Op-Ed Columnist, NYT
Dumb as We Wanna Be
By THOMAS L. FRIEDMAN
Published: April 30, 2008
It is great to see that we finally have some national unity on energy
policy. Unfortunately, the unifying idea is so ridiculous, so unworthy
of the people aspiring to lead our nation, it takes your breath away.
Hillary Clinton has decided to line up with John McCain in pushing to
suspend the federal excise tax on gasoline, 18.4 cents a gallon, for
this summer's travel season. This is not an energy policy. This is money
laundering: we borrow money from China and ship it to Saudi Arabia and
take a little cut for ourselves as it goes through our gas tanks. What a
way to build our country.
Fred R. Conrad/The New York Times
Thomas L. Friedman
When the summer is over, we will have increased our debt to China,
increased our transfer of wealth to Saudi Arabia and increased our
contribution to global warming for our kids to inherit.
No, no, no, we'll just get the money by taxing Big Oil, says Mrs.
Clinton. Even if you could do that, what a terrible way to spend
precious tax dollars --- burning it up on the way to the beach rather
than on innovation?
The McCain-Clinton gas holiday proposal is a perfect example of what
energy expert Peter Schwartz of Global Business Network describes as the
true American energy policy today: "Maximize demand, minimize supply and
buy the rest from the people who hate us the most."
Good for Barack Obama for resisting this shameful pandering.
But here's what's scary: our problem is so much worse than you think. We
have no energy strategy. If you are going to use tax policy to shape
energy strategy then you want to raise taxes on the things you want to
discourage --- gasoline consumption and gas-guzzling cars --- and you
want to lower taxes on the things you want to encourage --- new,
renewable energy technologies. We are doing just the opposite.
Are you sitting down?
Few Americans know it, but for almost a year now, Congress has been
bickering over whether and how to renew the investment tax credit to
stimulate investment in solar energy and the production tax credit to
encourage investment in wind energy. The bickering has been so poisonous
that when Congress passed the 2007 energy bill last December, it failed
to extend any stimulus for wind and solar energy production. Oil and gas
kept all their credits, but those for wind and solar have been left to
expire this December. I am not making this up. At a time when we should
be throwing everything into clean power innovation, we are squabbling
over pennies.
These credits are critical because they ensure that if oil prices slip
back down again --- which often happens --- investments in wind and
solar would still be profitable. That's how you launch a new energy
technology and help it achieve scale, so it can compete without subsidies.
The Democrats wanted the wind and solar credits to be paid for by taking
away tax credits from the oil industry. President Bush said he would
veto that. Neither side would back down, and Mr. Bush --- showing not
one iota of leadership --- refused to get all the adults together in a
room and work out a compromise. Stalemate. Meanwhile, Germany has a
20-year solar incentive program; Japan 12 years. Ours, at best, run two
years.
"It's a disaster," says Michael Polsky, founder of Invenergy, one of the
biggest wind-power developers in America. "Wind is a very
capital-intensive industry, and financial institutions are not ready to
take 'Congressional risk.' They say if you don't get the [production tax
credit] we will not lend you the money to buy more turbines and build
projects."
It is also alarming, says Rhone Resch, the president of the Solar Energy
Industries Association, that the U.S. has reached a point "where the
priorities of Congress could become so distorted by politics" that it
would turn its back on the next great global industry --- clean power
--- "but that's exactly what is happening." If the wind and solar
credits expire, said Resch, the impact in just 2009 would be more than
100,000 jobs either lost or not created in these industries, and $20
billion worth of investments that won't be made.
While all the presidential candidates were railing about lost
manufacturing jobs in Ohio, no one noticed that America's premier solar
company, First Solar, from Toledo, Ohio, was opening its newest factory
in the former East Germany --- 540 high-paying engineering jobs ---
because Germany has created a booming solar market and America has not.
In 1997, said Resch, America was the leader in solar energy technology,
with 40 percent of global solar production. "Last year, we were less
than 8 percent, and even most of that was manufacturing for overseas
markets."
The McCain-Clinton proposal is a reminder to me that the biggest energy
crisis we have in our country today is the energy to be serious --- the
energy to do big things in a sustained, focused and intelligent way. We
are in the midst of a national political brownout.
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