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Is The “Green” (Hybrid) Economy A Good Idea Or A Bad Idea?

Perhaps the most distinctive and broadly-observable change in the public-policy milieu as we enter 2009, is this: America has a new faith in the power of experts to cure whatever ails us.

It’s a season not only for big ideas (very few of them new) in public policy. It’s also a season in which we’ll try out a lot of them, in the naive hope that society will become a much better place as a result.

Why is this a naive hope? Because the most recent episodes of grand faith in technocracy (the New Deal and the Great Society) produced results that, while sometimes interesting, were always supremely costly. It takes a hubristic government, infatuated with its own capabilities, to spend the kind of dollar amounts that are simply beyond comprehension. The current debate over fiscal stimulus proves that yet again.

The other way for society to innovate, of course, is through private enterprise. This never goes out of style, although government has very effective tools at its disposal for weakening and defunding it. When allowed to work, however, it always produces results that are very interesting and economically very efficient.

We can see this dichotomy yet again in one of the most important items that we’ll all be discussing for the next few years: how to encourage a green/hybrid economy in the US.

With characteristic hubris, the New Technocrats who are coming to power in Washington refer not to encouraging green technology, but indeed of transforming the whole US economy to a green/hybrid one.

What can this mean? To judge from past statements by such as Rahm Emanuel, the objective is for the US to consume one half as much gasoline ten years from now as we do today.

That’s it in a nutshell. We’ll know we have a green/hybrid economy when we stop using gasoline. Let’s unpack this along a few dimensions.

What’s bad about gasoline? Two things: first, it comes from petroleum, which we have to buy from people we don’t like and who don’t like us, namely terror-sponsoring states in the Middle East. Second, burning gasoline emits fossil carbon into the atmosphere.

It’s no good to solve the first problem by producing more petroleum domestically, or moving to alternatives that are also based on fossil-carbon, like natural gas or gasified coal, because they run afoul of the second problem.

And it’s no good to solve the second problem by pointing out that anthropogenic global warming may in fact be a much smaller effect than global cooling produced by variations in solar radiation. This causes people to suspect that you’re a bad person at heart, which disqualifies you from participating in the debate.

So we know we have to find something that we can use instead of gasoline. What do we actually use gasoline for? Primarily to run our automobiles. There are many important secondary uses for petroleum products, but proportionally the big problem to solve is motor transport.

Well, I can imagine how private enterprise would react if the cost of motor transport were suddenly made prohibitively expensive (say, by increasing the Federal gasoline tax to the point that gasoline costs as much as it does in Europe, about $8/gallon, as incoming Energy Secretary Steven Chu has advocated): people would find ways to run our economy without driving as much. Over the course of a generation, this would result in comprehensive changes in land use and in the structure of employment.

Among other things, it means that the coming enormous “investments” in “infrastructure” are going to be a total waste of time and money. An economy that seeks to minimize the use of motor transport will derive minimal benefit from new roads and bridges.

But that’s not really what people are thinking. They’re thinking about how to electrify cars and trucks.

Soon enough, the thinking goes, all of the new vehicles we produce and drive will run on electric motors fed by batteries that are recharged from household electric power. (The alternative dream, hydrogen-based fuel cells, is too many grand leaps away from reality.)

The big problem we need to solve here, is batteries. The whole dream of a green/hybrid economy rests on whether or not we can store electricity much more safely and cost-effectively than we can today. (Forget about the safe-disposal problem, as new battery materials aren’t likely to be environmentally benign: that’s a problem we won’t confront at least until after the next Presidential election.)

There’s also a big problem with generating the electricity that will be used to power vehicles. As a practical matter, it’s going to be produced by burning coal because we know we don’t like nuclear power. Wind and solar will continue to attract massive investment, but they’re far less efficient than coal today for a variety of reasons.

Another big thing we’re talking about doing is a “national grid,” or a new generation of electric-power transmission infrastructure. Why would that be useful? Because, the thinking goes, we can install solar and wind-power collection capacity where the sun shines brightest and the wind blows strongest, and then transport it over new, improved power lines to everywhere in America.

So in sum, these are the three components of a new green/hybrid economy: new battery technology; new solar/wind technology; and new ways of moving electrical power.

It’s a considerable understatement to say that all of these objectives are incremental refinements of ideas that have been around for decades. None of them represents revolutionary thinking, and none of them is truly innovative. As I said upfront, when you place your faith in established experts, you get inefficient, conventional thinking.

To be sure, there are many people in the technocracy who have observed the near-magical power of the profit motive to produce truly radical innovation. That’s why such people are constantly on the lookout for “market solutions” and “public-private partnerships” to solve problems that are framed in conventional, non-radical ways.

One of those people is John McCain, who during the campaign proposed the ridiculous idea of offering a $300 million bounty to whoever produced a much better battery for automobiles. Why ridiculous? Because that sum of money pales in comparison to the riches that such an achievement will garner. We don’t need economic incentives to solve this problem. The incentives are already there. The problem is just hard. A real solution to the problem may be totally different from anything that John McCain or anyone like him even imagines.

Here’s the real nut of the problem: since we’ve chosen as a nation to hurtle down the path of seeking solutions to technically hard problems by brute force, we face a grave danger of wasting a whole generation’s worth of economic resources.

Far, far worse, we also face the biggest danger of technocratic, government-driven solutions to hard problems: because of the political stakes involved, such programs are too big to fail. Whatever they produce will be deemed a success, and its use will be mandated.

Why is that a danger? Here’s why:

Because we may produce a motor-transport solution that is economically less efficient than the current petroleum-based one.

That’s a very simple but profound statement. Don’t gloss over it too quickly.

If we come up with solid (and unforeseen) technological breakthroughs in battery, solar and wind technology, they will only be worth implementing on a grand scale if they make the total economic cost of driving vehicles far less than it is today. Not the same or a little better or a little worse. They will need to be much better.

If we can achieve that, then the dream of a green/hybrid economy actually will rise up to the claims being made for it, which amount to nothing less than an economic renaissance for American industry. But if we don’t produce those grand breakthroughs, then the green/hybrid economy will impoverish America for a generation.

The naive faith of experts is that, by simply spending enough money and giving enough fancy speeches (and perhaps by passing out a green/hybrid version of Gerald Ford’s WIN buttons), we’ll make the breakthroughs in basic science and technology that decades of private effort have so far failed to produce.

But research activity that is driven by private enterprise either has to pay off or it doesn’t get pursued. This is a powerful mechanism which prevents waste.

Research activity that’s driven by government and politics doesn’t have that automatic waste-prevention system built into it. We face the danger of building a green/hybrid economy that will bankrupt us even faster than trillion-dollar deficits will.

COMMENTS

  • izoneguy

    All this talk of a Green Economy is just marketing – pure & simple.
    I do work for many companies who are rolling out the Green Carpet.
    Most of it is marketing and not much substance, kinda like Obama.
    Like for example a janitorial company claims it is going “green”.
    I asked someone if the products they were using was really different. He said, no the labels are different, that was about it. While there might be something to some green programs, I am pretty sure most are really about making Green Backs. Don”t be fooled by the hype & change.

    • Praying

      Like those new lightbulbs that last 10000 (or whatever) hours – the ones Obama wants to create a million new jobs having people install in schools – they don’t last FOREVER, and when they burn out, you CAN’T THROW THEM OUT – THEY CONTAIN MERCURY, which is a POLLUTANT. Ironic, since CARBON DIOXIDE, the pollutant all this green mumbo jumbo is trying to rid the earth of, is ACTUALLY ESSENTIAL FOR LIFE! I’m not sure which is the bigger problem – that the public schools in America don’t teach science, or that liberals, as a group, think themselves above the science and “change” the answer to whatever they want it to be, “hoping” the rest of us aren’t paying attention!!

  • 10ksnooker

    Anybody can figure it out for themselves. When someone tells me they are going green, I respond “what does that mean” — Blank stare follows.

    Like with most thing sobama, they don’t even seem to know what it is.

    If I get a salesperson who says that, I walk …

  • Skanderbeg

    “With characteristic hubris, the New Technocrats who are coming to power in Washington….”

    I don’t know how you’re defining “technocrats,” but I sure wouldn’t call these guys “technocrats.”

    In my book, a “technocrat” has to have some modest familiarity with some basic principles of physics and engineering. The people pushing this green cr*p have no clue about any such things – which is the only reason that they can keep this stuff in the air. It’s amazing what you can believe when you’ve had no contact with reality.

    Sadly, this same disease also thoroughly infests the realms where “private” investment monies are managed.

  • Tbone

    1. A lot of people will starve to death.

    2. A lot of people will freeze to death.

    3. A lot of people will kill each trying to prevent either of the first 2.

    The upside is that the World has a lot of people that it doesn’t need.

    • janis

      n/t

    • mbecker908

      :-)

      I love it.

  • phxg

    not the flap that corporations or the government produces, we will find that the primary reason for “Green Marketing” is only to sell more products.

    Case in point a car. If a person is really into green initiatives they will forgo the Prius for a used car because:

    As Matt Power notes in this month’s issue of Wired, hybrids get great gas mileage but it takes 113 million BTUs of energy to make a Toyota Prius. Because there are about 113,000 BTUs of energy in a gallon of gasoline, the Prius has consumed the equivalent of 1,000 gallons of gasoline before it reaches the showroom. Think of it as a carbon debt — one you won’t pay off until the Prius has turned over 46,000 miles or so. —LINK

    Then of course there is this ECO-Friendly, or ECO Farce?

    “Eco-friendly doesn’t mean anything…
    unfortunately marketers have figured
    out that people are willing to pay a
    premium, a little more, if it says eco
    on it. So sometimes it does even though
    it may not be eco-friendly at all,” says
    consumer advocate Michael Shames of
    UCAN.

    There was another marketing pitch that I remember caught on and forced a market frenzy. Everyone just had to have it and if you didn;t you were going to fail at business in 10 days: Lo-Carb.

  • phxg

    If we come up with solid (and unforeseen) technological breakthroughs in battery, solar and wind technology, they will only be worth implementing on a grand scale if they make the total economic cost of driving vehicles far less than it is today. Not the same or a little better or a little worse. They will need to be much better.

    There is an idea out there that electricity can both run and recharge an auto battery by using a generator(s) that are mounted on each axle of a vehicle. These have been employed in the rail industry for years.

    This will allow a car to generate electricity to charge batteries AND provide enough power for normal operations; rarely or never needing to be plugged into an outlet. A true zero consumption vehicle.

    But batteries, especially “wet” batteries are not a viable or even a good choice. They are used up too quickly to make this a viable choice today.

    But a company in Texas, EEStor, using ultracapacitors are making big waves.

    Eestor just announced that its technology was verified by a third party, and that the company is on track to deliver a battery capable of powering a car for 300 miles on one charge. —LINK

    But here is where the real milestone will come into play; the ability of a battery to equal the energy potential of gas.

    …even though Eestor?s battery is expected to provide 1 megajoule of energy per kilogram, gasoline packs in 45 megajoules per kilogram. Much of the energy contained in gasoline though is wasted during the combustion process, typically engines capture about 12 megajoules per kilogram from gasoline, according to Wikipedia. Lithium ion batteries clock in at .54-.72 MJ/kg.

    And there it is, the Holy Grail of equivalency, 12 MJ/kg.

  • 1stRichard

    235 MPG diesel cars are a reality, it?s not a Hybrid

    http://gas2.org/2008/05/07/vw-confirms-1l-concept-will-become-reality-in-2010/

    All Electric and Electric Hybrids, look at the basic physics of overall energy consumption. The overall energy consumption is power from the grid stored in a battery and/or from a fuel. The overall energy needed to get a car from point A to point B is determined by its coefficient of drag and weight. From one US gallon of fuel or about 7.3 lb (using above as an example) it is possible to get 235 miles. Is it possible to get 235 miles out of a 7.3 lb battery, no? How much more would a battery weigh thus consuming more energy to go 235 miles? Therein the weight of a battery is an issue, energy costs be it from the pump or from your electric bill. Battery power is not green because it uses more energy. We should be talking about conserving instead of spreading it around, heck ?spreading it around? now where did hear that from.

    The conspiracy here is the government owns the power grid.

    Why don?t we have 235 MPG diesel cars on our roads now? It is the quagmire of regulations and speculation. We could have had this back in the 70s.

    Socialist liberal tree hugging EcoNazis are evil and we need to expose them as such, we need to deregulate with a smaller government making some sensible laws that work, not stifle the individual liberties.

    • phxg

      The thing is, that kinda of fuel economy comes at the price of riding in an extremely small two seater, with the two seats being one in front of the other, a la jet plane, rather than a standard side by side. –From your link

      Sure, 235 MPG sounds like a good idea, but petroleum based fuels are not the answer. Not because of the fallacy of running out or global warming or whatever, but because making engines/vehicles so small to achieve that MPG is unreasonable.

      Take me for example. There are 3 of us in my family. We already are unable to purchase the 1L as it is designed (The SMART too). But in reality, if we 3 wanted to drive out to So Cal for the weekend, it would be an impossibility as there is no baggage room.

      Batteries may not be a viable solution now, but they will be, eventually. 12 MJ/kg.

      • mbecker908

        it’s a limited use commuter car.

        • phxg

          85% of the US population (my SWAG) lives outside the urban metropolitan area….

          But who am I to disrupt the ideals and view that everybody lives like the no children, 785 sq ft apartment dweller in Manhattan.

      • 1stRichard

        Yes the VW 1L is an extreme commuter car only and if you want a more conventional family grocery getter VW?s Jetta Blue TDI @ 60 MPG and decent performance is almost here. That is better then the Toyota Prius hybrid @ 46 MPG.

        http://gas2.org/2008/05/09/2009-jetta-bluetdi-comes-to-us-this-summer-sports-60-mpg-and-cleaner-emissions/

        Fact remains, we should not be forced to consume twice the amount or more of fuel to pacify the global warming EcoNazis. Yes, some day the technology will be available but not now.

        Socialist liberal tree hugging EcoNazis are evil and we need to expose them as such, we need to deregulate with a smaller government making some sensible laws that work, not stifle the individual liberties.

  • 6eorge Jetson

    It’s part civilian, part army, ya know.

    This post is only half sarcastic. Why do folks call everything green? “Cause that’s where the money is”

    • 6eorge Jetson

  • alchemist17

    Is the effects of Obama’s millions of “green jobs”. Claiming that you’re going to create millions of green jobs seems to reduce to saying that you need a lot more people to produce a joule of “green energy” than you do with conventional technology. As such, one would expect to be paying more for your energy to pay for all of these “green jobs” to support their salaries. We’ve already seen how wonderful higher energy prices are – do we really want to ensure them in perpetuity?

    • jonathanswift

      “an unworkable idea.” If the technology was there, the private sector would have developed it.

      The best stimulus package to create jobs would be to ease environmental restrictions so we could start developing domestic oil and gas, clean coal and atomic power. Those are high paying jobs in real industries.

      • itrytobenice

        But we’re never going to come up with anything to beat oil as long as the government, with a stroke of the pen, can produce cheap oil (which they can.) Right now, if our gov’t authorized ANWR and offshore, we would be looking at $10/barrel.

        If you were John Q. Richman, would you invest one thin dime of your vast fortune in a technology that would replace $45/barrel oil? No way. And neither will the current wealthy. They didn’t get rich by throwing their money away.

        And Francis is right, the gov’t has no hope of ever discovering anything. They are a leech on innovation, not a turbo boost.

      • janis

        after listening to interminable blather about the newest stimulus package. The local TV news is already chock full of sob stories from people who need help paying their utility bills. If Obama does what he said and ruins the clean coal industry, lots of folks are going to be reduced to candles and fireplaces.

        If he did as you suggested, we’d have nearly full employment. Of course, then not nearly as many people would need the government to take care of them, so that’s how we know this will never happen.

      • icbm

        Boehner’s letter is worth reading

        http://www.powerlineblog.com/archives/2009/01/022586.php

        • Jaded

          about 700billion + bills now isn’t it! Who pray tell is going to believe a word he has to say when he whined and cried and signed the first 700 billion for his President. Americans see with their eyes that he was no different then every Democrat who signed on the first one and see a man who NOW wants to stand in opposition. THEY HAD THEIR SHOT to show the difference between the two parties in September and they BLEW IT!

          • icbm

            but i still like the letter.

          • Praying

            like some of our supposed GOP senators…

        • janis

          commentary was the best. “If ever there was a time for an effective conservative opposition, that time is now.” Absolutely.

          • janis

            .

          • Vegas_Rick

            Who will have the cajones to step up and courageously spread our message. I?m not even quite sure why it requires all that much courage. Polls consistently show that we are a center right country. More people share the majority of conservative values than do not, in my experience.

            Who has the vision, the political and moral courage, the eloquence of speech, the quiet self-confidence, and the ability to inspire? Palin, Jindal, Sanford, or any one of soooo many other young conservative Republicans.

            There are son many who, I think, can lead our party back to prominence without compromising our first principles and conservative values.

            Who will it be?

          • icbm

            n/t

          • scarlos

            Is Mine. Mostly because he’s next in line for the job of Floor leader, and therefore most likely to take over if Boehner messes up (well, messes up more)

            Though Jindal is certainly a possibility, and i want to keep my eye on Marsha Blackburn (though she has a few steps to go before reaching national prominence)

          • icbm

            and jindal as presidential nominee

            good combo

          • Praying

            when so many of us seem to have the right idea about the way to go? I mean the libs do the grass roots thingy – can it really be that hard? I’m over 50 years old but only a political activist for about…well, since Nov. 4. So I really don’t know. But if we wait around until we find the “right” person to lead us, we may wind up waiting for Godot. I’m not sure we have that much time. I think that’s the whole purpose of Erick’s Red State Army of Activists? Many of us have geared up and are ready to go – maybe a few officers to give us our marching orders, but we can get started, and see who emerges out of the army. We don’t need any more leaders with no known, proven experience – we’ve got one of those in the white house day after tomorrow (ugh).

      • Praying

        You are SO right! And why are we going through all this to eliminate a problem that DOES NOT EXIST (e.g., global warming) ANYWAY? I think that developing domestic oil and gas, clean coal, and atomic power is the answer for NOW and for the FUTURE. These will put people to work immediately, and we will not be subject to the whims of radical islamic nut-case dictators deciding to cut off our oil supply in the future. Drill Here, Drill Now. (with blessings from an environmental scientist – former oil exploration geologist)

  • beaming

    We are truly insignificant on our blue and green ride through space. As an amateur palentologist I have collected fossils of sea animals that once ruled the seas. I have found them in places like WV, VA, MD in the mountains. You’re thinking, what does that have to do with anything? Our planet is constantly changing, not however because of CO2 emissions from us.

    NASA scientists [thats right US gov. employees] say sunspot activity is almost nonexistent right now. The sun caused global warming, surprise, and global warming caused the release of CO2 from the oceans. The oceans are now cooling. The kicker is, the earth has been through this many times before. The real science is there. www.iceagenow.com

    Besides the obvious socialistic control our gov. wants to take over us, there is the bigger picture of how the world will be kept warm and fed during a prolonged cooling period when it is unprepared.

    I’m not trying to minimalize all the important issues about how to be “green”. It would be a disaster for the world to be so worried about heat [ better for crops ] when in fact is it’s getting cooler.

  • NedReck

    Is first related to discovering a use for chicken-crap on a pump-handle.

    We already have a great means of transportation… it is called the gasoline-driven “automobile”. It allows us privacy under the U. S. Constitution… a means of arriving to a speedy trial… and afford us free speech as we can privately curse out the person who just cut us off.

    Just try doing any of those things on a public bus. People won’t know what they have lost… ’til its gone.

    Ned Reck

  • Vladimir

    As P.J. O’Rourke eloquently (an humorously) explained in All the Trouble in the World, IIRC, it’s important for the grownups to allocate resources efficiently. The best way to do that is to leave the decisions to free markets. The cost of not doing it is human lives.

  • mickeywhite

    Marsha Blackburn is my Congressman.
    She is no conservative.
    See her unconstitutional votes at :
    http://bluecollarrepublican.com/blog/?p=614
    Mickey

    William Morrison of Des Moines is credited with building the first electric car in 1891. It was successful, except for two problems: the batteries were heavy and expensive, and it wouldn’t go very far on a charge. In 2009 Ford and General Motors showed their new line of electric cars at the Detroit Auto Show. They were as pretty as you can make a vehicle. But they have two major problems: the batteries are heavy and expensive, and they don’t go very far on a charge

  • mickeywhite

    Marsha Blackburn is my Congressman.
    She is no conservative.
    See her unconstitutional votes at :
    http://bluecollarrepublican.com/blog/?p=614
    Mickey

    William Morrison of Des Moines is credited with building the first electric car in 1891. It was successful, except for two problems: the batteries were heavy and expensive, and it wouldn’t go very far on a charge. In 2009 Ford and General Motors showed their new line of electric cars at the Detroit Auto Show. They were as pretty as you can make a vehicle. But they have two major problems: the batteries are heavy and expensive, and they don’t go very far on a charge