Monday, February 20, 2012

The Republican's Selective Outrage

Solyndra, the California solar panel manufacturer that received a half-billion dollar loan from the federal government before declaring bankruptcy, sparked a lot of Republican and public outrage (including from this blogger).

This model of new-energy development has come in for a lot of criticism because of the risk it imposes on taxpayers. The company gets the profits, the country gets the bankruptcy bill.

However, there is an equal danger in believing the "free market" will magically produce viable alternative energy. China is well ahead of the U.S. in this area precisely because of state-funded research. A refusal to offer some state subsidy would be to concede the race, and compromise future development and jobs.

In addition, the United States subsidizes other forms of energy, including nuclear. Important to remember too is that loans to other "clean", "green", and fossil fuel energy have enjoyed plenty of bipartisan support.

There are no safe bets. That argues for an incentive program that casts the broadest possible net, allowing the best technologies to emerge while recognizing that some government help will be needed to spur research, development and production.

Solyndra mat be one glaring example of why that due diligence is needed, but then again, why do we still give the oil companies billion of dollars every year in government subsides? Last year, on a partisan vote, all the Republicans and a few Democrats voted to re-new $35 billion in corporate welfare checks for big oil and gas.

But where was all the Republican and public outrage?

And then there's this: Does anyone remember that summer day when Representative John Boehner (R-Ohio), chairman of the House Republican Conference, decided to play Santa Claus?

Mr. Boehner took it upon himself to begin handing out money from tobacco lobbyists to a few of his colleagues on the House floor. He was not deterred by the fact that the House was in session, and that he was supposed to be attending to the nation's business.

"He was not constrained by any sense that passing money around the floor of the House of Representatives was a sacrilege. He had the checks and he dispensed them." - Columnist Bob Herbert, NEW YORK TIMES, May 10, 1996, p. A33.

Herbert went on to say that according to the House Ethics Committee, Boehner's action was not illegal. Although it is against the law to "solicit" contributions while on Federal property, representatives and senators are free to accept and distribute donations that are "voluntarily offered".

Two weeks later after John Boehner had passed out those envelopes from generous tobacco companies, the House voted to retain multi-million dollar subsidies for the tobacco industry. Boehner's office said it was just "a coincidence of timing", and that handing out the checks, and the later vote, were not at all connected.

The irony of the tobacco subsidies was that while the government was taxing cigarette smokers, and also giving away huge sums of money to tobacco farmers, Congress had also passed a law forcing cigarette manufacturers to pay billions of dollars to help cover expenses for tobacco-related illnesses after a major lawsuit. The settlement requires tobacco companies to pay $246 billion over the next 25 years.

The government is both helping and penalizing farmers for their production of tobacco. Interestingly, 50 percent of that settlement was allocated to tobacco farmers. Only 10 percent was set aside for anti-smoking efforts and the remaining 40 percent was distributed for roads, education, and other undetermined initiatives.

The United States currently pays around $20 billion per year to farmers in direct subsidies as "farm income stabilization", which includes government subsidies for cigarette manufacturers.

Where is all the Republican and public outrage?

And if you think the Keystone XL oil pipeline will make America "energy independent", then you are very naive because it will only produce greater profits for big oil companies who have received taxpayer subsidies for decades and don't pay their share of taxes while jacking up your gas and energy prices.

But where is all the Republican and public outrage?

Solyndra, by comparison, was just a drop in the bucket when the government was attempting to subsidize TRUE energy independence, from both foreign oil and domestic oil. By comparison, the taxpayer's loss by Solyndra was only 1/10th of what taxpayers paid to big oil and tobacco companies just last year alone. Where was all the Republican and public outrage for that?

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