Officially, we are not in a recession. But we are in a really bad recovery with massive unemployment, horrifically low labor participation, and households struggling to make ends meet. Families don’t need gratuitously higher energy prices.
But that’s what we have. Many states have passed laws requiring utilities to purchase a certain part of their energy from “renewable” sources. In addition to oil and coal, electrical utilities, by law, must purchase power from wind farms, solar panels, biofuels, and other renewable sources. This energy is more expensive than conventional energy, so it raises household energy bills.
And despite a hard push to end this robbery of the American people, attempts to stop and reverse these laws have failed. Why? Because
“these laws have created their own constituencies, making them harder to repeal. Once a state starts bolstering wind and solar power, that jump-starts various industries — from turbine manufacturers to solar installers. Texas, for instance, now has more people working in the solar industry than it has ranchers.”
The moment the legislature votes to give money to a company, it thereby finances its own trap. It creates a new special interest that now makes money off the government and, thus, has both the interest, and the finances, to lobby the government to continue the subsidy.
I can’t state strongly enough how perverse this all is. Consumers are forced to pay higher prices to give profits to industries so that they can use those profits, in part, to lobby and campaign for consumers to be forced to pay higher prices and give more profits to the industry.
So when the Wall Street Journal runs a headline, “Green Energy Mandates Find Improbable Allies,” it is somewhat misleading the reader. The allies are not improbable but unexpected to people who don’t follow the money. But the money explains how the alliance is totally probable.
“Perhaps the most striking rejection of a repeal effort came in North Carolina, where the GOP holds supermajorities in both chambers of the state’s General Assembly and where renewable energy still represents a tiny percentage of the electricity supply. … ‘I think it raised eyebrows that the swine industry and environmental interest groups were on the same side of this,’ said Don Butler, vice president for government relations at North Carolina-based Murphy Brown LLC, the livestock-production unit of pork giant Smithfield Foods Inc. Mr. Butler told lawmakers that since the 2007 bill passed, his company and others had together spent tens of millions of dollars developing technology to turn pits of swine manure into fuel for making electricity by capturing methane gas.”
Additionally, in Kansas turbine makers and farmers joined forces to lobby to prevent the law from changing. The farmers are getting revenue by leasing space for wind farms.
So why does the government push for such uncontrollable laws that subsidize industries? I think it is because everyone in government has a vested interest in seeing government expand. These subsidized industries hurt the people and are impossible to stop. Politicians don’t see a down side.