Shivering in the dark
I have said this before, and I'll keep saying it as long as it's true: Barack Obama's economic understanding is dangerously naïve and borders on the ludicrous.
The latest evidence of this dangerous naïveté is a recently unearthed interview in which the Obamessiah held court with the editorial board of the San Francisco Chronicle. (Video here – audio download here)
In this wide ranging interview, Obama outlines his philosophy on energy – specifically his plans to discourage the building of coal fired electrical plants in the United States.
Before I start quoting the Obamessiah on coal, I'd like to provide you with a few details which you most likely know already. First off, the United States is the Saudi Arabia of coal. We've got more coal than we can ever even think of burning, liquefying, or placing in the Christmas stockings of short sighted Democratic members of Congress.
The United States will need more electrical generation capacity in the future. Barry thinks he can generate that power using a bunch of windmills and solar panels rather than coal fired power plants. I guess that's what you get when you add "hope" to the equation. But enough of me putting words in the Anointed One's mouth. Direct from Frisco, here's Barry:
So if somebody wants to build a coal-powered plant, they can; it's just that it will bankrupt them because they're going to be charged a huge sum for all that greenhouse gas that's being emitted. That will also generate billions of dollars that we can invest in wind, solar, biodiesel and other alternative energy approaches. The only thing that I have said with respect to coal, I haven't been some coal booster. What I have said is that for us to take coal off the table as a ideological matter as opposed to saying if technology allows us to use coal in a clean way, we should pursue it.
Here, Obama shows just how dangerously naïve he really is. He thinks that some enterprising entrepreneur will go to the time, effort, and expense to build a coal-fired plant that will have to pay so much in greenhouse gas penalties that it will bankrupt said entrepreneur. The "billions of dollars" in revenue generated from the bankrupting penalties levied against the entrepreneur's power plant will be invested in Barry's pet energy projects.
What Barry doesn't get is the fact that prior to investing the time, treasure, and effort required to build a power plant, the entrepreneur will conduct a cost-benefit analysis of the investment. When the bean counters come back and tell him the project will bankrupt him, the plant isn't built in the first place.
But I digress. More Barry on energy:
You know, when I was asked earlier about the issue of coal, uh, you know — Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. Even regardless of what I say about whether coal is good or bad. Because I'm capping greenhouse gases, coal power plants, you know, natural gas, you name it — whatever the plants were, whatever the industry was, uh, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.
Actually, Barry, they won't "pass that money on to consumers". The "cost" will get past on to consumers. Bear in mind, dear reader, that this is the second area of energy in which the Obamessiah has praised higher costs. Remember back to not too distant past when he said he would have preferred a "gradual adjustment" to gas prices rather than the steep rise endured by all Americans. Barry didn't have a problem with $4 gas, he only had a problem with how fast the price went up.
So, where does Barry's coal hating energy plan get us? Well, if you lived in California in 2001 you understand what happened the last time democratic politicians attempted to repeal the laws of supply and demand. In the electricity market, when demand outstrips supply you end up with rolling blackouts.
Its no wonder the San Francisco Chronicle didn't bother to include the aforementioned quotes in its summary of the conversation between Obama and the editorial board. Whether intentional or on purpose, I'm pretty sure those San Franciscans who spent hours stuck in elevators as the blackouts rolled thorough downtown might think twice about voting for a guy who would visit that same "necessity" on the rest of the country.
Here endeth the lesson.