Fighting for America's Energy Independence
Consider the billions of tax dollars we give to polluters each year. This largesse is sprinkled throughout our tax code in ways that thwart easy analysis. So estimates of the subsidies for fossil fuels and nuclear power yield wildly different numbers--from the US Energy Information Administration's conservative estimate of $2.7 billion in 1999 to guesstimates as high as $80 billion a year. In search of less spongy data, Norman Myers and Jennifer Kent wrote Perverse Subsidies, which identified $21 billion the United States hands over every year to fossil fuels and nuclear power. "If taxpayers were aware that a good chunk of their taxes were going down the rathole into these subsidies, they'd be marching on the Mall," said Myers in an interview. "But it's hard to get the message to the taxpayer because these subsidies are so numerous and so varied, and some are so covert."
Myers and Kent also found that renewables get at best a tenth of the subsidies the dinosaurs do. They calculate that the $90 million or so the United States spends on solar research wouldn't be enough to pave two miles of Interstate highway. Meanwhile, the wind PTC costs us somewhere from 0.2 percent to 0.025 percent of what the supersubsidized polluters pull down. Critics of renewables have seized upon the wind PTC to argue that wind is not "market ready." Fair enough--but then, what is?
House minority leader Richard Gephardt called in January for "an 'Apollo Project' to develop environmentally smart, renewable energy solutions." Among other things, he proposed 100,000 hydrogen-fueled cars by 2010. Five days later, Gephardt gave the Democratic response to the State of the Union address and mumbled something unmemorable about energy. Democratic Senator John Kerry and independent Jim Jeffords have called for harvesting 20 percent of our energy from renewables by 2020, and Jeffords has offered an excellent bill to mandate that. But the emerging "Senate energy bill" is a much messier offering by Tom Daschle and Jeff Bingaman. Already Daschle-Bingaman has declined to demand real fuel efficiency, and had adopted a far less aggressive 10-percent-by-2020 renewables standard--even while larding in so many new subsidies for fossil fuels and nuclear power that Public Citizen derides the bill as "Enron-influenced, Exelon-tested and Exxon-approved."
So the Democrats are slouching timorously toward perhaps someday actually standing for something. Gephardt is right, of course: We could still leap to the front of this coming revolution. An Apollo Project for clean and secure energy might, for example, put a hydrogen pump next to every gasoline pump--doing for hydrogen-fueled cars what Eisenhower's Interstate highway system did for gasoline cars. Estimates of the price tag for such a project range from $20 billion to $100 billion. Or we could kick off a renewables procurements policy. The Institute for Energy and Environmental Research suggests spending $20 billion a year buying solar panels, fuel cells and fuel-efficient vehicles for federal and local government use--as a way of pushing those technologies into true mass production.
A common response to such proposals is to tsk-tsk: "Prohibitively expensive!" "The government can't pick winners!" But we are already showering billions of dollars every year on the dirty energies of yesteryear. Even if we don't want the Apollo Project, shouldn't we be dismantling the Anti-Apollo Project of perverse subsidies?
Then again, if we ended the subsidies to the dinosaurs, who would bankroll the GOP? In 2000, oil and gas gave $13 to presidential candidate George Bush for every $1 to candidate Al Gore. Coal gave $9 out of every $10 to Republicans. And according to the Center for Public Integrity, the top 100 officials in the Bush White House have the majority of their personal investments, up to $144.6 million, sunk in the old-guard energy sector.
The Green Scissors Campaign, an alliance of environmentalists and taxpayer watchdogs, parses the Bush-backed energy bill giveaways: $21.2 billion for oil and gas, $5.8 billion for coal, $5.9 billion for utilities and $2.7 billion for nuclear power. That same oilman's orgy included, for green window dressing, a wind PTC extension, but while the wind PTC couldn't get a hearing on its own, nuclear power certainly could. Last fall House Republicans worked furiously on legislation that, in the event of a nuclear catastrophe, hands taxpayers the bill. This federal insurance program for nuclear power was approved under rules that keep everyone anonymous--rules usually reserved for noncontroversial matters like renaming post offices. A White House statement praised this sneaky vote: "To assure the future of nuclear energy, [taxpayer-subsidized] liability coverage must continue for nuclear activities." (In other words: The White House concedes that nuclear power can't survive in a free market.) This subsidy, the Price-Anderson Act, awaits Senate action along with the rest of the subsidy binge; it is already part of the Daschle-Bingaman bill.
Arguably, fossil fuels and nuclear deserve no subsidy at all. But with the "free market" Republicans leading and the Democrats meekly following, we encourage dangerous, dirty and terrorist-friendly energy infrastructures (often in the name of security!). That's not to suggest despair; from California to Europe, renewables are emerging as the business and political favorites. But it is to ask, impatiently, how much longer Americans will be expected to overpay for energy--in health costs, environmental damages and misused taxes. The people of America are being overcharged; it's time to ask for a refund.