The Green Tax

So, temperatures have been flat for the last decade. The science supporting the idea of anthropogenic global warming is becoming more suspect. Neither China nor India has any interest in reducing their carbon emissions. So, now is the time to cripple ourselves economically to make ourselves feel good about cutting carbon emissions even though it will have almost no effect. I must be missing something. Why, again, is this imperative? Why is this not a regressive tax?

I loved this take on it by The Tax Foundation:

The Wrong Side

Anyone who has played, watched, or coached a Little League game has seen players just learning the game make some basic mistakes. The players are forgiven, of course, because they are still learning under the tutelage of their coaches. Kids run the wrong direction, forget to throw the ball to first base, or even end up on the wrong side of the field. It’s understandable, really, that in the confusion of one team leaving the field and another team taking the field, that someone can end up in the wrong dugout. This is usually remedied quickly when the player realizes he doesn’t recognize the dugout or the kids standing around him and he’ll bolt across the field as the opposing team heckles and parents in the stand chuckle quietly.

So, what do you do with an otherwise intelligent adult with no teacher or coach who ends up on the wrong side and refuses to admit it? This is exactly what has happened to Barack Obama in regards to the Honduras “coup”. First off, it was not a coup. A coup is a calculated breaking of the law by powers that want to take control. It’s usually followed by a new leader explaining why it was necessary and how the law of the land will change under the new leadership. Traditionally, it’s also been followed by that leader being leader for an indefinite period of time.

In Honduras, it was the government itself that ordered the army to arrest and expel President Zelaya because he was breaking the law and threatening to subvert that country’s constitution. The new leader sworn in to replace Zelaya was the next in line according to their constitution. He is a civilian and has promised to hold elections in November as usual. The army did not install their own leader. The army did not change the law of the land. The army was enforcing the law of the land as ordered by the Supreme Court of Honduras.

Apparently, President Obama has not had this thirty second summary communicated to him and he, almost immediately, condemned these actions and insisted that Zelaya be reinstated. The American public, like parents in the Little League stands, watched the leader of their team (the leader of the free world) running to the wrong side. Obama finds himself making the same demands of Honduras as Venezuela’s Hugo Chavez and Cuba’s Fidel Castro, both anti-American dictators of their countries. He stands shoulder-to-shoulder with thugs and opposes the rule of law in a democracy.

This Washington Times editorial summarizes the situation well and comes to this conclusion:

Whatever the outcome of the crisis in Honduras, Mr. Obama has failed another key test of international leadership. The United States is in an increasingly perilous position in Latin America and needs solid allies to stem the anti-American tide being led by Venezuela. Mr. Obama should think twice before rushing to stand beside the likes of dictators such as Mr. Chavez and Cuba’s Fidel Castro. They support Mr. Zelaya because he is a fellow traveler, a socialist in good standing, a member of their anti-gringo alliance. There’s no reason for America to support him.

In Little League, a coach or parent will encourage the child and suggest a correction for the mistake. Then, hopefully, the child will learn the lesson and not make the same mistake again. Of course, Little League games don’t quite carry the weight of international politics. There are no coaches or parents that have the President’s ear. There are too few critical press outlets that will challenge his decisions and postulate alternatives. So, the public sits in the stands and waits to see what he’ll do next.

Will Mr. Obama realize that he’s on the wrong side and run for the other dugout? Or, not wanting to admit his error, will he defiantly stay on the wrong side only to increase the hidden laughter of his newfound teammates? Or, worst of all, will he remain where he is because he knows exactly what he’s saying and approves? None of these choices present a very impressive picture of this President learning the basic rules of the game.

Update: This article in The Christian Science Monitor is from a citizen of Honduras and only reinforces what we already know. It also has the effect of making President Obama look even more foolish. He starts:

Sometimes, the whole world prefers a lie to the truth. The White House, the United Nations, the Organization of American States, and much of the media have condemned the ouster of Honduran President Manuel Zelaya this past weekend as a coup d’état.

That is nonsense.

And, he concludes with a passion I love hearing:

Don’t believe the coup myth. The Honduran military acted entirely within the bounds of the Constitution. The military gained nothing but the respect of the nation by its actions.

I am extremely proud of my compatriots. Finally, we have decided to stand up and become a country of laws, not men. From now on, here in Honduras, no one will be above the law.

Behind the Times

The only thing worse than someone being intellectually stagnant is someone who is actively running away from knowledge. Apparently, there are quite a few in Washington, DC who are fleeing knowledge in this way. Currently, there are two major bills attempting to move through Congress that would, at best, be serious mistakes and, at worst, be boondoggles that will remake American society in a way that we may not recover from for decades. The health care overhaul is basically an attempt to let the US government become the single payer for all health care in the country. The cap-and-trade bill is an attempt to severely hamstring US industry on the basis of junk science.

Now, the Obama administration will tell you that providing a public option for health care won’t affect your choices. You’ll be able to choose to stay with your current plan (well, that’s not entirely true. If your current plan doesn’t provide the minimum benefits declared by the bill, that plan would have to change.) Of course, if it is cheaper for employers to switch their staff to the public plan, they will do so. And, in doing so, they will remove any options for existing plans. So, Obama qualified himself by saying that the government won’t force you into the public option. That would be your employer’s fault. Never mind that it will be, by far, the most common scenario.

Worse, senators and congressmen have exempted themselves from having to participate in this plan. They get to stick with the impressively sweet deal they already have while the rest of us will be blessed by being better informed so we won’t use treatments that aren’t likely to work. In other words, the government will get to decide if it’s really worth trying that procedure on grandpa. You won’t. How else do you interpret this (from the LA Times):

In a nationally televised event at the White House, Obama said families need better information so they don’t unthinkingly approve “additional tests or additional drugs that the evidence shows is not necessarily going to improve care.”

He added: “Maybe you’re better off not having the surgery, but taking the painkiller.”

In other words, the government will give you better information than your doctor based on what will be cost-effective. So, don’t get sick when you’re old, you may not be worth saving.

Then, on to the environment: the Democrats in the House are hurrying to get a contentious cap-and-trade bill through to limit carbon output over the next several years. Yet again, this bill solves our ills by creating vast bureaucracies designed to control key aspects of the economy and, therefore, aspects of your life. Minority Leader John Boehner created this graphic showing how the bill is intended to work. Let me know when you’ve figured it out (click to see the full-size image):

bureaucraticnightmare

These are serious intrusions into our lives. These will impose huge taxes on each and every one of us (don’t believe the “tax the rich” rhetoric because there aren’t enough of them. Don’t believe the “polluters will pay their share” rhetoric because all companies pass cost increases on to the customer.) This is, flat out, terrible legislation and will cripple our economy when it’s already in a bad way.

Now, the title of this post is “Behind the Times”. I give you all of this information simply to note that we aren’t the first country to try nationalized health care nor are we the first to try to limit carbon emissions. With a fairly simply review of nationalized health care plans in Europe and Canada, it’s easy to see that the result is that everyone has access to sub-standard healthcare. Lines are long. Doctors are fewer. Mortality rates go up (due to the delays and denials of service). Innovation even goes down. This will not only give us bad healthcare, but it will cripple the industry such that it will take years to recover even if the legislation is reversed.

And, in an even more stark case, countries are realizing that cap-and-trade is a terrible idea based on highly disputed science. The Wall Street Journal has an opinion piece by Kimberley Strassel that sums it up. She makes the point that the “consensus” is collapsing:

The collapse of the “consensus” has been driven by reality. The inconvenient truth is that the earth’s temperatures have flat-lined since 2001, despite growing concentrations of C02. Peer-reviewed research has debunked doomsday scenarios about the polar ice caps, hurricanes, malaria, extinctions, rising oceans. A global financial crisis has politicians taking a harder look at the science that would require them to hamstring their economies to rein in carbon.

Strassel tells the story of an Australian legislator who came to America on a fact-finding mission to confirm or deny the need for carbon management legislation. He met directly with President Obama’s special assistant on energy and the environment, Joseph Aldy, and challenged the team to address the controversy. They, apparently, were unconvincing as the Australian went home and voted against the cap-and-trade bill.

Politicians are the only people I know who will passionately pursue a plan even when it has much evidence that it will fail and no evidence that it will succeed. They are fleeing knowledge and end up behind the times.

Reconsidered

Anyone with a passing interest in the global warming debate is aware of the IPCC. This is the Intergovernmental Panel on Climate Change that released it’s findings in 2007. The panel came to the conclusion that it was “very likely” that global climate change is caused by human activity. One of the lead authors even stated:

We can be very confident that the net effect of human activity since 1750 has been one of warming.

Since that time a series of serious criticisms have been made about that report including that idea that governments had an interest in what it said. Much research available to the panel was ignored because it did not fit into the desired narrative. Many of the scientists who did contribute to the overall report were unhappy with the way the summary was written. And, in some cases, the summary conclusions did not even follow from the evidence gathered. The data was collected and analyzed by scientists. The summary was written by bureaucrats and politically-motivated appointees.

On June 2 of this year, another report was released. This one was from the NIPCC (the Nongovernmental International Panel on Climate Change) and titled Climate Change Reconsidered. This group had the major advantage of three more years of published science and no government support to unduly influence its results.

They make a clearly opposing case:

The scholarship in this book demonstrates overwhelming scientific support for the position that the warming of the twentieth century was moderate and not unprecedented, that its impact on human health and wildlife was positive, and that carbon dioxide probably is not the driving factor behind climate change.

The authors cite thousands of peer-reviewed research papers and books that were ignored by the IPCC, plus additional scientific research that became available after the IPCC’s self-imposed deadline of May 2006.

The details are immense, but I challenge any believer in AGW to refute the evidence within. These men and women have taken the common sense that many of us had and backed it up with a vast amount of evidence and study that was ignored because it challenged the “consensus” that never really existed.

I do believe we are seeing the beginning of the end of the cult of AGW. The only challenge now is to make sure the government doesn’t pass anti-global warming legislation before it becomes clear that this is all a hoax. That, in fact, is a real danger that can affect us all for decades to come.

Lies, Damn Lies, and Invented Metrics

Ever since the debate about the President’s stimulus package began, I’ve been bugged by one phrase he and his team keep using. They keep referring to the number of jobs “added or saved” that will result from passing the stimulus. I understand that there are departments in the federal government that track employment numbers, unemployment numbers, hiring numbers, and more. I can see how you can estimate the number of jobs added. I’ve never understood how you can track the number of jobs saved.

The implication here is that these are jobs that would have been lost had the stimulus (or some other program the President is advocating) been blocked. How exactly do you measure that? When I watch sports, I often find myself playing the “what if” game. What if the buzzer beater doesn’t go in? What if that last pitch had been called strike three? What if the officials had called holding on that touchdown play? But, I catch myself because you can’t predict what would have happened. But, this is exactly what the Obama White House is trying to do.

The administration is trying to convince you that they know how bad it would have been and how much better it is now because of their actions. I’ve come to the conclusion that this is nothing more than smoke and mirrors. This is a complete dodge. More knowledgeable men than I have realized the same thing (and much quicker than I did). Here’s Tony Fratto at CNBC:

Here’s an important note to my friends in the news media: the White House has absolutely no earthly clue how many job losses have been prevented because of the stimulus bill. None.

And later in the same article:

There is only one necessary data point to make the “jobs-saved” claim: an accurate measure of expected employment levels in the future. That baseline data is critical to measure what the employment level would be in the absence of the stimulus. Unfortunately for the White House, they cannot possibly know that measurement within any degree of confidence — and they know it.

This whole bait-and-switch is being done to make the stimulus look like a success. It’s a nonsensical statement that’s meant to make the employment numbers look good no matter what. With this formulation, there’s no way to lose! The truth is that unemployment is rising. True, it may be slowing, but it’s still rising. In fact, it’s far worse than the Obama administration ever planned.

This graph (with a description at Innocent Bystanders) explains it all:

stimulus-vs-unemployment-may-corrected

The unemployment rate is far worse than the Obama administration said it would be without the stimulus. Hey, guys, how about we give all that money back and just live with the unemployment rate as is? At least, then, I wouldn’t be worried about the impending inflation problem.

Inflation? Yep, it’s coming. Here’s a quote from Arthur Laffer writing at the Wall Street Journal Online:

With the crisis, the ill-conceived government reactions, and the ensuing economic downturn, the unfunded liabilities of federal programs — such as Social Security, civil-service and military pensions, the Pension Benefit Guarantee Corporation, Medicare and Medicaid — are over the $100 trillion mark. With U.S. GDP and federal tax receipts at about $14 trillion and $2.4 trillion respectively, such a debt all but guarantees higher interest rates, massive tax increases, and partial default on government promises.

But as bad as the fiscal picture is, panic-driven monetary policies portend to have even more dire consequences. We can expect rapidly rising prices and much, much higher interest rates over the next four or five years, and a concomitant deleterious impact on output and employment not unlike the late 1970s.

Now, fortunately, I didn’t have to deal with finding a job or financing a mortgage in the 1970s, but I know enough to know that it was very bad. It was a cycle of inflation and rising interest rates that kept the economy painfully flat for quite a while. I’m not all that interested in experiencing what my parents did. Of course, now I can document the misery minute-by-minute on the Internet and blog about it here. Hurray.

Counterintuitive

Some aspects of the real world are counterintuitive. By that, I mean things that seem like they should do one thing and then do another. There’s the idea of turning into a skid or large planes staying in the air or how bumblebees fly. These are counterintuitive in observation.

When someone does something counterintuitive, you have to conclude that they are either very smart and have recognized a relationship of which you are unaware or they are rather clueless and have made a bad decision.

President Obama has yet to display any great depth of knowledge about history, economics, or foreign policy. I am not saying that I’m smarter than he is, but he certainly hasn’t convinced me that he’s far smarter than I am. So, it comes to pass that his actions seem counterintuitive to me and, additionally, nobody has been able to explain what it is that I’m missing such that he’s justified in his decisions. In fact, all the evidence points to him either making bad decisions or making decisions for reasons other than what he’s stated. I’ll be generous and just assume he’s performing poorly rather than suggesting he’s deceptive. Although, I suppose that wouldn’t be unusual for a politician.

Next on today’s list of evidence is his effort to impose higher taxes on the foreign profits of US companies. By Obama’s argument, this would prevent companies from sending jobs overseas. In fact, many CEOs are complaining that it would make more sense for companies to move their entire operations overseas, instead.

This Bloomberg article by Ryan J. Donmoyer gives the details. I’ve never been a fan of Steve Ballmer, CEO of Microsoft, but he is in a position that requires he make a profit for his shareholders. Here’s his take:

“It makes U.S. jobs more expensive,” Ballmer said in an interview. “We’re better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S.”

John Thompson, the Chairman of Symantec Corp. summarizes exactly why companies would want to flee the US.

Thompson called the Obama proposals “counterintuitive” to the administration’s other stated goals of fostering an innovation-oriented economy.

“It is a little bit ironic that most of our most significant trading partners and partners globally have taken the tack that they’ll reduce corporate tax rates to stimulate economic growth and not raise corporate tax rates,” Thompson said.

Once again, it is impossible to tax yourself into prosperity. It’s more than ironic, it’s stupid. I fear that this is an initiative driven by talking points from the left that have not been critically evaluated. Companies will not stand around and have their profits confiscated without doing something to adapt. It’s the unexpected adaptation that will hurt the economy in the long run.

In the Bag

I just wanted to drop a quick note here to happily proclaim David’s junior year complete! With the grading of his final Algebra 2 test last night (on which he scored 100%), school was officially done.

We plowed through Physics, Algebra 2, US History, English, and a semester of Latin all while learning to drive, play the drums, and taking the SAT for the first time. I’d call that a full year of accomplishment.

Way to go, David! We’re proud of you!

We are the Better Choice

For many issues, there are those who will start the discussion with, “Why is America better than any other country/culture/organization to manage this?” When we went to Iraq, it was argued that the rest of the world didn’t support us, so we should not do it. When we discuss global warming, it is argued that the world has decided we are the worst carbon producers so we should abide by their decision that we decrease our output. When we discuss the morality of our law, it is argued that international law is more sophisticated and nuanced, so we should take our cues from the international “consensus”. 

Needless to say, I will almost never agree with the idea that our culture or way of life is morally equivalent to any other. This is, by far, the most productive, most freedom-loving, and most altruistic nation this planet has ever seen. I am a firm and proud believer in the idea of American Exceptionalism.

This is some grand stage-setting to make a case in point. One of the many issues that has been driven by the mantra of, “Why should America be in charge?” is the management of the Internet naming authority

The IANA, the Internet Assigned Numbers Authority, is the organization responsible for managing top-level domains. Top-level domains are the last parts of URLs like .com, .org, .edu and the country-based domains like .uk for the United Kingdom, .nz for New Zealand, etc. The IANA is operated on behalf of the US Department of Commerce. How this came about is a winding story, but it boils down to the fact that the United States build the first parts of the Internet and we’ve managed the naming schemes ever since.

Now that the Internet is clearly necessary for governments and businesses to function internationally, those who believe that the United States would abuse it’s authority are demanding that the IANA turn control of the top-level domains over to an international body like the UN. Has there been any major mismanagement at the IANA? Has there been any legitimate controversy that would suggest they are abusing their privilege? No and no. This is simply a case of arguing that the United States has no more rights than any other country to run this service and, in fact, the US is less equal than others (this is where moral equivalency morphs into anti-Americanism. A very common occurrence.).

Ariel Rabkin wrote this great article for The Weekly Standard describing the situation and the legitimate fears and dangers of letting anyone else control the top-level domains. He makes the case that letting any other group decide how to manage those domains would invite censorship and persecution by a group that likely wouldn’t have to answer to any particular population. See how Islamic countries feel about Israel in the UN. Do you think they wouldn’t argue for shunning them technologically? See how the UN feels about whether to recognize Taiwan (who currently has it’s own top-level domain separate from China). Do you think a permanent Security Council member wouldn’t argue for downgrading Taiwan’s Internet status?

Mr. Rabkin wraps up with a great point:

It is natural for other countries to resent the privileged role of the United States in Internet governance and to demand a greater measure of control. But if we believe in free speech, we ought to keep control of the Internet away from foreign governments that value it far less than we do.

Which brings us back to the beginning. How many foreign governments value free speech like we do? How many foreign governments value property rights like we do? How many foreign countries are built on the idea of limiting government like we are?

You see, America is exceptional.

Snake Fuel

The title is a poor attempt to combine the term “snake oil” with the substance I’m discussing here: ethanol.

Ethanol has been perpetually trumpeted as a fuel source that we could produce domestically to lower our foreign oil dependency. This has always been a pipe dream. From day one, the ethanol industry needed government subsidies to even get it off the ground. Guess what? It’s still failing. As Ed Wallace describes in this Business Week article, this is a scam that is costing the average American in three ways:

First, the taxpayers are paying to subsidize the farmers to grow the corn and other crops sold to create ethanol.

Second, the average American is paying more for food costs because the use of these crops as fuel has driven up prices of the foods that used to be grown in the same place.

Finally, and most subtly, car-owners are paying for repairs because ethanol damages engines of all kinds. As Wallace describes, high ethanol content (in the 10-15% range) will damage or destroy fuel filters, fuel lines, and fuel pumps in a variety of cars. It is damaging to small engines (such as those used in lawnmowers, blowers, edgers, etc.), and will break down the resins used in marine engines. For many cars, simply using fuel with more than 10% ethanol immediately voids the warranty.

So, you have a product that has no sustainable business model, causes price inflation in other, more important, markets, and actually damages the property of those who use the product. Oh, and the government pays to have it created and sold. When this industry tanks anyway, isn’t just time to let it die a natural death?

Apparently not. Ethanol producers are lobbying for the government to mandate 15% ethanol fuel to increase demand in an attempt to revive the industry. And, of course, the EPA is considering it. I have to agree with Wallace’s conclusion about this madness:

Sadly, when a truly bad idea is exposed today, Washington’s answer is to double-down on the bet, mandate more of the same, and make the problem worse. Only this time around motorists will be able to gauge the real cost of ethanol when it comes time to fix their personal cars.

Through the Looking Glass

There are times, in public debate, when the sides seem to switch and they begin to look like their opponents from the past. It’s sort of a “through the looking glass” moment when I see the same people saying the opposite things or the critics of a certain practice now engaging in it themselves. Is it hypocrisy? Is it jumping the shark? Is it just the weird side-effect of a changing debate?

Any way you slice it, it’s time for a fresh consideration of the topic.

Bjorn Lomborg wrote a fascinating op-ed in the Wall Street Journal here about how some business leaders are becoming advocates of government intervention to deal with climate change. Whenever you see something unexpected like this, it’s always a good rule to follow the money. As Mr. Lomborg points out, these companies see an opportunity to sell products and services to those who are forced to deal with new government regulations. This is simply a recognition of a new market being created by government intervention. The obvious comparison to the classic “military-industrial complex” mentioned by President Eisenhower is drawn and, actually, I think it’s more apt. In the case of the Cold War, at least the government was doing a job that it was constitutionally empowered to do. I don’t see where the government should be telling us how to live, work, and produce based on shaky science.

Didn’t the environmentalists used to be the underdogs? Weren’t they supposedly the voices crying out in the wilderness about how we were cluelessly destroying our planet? Wasn’t the case being made that we were blindly marching to oblivion because we wouldn’t pay attention? 

Now, I feel like the populace is that voice in the wilderness. Every day, the evidence mounts that we are not responsible for climate change. Now, it’s the government and big business leaders who are demanding punitive taxes and subsidies for technologies that aren’t ready. They demand these ostensibly to solve a problem that cannot be solved by man. Now, it’s our government that is marching into danger with our money because they won’t listen to the evidence.

Mr. Lomborg finishes his op-ed with precisely the same sentiment I have, so I’ll let him have the last word here:

The partnership among self-interested businesses, grandstanding politicians and alarmist campaigners truly is an unholy alliance. The climate-industrial complex does not promote discussion on how to overcome this challenge in a way that will be best for everybody. We should not be surprised or impressed that those who stand to make a profit are among the loudest calling for politicians to act. Spending a fortune on global carbon regulations will benefit a few, but dearly cost everybody else.