“[Government] intervention that impinges on complex market forces can produce both unpredicted and unpredictable results.”
– Robert Bradley, Oil, Gas, and Government: The U.S. Experience (vol. 2), p. 1791.
Of all the environmental boondoggles of recent years, the biggest must be corn ethanol. As MasterResource’s Ken Green wrote in an article summarizing ethanol’s impact on the environment:
Contrary to popular belief, ethanol fuel will do little or nothing to increase our energy security or stabilize fuel prices. Instead, it will increase greenhouse gas emissions, local air pollutant emissions, fresh water scarcity, water pollution (both riparian and oceanic), land and ecosystem consumption, and food prices.
In a recent speech, Green elaborated, pointing out
…the absolute fiasco of corn ethanol, which has caused increases in air pollution, water pollution, freshwater consumption, coastal pollution, greenhouse gas emissions, and food prices.
Editor Note: This commentary is reproduced, with slight revision, from the December 2009 issue of POWER magazine.
As director of public policy analysis in my last seven years at Enron, I participated in many legislative and regulatory debates involving electricity, although the public policy thrust of the company was the opposite of what I personally believed was good social policy.
While I favored free markets, the business model of Ken Lay (a PhD economist with years of Washington regulatory experience) centered on special government favor. Enron, for example, had seven profit centers geared to government pricing/rationing of carbon dioxide (CO 2) emissions. And in the 1990s, the company was squarely behind a Btu tax. Today, Enron would be pushing cap and trade and a federal renewables mandate–and a lot of mandated energy efficiency with its profit centers in mind.…
“The fraudulence of the Copenhagen approach – ‘goals’ for emission reductions, ‘offsets’ that render even iron-clad goals almost meaningless, an ineffectual ‘cap-and-trade’ mechanism – must be exposed. We must rebel against such politics-as-usual.”
– James Hansen, “Never-Give-Up Fighting Spirit,” November 30, 2009
There is a civil war on the Left against cap-and-trade as the centerpiece of a U.S. climate bill. Among the leading critics is NASA scientist and Al Gore mentor James Hansen, who reiterated his opposition in Sunday’s The Observer with Copenhagen’s climate summit in mind:
…“Cap and trade with offsets … is astoundingly ineffective. Global emissions rose rapidly in response to Kyoto, as expected, because fossil fuels remained the cheapest energy.
Cap and trade is an inefficient compromise, paying off numerous special interests. It must be replaced with an honest approach, raising the price of carbon emissions and leaving the dirtiest fossil fuels in the ground.”