attacks on U.S. and Israeli targets in Africa and is believed to be training foreign militants -- including some Somali Americans -- for future operations.
Again and again, mostly for political reasons, U.S. administrations have refused to absorb the lessons Somalia teaches, in tandem with pre-2001 Afghanistan and the tribal territories of present-day Pakistan. Those lessons are that stateless territories, particularly in the Muslim world, can pose a significant threat to U.S. interests and even homeland security, and that the danger can be adequately addressed only by helping a state authority emerge to fill the vacuum.
Last week's crisis offers the Obama administration an opportunity to avoid perpetuating past errors. No, we aren't advocating another massive U.N. intervention in the country backed by U.S. troops. As the Bush administration discovered late last year, there is no appetite among America's European or African allies for such an operation. But what would be possible is a concerted push to strengthen the most recent attempt at a Somali government -- a not-unpromising coalition between moderate Islamists and various clan-based factions. The government needs massive economic aid, training and equipment for an army and coast guard, and help in brokering political deals.
A coordinated international effort to build up a Somali government and security forces would cost many billions of dollars and take many years to pay off. It would consume U.S. diplomatic capital and be domestically controversial -- like the nation-building missions underway, at last, in Afghanistan and Pakistan. It is also the only way to end the threats of piracy and terrorism from the Horn of Africa.
What it will take to stop the threats of piracy and terrorism
WaPo, Tuesday, April 14, 2009; Page A16
SKILLFUL SHOOTING by U.S. snipers rescued an American ship captain from Somali pirates Sunday -- along with an Obama administration facing its first foreign emergency. Unfortunately, no silver bullets are available for the growing threat of piracy in the Indian Ocean or the toxic anarchy that has spawned it.
President Obama said in a statement Sunday that "we must continue to work with our partners to prevent future attacks, be prepared to interdict acts of piracy and ensure that those who commit acts of piracy are held accountable for those crimes." Those actions are certainly necessary, and they speak for themselves. But they don't begin to address the underlying problem, which is Somalia's long-standing status as a failed state and the desperation and extremism growing among its Muslim population.
Since the Clinton administration abandoned a U.N. mission in Somalia 15 years ago, the United States has tried ignoring the chaos there, using proxies to subdue it and targeting its worst elements with airstrikes. An international naval task force has been cruising along the coast for months to deter piracy. All along, the country's misery and the threat it poses to the United States and other Western countries have steadily worsened. It's not just the pirates, who have staged at least 66 assaults so far this year and hold more than a dozen ships and 200 foreign crew members hostage. As senior U.S. officials have repeatedly acknowledged, a radical Islamist militia that controls much of Somalia has ties to al-Qaeda, which has used its Somali base to stage attacks on U.S. and Israeli targets in Africa and is believed to be training foreign militants -- including some Somali Americans -- for future operations.
Again and again, mostly for political reasons, U.S. administrations have refused to absorb the lessons Somalia teaches, in tandem with pre-2001 Afghanistan and the tribal territories of present-day Pakistan. Those lessons are that stateless territories, particularly in the Muslim world, can pose a significant threat to U.S. interests and even homeland security, and that the danger can be adequately addressed only by helping a state authority emerge to fill the vacuum.
Last week's crisis offers the Obama administration an opportunity to avoid perpetuating past errors. No, we aren't advocating another massive U.N. intervention in the country backed by U.S. troops. As the Bush administration discovered late last year, there is no appetite among America's European or African allies for such an operation. But what would be possible is a concerted push to strengthen the most recent attempt at a Somali government -- a not-unpromising coalition between moderate Islamists and various clan-based factions. The government needs massive economic aid, training and equipment for an army and coast guard, and help in brokering political deals.
A coordinated international effort to build up a Somali government and security forces would cost many billions of dollars and take many years to pay off. It would consume U.S. diplomatic capital and be domestically controversial -- like the nation-building missions underway, at last, in Afghanistan and Pakistan. It is also the only way to end the threats of piracy and terrorism from the Horn of Africa.
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