An op-ed in the Wall Street Journal written by the American Council for Capital Formation’s Margo Thorning makes a good case for “pulling the plug” on subsidies for electric vehicles. Subsidies for alternative energy vehicles have been popular with both Democrat and Republican administrations, but the Obama administration has been a particularly enthusiastic supporter of industrial planning.
Downsizing Blog
Gingrich & Woolsey on Energy
The other day, The Wall Street Journal provided a public service by lambasting Newt Gingrich for his absurd speech to the ethanol lobby in Des Moines last month (money line: “Obviously big urban newspapers want to kill it because it’s working, and you wonder, ‘What are their values?’”). Today, Gingrich and fellow ethanol-maven James Woolsey struck back in those very same pages. In doing so, Gingrich provided yet more evidence that he’s intellectually unfit for office.
Bad Advice from Gov. Polar Star
In 2006, Michigan Gov. Jennifer Granholm told citizens, “In five years, you’re going to be blown away by the strength and diversity of Michigan’s transformed economy.” When those words were uttered, Michigan’s unemployment rate was 6.7 percent. It’s now almost 13 percent.
Un-Stimulating Bureaucracy
An essay from economist Arnold Kling in the latest Cato Policy Report discusses what Kling calls the “knowledge-discrepancy problem.” This occurs when knowledge is dispersed but power is concentrated, and it is particularly acute in government.
Obama's Batteries
The economy remains weak and the administration’s stimulus has been a bust. To counter the growing unpopularity of his economic policies, the president is traveling around the country handing out government checks to anointed industries.
Cost Overrun Incompetence at Energy
OMB Director Peter Orszag is blaming the inefficiencies of the federal government on outdated personal computers. That is hard to understand given that federal IT spending amounted to $200 million a day last year.
Stifling Innovation with Subsidies
A couple of weeks ago I wrote about a story in Wired regarding the Department of Energy’s Advanced Technology Vehicles Manufacturing Loan Program. The gist was that government subsidies to particular manufacturers are putting non-recipients at a competitive disadvantage in obtaining private capital. The author, a former Tesla Motors official, noted that “this massive government intervention in private capital markets may have the unintended consequence of stifling innovation by reducing the flow of private capital into ventures that are not anointed by the DOE.”
Stifling Innovation by Subsidizing It
In 2007, the Advanced Technology Vehicles Manufacturing Loan Program was created in the Department of Energy to support the development of advanced (i.e., “green”) technology vehicles. Last year Congress appropriated $7.5 billion to support a maximum of $25 billion in loans. So far, the subsidies have been dished out to Ford ($5.9 billion), Nissan ($1.6 billion), Tesla Motors ($465 million), and Fisker Automotive ($528 million).
Government Electric
The recession has given the government an excuse for major interventions into markets, and the word “bailout” is found in business section almost daily. While there are justified concerns over government bailouts of large corporations, big businesses cashing in on the economic stimulus plan have flown below the radar.
Central Planning at Energy
The U.S. Department of Energy recently awarded $2.4 billion in stimulus money to develop and manufacture electric vehicles. The ostensible purpose of the government’s effort is to set the nation on a path toward more environmentally friendly transportation. But as the USA Today notes, electric cars might not provide the environmental benefits that proponents cite: