“You walk in to a shoe store with $150, you walk out with one shoe." —Paul Newman speaking to Tom Cruise in the film “The Color of Money.”
Earlier this month another terrible blizzard struck in what has been one of the worst winters in memory. As snow packs finally begin to melt I can’t help but think that the environmentalists are not telling us the truth. Of course, having two terrible winters in Western Canada over the past three years can’t yield a scientific conclusion. Yet my observations may carry as much evidence as the Green’s theory that the earth is melting beneath our mukluks.
In his 2009 book Heaven and Earth: Global Warming—The Missing Science, Australian geologist Ian Plimer makes the following points:
- There is little to no geological, archaeological or historic analysis on what is causing climate change.
- Greenland was once a green land because of natural occurring global warming. During medieval times Earth was several degrees warmer than it is now.
- Climate has always changed but it is not because of industrialization.
- Atmospheric CO2 has been far higher than it is now.
- The hockey stick graph that charts global warming as the result of manmade CO2 emissions is fraudulent.
The book concludes that the slogan, “Stop climate change”, is a public phenomenon based on widespread ignorance rather than real science. The sheer number of TV programs that go out of their way to hammer home the dangers of global warming is evidence that Plimer is on to something.
You can order this book from Amazon.com by clicking here.
President Barack Obama is staking America’s future on clean energy while ignoring these truths. A few weeks ago in a major policy address, Obama announced that America would continue to pursue green energy solutions from wind, solar, biofuels and nuclear power.
According to the President, “We cannot keep going from shock when gas prices go up to trance when gas prices go back down.”
This prompted The New York Times toconclude: “The path to energy independence—or at least an end to dependence on the Mideast—could well be dirty, expensive and politically explosive.”
What the Greens seem blind to is the fact that a shift away from fossil fuels will have huge opportunity costs for the United States at a time when the country can least afford it. The technology for clean energy does not yet exist. To embrace it when competitors like India and China do not would be economic suicide.
What the President either cannot or will not grasp is that these solutions involve huge subsidies and are cost ineffective.
Why Adam Smith Would Hate The Environmentalists
Over the past couple of years I have written to you about all the problems inherent with renewable energy. On that list is the vast amount of cropland needed to create ethanol, the inefficiency of solar energy and the lack of an infrastructure for hydrogen vehicles. In time, all of these problems can be worked out, but the best way to achieve a seamless switch is to take government out of the equation.
And while Adam Smith died more than 200 years ago, the father of economic thought would object to Obama’s energy agenda because it does not allow free markets to operate.
The invisible hand that Smith spoke of when describing how free markets create wealth was at work when oil was trading above $120 per barrel. The record purchases of hybrid cars three years ago were evidence that free markets work.
The chart below shows hybrid car sales statistics along with the price of gasoline over the past seven years. As gasoline prices have declined so too have sales of hybrid cars. That is how the free market works.
As petroleum becomes less and less affordable, consumers will switch towards other types of transportation, including electric cars. This will encourage outside investment and, over time, crude oil will be displaced. This won’t happen because the Federal government mandates a changeover which is neither practical nor affordable.
Despite this fundamental truth, Obama is hell-bent on the Federal government fixing a problem (global warming) that doesn’t even exist. It seems hard to understand why, but the Las Vegas Review Journal suggested an answer. A headline in the April 4 issue read, “Green goal: End capitalism, destroy our quality of life.”
According to that newspaper:
“Those who claim to be trying to save the planet from the scourge of greenhouse gases and catastrophic global warming have a few other goals: social engineering, assaulting capitalism and assailing the American lifestyle.
“United Nations Environment Programme (UNEP) defines a green economy as one that results ‘in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.’ In its simplest expression, a green economy can be thought of as one which is low carbon, resource efficient and socially inclusive.
“By socially inclusive they appear to mean a leveling [SIC] of the capitalist system under a global government, with less wealth spread equally among a population of green-collar workers without social or employment mobility.”
I don’t know if Obama and his Green coalition are nefarious. But there remains one simple fact—fossil fuels still make economic sense. To claim otherwise and keep subsidies for renewable energy or pass carbon tax legislation would only serve to sell the American people a useless bill of goods.
Yours in good times and bad,
Myers’ Energy & Gold Report