ExxonMcCain

It's silly, but no sillier than a lot of the useless garbage coming fron the Republicans (e.g., tire gauges).

McCain Goes Nuclear

McCain toured a nuclear power plant today:

Senator John McCain toured a nuclear power plant in Michigan on Tuesday to highlight his support for the construction of 45 new nuclear power generators by 2030, a position that he said distinguished him from his Democratic rival, Senator Barack Obama.

Mr. McCain, an Arizona Republican, portrayed his support of nuclear energy as part of an “all-of-the-above approach” to addressing the nation’s energy needs at a time of $4-a-gallon gasoline. He called it “safe, efficient, inexpensive and obviously a vital ingredient in the future of the economy of our nation and in our mission to eliminate over time our dependence on foreign oil."

It's important to point out that Obama agrees that nuclear power should be considered.

I've said before that I think talking about nuclear power as a solution to dependence on oil is simply an excuse to blame the left. The implication is that we wouldn't be in this mess if we could get rid of those darn environmentalists who prevent nuclear power plants.

I am not opposed to nuclear power, but it will not reduce oil prices. Oil is primarily used to make goods and fuels that would not be replaced by nuclear power. Yes, if everyone drove electric cars nuclear power may be part of the electricity supply to charge those cars. But the combination of off-peak charging and coal power could allow us to charge those cars without nuclear power.

I think a big reason for nuclear power's popularity is that many people don't understand off-peak electricity generation capacity. Electric companies must constantly be able to provide power to you so that when you flip the switch, the light comes on immediately. During the day, we use electricity to run our offices and factories. During the evening, while everyone has the lights on and is running the TV, DVD player, cable box, dishwasher, clothes dryer, computer, etc., the power companies have to be able to meet the demand during those peak hours. The problem is you can't store electricity during off-peak hours to meet peak demand. The companies have to buy enough electricity generation capacity to meet maximum energy usage, but during the night this electricity generation capacity is essentially wasted while we sleep. The fact that plug-in electric cars would normally be charging at night allows us to finally use this off-peak capacity. We could replace most gas-powered cars with electric cars without increasing our electricity infrastructure at all. And while nuclear power is better than other power plants in terms of greenhouse gas emissions, our current electricity grid is better than the internal combustion engine on that front. Replacing the internal combustion engine with a battery charged by electricity currently reduces grenhouse gas emissions by 40%.

In the article, McCain describes his energy policy as "all of the above." But offshore oil drilling shouldn't even be considered part of a multi-pronged effort to deal with the energy crisis because it is actually counterproductive for several reasons: (1) billions of dollars invested in offshore drilling is money that could be invested in alternative energy; (2) by increasing the profit margins of oil, we encourage continued investment in oil by energy companies; and (3) to the extent that it reduces prices, and I don't think that it will, it disincentivizes the use of alternative energy. Remember, the purported benefits of offshore drilling won't be seen for a decade. This isn't a temporary solution to ease the burden on consumers. It is a long-term commitment to oil.

UPDATE:

Pride in Being Ignorant

Negative Externalities and Energy Policy

Our co-blogger has asked why the government needs to be involved in an energy solution. I have pointed out negative externalities in comments on this blog here and here. Another thing to consider is the impact that government policy has on the choices that we make as energy consumers:

Americans can optimize their personal consumption decisions all day long, but without a policy in place to internalize social costs, they’ll still end up creating costly traffic jams and devastating climate change.

Along these same lines, I'm constantly annoyed that people insist that public transportation pay for itself. Gas taxes and vehicle taxes go a long way in paying for roads, but we also heavily subsidize the use of oil by spending income and sales taxes on roads. In addition, local governments provide services such as sewer, water, fire protection, schools, etc., to outlying suburbs. It is more expensive to provide these services over a larger geographic area, so local taxpayers subsidize the use of oil through local taxes.

A lot of people live in suburbs in part because it is cheaper. You can get more house and more land for less money. That wouldn't be the case if the costs of our automobile culture were not so hidden from individuals.

I'm not suggesting that we all be required to live in urban areas. I commute over 20 miles each day, love my car, and enjoy my few acres in the middle of nowhere. But aligning individual costs more with social costs makes sense.

Energy Solution Questions

1. Why does the government need to be involved in this anyway?

2. If it's so important that we do this why don't we cut all programs a certain amount to pay for it?

3. Why do we need new taxes to pay for this?

RNC Ad on Energy

Yes, the RNC talking up the virtues of bucking the party is comical. And yes, there is a certain dissonance in advocating more drilling and investment into alternative fuels.

However, Obama needs to get out in front of this issue. I think that more domestic drilling is a gimmick. It is a diversion of resources that will result in no perceptible reduction in gas prices to the consumer. But that is a difficult sell. He needs to publicize a clear and simple plan to reduce gas prices or the hardship that they cause.

Gas prices could very well be the most important issue in this election.

UPDATE: Obama has a response ad airing in the same states as the RNC ad. Not enormously effective, but decent.

Alcohol: The Cause of - and Solution to - All of Life's Problems

Bowling
Golf
Fishing
Sporting Events
Watching Live Music
Watching Fireworks
Cookouts
Boating (always use a DD)
Poker

Add living car-free to the list of activities that become more attactive when you realize you can drink while doing it.

Via Matthew Yglesias:


Now that's a convincing case for public transportation.

Offshore Drilling: No Equipment?

On This Week with George Stephanopoulos, Rep. Ed Markey (D-MA) pointed to the vast federal lands that the oil industry already has access to. Red Cavaney of the American Petroleum Institute disputed the assertion that there is oil and gas under all of this land, but also claimed that the industry doesn't have the equipment needed to drill.

Transcript (video here):

STEPHANOPOULOS: is there grounds for a compromise?

SACHS: yes.

STEPHANOPOULOS: okay. fine. we don't love it. but let's drill on the outer continental shelf. let's drill on anwr for the return on investments you're talking about in alternatives.

REP. MARKEY: we don't have to have a grand compromise to drill off beaches to drill where the polar bear is swimming. until experts say this is the case. they drill on 80% of the oil that we already have that is available to them. they should clean their plate before they ask for dessert. they are not going there. exxon mobile, 40 billion in profits just to buy back their own stock. they onlypent $10 million on renewables last year and blocked the tax breaks. that formula is a recipe for dependence upon oil to the indefinite future.

CAVANEY: every single available drilling rig, drill ship is in use being used right now. you can't go and drill when you don't have equipment. we are not magicians as an industry. the idea that there's oil and gas under this 80% it's not true.

SACHS: can i say that's not the support? they are sure this oil off the beaches and in the arctic where the polar bear is swimming but the 80% of the leases they already control, they are not sure the oil is there. it's a disingenuous argument. in order to get access to every bit of oil in pristine wilderness areas.

How do they intend to take advantage of the additional drilling rights that McCain wants to give them without equipment?

Do You Own an Oil Company?

Now that I think about the few bucks a quarter I'm making in my retirement account, I'm not so unhappy about paying several hundred dollars more per month for gas, paying more for everything else because of high energy costs, borrowing money from China to send to terrorists, and all of the other trivial complaints I once had about our energy policy.

Thanks, Big Oil! I'm sorry I've been such an ingrateful bastard.

"How Can You Possibly Support the Policy I Once Supported"

I understand that politicians change their minds occasionally. Often, it reflects a habit of actually thinking about things rather than being automatically for or against something because of ideology, party line, etc. As Winston Churchill once said about changing his postion: "When facts and circumstances dictate a change of policy, I change my position. What do you do?"

I also realize that positions change for purely political reasons. I don't like it. It makes me find the candidate less trustworthy, but it happens to almost every politician and I am realistic about that.

What really annoys me is when a politician suddenly mocks an opponent or attacks the opponent's character for a position he once held. Hillary Clinton was a master at this. For example, she accused Obama of disenfranchising Michigan and Florida after supporting the DNC policy!

Disappointingly, McCain is playing the same game. He once said a windfall profits tax doesn't bother him:



Now that his campaign theme is to compare Obama to Carter, Obama is hopelessly idiotic for supporting a windfall profits tax:

McCain reminded the crowd of Obama’s support for taxes on oil company profits, which resulted in a chorus of boos from the audience. “He wants a windfall profits tax on oil, to go along with the new taxes he also plans for coal and natural gas,” McCain said about Obama’s energy policy. “If the plan sounds familiar, it's because that was President Jimmy Carter's big idea too – and a lot of good it did us. Now as then, all a windfall profits tax will accomplish is to increase our dependence on foreign oil, and hinder exactly the kind of domestic exploration and production we need. I'm all for recycling -- but it's better applied to paper and plastic than to the failed policies of the 1970's.”

As I've written here before, I tend to think Obama is wrong and McCain is right on this particular policy. What I can't stomach is McCain acting like only a completely naive imbecile would favor a policy that he once seemingly accepted as self-evidently reasonable.

Windfall Profits Tax

Obama's support for it may be politically popular, but I disagree with him here.

My Opening Salvo

Curt's first post is both wide-ranging and limited enough that responding to it will be a good way for me to outline my views.

Curt, beginning with a quote from DJ Toluene:

The Democrats are actually the tax, borrow and spend party. The last Congress (they are the ones who pass budgets) to balance a budget were the Republicans. Now I understand that the Republicans haven't acted that way in a while and that's why they lost in 2006. Now I'm all for punishing them for being as corrupt as the Democrats when it comes to spending but at the same time I'm not going to reward the Democrats. The Republicans are the lesser of two evils. Although the best scenario would be for a McCain presidency with a Democratic Congress. Nothing would get done. We saw what happened when the same party controlled both the Congress and the White House.

You can't punish them by electing them. I know the Democrats are your only other option, so if you see them as equally bad then I understand striking this category of voting criteria as a wash and choosing on other issues. You're right, we did see what happened when the same party controlled both branches. I think I'm far angrier and more deeply upset about the results of that than you. Even if I did not like Obama, I could still vote for a lump of dirt over a Republican candidate based on what's happened over the past 8 years unless the Republican candidate offered up a clear and strong repudiation of most of what the current administration has done and stands for, which of course will never happen.

I have no reason to believe that Democrats will spend less money than the Republicans, but I'm not sure that they can do worse. If spending stays the same, or continues rising, I can at least feel comfortable in two things: (1) the spending will benefit more ordinary Americans; and (2) the taxes will be raised to pay for it.

On the second point, I thnk it's a fallacy to say that Bush has cut taxes. If you don't have a balanced budget, it is impossible to cut taxes. We have to borrow to pay the difference. At least theoretically, the debt must eventually be paid back with interest. Even if we intend to stiff those people who lend us money, we must make regular payments toward the interest on the debt.

Also, I'm no economist, but I think that when Alan Greenspan says that budget deficits contribute to the weak dollar (see here and here), we ought to at least have an honest, in-depth national debate over the budget deficit. Who cares about a weak dollar? Perhaps everybody that is suffering from high gas prices. Yesterday, it was reported that oil futures are falling in part because of a strengthening dollar. Phil Flynn, senior market analyst at Alaron Trading:

If the dollar continues to strengthen, it will continue to put downward pressure on the price of oil.

I admit that I have misgivings about universal health care. However, the status quo is not working and we have to do something. I am encouraged that Obama does not seek to take over the health care system, but merely work within the private system by providing an insurance alternative for those who are currently unable to get insurance. You could have a whole blog about the health care system, but I'll just say here that I think the current system is so flawed that we may be able to provide health care for all Americans while cutting costs in other areas (for example, universal health care provides access to physicians so that the poor don't show up at our emergency rooms instead). I also think Wyden's Republican-supported Healthy Americans Act is worth considering.

McCain's long-standing objection to earmarks is admirable, but that won't come close to addressing our spending problem. And I think his other promise to review all discretionary spending will be met with so much resistance that may end up accomplishing nothing. We need to cut entitlements, raise taxes, or both. There are no easy choices here.

Curt, again beginning with a quote from DJ:

Talking to your enemies without preconditions is stupid. And Iran, Syria and North Korea are our enemies. It annoys me that we haven't drilled more domestic oil, and started up more nuclear power plants, use our almost unlimited coal supplies and given more incentives for alternative fuels so we can bankrupt the Middle East.

Talking to your enemies without preconditions might not be the best of all foreign policies. However, it is far less stupid than invading them based on KNOWN FALSE conditions (and lying to the country about it). Dialog is good. The idea that we "embolden" (what a stupid word) our enemies by giving them the time of day is naive, isolationist, and in many ways has led our foreign policy where it is today.

I agree with you regarding domestic oil, nuclear power, etc.

Refusing to talk to our enemies strikes me as childish and contrary to a projection of strength. A superpower ought to be confident enough to look an opponent in the eye and challenge him directly. I have heard no good argument against talking to our enemies. Yes, I feel that way even after our foreign policy genius President compared Obama to the appeasers of the Nazis. Setting aside Godwin's Law, the mistake wasn't talking to Hitler, it was giving him Czechoslovakia.

I am as concerned about the impact of our energy policies on national security as I am about the environment. Therefore, I am open to more use of coal and nuclear power.

Illegal immigration is a problem. Immigration is not. Here's my proposal: Crack down on illegal immigration and increase legal immigration to current combined legal and illegal levels.

I'm a strong supporter of gay marriage, but I understand the sentiment and some of the arguments against it. There'll be plenty of time for that issue later.

I see that DJ trotted out the accusation that Obama has the most liberal voting record in the first post. That's a bogus label.