Climate Change Reality

This just in--Al Gore has recanted his stance on Global Warming. Mr. Gore has said recently: "I have, after much studying of the scientific evidence, concluded that there isn't enough hard environmental evidence to support the theory of Global Warming. There are simply too many variables to take into account and several decades worth of data is simply not conclusive." Mr. Gore finished his statement by saying that he was going to turn his attention to alleviating the very real threat of poverty and hunger that continues to afflict the very poor of the world. APRIL'S FOOL!! I really had you going on that one, eh? Al Gore wouldn't come to his senses if an iceberg hit him on the head.

The Cato Institute published this full page ad in various newspapers around the country back in November, 2008. Since the Obama administration is now ready to get into the auto business and it is clear that it will push expensive "green" mandates--hybrid cars and a cap and trade scheme--it would be nice if "Mr. Pragmatic" would actually act like a pragmatist and be concerned with practical consequences and not political expediency or tendentiousness.

GM: Government Motors

The move to oust GM CEO Rick Wagoner by the Obama administration is yet another masterful stroke towards economic populism; the federal government will now apply copious political pressure to corporations and companies that bristled happily when it came time to accept bailout funds--har! har! har!--little did they know that were essentially making the federal government their hard taskmaster and overseer. The lesson is clear: Don't take tax dollars from the government. They will bend and twist your company to satisfy its political ends while making a public hanging of you and your management. Score one for Team Obama since this whole sorry episode is a clever cover for the White House to dump more public funds to the automakers with little public resistance or scrutiny. After all, getting rid of a bad CEO (aren't they all unpopular now?) in a very public manner appeases populist sentiment against the bailouts for a time.

I will repeat my call for no bailouts for auto companies: Let them go chapter 11. We could have avoided this whole mess if they were simply allowed to go bankrupt months ago.

It’s not easy being Green

Now that Barack Obama is President and liberal Democrats feel an emboldened sense of political mandate, a test of competing liberal agendas comes to the fore with the issue of greenhouse gas emissions. In one corner we have the United Auto Workers and in the other we have the dreaded environmentalists:

The state of California and the automobile industry are pressing the Obama administration to decide whether states may impose their own limits on autos' greenhouse-gas emissions, an issue that pits President Barack Obama's allies in the labor and environmental movements against one another...

...Gearing up to fight California's request is the National Automobile Dealers Association, which is holding its annual convention this weekend in New Orleans, an event expected to draw 25,000 attendees and feature appearances by former presidents George H. W. Bush and Bill Clinton. The group has prepared a report warning that the California law would impose "a costly and unnecessary burden on an industry already reeling" from the worst year of U.S. vehicle sales in more than a decade.

Mr. Obama expressed support during his campaign for California's bid to regulate auto greenhouse-gas emissions, so called because they trap the sun's heat in the earth's atmosphere, thus contributing to global warming. But he has avoided saying publicly how quickly his administration intends to act on the state's request.

In addition to the question of whether to let states regulate greenhouse-gas emissions, Mr. Obama's administration is bound by a 2007 Supreme Court decision to determine whether greenhouse-gas emissions "endanger" public health or welfare, the legal trigger for regulating them under the federal Clean Air Act…

…A decision in favor of the request would clear the way for more than a dozen other states to enforce laws they modeled on California's. But it also would risk antagonizing the United Auto Workers, which has complained that the law unfairly discriminates against companies whose product mix is skewed toward pickup trucks, sport-utility vehicles and minivans -- which guzzle a lot of gas. A spokesman for the union, which helped Mr. Obama clinch Ohio and Michigan in last fall's presidential contest, didn't respond to requests for comment on California's request.

With the economy in a slump, it will be interesting to see on which side of the fence the Obama administration forcefully lands on. Obama won’t be able to straddle the philosophical line with oratory flourish like he did during his campaign for the Presidency. He will have to make a tough decision and he will indubitably step on some very sensitive toes; the sort of toes that walked to the polls to elect him.

Update: Mr. Obama has chosen with the Greens. The American auto industry, already on the ropes, may have been dealt a final blow. Break out the popcorn, this may get interesting.

GM gets on line for some of our money

There was a time when automakers wanted protection from competition and they lobbied government hard for it. This time around they seem to want to protect themselves from risk and the bad decisions that have wrought havoc to their companies. The current national and global economic crisis has created a seemingly legitimate reason for a bailout package for the automakers and also for many other corporations. But taxpayers should not be lulled into believing that a bailout for Detroit is sound policy. The federal government is largely responsible for plenty of Detroit’s ills and much of the legislation currently discussed to be tied to a bailout is politically motivated and not really based on making the companies successful. I say let them file for chapter eleven and then they can restructure their operations just like many airlines have done over the years. And the argument I keep hearing from advocates of a bailout that claim that filing chapter eleven would not work for automakers because consumers would not buy cars of a bankrupt company--this is fallacious; Consumers willingly paid and walked onto planes of bankrupt airlines without a hitch. This madness of bailing out every company that asks must stop.

Unintended consequences in lithium batteries

The electric-hybrid cars with lithium batteries that we are constantly told should be built and marketed to the public come with an environmental and social cost. Not only is lithium a finite resource, but the people of the communities in Bolivia where the world's largest reserves of lithium lie have great reservations of mining the resource due to environmental concerns and also simple resistance to having, as they say, industrialized countries exploit them for the lithium. In this case it seems that as the Western world tries to move away from oil, in some respects due to the hostility of the nations that have the largest reserves and due to climate change, it also falls into the same sort of trap it desperately wishes to leave behind. It's not easy being green.

The danger of subsidizing renewable energy

Reason.tv has a great video on the fiasco that Bio-fuels made from corn ethanol has brought on the world.

When government ends up subsidizing an industry or a program that ends up having poor unintended consequences, like we have experienced with corn ethanol, my trail test to those that favor deep government subsidies for projects that they deem essential to society is what happens if that program or policy turns out to not work as initially expected? Since Democrats, environmentalists, and even some Republicans continuously call for subsidizing “renewable” energy or “alternative” energy, what happens if government picks a loser and ends up wasting billions of taxpayer funds chasing a viable technology? I find it difficult to imagine that many of these groups would be comfortable with such a waste.

Now that many national and international organizations and government bodies have acknowledged the problems with corn ethanol, how long will it take our government to fix the problem? I bet that it will take at least a decade before subsidies for corn ethanol bio-fuels are reversed.

Americans don’t want to return to the 1970’s

From CNN: As much as Americans fret over the rising price of gas, one thing worries them more: the possibility of having to wait in long lines to buy rationed gas.

A CNN/Opinion Research poll released Tuesday shows that 55% of those surveyed are more worried about long lines at gas stations and rationing than about the high prices that drivers have paid in recent months. The poll shows 40% of the respondents are more concerned about the high prices.

While gas rationing is not expected at this time, it was a hallmark of the 1970s- era energy crisis, when drivers lined up outside gas stations and sales of gas were limited to certain days of the week.

However, at that time, gas was in short supply, which is not the case today.

I’ll tell you this, if current politicians repeat the mistake of enacting price controls in order to placate the public and to pander for votes, we will see gas stations run out of gas and the return of rationing.

The failure of CAFÉ standards

In another example of how a government mandate has failed to accomplish its stated lofty goal, this article by the Foundation for Economic Education sums up the canard that gets repeated over and over by those that believe that CAFÉ standards aren’t strict enough: The inconvenient truth is that CAFÉ standards do more harm than good.

Save some gas and scale large rocks!

If you just must have your vehicle be four wheel drive but gas prices have been nipping the wallet, here’s an idea. This one needs a gun rack though.

Cities with the worst pain at the pump

From LA Times

Gas prices in Texas are among the cheapest nationwide, but that doesn't mean commuting by car there is light on the wallet.

Indeed, though the cost of gasoline does matter, other factors, including distance, congestion, carpooling rates and use of public transit also play important roles.

The reality of ethanol

HT: Mark J. Perry

Who needs CAFE standards?

The Wall Street Journal reports that a weakening economy coupled with high gas prices has started to quench America's thirst for gasoline. High gas prices have even started to push consumers to smaller, fuel-efficient vehicles. It seems that high gas prices do have some positive effects. As long as prices stay high, investment in alternative technology may become attractive. Additionally, when shopping for a car, consumers will prioritize fuel efficiency far higher than they do when gasoline prices take up less of their discretionary income. There is already evidence that Americans are choosing cars with higher fuel standards. In real terms, the free-market is efficiently doing what CAFE standards are meant to accomplish through government mandates and regulation.