To fund alternatives, raise energy prices
Commentator David Frum
TEXT OF COMMENTARY
Tess Vigeland: Any hope of creating a low-carbon economy has to include nuclear power. That's today's word from the World Energy Council, a group that represents electricity generators. The council said nuclear power wasn't the whole solution, but had to be a part of the mix.
What to do about global warming and how to wean ourselves off of oil is on the minds of many presidential candidates. But commentator David Frum says so far, their solutions fall short of the mark.
David Frum: Recently, Barack Obama pledged that as president, he would "invest" in efficient and clean energy technologies
His rival, Hillary Clinton, says she backs a strategic energy fund, financed by taxes on oil companies to invest in alternative energy technology. Republican Mitt Romney says we need to initiate our generation's equivalent of the Manhattan Project or moon landing to solve our energy problems.
They're all echoing President Bush. At the start of the year, the president told a Delaware audience that he thinks it appropriate to spend taxpayers' money on new energy technologies.
Does anybody remember that we've been here before? In the 1970s, the Carter administration spent — sorry, invested — tens of billions of dollars to develop alternatives to imported oil.
The results? The Synfuels Corporation — one of the most flagrant boondoggles in American economic history. A market-flunking exercise that made even the farm program look like sound public policy. Why would anyone want to go down that road again?
Here's why — because talking about "Manhattan projects" and "moon landings" is a way for presidential wannabes to sound bold and decisive, while in fact hiding and evading.
There's only one way to bring oil alternatives to market: keep energy prices high, with tax increases if necessary.
Under that price umbrella, entrepreneurs, firms, and consumers will develop their own next-best solutions — cutting back on consumption, devising substitutes and so on. Incremental steps, rather than an atomic breakthrough.
But no politician wants to tell voters that they have to pay more for fuel to achieve energy independence.
Instead, they offer delusions that government investors can somehow do what trillions of dollars in private capital cannot: discover a cheap and abundant alternative to oil that will deliver cleaner fuel at lower prices.
The reality will be wasted billions and higher taxes, and nothing to show for it. I guess they think that's a small price to pay to avoid telling the truth.
Vigeland: David Frum is resident scholar at The American Enterprise Institute.