Renewable Energy Is Worth 90 Billion Dollars of Government Funding

One of the most remarkable statements to come out of last week’s presidential debates was Romney’s claim about Obama’s energy policies. Romney claimed that Obama had wasted 90 billion dollars in subsidies and loans on renewable energy, and that half of the companies invested in went bankrupt. Let’s for the moment forget that the 90 billion in question didn’t all go to renewable energy companies. Let’s also forget that only 16 billion of the 90 billion has actually been spent on energy companies. Let’s also forget that 9 of the 12 companies that actually received funding are still in operation. Let’s forget all of this and simply ask the question would Romney’s made up Obama energy policy make sense?

Energy in America

One of the least discussed facets of our government that needs to be cogently debated is our national energy policy, or lack thereof. Sure we talk a lot about drilling for more oil here, there, and everywhere as if we were some dyspeptic version of the Lorax. But in real terms our last coherent set of plans on what we are going to do about the energy needs of this country went up with Three Mile Island. Our current “policy” is: “We don’t know what to do so try everything until something works.” This despite the fact that we still cannot clean up oil spills offshore or on shore, natural gas fracking could potentially irrecoverably damage the water table for millions of people, coal from its mining to its burning is the dirtiest pollutant on the planet save of course our 50 year old nuclear technology. This is the equivalent of your doctor telling you that you have diabetes but you can continue to smoke, drink, and eat all the sugar you want until they figure out what the best treatment is.

The Energy Economy

Renewable energy is our best hope of creating a modern industrial revolution and if anything we don’t spend nearly enough. The last century long economic boom was a result of harnessing and exploiting the power of cheap fossil fuels. The problem is that well started to dry up in the 1970s and since then we have been struggling to find our post oil economy. Since then we had a military spending bubble during the cold war Reagan years, followed by a dot-com bubble, overlapped by a housing bubble. All of these were attempts to find a stable footing to build our economy, and none shows the depth of promise for a sustainable economy like solving our energy needs does.

The Environmental Problem

As I mentioned, all of the other competing fuel sources are extraordinarily dirty and have dramatic impacts on their local environment. This is enough reason to pursue alternatives but the larger looming problem is the carbon impact. Fossil fuel emissions will continue to increase the amount of greenhouse gases in our atmosphere which will raise sea levels to decimating levels destroying coastal cities, and could potentially destroy the heart of our agricultural supply. Our lack of focus on the effect of our energy consumption on the country let alone the world is leadership malfeasance.

Energy Security is National Security

Military Spending under Romney

We’ve gone over this before but it bears repeating the US spends more on the national defense than most industrialized nations combined. Knowing this Romney has pledged to fix military budgets to 4% of GDP. Mind you this is his baseline for what is presumably peace time spending. This would actually result in a net increase in yearly military spending of 400 billion dollars by 2021. Yet the question is what is this military tasked with protecting us from? There is no question that our continued involvement in Middle Eastern affairs has two purposes: maintaining reliable stable oil supplies, and preventing the proliferation of nuclear materials. Advancements in renewable energy would reduce the need for the former and remove the stated excuse rogue countries have in researching the latter for energy purposes.

Picking Winners & Losers

The big argument critics have against government investment in renewable energy is we don’t want the government picking winners and losers. Something they claim the government is notoriously bad at. It is as if the government gave funding the way most people decided on funding Kickstarter projects. People who make this argument are either making overly broad assertions or are woefully ignorant of how difficult it is to obtain federal funding for anything. It isn’t as if anyone calling themselves green gets a bucket and a key to the money pit. Anyone who has applied for research funding would be familiar with the process. To receive funding you must clearly document in excruciating detail how you qualify, and even still you will need to provide better evidence than all the other competing applicants because funding is always limited.

The 90 Billion Dollar Question

The truth is the government has and will always be involved in picking winners and losers when it comes to energy because it is a national concern. Given the stakes I wish Obama’s policy had been to put 90 billion dollars into renewable energy companies. I wish he put a trillion dollars into it. Romney says he would make every dollar of government spending have to pass the: is it worth borrowing from China test. China is putting billions of dollars towards their energy Independence and as I said the next industrial revolution will come from renewable energy. The answer to Romney’s test is we can either borrow from China now and center the industry in America or buy from an industry centered in China.

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