On the Blog
In today’s edition of The Heartland Daily Podcast, we listen in as Research Fellow Heather Kays appears on the “Freedom Works Show” on Tantalk1340 in Florida with host Paul Molloy. Kays was on to talk about the various education related issues that are taking place around the country.
Kays and Molloy briefly talk about the Vergara lawsuit out of California and its implications, charter school waiting lists in Massachusetts, and anti-charter school rulings out of Washington state.
Socialism is a failed ideology. It was the avant-garde approach to how to do government – in the Twentieth Century. The Soviet Union was the flagship petri dish. That conquered, infiltrated or ingratiated themselves with many other nations – to establish them as additional petri dishes (Hello, Cuba). We certainly now have a large enough, long enough sample set – and the results are in. The system is contaminated – Socialism does not work.
Socialists feebly cry “But they weren’t Socialist – they were Communist.” Which is a distinction with very little difference. Communism is Socialism – with a boot in the neck. The Communist boot is almost always ultimately necessary – because people eventually figure out Socialism stinks on ice. Which is why so many peaceful Socialist experiments end up as Communist totalitarian regimes. See: Orwell, George.
Unfortunately, the vast majority of Americans attend government schools. As Neal Boortz rightly notes: “If you go to a Catholic school – you get a pro-Catholic education. So if you go to a government school – you get a pro-government education.” Our government school system doesn’t teach that Socialism stinks on ice. They have for decades defied decades of evidence – and declared Socialism to be great. (And our colleges are at least as bad – if not worse.)
Ignorance replicated – resonates. Flash forward to today: Avowed Socialist Senator Bernie Sanders is a force in the Democrat presidential primary. Little known factoid: When in the Senate, primary opponent Hillary Clinton was only 0.1% less Left than Sanders. And they were ranked Numbers 15 and 13 respectively in the Democrat caucus – meaning there were a dozen Senators more Left than them. Know why Democrat National Chairman Rep. Debbie Wasserman Schultz (D-FL) can’t distinguish between a Democrat and a Socialist? Because they are indistinguishable.
Speaking of Miss Clinton – behold Robert Reich. Who was a Labor Secretary during her husband’s presidential administration. (What does Reich do now? Teaches college, of course.) Is Reich a Socialist? If it walks and talks like a duck,….
In 2010, he praised the uber-failed ObamaCare – and proposed similar huge government power grabs for just about every other economic sector. Foreshadowing Sanders, he called for a 70%-90% top income tax rate.
Now, Reich thinks uber-failed ObamaCare wasn’t huge-government enough – and demands a government-only single-payer system. He robustly defends Sen. Bernard Sanders (I-VT)’ $18 trillion (at least) in new spending. (Our entire national debt is currently $18.4 trillion.)
Suffice to say, Reich has about the economy very little to say that is of any actual assistance. The amount of Reality totally missed by him and his ilk is always dangerous – but just occasionally, they can be amusing in their blinkered, naif-like naiveté. So it was when Reich for the New York Times recently penned “Big Tech Has Become Way Too Powerful.”
But as has happened before with other forms of property, the most politically influential owners of the new property are doing their utmost to increase their profits by creating monopolies that must eventually be broken up.
The most valuable intellectual properties are platforms so widely used that everyone else has to use them, too. Think of standard operating systems like Microsoft’s Windows or Google’s Android; Google’s search engine; Amazon’s shopping system; and Facebook’s communication network. Google runs two-thirds of all searches in the United States. Amazon sells more than 40 percent of new books. Facebook has nearly 1.5 billion active monthly users worldwide. This is where the money is.
Reich is lambasting some huge Internet players. Threatening them with an eventual government hammer to break them apart. “Government must intervene in the Tech Sector!” he cries.
Well, government recently did intervene in the Tech Sector. In massive, all-encompassing, Reich-like fashion. The Barack Obama Administration just fundamentally transformed (royally messed up) the basic economics of the entire Tech World. It’s called Network Neutrality:
Net Neutrality mandates all electronic bits be treated equally. No website can be treated differently than any other website. No Internet “fast lanes” – where a website can pay more for faster service. Which is about as anti-Reality as any policy ever devised. Your Mom-and-Pop embroidery website is a little different and uses a different amount of bandwidth than does Amazon.com. You shouldn’t have your bandwidth costs equalized with Amazon’s bandwidth costs. Gas stations don’t equalize fuel costs between eighteen-wheelers and Smart Cars. The Post Office doesn’t equalize postage between overnight and snail delivery. In Reality, Amazon should, would and could pay more for the massive bandwidth they use – and the faster speeds they want.
In actuality, Net Neutrality mandates that crony companies like Amazon, Netflix and Google get unequal, MUCH better treatment than do our Mom-and-Pop sites.
Get that? The huge companies Reich is decrying in the Times – just received a HUGE crony boost from Huge Government. This terrible government policy allows them a permanent, mass-transport free-ride. Where was Reich on this terrible government policy? In favor, of course. He was in favor in 2006. And he approved in February when the Obama Administration slammed it down.
But Reich now writes that the huge companies his favored policies heavily favored – are too big and must be broken up. Confused? That’s certainly understandable – because Reich is terminally confused.
This is what happens when government and our Betters try to micromanage the economy. Like it’s controlled by a bunch of levers, and our Betters can lower this one, raise that one – and magically make everything great.
In Reality, the economy is like a long, thin balloon – and when our Betters press on one section, other sections in unanticipated ways bubble and warp. When the government pressure gets too great (like when they mandate banks make too many bad home loans) – the economy pops.
Reich and his ilk dropped Net Neutrality on the economy ballon. And watched an unexpected bubble arise – that benefits the companies Reich says are overly-benefitted and should be broken down. Whiplash-inducing, is it not?
Reich the Wiser couldn’t see that coming? No, because Reich doesn’t understand economics. Or government. Or government’s effects on economics.
Socialism officially doesn’t work. May we please finally stop trying it? And stop listening to those who still think it does?
In today’s edition of The Heartland Daily Podcast, Heartland Science Director Jay Lehr joins managing editor of Environment & Climate News to discuss the incestuous relationship between the EPA and radical environmental groups.
Lehr explains how the EPA has lost its focus on protecting people and the environment in an anti-capitalist crusade and thus needs to be replaced. Lehr also gives insight into what might occur at the Paris climate conference.
Five presidential candidates, including former Florida governor Jeb Bush (R), support the amendment of federal healthcare regulations and laws to reposition substance abuse addiction as a disease that can be treated, and not a crime.
“But, as The Washington Post reported this weekend, the share of substance abuse treatment patients receiving in-facility care covered by health insurance dropped to 10 percent in 2014, down from 22 percent the previous year.”
According to the paper, Obamacare was supposed to improve access to mental health care for patients. But it has not. Many psychiatrists no longer even accept any form of health insurance, the Post reported today. There are psychotherapies and pharmacotherapies that can help addicts, but most health insurance companies will not pay for the complete treatment regime.
The Obama White House is about to amp-up its propaganda campaign for regulations to combat global warming, as the U.N. climate summit approaches this fall in Paris.
“How is it doing this? By bringing on Thomas Reynolds, ‘a top communications strategist at the Environmental Protection Agency and a seasoned political operative, to a new position dedicated solely to messaging Mr. Obama’s global warming agenda,’” according to The New York Times.
A report in The Daily Caller indicates that Reynolds has pushed EPA regulations for the past two years, and before that, “derived from his experience directing regional media operations for Mr. Obama’s 2012 reelection,” the Times reported. Reynolds spearheaded the EPA’s messaging campaign against coal-fired power plants, raising the ante in the “war on coal.”
There is no way to describe current Federal Reserve policy other than as monetary confusion and misdirection. In a nutshell, Janet Yellen and the other members of the Fed’s Board of Governors have no idea what to do. Do they raise certain interest rates over which they have some direct influence? Do they keep them at their current rock bottom levels, as they have for the last six years?
On the one hand, government measured unemployment levels have fallen from their high of over 10 percent at the depth of the recent recession to 5.1 percent in September 2015.
However, there is an alternative measure of unemployment also calculated by the U.S. Bureau of Labor Statistics. It includes not only those currently unemployed and looking for work during the previous four weeks, but also “discourage workers” who have stopped looking for jobs who would be interested in working if they found a suitable employment; and those who are part-time who would prefer to be employed full-time. If these two additional groups are included, the U.S. unemployment rate is 10 percent, double the headline “official” level of unemployment the administration touts as a “positive” sign of the economy’s recovery.
On the other hand, price inflation as measured by the Consumer Price Index seems to be barely rising. According to the Bureau of Labor Statistics, price inflation in August 2015 was .02 percent higher than twelve months earlier.
Again, however, when food and energy prices are subtracted out of the Consumer Price Index to leave what the government statisticians call “core” inflation, prices in August were 1.8 percent higher than a year ago. Certainly not a “galloping” inflation, but not the nearly zero price inflation rate the highline number suggests, particularly since food prices were up 1.6 percent over the year; the “drag” on measured price inflation was all due to a 15 percent decline in energy prices compared to twelve months earlier.
No Trade-Offs Between Employment and Inflation
If we look at that alternative unemployment rate of 10 percent in conjunction with the “core” price inflation rate of 1.8 percent, what we see is a moderate form of what in the 1970s was called “stagflation”: high unemployment with rising price inflation.
The Federal Reserve could try to nudge up the key interest rates it most directly has influence over, especially the Federal Funds rate at which banks lend to each other overnight, but with the risk of threatening the investment and home mortgage borrowing that it has attempted to “stimulate” through near zero interest rates.
Or the Federal Reserve could continue to keep those interest rates low through a continuation of their moderated “quantitative easing” monetary policy, but with the risk that price inflation (however measured) may start to rise faster than it has, creating the danger of price inflation above their declared target level of two percent a year.
(It should be kept in mind that even the Federal Reserve’s “modest” target rate of two percent annual price inflation would still result in a near 50 percent decrease in the value of every the dollar in our pockets in around 20 years.)
Either way, the old Keynesian notion that you can lower unemployment by accepting a higher rate of price inflation, and vice versa, shows itself to be as illusionary as when it was first touted back in the 1960s as the mechanical macroeconomic policy trade-off between unemployment and price inflation known as the Phillips Curve.
The European Central Bank, by the way, is in its own dilemma. European Union-wide official unemployment continues to hover above 10 percent with a modest price deflation as most recently measured, in spite of that central bank’s own version of “quantitative easing” of nearly $70 billion of new paper money-creation per month since the beginning of 2015.
The Fed Causes Booms and Busts
The only result of these years of monetary expansion and interest rate manipulation is economic instability and distortion. The financial market indices significantly gyrate up and down seemingly every day based on attempted nuanced readings of the latest public statements by any of the Federal Reserve Governors concerning interest rate policy changes.
The house of cards constructed on years of artificially low or zero interest rates in terms of investments undertaken with trillions of dollars of cheap money, as well as home mortgages at manipulated interest costs, hang in the balance again as in previous boom-bust cycles.
Every time the booms turn into busts, the central bankers insist that they have had nothing to do with it. It has been due to “irrational exuberance” in financial markets, or huckster bankers who duped people into taking out loans they could not really afford, or international events beyond a national central bank’s control, or just, well, “bad luck” with things happening in unpredictable ways even under the watchful eyes of the central bank “experts.”
The fact is, the boom-bust cycles that have plagued modern industrial societies for well over a century, including the Great Depression of the 1930s and this most recent “Great Recession,” as it has been dubbed, have not “just happened” or been the result of inherent and inescapable weaknesses in a market economy or capitalist financial markets.
The booms and busts of the business cycle are the result of the very central bank system that government policy-makers and central bankers insist they are there to either prevent or mitigate in its amplitude and duration.
As I explain in my new, recently released book, Monetary Central Planning and the State, published by the Future of Freedom Foundation, central banking suffers from the same political and economic shortcomings as all other forms of central planning.
Monetary Printing Press Plunder
First, placing the control of the monetary system in the hands of the government or a government-created agency such as the U.S. Federal Reserve System opens the door to the temptation of political abuse in many forms. On the one hand, the temptation exists to use the monetary printing press to create the money that covers the expenses of a government’s deficit spending and provides the artificially low interest rates to manipulate the costs of funding the government’s accumulated debt.
On the other hand, a central bank can also be used to “stimulate” employment and production in the service of politicians leading up to an election, to make it seem that those in political power have the magic wand to “create jobs” and better standards of living – what is sometimes referred to as the “political business cycle.”
It also enables pandering to special interest groups wanting sources of below-market rates of interest for loans, as well as the banking institutions themselves that have access to the created credit supplied by the central bank with which they earn interest income that otherwise might not have been there.
Government full or near monopoly control of any resource, asset or institution (such as a central bank) historically has always brought in its wake plunder and privilege for some at others’ expense that would not have been possible in a more open, competitive market setting.
Monetary Central Planning and the Business Cycle
However, even if those who oversee and manage central banks were as “pure” and benevolent as angels only wishing to do good for mankind with no ulterior self-interested motives or temptations, the monetary and banking system would still constantly run the risk of suffering from the same boom-bust cycles that we see in our world today.
That is because central banking is a form of central planning, and as such, manifests the same weaknesses and impossibilities as all centrally planned economic systems. Interest rates are market-generated prices that are meant to coordinate the decisions of savers with those of potential investors, by bringing the two sides of the loan market into balance.
Income-earners make a decision to spend a portion of their earned income on desired consumer goods and to save a portion of that income for planned and possible demands and uses in the future. The real resources that saved portion of their money incomes represent in terms of buying power in the market is transferred to interested and able borrowers; they use that saved portion of other people’s money income to enter the market and demand and purchase resources, raw materials, capital goods (machines,
tools, equipment) and labor services to undertake future-oriented and time-consuming investment projects of various types and lengths that will bring forth goods to be bought and sold in the future.
Interest rates, in other words, serve as the balancing rod to keep in coordinated order the use of scarce resources in society between the production of consumer goods closer to the present and the investments that will bring forth consumer goods further in the future. It is the balancing of resource uses and goods production across time.
Central Banker Hubris vs. Competitive Markets
There is no way to know what are the “correct” coordinating interest rates for different types of loans with differing periods of investment time in relation to people’s decisions to consume and save parts of their income other than to allow free, competitive financial markets to discover through the interactions of supply and demand what the “equilibrium” or market-balancing interest rates should be.
This is, of course, no different than in the case of any other good or service that can be offered on the market. No central planner can replace the competitive market and its free pricing system for integrating and coordinating all the complex knowledge and circumstances of multitudes of millions of suppliers and demanders in an ever-changing world.
And, likewise, it is shear arrogance and naïve hubris for central planners to believe that they do or ever can have the knowledge, wisdom and ability to correctly determine what the quantity of money should be in the economy, what money’s value or purchase power should be over goods and services in the marketplace, or what interest rates would assure that coordinated balance between savings and investments.
Monetary Freedom and Private Competitive Banking
That is why in is time to rethink and challenge the presumption of a need for and superior outcome from the institution of central banking, whether in the United States or anywhere else in the world.
In the twentieth century a group of economists known as members of or sympathizers with the “Austrian School of Economics” challenged the reasoning and rationale behind central banking. Among these leading Austrian economists were Ludwig von Mises and F. A. Hayek.
Though Austrian economists have differed sometimes in their emphases and arguments about the practical workings of a private, competitive free banking system, there is one underlying premise shared by all of them: a completely market-based monetary and banking system would be far superior to historical and current institutional forms of central banking.
Money is, perhaps, the most central and essential, economic good in the market, since it is the generally used medium of exchange to facilitate all transactions entered into by buyers and sellers. It makes smoother and more effective the exchange of goods and services throughout the economy.
Money and Banking is Too Important to Leave to Central Banks
But precisely because of its central role and significance in a complex and ever-changing market economy the supply and control of money is too important to leave in the hands of politicians or their central bank appointees.
They are either too open to the temptations of short-run political purposes in their control of the monetary printing press; or they suffer from what Hayek called a “pretense of knowledge” in presuming that they can ever know more or better than the cumulative knowledge of all the participants of the competitive market as manifested in the prices and interest rates that emerge through the interaction of supply and demand.
Historically, markets – which means all of us in our roles as consumers and productions – determined which commodities were most useful as media of exchange for different types and sizes of transactions. Money was not and need not be a creation or creature of the state, and has most often been commodities such as gold and silver.
Banking as the institutional procedure and process to facilitate and coordinate the decisions of savers and investors emerged out of the market discovery of profitable opportunities in providing intermediary services to minimize the costs of lenders and borrowers directly searching out trading partners for the exchanging of resources and goods across time.
Money Creation as a Tool of Plunder
Governments and their central bank creations usurped market-based monetary and banking systems to serve the plundering purposes of kings, princes, parliaments, and special interest groups who all wanted to hold the magical hand of the monetary printing press.
Print up money (or its digital substitutes and surrogates in more modern times) and you can have access to all the hard work of others who have invested in manufacturing and bringing to market all the goods and services you desire without having to undertake the reciprocal effort and work to make and trade an actual good or service to earn the money so as to honestly buy what you want from them. Some are so impolite as to refer to such monetary mischief as “fraud” and “theft.”
Added to this more “base” purpose of government monopolization of the monetary printing press, has been, over the last one hundred years, the arrogance and hubris of social engineers, bureaucratic elites of “experts” and “socially-oriented” policy-makers who presume to know how to micro-manage and macro-manage society better than leaving people to manage their own lives through peaceful interaction with others in the competitive marketplace.
Their century-long legacy in the arena of money and banking has been the booms and busts of the business cycle. The monetary social engineers have worn different hats at different times – calling themselves Keynesians, Monetarists, New Classical or Rational Expectations theories, or Post- and New Keynesians – but they remain variations on the same conceptual and ideological theme: monetary central planners imposing their notions of desired market outcomes by co-opting the functioning of a real and functioning market-based competitive system of free banking using market-chosen media of exchange.
The time has come to end the tragic and disruptive reign of monetary central planning.
In this episode of the weekly Budget & Tax News podcast, managing editor Jesse Hathaway takes a leap into the Final Frontier, talking with Texas Tech University economics professor Alex Salter about how current international legal policy and basic economics are causing a potentially deadly problem in the skies: space junk.
Too large to burn up and too small to be tracked, the danger of space junk in Earth orbit is caused by the lack of an economic incentive to clean up things like inoperative satellites or spent rocket casings, and outdated and ineffective extraterrestrial property laws remove the incentive for private companies to clean up orbits.
Instead of leaving the problem for nation-states to deal with on their own, at taxpayer expense, Salter proposes “renting” the right to clean orbits of valuable recyclable ore to private companies, creating a private-public partnership (P3) that’s truly out of this world!
In just two months, politicians and activists from all over the planet will begin the “most critical phase of the 2015 United Nations climate change conference in Paris,” according to a report published online by Deutsche Welle, the international, German-language broadcaster. Yesterday, the co-chairs of the ad hoc working group on the Durban platform (ADP) – the bureaucratic entitity tasked with negotiating the terms of the agreement – “submitted a first draft for the treaty text, which contains the basis for negotiation of the Paris climate package,” the news service reported.
The Paris summit is poised to adopt a framework directing governments around the globe as to how to manage climate change. “All member countries of the UN Framework Convention on Climate Change (UNFCCC) were asked to submit their emission reduction targets ( Intended Nationally Determined Contributions, INDCs ) for 2025 and 2030. An informal deadline passed October 1. Until now, the UNFCCC has received responses from 146 countries, or three-quarters of all member countries,” the news service reported.
A UNFCCC’s spokesperson, Nick Nuttall, told DW: “It is a really good number of countries with wide geographical spread. We have the major emitters, all the industry countries and big developing countries. While more will come in, it won’t make a significant difference.”
Still, many progressives worry, the report added, that global temperatures will continue to rise even if all of the political agreements are followed this fall to reduce carbon emissions.
The legislators in Raleigh recently took a step to lower North Carolinian’s tax bill.
At the end of midnight marathon session of the North Carolina House of Representatives, the House passed a compromise budget bill funding the government for the coming fiscal year. One of the provisions of the bill ends North Carolina’s generous 35 percent tax credit solar or other renewable energy projects. One project alone, the Desert Wind Project, if completed would cost North Carolina taxpayers more than $140 million to produce energy for out of state customers. Iberdrola, the Spanish company that owns Desert Wind, gets more subsidies from U.S. taxpayers than any other renewable energy company in the world, yet investors fear it is on the edge of financial collapse while it is simultaneously the subject of several federal investigations. There is no good reason for North Carolinians to throw more good money after bad.
Until the legislature ended this credit, North Carolinians had been forced to pay twice to prop up the state’s renewable energy lobby: once in the form of the tax credit and again for higher electric bills as a result the state’s renewable power mandate.
Unfortunately, having dealt with the first issue, the legislature failed to end a second source of the higher prices state residents and businesses pay for energy. HB 332 was not allowed an up or down vote in the Senate despite passing out of committee. In the debate over HB 322, according to WRAL, Republican State Sen. Bill Cook (Beaufort) said “It sounds like you’ve got one camp that’s real interested in promoting the wind and solar industry and another camp that’s interested in trying to save the rate-payers.” I couldn’t have said it better myself.
Some in the Senate evidently thought it was more important to cater to green special interests desires for unearned profits rather than put North Carolinians needs for affordable, reliable energy first.
HB 332, would have had North Carolina follow Ohio’s lead and freeze the state’s renewable energy mandate at its current level of six percent. Absent the freeze, utilities will be required to increase the amount of renewable energy they provide to 10% in 2018 and 12.5% in 2021. The bill would also reduce the guaranteed market for renewables by requiring utilities pay a standard rate for power from small renewable power generators.
The case for freezing the mandate, or even better, repealing it entirely as West Virginia and Kansas both did earlier this year, comes down to money. Renewable energy, like wind and solar power, costs more in part because it is not not available 100 percent of the time as are conventional fuel sources, thus you have extra costs associated to provide backup energy by traditional power sources when wind and solar drop off line, or as the power they supply fluctuates. Both problems are common.
Higher energy costs hit low-income households the hardest, as they must spend a larger share of their monthly income on utility bills than do higher middle- and upper income households.
What impact has six percent renewable mandate had on North Carolina? A lot! Earlier this year, Utah State University’s Institute of Political Economy estimated North Carolina residential ratepayers paid slightly more than $3,800 for a typical household in North Carolina in 2013 alone because of the renewable mandates. The study further concluded higher energy costs to commercial and industrial ratepayers has discouraged investment, already costing the state 24,000 jobs and $14.4 billion in personal income.
And it’s not just North Carolina as studies consistently show states with renewable power mandates have seen their energy costs rise higher and faster than states lacking such market interventions.
State Rep. Mike Hager (R-Rutherfordton), the sponsor of the bill in the House testified before the Senate Commerce committee the bill was about helping the poor, saying, “What we’re trying to do on that is protect those folks in each of your districts that can least afford to pay more on their power bills.”
Like all legislative mandates and tax credits for specific industries, the renewable tax credits which will now die, and the renewable mandate, which should be killed, distort the market. They are a form of welfare for the well-to-do, giving big bucks to politically connected renewable energy producers who know how to game the system. They, in turn, fund environmental groups and hire lobbyists to ensure the revenue stream continues flowing. Absent tax breaks and mandates wind and solar boondoggles just can’t survive, except for niche applications for the very rich, who don’t need such subsidies.
While HB 332 died in North Carolina’s Senate, in Ohio, the legislative committee established by the law freezing its renewable energy mandate until 2017 recommended maintaining the freeze indefinitely. The committee recognized that, if anything, the justification for freezing the mandate had become even stronger since it went into effect.
A study of the impact of Ohio’s renewable mandate by the same Utah State University think tank that examined the cost renewable energy to the state’s economy and residents found Ohio’s renewable mandate will cost electricity customers up to $1.92 billion between now and 2026.
In a news release announcing the study’s release, Ryan Yonk, one of the study’s authors said, “This study, one of the strongest and most widely examined ever conducted on RPS, shows there is significant evidence to suggest RPS mandates were not helping local economies. Rather, they were causing economic damage to families and businesses.”
The study reports Ohio’s renewable mandate will reduce personal income by $258 million between now and 2026. Ohioans can expect to receive approximately $3,800 less per household than households in states without a renewable mandate. In addition, the RPS could result in a loss of nearly 3,600 jobs.
This uncontroverted evidence led the Energy Mandates Study Committee to its decision to recommend extending the freeze indefinitely.
Oddly, Gov. John Kasich (R), who signed the earlier freeze, has come out against the Committee’s recommendation. Perhaps, Kasich’s presidential ambitions have overcome his concern for Ohio’s ratepayers and businesses – maybe he’s trying to win the vote of moderate Republicans and independents who consider a candidates views on the environment as important when they vote.
The reason most often cited for the success of the nonpolitical candidates is the frustration with Washington; the sense that the system is broken. Voters feel that we have no control and that government has gone wild. Even people who don’t watch the news or closely follow politics are aware of the “overreach.” It seems that, perhaps, the messages the outsiders have been heralding on the trail has caught on.
Washington’s overreach has been rolled back—by courts and commissioners and, even, in response, the government itself. In little more than 30 days, there have been five distinct cases that you may have missed—each, a victory for responsible land use.
First was WOTUS, or the Waters of the U.S. rule—which was scheduled for full implementation on, Friday, August 28. WOTUS attempted to greatly expand the federal government’s authority over water and land and could apply to ditches, streams, wetlands and small isolated bodies of water. Late on Thursday, August 27, U.S. District Judge Ralph Erickson issued a temporary injunction sought by North Dakota and 12 other states. In his decision, Erickson wrote: “Once the rule takes effect, the states will lose their sovereignty over interstate waters that will then be subject to the scope of the Clean Water Act.” Calling the rule “arbitrary and capricious,” he declared that the EPA “violated its congressional grant of authority in its promulgation of the rule.”
Undaunted, the Environmental Protection Agency (EPA) pushed back, stating that the rule only applied to the thirteen states that requested the injunction. For the remaining 37 states, the EPA is enforcing the regulation as planned. At least 10 lawsuits—including 29 states and 14 agricultural and industry organizations—have been filed in federal district court challenging the rule.
Constitutional and environmental law professor, Jonathan H. Adler, addressed WOTUS in the Washington Post, saying: “As a general matter (and as the Supreme Court has recognized) land-use control is generally beyond the scope of federal power. In this case, the district court concluded that the states were likely to succeed on the merits as the EPA had adopted an ‘exceptionally expansive’ view of its own jurisdiction under the CWA.”
Perhaps, as you’ll see, if the WOTUS deadline was a month later, the EPA may not have been so bold in its assertion that it would continue to enforce the rule. But, then again, this is the Obama EPA.
Lesser Prairie Chicken
Once again, a federal agency has been acting “arbitrarily and capriciously.” This time, it is the U.S. Fish and Wildlife Service (FWS). On September 2, U.S. District Judge Robert A. Junell overturned the Obama administration’s 2014 listing of the lesser prairie chicken (LPC) as a threatened species, which gave the bird protection under the Endangered Species Act (ESA) and limited land use in five states.
Citing the “more than 180 oil and gas, pipeline, electric transmission and wind energy companies” that had enrolled in voluntary conservation plans, The Permian Basin Petroleum Association challenged the listing, as soon as it was finalized.
The FWS is required to consider the conservation plans. The court determined that FWS “did not properly consider active conservation efforts for the bird when listing it.” Junell wrote: “The Court finds FWS did conduct an analysis, however this analysis was neither ‘rigorous’ nor valid as FWS failed to consider important questions and material information necessary to make a proper evaluation.”
Addressing the LPC decision, The National Law Review, states: the “ruling raises important questions about the upcoming Service decision whether to list the greater sage-grouse under the ESA. A sage-grouse decision was due on September 30.
Representative Rob Bishop (R-UT), Chairman of the House Natural Resources Committee, sees that the FWS “has been illegally steam rolling states by their own secret rules.” He added: “The Obama administration has been merciless in its quest to list species—even when the science says otherwise.”
Hydraulic Fracturing Rule
On September 30, another federal district court judge smacked down another federal agency—this time the Interior Department’s Bureau of Land Management (BLM), which, in March, issued federal fracking rules designed to spur states to follow suit (most energy-producing states already regulate fracking). BloombergBusiness states: “There are more than 100,000 wells on federal land making up 11 percent of the nation’s natural gas production and five percent of its oil.” The rule, if implemented and adopted by states, as hoped for by the administration, would magnify the impact, “potentially slowing development of oil and natural gas resources”—which is likely the goal. As a result, BloombergBusiness adds, producers “would have faced higher costs at a time when profits already are strangled by low crude prices.”
In his 54-page decision, Wyoming’s U.S. District Judge Scott Skavdahl wrote: “Congress has not authorized or delegated the BLM authority to regulate hydraulic fracturing and, under our constitutional structure, it is only through congressional action that the BLM can acquire this authority.” He issued a preliminary injunction barring implementation of the rules, “finding that those suing had a good chance of winning their case and getting a permanent order barring enforcement.”
Different from the EPA’s arrogant decision to move forward with implementing WOTUS, a BLM spokeswoman, according to the Wall Street Journal, said: “While the matter is being resolved, the BLM will follow the Court’s order and will continue to process applications for permit to drill and inspect wells sites under its pre-existing regulations.”
Kathleen Sgamma, vice president of government and public affairs at Western Energy Alliance, a party to the lawsuit against the government, is overjoyed to finally be “getting relief from the courts regarding the regulatory overreach of the Obama administration.” She added: “We hope the BLM, EPA and other agencies that are rushing to implement even more regulations on the very businesses that create jobs will pause and actually follow the law and regulatory procedure.”
“The case will proceed to a final resolution,” BloombergBusiness reports, “probably early next year.”
Ranchers in and around New Mexico’s Gila Forest have been fighting the federal government’s plan to release “another dozen or so Mexican grey wolves.” Already, in the region, wolves since their introduction in 1998 have killed livestock, and children waiting for the school bus often do so in cages for protection. I’ve written on the sad tale several times.
On September 29, in a 7-0 vote, concerned about the impact to ranchers and elk hunters, the New Mexico Game Commission upheld an earlier decision denying the FWS permits to release Mexican wolves into federal land in southwestern New Mexico.
“Federal policy requires FWS to consult state agencies and comply with their permitting processes when releasing endangered animals from captivity,” Science Magazine reports, “even when releases are made on federal land.”
In June, according the Santa Fe New Mexican, “New Mexico Game and Fish Department Director Alexandra Sandoval rejected a federal permit for the Mexican wolf program because she said the FWS lacked a detailed plan to release up to ten captive wolves in the Gila National Forest, leaving her without enough information on what effects the predators would have on deer and elk populations.”
In response to the decision, Game Commissioner Elizabeth Ryan of Roswell, NM, said she and her colleagues could only overturn the director’s decision on the wolf permit if they found it “arbitrary and capricious.”
This string of recent decisions may have been noticed by the Obama administration. On September 22, after years of debate, and after the LPC listing was overturned, Department of Interior (DOI) Secretary Sally Jewell announced that the sage grouse would not be listed under ESA. The Washington Post reports that “the chicken-like grouse does not meet the required standard because a collaboration of federal agencies, states, ranchers, industry and environmental groups has already begun to restore areas where it breeds.” “According to state fish and game agencies,” Kent Holsinger, a Colorado attorney specializing in lands, wildlife and water law, told me: “sage grouse populations have risen 63 percent over the past two springs.”
An ESA listing would “significantly limit future development.”
The ESA, Brian Seasholes, director of the endangered species program at the Reason Foundation, states: “has a well-deserved reputation for putting severe restrictions on otherwise normal and legal forms of land and resource use, such as farming and energy development.” In an op-ed in The Hill, he adds: “When a species is listed under ESA, landowners can face steep fines, penalties and land use controls that can devalue their property.”
While environmental groups see the decision as a victory for “industry and its supporters,” others, such as Utah Governor Gary Herbert—who estimated Utah would lose more than $40 billion in economic production from oil and gas if the sage grouse were listed—are still not happy.
Rather than listing the sage grouse—which would likely be overturned in court—the DOI’s BLM has released a plan to implement more than 90 land use strategies. Herbert sees that the federal government rejected the successful sage-grouse conservation plan and says the land use plans that govern use of over 60 million acres of federal land “constitute the equivalent of a listing decision outside the normal process.” He calls the plans “a significant overreach by the federal government.” Bishop agrees: “Do not be fooled. The announcement not to list the sage-grouse is a cynical ploy… With the stroke of a pen, the Obama Administration’s oppressive land management plan is the same as a listing.” The land-use restrictions have been decried as “every bit as rigid as could be expected under ESA.”
While “the West’s sage-grouse worries are far from over,” I see that, when combined with the aforementioned stories, the unwarranted decision is still welcome news. Land-use plans will be easier to revise under a new administration than removing an ESA listing. But, more importantly, I view it as a recognition that big government overreach has reached its limits.
The good news about having so many reform-minded outsiders running for president is that they are like a band of crusaders spreading the message of big government overreach far and wide. That message is, apparently, being heard. Voters are, hopefully, ready for responsible land use. The tide is being rolled back.
The author of Energy Freedom, Marita Noon serves as the executive director for Energy Makes America Great Inc. and the companion educational organization, the Citizens’ Alliance for Responsible Energy (CARE). She hosts a weekly radio program: America’s Voice for Energy—which expands on the content of her weekly column. Follow her @EnergyRabbit.
Heartland Daily Podcast – Dr. Merrill Matthews: Hillary Clinton’s Plan Makes Prescription Drugs More Expensive
In today’s edition of the Heartland Daily Podcast, Dr. Merrill Matthews, a resident scholar with the Institute for Policy Innovation, a research-based, public policy think tank in the Dallas area, joins managing editor Kenneth Artz to discuss Hillary Clinton’s plan to make prescription drugs even more expensive.
Hillary Clinton, Democratic presidential candidate, announced in September her plan to introduce price controls on prescription drugs. Immediately the biotechnology and health care sectors tanked, as investors fled those industries, taking billions of dollars of capital with them.
But she wasn’t through. Right after telling us she wants price controls on prescription drugs, she turned to health insurance, doubling-down on Obamacare. Matthews says both these prescriptions are the wrong tonic for curing what’s wrong with the American health care system.
New research has emerged showing the world’s oceans are cooling the planet by emitting vast amounts of volatile organic compounds (VOCs) into the atmosphere. These VOCs are not presently accounted for by climate models and may explain in part or in whole the growing gap between the temperatures predicted by the models and those actually measured by satellites, weather balloons, and surface temperature stations.
The VOC isoprene, which like all VOCs tends to cool the planet, has long been known to be produced by plants and trees on land and plankton in the sea. Now, atmospheric chemists from France and Germany have discovered huge amounts of isoprene are also produced in the “microlayer” at the top of the ocean by sunlight acting directly on floating chemicals – no life being necessary. Global models presently assume total emissions of isoprene from all life-form sources – trees, plants, plankton – of around 1.9 megatons per year. The new research shows “abiotic” processes occurring in the oceans release as much as 3.5 megatons on their own.
A new form of informant is emerging in politically correct California — the “water rat.” The water rat is a person who dials “311” to report that a neighbor is wasting water in Los Angeles, or who files a complaint on the other residents of their street at savewater.ca.gov, the government’s informant tip site. The informants are creating a wave of anxiety in Hollywood, according to a report in The Hollywood Reporter. “I called the DPW (Department of Public Works) and told them there was a hose draining a huge amount of water from someone’s driveway,” the trade paper reported, of comments made by a tipster. “The water waste stopped the next day. I still check every day. It’s been more than a month, and I do feel it was due to me.”
During the month of May 2015, alone, 29,000 Californians informed on their neighbors about suspected water use violations in the drought-stricken state. Use of too much water is considered, today, in LA, an obscene form of demonstration of wealth, and is not socially acceptable for movie stars, movie producers, or executives in related industries.
To reduce their chances of being busted by the water police, wealthy Californians are planting “drought-tolerant” fruit trees, like pomegranates; figs; feijoa; and the pineapple guava. They are also adding gravel gardens, desertscapes, and California native plantings, according to the trade weekly.
The world has changed. Although few yet understand it, the revolution in the production of oil and natural gas from shale has altered the course of global energy, affecting most of the world’s people. This is not a short-term event. Citizens, industries and nations will be impacted for decades to come.
We are witnessing a modern energy miracle. For more than 30 years, U.S. crude oil production fell from 9.6 million barrels per day in 1970 to 5 million barrels per day in 2008. Oil production, an annual $200 billion industry, was in long-term decline. Industry experts proclaimed that we had reached “peak oil” and that world oil output would soon fall. But beginning in 2008, U.S. production soared, again reaching 9.6 million barrels in June of this year, recovering all of a 30-year decline in just seven short years.
For more than a century, geologists searched for pockets of oil and gas between rock layers. But by using the technological advances of hydraulic fracturing, or fracking, and horizontal drilling, geologists learned how to squeeze oil and gas out of the rock itself. Shale is a common rock formation that covers large areas in the U.S. and other nations. In a 2013 study, the Energy Information Administration concluded, “the world shale oil and shale gas resource is vast.” The shale revolution has opened additional centuries of low-cost hydrocarbon resources to modern society.
On the world stage, the most obvious shale shock impact is the precipitous drop in world oil price. The price of a barrel of West Texas crude dropped from $106 in July 2014 to $53 in January of this year. Prices have now fallen to under $45 per barrel, a level not seen since 2009. Our current $2.50 price for a gallon of gasoline is a direct result.
For the first time in four decades, the world market price for petroleum is determined by competition. The Organization of Petroleum Exporting Countries (OPEC) can no longer dictate the price of crude oil by restricting production. Small firms that led the shale revolution, such as Baker Hughes, Cabot Oil & Gas, and Range Resources, now have the ability to quickly ramp or reduce production from shale fields, depending on market price. Big oil firms like ExxonMobil and BP are reacting to the shale shock along with everyone else.
It appears that low oil prices are the new normal. In the shale fields, oil production per drilling rig has increased 500 percent in the last seven years. Energy expert Mark Mills of the Manhattan Institute estimates that the fracker cost will soon drop to $20 per barrel, on par with the low-cost oil fields of Saudi Arabia.
The geopolitical implications of the shale shock are huge. Low oil prices have crippled the economies of oil-baron nations Venezuela and Nigeria. Food and medicine shortages are rampant in Venezuela, and prices are soaring. Oil provides 80 percent of the government revenue of Nigeria, where low prices have forced budget cuts and stimulated civil unrest. In Russia, oil and gas account for over 50 percent of the national budget and 75 percent of export revenue. The Russian ruble has weakened to 71 rubles per dollar, halved in value over the last year.
On the positive side, affordable prices are great for consumers and the world’s poor. Lower oil prices are reflected not only in energy but also in transported food and consumer goods. Low prices are boosting the economies of nations not dependent upon hydrocarbon production.
The anti-fossil fuel environmental movement is in despair. For decades, proponents of the ideology of sustainable development preached that humanity was running out of oil and gas, that consumption of hydrocarbons was destroying the climate and that renewable energy was rapidly becoming a cost-effective alternative. But the shale shock has slain peak oil and promises low-cost oil and gas for centuries to come.
Oil and gas from shale will provide irresistible pressure for global carbon dioxide emissions to increase. Environmental groups are engaged in an all-out effort to stop fracking, but these efforts will ultimately fail. The world’s one billion automobiles today will double to two billion in the next 40 years, buoyed by inexpensive hydrocarbon vehicle fuel.
Electric cars and biofuels are already being impacted. US sales of hybrid and plug-in electric vehicles fell 15 percent in the first half of 2015 compared to last year. Ethanol vehicle fuel, an alternative when gasoline was priced at $4 per gallon, is no longer competitive.
Natural gas from the shale revolution provides a tremendous advantage for our nation. U.S. natural gas prices are one-half those of Europe and one-third those of Japan. Inexpensive gas now powers a growing number of power plants, keeping U.S. electricity prices low. Global chemical producers are relocating to the U.S. to use low-cost ethane feedstock from natural gas.
The shale industry will provide a U.S. competitive advantage for many years. More than two billion well-feet of horizontal shaft have been drilled in the U.S. over the last 20 years, a distance equal to 15 times around Earth. Fracturing is just starting in China, Argentina and the United Kingdom, but such efforts are more than a decade behind.
The shale shock is a tribute to U.S. hydrocarbon geologists and to human ingenuity. Dozens of small companies perfected hydraulic fracturing, launched the shale revolution and changed the world. As the late economist Julian Simon pointed out, the greatest resource of mankind is not material in the ground, but the ingenuity of people operating in a free society.
This year, coinciding with All Hallows’ Eve, U.S. House of Representatives Speaker John Boehner (R-OH) is retiring, ending a quarter-century career in Congress, which was capped by successfully organizing a historic papal speech to both houses of Congress.
With Boehner’s resignation, the Export-Import Bank (Ex-Im) is effectively dead and buried, and lawmakers jockeying to take up his mantle should commit to keeping the zombie crony-capitalist program six feet under.
Boehner was the only member of House leadership supporting the reauthorization of the Export-Import Bank, a government agency created by President Franklin Delano Roosevelt in 1934 “to remove obstacles to the free flow of interstate and foreign commerce which tend to diminish the amount thereof” and “to reduce and relieve unemployment, to improve standards of labor, and otherwise to rehabilitate industry.”
Ex-Im provided a mechanism for using taxpayer money to guarantee loans to domestic businesses unwilling or unable to obtain loans for exporting goods. Congress rightly opted to allow Ex-Im’s charter to expire at the end of June, which it should have done decades earlier. A bipartisan team of Senate leaders had voted to raise Ex-Im from the dead and reauthorize it as a rider in an unrelated spending bill, but House leaders refused to take up the bill, favoring their own spending bill and leaving Ex-Im to expire on June 30.
In April, Boehner warned of dire repercussions if Congress did not reauthorize the Great Depression-era corporate welfare program, telling reporters, “There are thousands of jobs on the line that would disappear pretty quickly if the Ex-Im Bank were to disappear.”
Nearly three months after Ex-Im’s corpse was laid to rest, the spirit of Ex-Im job loss has yet to materialize, like the subject of a failed All Hallows’ Eve séance.
In September, General Electric (GE) executives claimed forcing GE to seek private financing of export loans resulted in 400 jobs being outsourced to France, but that isn’t what happened in the real world.
As reported by the Washington Examiner, GE had planned to move those jobs, which do not currently exist, to France as early as 2014. GE committed, in writing, to exporting those jobs, as a deal sweetener, swaying French regulators to approve a then-pending purchase of Alstom, a French power generation company.
So GE was planning to move U.S. jobs overseas despite receiving a huge amount of Ex-Im encouragement to keep them here. According to research conducted by Mercatus Center Senior Research Fellow Veronique de Rugy, GE was one of Ex-Im’s biggest beneficiaries, receiving a total of $2.6 billion in financial assistance from U.S. taxpayers.
Not only did Ex-Im fail to prevent GE from moving jobs overseas, the program doesn’t create jobs.
According to a 2011 American Action Fund study of Ex-Im’s economic effects, “For the economy as a whole, export financing merely redistributes jobs across the economy, rather than create more overall jobs.”
After Boehner enters retirement, his replacement should continue to treat taxpayers by resisting the urge to breathe life into Ex-Im’s dusty old bones. Ex-Im is a dead idea, and it should be allowed to rest in peace in the graveyard of failed government interventions.
In his 1998 State of the State address, Ohio Governor George Voinovich (R) famously referred to Medicaid spending as the “Pac-Man” of entitlement spending, noting how it ends up “gobbling up ever larger portions” of government funds.
By following through on entitlement reforms started in the 1990s, Congress can defuse a ticking entitlement-spending time bomb and allow states to lead the way on holding costs down and better serving taxpayers.
According to estimates from the Congressional Budget Office (CBO), the national deficit will exceed $1.088 trillion, or roughly $8,369 per U.S. household, by 2025. Much of the growth in the deficit will come from increases in major health care program costs, including Medicaid.
In 2014, $3 of every $20 spent by the federal government was spent on Medicaid. Over the next decade, CBO predicts, Medicaid spending will increase by 87 percent, ballooning from about $952.86 for every man, woman, and child in the United States in 2014 to about $1,635.77 per capita in 2024.
Block grants are a time-tested solution to the problem of skyrocketing Medicaid spending.
In the 1990s, increasing welfare costs kept federal lawmakers up at night, so Congress and President Bill Clinton worked together to transform welfare from a top-down federal program into a more efficient state-administered program.
In 1996, Congress replaced the old and busted Aid to Families with Dependent Children program with Temporary Assistance for Needy Families, allowing states to take charge of their own destinies and conform welfare to their particular circumstances. As states tailored their programs to suit their individual needs, the overall costs of entitlement programs fell and the quality of service increased.
At the time, lawmakers seriously considered including Medicaid block-grants in the reform bill that ultimately became the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA). In early 1996, Clinton was open to including Medicaid in the reforms, as recounted by Peter Edelman, an anti-reform advisor to the president.
In a 1997 article for The Atlantic, Edelman, who opposed PRWORA so much that he quit his job after Clinton signed it, wrote, “When the governors came to town for their winter meetings early last year, the President invited them to draft and submit new proposals on welfare and, for that matter, Medicaid.”
Medicaid is fundamentally broken because of how it was designed. New York, a state with about 6.2 percent of the nation’s population, sucked up 12.4 percent of all federal Medicaid money in 2014. As that fact indicates, Medicaid has powerful incentives for high spending by states like New York that can afford it. The more a state spends other people’s money, the more of other people’s money it gets.
Finishing the work Congress and Clinton started with PRWORA would empower states to improve Medicaid with new ideas such as global spending caps, health savings accounts, and program budget rebalancing. Cost overruns would be discouraged, as state lawmakers would face pressure from taxpayers to avoid mismanagement and optimize for efficiency.
It’s urgent for Congress to build on the work it started more than 20 years ago and block-grant the “Pac-Man” Medicaid monster before it gobbles up an even bigger proportion of cash-strapped state budgets.
If you don’t visit Somewhat Reasonable and the Heartlander digital magazine every day, you’re missing out on some of the best news and commentary on liberty and free markets you can find. But worry not, freedom lovers! The Heartland Weekly Email is here for you every Friday with a highlight show. Subscribe to the email today, and read this week’s edition below.LeftExposed.org Profile of the Week: Center for American Progress
LeftExposed.org is a new Heartland Institute project devoted to creating accurate profiles of prominent individuals and organizations on the political Left with a special focus on groups in the global warming (a.k.a “climate change”) debate. Project Manager Emily Zanotti and principal researcher Ron Arnold have written a devastating profile of the Center for American Progress, a political spin-machine for the Democratic Party that pretends to be a think tank. Zanotti and Arnold document the organization’s founding, funding, and latest scandals. READ MORE Roadway Impacts of Industrial Silica Sand Mining
Isaac Orr and Mark Krumenacher, Heartland Policy Study
Hydraulic fracturing – “fracking” – has produced tremendous benefits to American energy consumers. The fracking process requires a special type of sand, called “frac sand,” mined in Wisconsin and a few other states. What impact has the rapid growth of fracking had on communities near frac sand mines? In this new Heartland Institute Policy Study, authors Orr and Krumenacher address “the potential impacts of industrial sand operations on the public roadways and [provide] an overview of successful methods used to minimize those potential drawbacks while maximizing the benefits of industrial sand mining to the community.” READ MORE Buy Your Tickets Now: 31st Anniversary Benefit Dinner Is Next Week!
The Heartland Institute’s 31st Anniversary Benefit Dinner will take place Thursday, October 8 at The Cotillion, 360 South Creekside Drive in Palatine, Illinois. This year’s theme is “The Heartland versus The Ruling Class,” featuring keynote speaker Angelo Codevilla, Ph.D., author of The Ruling Class: How They Corrupted America and What We Can Do About It. Donald J. Devine, Ph.D., will receive this year’s Heartland Liberty Prize. Join us for dinner, drinks, great conversation, and fellowship in liberty! MORE INFO HERE Featured Podcast: Wayne Allyn Root: Liberalism Leads to Lack of Economic Freedom
Wayne Allyn Root, author, entrepreneur, and television and radio personality, joins Heartland Research Fellow H. Sterling Burnett to discuss the problems of big government and how advocates of liberty must be relentless in their efforts to reclaim the country. Root laments the fact government power and influence continue to grow and the United States continues to drop on the Economic Freedom Index. LISTEN HERE 31st Anniversary Sale at the Heartland Store! 31% Off!
The Heartland Institute is celebrating its 31st anniversary on Thursday, October 8. To commemorate this special occasion, get a 31% discount on one item you purchase from the Heartland Store. Visit the store to find t-shirts, posters, and even poker cards featuring images of freedom’s founders and champions plus other great products. Use the code “31years” for big savings! SHOP HERE The U.S. Coal Industry Is Under Regulatory Assault
H. Sterling Burnett, Huntington (WV) Herald-Dispatch
The once-vibrant coal industry is being crippled by increasingly onerous and scientifically unjustified regulations on carbon emissions. As a result of Obama’s anti-coal policies, nearly a third of coal miners in Kentucky have lost their jobs since 2008. New and existing regulations have been made more stringent by Obama and have caused the premature closure of dozens of U.S. coal-fired power plants. READ MORE Without Boehner, Export-Import Bank Is Over
Jesse Hathaway, The American Spectator
The resignation of House Speaker John Boehner may mean the Export-Import Bank (Ex-Im) is effectively dead and buried, a significant victory for free-market advocates. Boehner was the only member of House leadership supporting reauthorization of the Export-Import Bank, a government agency created by President Franklin Delano Roosevelt in 1934. Lawmakers jockeying to take up Boehner’s mantle should commit to keeping the zombie crony-capitalist program six feet under. READ MORE
Obama’s Solar Energy Socialism
Isaac Orr, The Hill
Taxpayers have been bilked for billions of dollars for decades so politicians could funnel money into solar firms like Solyndra, which a new investigation by the Inspector General of the Department of Energy (DOE) confirms engaged in a “pattern of false and misleading assertions” to win a loan guarantee from DOE. Obama’s solar energy socialism will not lead to a utopia of cheap energy but will instead drive up costs for U.S. households and businesses. READ MORE Bonus Podcast: Norbert Michel: The Benefits of Bitcoin
Norbert Michel, research fellow at The Heritage Foundation, joins Heartland Research Fellow Jesse Hathaway to discuss the innovative digital currency Bitcoin. Michel explains how Bitcoin works and why policymakers should get out of the way of this financial revolution instead of trying to ban or regulate it using outdated financial models. READ MORE Families Intervene Against Lawsuits Challenging Nevada ESA Program
Heather Kays, The Heartlander
When Nevada legislators approved the Nevada Education Savings Account Program (NESA) earlier this year, school choice advocates celebrated their biggest victory ever. Naturally, the Evil Empire has struck back, filing two lawsuits alleging the program violates the state constitution’s ban on public funding of religion. The Institute for Justice is defending NESA, representing five Nevada families. READ MORE How Missouri Should Handle Transitional Care Facilities
Matthew Glans, Research & Commentary
Senior citizens have longer recovery rates after surgery, and the market has responded with transitional care facilities (TCF), which offer an alternative many seniors use for post-acute and rehabilitation health care needs. Heartland Senior Policy Analyst Matthew Glans writes aResearch & Commentary urging Missouri lawmakers to give this innovation a chance to succeed by not adding TCFs and other facilities to the state’s certificate of need program. READ MORE Invest in the Future of Freedom! Are you considering 2015 gifts to your favorite charities? We hope The Heartland Institute is on your list. Preserving and expanding individual freedom is the surest way to advance many good and noble objectives, from feeding and clothing the poor to encouraging excellence and great achievement. Making charitable gifts to nonprofit organizations dedicated to individual freedom is the most highly leveraged investment a philanthropist can make. Click here to make a contribution online, or mail your gift to The Heartland Institute, One South Wacker Drive, Suite 2740, Chicago, IL 60606. To request a FREE wills guide or to get more information to plan your future please visit My Gift Legacy http://legacy.heartland.org/ or contact Gwen Carver at 312/377-4000 or by email at email@example.com.
President Barack Obama recently made headlines in Nevada by promoting the “progress” his administration has made in promoting solar power and fighting climate change. Most media outlets conveniently forgot to mention one crucial fact: Without government mandates, subsidies, and sweetheart deals, the sun would quickly set on Obama’s solar empire.
The administration has taken a two-pronged, carrot-and-stick approach to propping up the solar industrial complex. Carrots have been lavished on the solar industry by encouraging states to enact policies such as renewable energy mandates, which require a certain percentage of the electricity generated in the state come from renewable sources, and net-metering policies, which subsidize wealthy rooftop solar owners at the expense of middle- and low-income families.
Taxpayers have been bilked for billions of dollars for decades so politicians could funnel money into solar firms like Solyndra, which a new investigation by the Inspector General of the Department of Energy (DOE) confirms engaged in a “pattern of false and misleading assertions” to win a loan guarantee from DOE. The Inspector General also said DOE failed to do its job in vetting the loan, because of pressure from the White House.
Despite all these carrots, solar produces just 0.4 percent of the electricity generated in the United States, according to the Energy Information Administration, which is why Obama is increasingly turning toward using the stick.
The Environmental Protection Agency (EPA) has wielded those sticks, circumventing congressional authority in order to punish conventional sources of energy such as coal, natural gas, and oil by saddling them with a series of costly, burdensome regulations. Those regulations, such as the Clean Power Plan and new rules regulating methane from hydraulic fracturing sites, drive up the cost of energy while providing no benefit to the environment.
An analysis by the Cato Institute, using EPA’s own climate models, showed the carbon dioxide emissions reductions forced by the Clean Power Plan would offset only 0.02 degrees C of anticipated warming by the year 2100, an amount so small it falls below the margin of error for the model, meaning this plan would cost billions of dollars and drive up energy costs for no measurable benefit. The increase in costs will hit low-income families the hardest, a fact even EPA boss Gina McCarthy has admitted. Maybe that’s what Obama means when he claims he stands up for the middle class.
The Obama administration is subjecting the energy sector to the same harmful ideology that has stagnated the overall economy (except for oil and natural gas development from fracking, ironically). He is attempting to build up the weak—solar and wind—by tearing down the strong. Obama’s plan is to build up inefficient and costly forms of energy by tearing down reliable and affordable energy sources.
Obama’s solar energy socialism will not lead to a utopia of cheap energy but will instead drive up costs for U.S. households and businesses and further tank the nation’s economy along with the forms of energy we depend on to power our hospitals, schools, and refrigerators. All of that will accomplish nothing for the environment.
The solar industry gets the carrots, and the rest of us get the sticks.
Last month, a man by the name of Dr. Jagadish Shukla (along with several other scientists) sent a letter to the President and Attorney General Loretta Lynch, demanding that RICO charges – that is, “racketeering, influenced and corrupt organization” charges – be brought against so-called “climate deniers,” as though those who disagree with the theory that global climate change is inherently man made and undeniably catastrophic, were joined together in a conspiracy that amounts to organized crime.
Dr. Shukla is a meteorologist and professor at George Mason University, but the letter itself was posted on the Institute of Global Environment and Society website (it has since been replaced with a notice that it’s posting was an unfortunate mistake – odd since the URL featuring the “mistake” message, was the one listed on a press release touting the letter itself), bringing up the possibility that Shukla’s actions were either endorsed or commissioned by the IGES, and that Shukla may have benefited financially.
This is a problem; the IGES receives millions in taxpayer dollars each year for its research, and such an offensive measure as calling for a RICO investigation is very clearly partisan politics.
“IGES’s recent decision to remove documents from its website raises concerns that additional information vital to the Committee’s investigation may not be preserved,” Smith wrote in a Thursday letter to Shukla.
Smith asked Shukla to preserve all internal documents and communications that could be relevant to the committee’s investigation, and to ask all current and former employees and contractors to do the same…
Shukla’s letter to Obama and Lynch “raises serious concerns because IGES appears to be almost fully funded by taxpayer money while simultaneously participating in partisan political activity by requesting a RICO investigation of companies and organizations that disagree with the Obama Administration on climate change,” Smith wrote.
Smith’s letter cited prior reporting by the Washington Free Beacon revealing that IGES has received $63 million in government funds since 2001, which comprised 98 percent of its total revenue in that time according to annual tax filings.
This money comes from several sources, including the National Science Foundation (NSE), the National Oceanic and Atmospheric Administration (NOAA), and NASA. It’s supposed to be used for research.
It goes deeper, though, than just a conflict of interest involving a non-profit. Much of that federal money, too, appears to have eventually ended up funding Dr. Shukla’s paycheck.
IGES employs just a few people – Dr. Shukla, his wife and his daughter among them. And according to a report by National Review‘s Ian Tuttle, the Shukla’s seem to do very well, “pocket[ing] $5.6 million in compensation from IGES since 2001” (not counting what their daughter, Sonia earned). And, according to Tuttle, that’s on top of what Dr. Shukla earns as a professor at George Mason, a “double-dipping” scenario that is, to say the least, frowned upon in academia. His partner, another professor at George Mason, appear to also “double dip,” taking funds from George Mason as well as from IGES. According to Climate Watch, the story goes even deeper and involves allegedly shifting grant money, earmarked for IGES to other projects, including an educational charity.
In sending the letter to President Obama demanding transparency among “climate skeptics,” a well-known professor in the global climate movement may have exposed his own questionable handling of finances. Rep. Lamar Alexander has promised to “get to the bottom” of the interrelationship between IGES, Shukla’s work (both public and academic), and how taxpayers might have inadvertently funded some things they didn’t expect to. The results should be very interesting.
Cross-posted from LeftExposed.org.
In The Tank Podcast (ep6): Alcohol Prohibition, Economic Sinkhole States, and Presidential Campaign Blunders
With John Nothdurft out of town, Jim Lakely stands in to host with Donny Kendal for episode #6 of the “In The Tank” podcast. This weekly podcast features (as always) interviews, debates, roundtable discussions, stories, and light-hearted segments on a variety of topics on the latest news. The show is available for download as part of the Heartland Daily Podcast every Friday.
In today’s episode of In The Tank, Donny and Jim debate about the unintended consequences of alcohol prohibition, and discuss proposed minimum wage hikes in Berkeley, California and elsewhere. John Nothdruft also comes on to discuss the financial “State of the States” from Truth in Accounting, and potential Mars contamination. The trio also talk about some of the best presidential campaign and debate blunders.
- These places banned booze. Now they’re dealing with something far worse – Meth
- 2015 Financial State of the States
- $15 minimum wage? Berkeley shoots for $19 an hour
- Water on Mars: Nasa faces contamination dilemma over future investigations
We also talk about the infamous “Rock” political ad by Democratic presidential candidate Mike Gravel, which is embedded below.