Guest essay by Eric Worrall
Manchin is worried about Texas Blackouts just saved the US from Build Back Better? Washington-based reporter Tim McDonnell wants you to understand why large amounts of government cash make things better.
Joe Manchin has a fundamental misunderstanding of climate economics
Via Tim McDonnell
Climate reporter
…
In one statement, Manchin said the bill would “put the reliability of our grid at risk” and that reducing emissions “at a rate faster than technology or the market allows would have dire consequences for the American people as we have seen in both Texas and California. over the past two years” (referring to power outages in states that usually lost due to renewable energy).
…
But his argument is empty for some reason.
First, the “market”, especially in the energy sector, has never existed in a non-government environment. The United States currently subsidizes oil and gas production on a trend of about 20 billion dollars each year, which gives these fuels an advantage over renewables that need tax incentives. Although the United States, as Manchin mentioned in its statement, has a history of innovation in clean energy technology, it has ceding its competitive advantage to China on emerging industries such as battery and solar panel manufacturing largely due to not willing to fully subsidize domestic production facilities.
Second, the bill directs much of its support to the government technology– facility-scale energy storage and transmission line improvements – needed to improve “reliability of our grid” and to reduce risks future blackouts as renewables become more common.
Finally, the most important flaw in Manchin’s argument is that it propagates a false choice about climate action: Either spend money on climate, or do nothing and save money. In fact, maintaining the status quo — in other words, plunging headfirst into climate catastrophe — is by far the more expensive option. damage to the US economy.
After Manchin’s announcement, Goldman Sachs lowered its GDP forecast for the United States by 2022.
Read more: https://qz.com/2104166/why-joe-manchin-wont-vote-for-the-build-back-better-bill/
I think the underlying problem is that many of the people pushing these massive government schemes have never attempted to run their own businesses.
There are more ways for things to go wrong than right. Anyone who runs a business knows every expense needs careful consideration. If I upgrade my laptop, can I pay my child’s tuition? Do I really need to upgrade now? Will the upgrade improve my productivity enough to offset the cost?
People who have never tried to run a business and solve problems of this kind are mostly unaware of this risk. There are some exceptions, but for most people who have worked for others all their lives, money comes in predictable packages at set intervals. Laptop upgrades come as a matter of course due to company policy. Government money comes from banks or printers. There should never be any problem paying for tuition from predictable sources of salary income, unless you (swallow) lose your job.
If income is predictable and secure, what downside could there be to governments gambling trillions of dollars on technologies that don’t exist?
Senator Joe Manchin ran multiple businesses before he committed full-time to politics. He gets it, in a way that many of his colleagues clearly don’t.
I have no problem with the government spending several billion a year on research. Basic research into the resilience of communication networks that no one imagined would have commercial value has led to the domination of the United States in the internet age. All the spin-offs from the space race, too many to count. For those who want to commit their lives to exploring the universe, there’s plenty of evidence that the benefits of giving them a little support far outweigh the costs.
But that’s where government spending should stop. If the technology that scientists discover cannot be self-sustaining, in the sense that the businesses trying to get access to it can function and make a ton of money without additional government help, in most cases. In all cases, no amount of government cash or market-distorting rules will create economic benefits for taxpayers.
Related
