US Dominance – The True Renewable Energy Incentive

Polls show that if you don’t believe in global warming, odds are you are a Republican. So it comes as no surprise that discussions about reducing Carbon Dioxide pollution, that may cause as many as 2 million deaths per year, and mitigate its impact, often rub conservatives the wrong way.

In isolation their resistance makes some sense. It checks off many of their talking points – Big government overreach, Job killing regulations, and Free market superiority. But in the big picture, isolating recent CO2 regulations on the coal industry or incentives for products like the Chevy Volt for extra scrutiny seems disingenuous.

The reality is the US has a long a glorious history of using tax dollars to promote changes under the guise of “public good”. In the mid to early part of the 20th century the US spent around $157 billion to win the space race because it was “seen as necessary for national security and symbolic of technological and ideological superiority”. The fact that it was the government, using tax dollars, that delivered this win didn’t matter.

Without government involvement the cost to research and develop the technology necessary for the moon landing was out of reach for even the largest private sector companies. The same has been true for nearly a century in the energy sector. When oil was first being developed as an energy source for widespread use in America, the government provided subsidies to help ameliorate the exorbitant costs. As a matter of fact in the first fifteen years of oil production in the US the average government subsidy was $4.86 billion in 2009 dollars or over thirteen times more than the $0.37 billion of support provided to renewable energy in its first fifteen years. This is also the case with Nuclear energy and biofuels that received an average of $3.5 and $1.08 billion respectively.

We also have a history in the US of regulating industry either as a way to reduce energy use or to improve the environment.

- Federal Food, Drug, and Cosmetic Act of 1938 to regulate contamination in the food supply.
- Federal Insecticide, Fungicide, and Rodenticide Act of 1947 to regulate the use of pesticides.
- Atomic Energy Act of 1954 to regulate the use of Nuclear power and the disposal of nuclear waste.
- Clean Air Act of 1970 to regulate air quality and control air pollution.
- Clean Water Act of 1972 to set standards for water quality and purity.
- Safe Drinking Water Act of 1974 to regulate our drinking water.
- Surface Mining Control and Reclamation Act of 1977 to regulate the coal mining industry and prevent damage to the public and the environment.
- Emergency Planning and Community Right-to-Know Act of 1986 to require companies to disclose information regarding chemical they release.
- National Appliance Energy Conservation Act of 1987 that set standards for energy efficiency of household appliances.
- Montreal Protocol of 1989 to regulate the use of ozone depleting chemicals.

Unlike today, concern for public safety and the environment held no political affiliation. This list contains legislation signed by both Republican and Democratic presidents. And while many companies and industries were adversely affected, protecting the public and the environment were given a higher priority than corporate profits.

And while regulations have been one form of government involvement in shaping individual and corporate actions, incentives offer another shining example. The home mortgage deduction, the capital gains tax rate, tax deferred retirement savings, and charitable deductions all serve to increase a certain behavior by rewarding it monetarily, with a nice tax deduction. Even the bastion of conservative policy, Texas, makes extensive use of government incentives – giving out nearly 25% of all government incentives offered by states and as much as the next four states combined.

The truth is that many of America’s greatest inventions and products exist because of the unique symbiotic relationship the public and private sector have. Personal opinions on global warming and climate change have no bearing on the value of energy independence and the economic potential that renewable energy offers. Developing new products that help the US maintain technological superiority and protecting American citizens are part of the American fabric. Pretending that support for renewable energy is somehow unpatriotic ignores history and threatens a system that spawned a super power all in an effort to pin the tail on the donkey.

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