The White House recently announced a “jobs plan” that will cost American taxpayers about $500 billion starting in 2013 for a government spending spree today. We knew what to expect: green-energy subsidies, tax breaks for people who already pay no income tax, further stimulus for non-shovel-ready projects, increased taxes on the wealthy — in short, most anything except what would actually create jobs, namely lifting the prohibitive regulatory and tax burdens on the nation’s job creators. Obama’s policies — particularly his heartless energy policies — promise to eliminate many more jobs than they create.
In times of economic hardship, high energy prices cut particularly deep. Nobody has said it better than the empathizer-in-chief:
One area of particular concern has been the cost and security of our energy. In an economy that relies on oil, rising prices at the pump affect everybody — workers and farmers, truck drivers and restaurant owners. Businesses see it hurt their bottom line. Families feel the pinch when they fill up their tank. For Americans already struggling to get by, it makes life that much harder.
Talk like that (from his big energy speech last March) is meant to convey empathy, understanding, and common cause. The trouble is, he’s got other things to consider. If we can’t save the planet from global warming, what’s the point of worrying about the cost of living today? Do you remember when Obama locked up the Democratic nomination back in 2008? That was “the moment when the rise of the oceans began to slow and our planet began to heal,” as he put it that night.
I’m not much for this sort of oratory. I prefer when people get to the point, as when incoming Secretary of Energy Steven Chu said, before one congressional committee, “Somehow, we have to figure out how to boost the price of gasoline to the levels in Europe.” That exclamation was wonderful not just because it was simple, and clear as a mountain stream. It was also an accurate description of the administration’s energy policy.
The “alternative energy” movement has an enormous obstacle to contend with, namely that none of the alternative energy sources produce nearly as much energy, nearly as reliably, nearly as cheaply, as fossil fuels. Sources such as wind and solar are inherently intermittent and unpredictable, even when they are found in high enough density that it is economical to use them, which is virtually never. As long as fossil fuels are cheap, the subsidies to alternative sources have to be huge, and therefore politically painful. But even if oil prices reach a point at which renewables can compete on price (which would plunge the world into an incalculably deep economic crisis), there simply isn’t enough marketable renewable energy to replace the vast bounty of fossil fuels.
The president likes to target the “special subsidies” we give oil companies. What he’s talking about is manufacturing tax deductions, expensing for intangible business costs, and depletion tax allowances. These tax-related provisions, which the president misleadingly characterizes as special perks for oil and gas companies, are generally available to all American manufacturers. Eliminating them would in fact single out the energy industry for punitive tax treatment — and it already pays out a higher proportion of its income in taxes than virtually any other industry. In his 2012 budget, Obama proposed eliminating twelve such tax-related provisions, generating $46 billion over ten years, all of which would go to his proposed $148 billion in subsidies for green and renewable energy.
If adopted, this confiscatory scheme would transfer more than $4 billion a year from the oil-and-gas sector to alternative energy — and the administration is proud of it! Mark this, from the White House website:
The energy industry objects that drillers will have to cut back the money they spend on development by about a third, eliminating or deferring hundreds and potentially thousands of jobs. No doubt the thought of all those job losses keeps the president up at night — but we have to start shutting down the fossil-fuel industry in order to make sure the oceans begin to recede and the planet begins to heal.