In his recent State of the Union Speech, talking on supposed the race for "green" technologies, between China and the US, President Obama, thriftily recycling the term from a December speech, called for a new "Sputnik Moment".
Leaving aside the quite obvious lack of analogy between the launch of Russia's Sputnik satellite and the US/USSR space race, lets look at China. Has China indeed launched a "green" technologies sputnik with the goal of economically surpassing the United States? Or was the President's analogy an effort make palatable in the name of international competition, new money wasting "investments" in American green technology paid for by the overburdened American Taxpayer?
Derek Scissors, research fellow in economic policy at the Heritage Foundation's Asia Studies Center, gives us some facts on China...
* Over the past decade, the US has increased its energy efficiency by 2.5% annually, while China despite its superior coercive powers, has raised its only 1.7%
* Coal, generally considered a less clean energy source constitutes less than 1/4 of US energy consumption, while in China it is 2/3
*According to the Netherlands Environmental Assessment Agency Chinese greenhouse emissions were 50% greater than the US.... and this with an economy that is only 40% the size of the United States!
* The Chinese government has acknowledged that much of its investment in wind power is an effort to keep up employment.
* The Chinese target for nuclear power is only 5% of electrical capacity.
* Less than 5% of China's solar panel production is used in the internal market.
If there is a Sputnik here, it is China attempting to react to a Sputnik launched from the US market.
If green technologies were cost effective, or were in the future to become cost-effective over other sources of energy, would the United States government need, via our tax dollars, to "invest" in it? When private investors make a bad choice they lose a little money and get out of the market. When the government begins a program it's forever--- even if that means pouring our money into a hole.
Here's some more statistics: In the US, coal costs $78 per megawatt hour, while wind runs $150 and solar is pushing $400
Right now, green energy, is a poor investment. Says Scissors:
Nobody knows this better than the renewable-energy lobby itself, which is why it constantly clamors for subsidies, special tax credits, and guaranteed market shares.
In his speech, the President also called for a removal of tax subsidies to oil companies. This is an excellent suggestion. Let's let ALL energy production stand on its own feet and let the market determine the winners. That of course would include not handicapping domestic oil production by putting the Gulf of Mexico and ANWAR off-limits, and not enacting proposed dramatic new restrictions on our coal industries.
Meanwhile, the American citizen will be able to enjoy abundant energy while keeping some extra dollars in his pocket to make his own investments.
Best Wishes,
Bernie Iven
PS. It shouldn't be surprising that China's energy situation is much less efficient than the US. Though they have a semi-capitalist market, energy is controlled wholly by Bejing. Socialism always fails. Free markets bring efficiency. And this is what we see over and over. Want cleaner air, more efficient cars?--- root for the market. And this is the theme of an excellent book on this issue, The Improving State of the World by Indur Goklany. I invite you to check it out. To learn more, click here>>>
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