Wednesday, April 30, 2008



McCain and Hillary-- two pandering fools

You may think of Thomas Friedman primarily as one of the cheerleaders behind Bush's illegal attack on Iraq, but he also sometimes makes a little sense-- like in his NY Times column today. Like anyone everyone who takes the problems of the economy seriously, he is very disappointed that Hillary would lower herself to the standards of McCain-- and he explains why. Their proposal is "not an energy policy. This is money laundering: we borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build our country. When the summer is over, we will have increased our debt to China, increased our transfer of wealth to Saudi Arabia and increased our contribution to global warming for our kids to inherit." He commends Obama for resisting the politician's inborn urge to pander. I'd go further and point out that their respective positions show that Obama is the only one of the three fit to be president.
our problem is so much worse than you think. We have no energy strategy. If you are going to use tax policy to shape energy strategy then you want to raise taxes on the things you want to discourage-- gasoline consumption and gas-guzzling cars-- and you want to lower taxes on the things you want to encourage-- new, renewable energy technologies. We are doing just the opposite.

Are you sitting down?

Few Americans know it, but for almost a year now, Congress has been bickering over whether and how to renew the investment tax credit to stimulate investment in solar energy and the production tax credit to encourage investment in wind energy. The bickering has been so poisonous that when Congress passed the 2007 energy bill last December, it failed to extend any stimulus for wind and solar energy production. Oil and gas kept all their credits, but those for wind and solar have been left to expire this December. I am not making this up. At a time when we should be throwing everything into clean power innovation, we are squabbling over pennies.

These credits are critical because they ensure that if oil prices slip back down again-- which often happens-- investments in wind and solar would still be profitable. That’s how you launch a new energy technology and help it achieve scale, so it can compete without subsidies.

The Democrats wanted the wind and solar credits to be paid for by taking away tax credits from the oil industry. President Bush said he would veto that. Neither side would back down, and Mr. Bush-- showing not one iota of leadership-- refused to get all the adults together in a room and work out a compromise. Stalemate. Meanwhile, Germany has a 20-year solar incentive program; Japan 12 years. Ours, at best, run two years.

“It’s a disaster,” says Michael Polsky, founder of Invenergy, one of the biggest wind-power developers in America. “Wind is a very capital-intensive industry, and financial institutions are not ready to take ‘Congressional risk.’ They say if you don’t get the [production tax credit] we will not lend you the money to buy more turbines and build projects.”

It is also alarming, says Rhone Resch, the president of the Solar Energy Industries Association, that the U.S. has reached a point “where the priorities of Congress could become so distorted by politics” that it would turn its back on the next great global industry-- clean power-- “but that’s exactly what is happening.” If the wind and solar credits expire, said Resch, the impact in just 2009 would be more than 100,000 jobs either lost or not created in these industries, and $20 billion worth of investments that won’t be made.


You wouldn't vote for McCain, I'm sure. Hillary is better than he is... to some extent. Obama is the only one qualified to be president. He's willing to tell the truth to the American people. McCain and Hillary are just dishonest political hacks.


Alter is a smart guy and in Newsweek today he asked, rhetorically, why McCain and Hillary don't know any better than to propose this horribly pandering gas tax holiday. I think they did the American voters a great service by both coming out for it. It shows voters exactly who is willing to try to buy them off with cheap counter-productive tricks and who is willing to stand up and speak the real straight talk. And it shows the American people-- or at least those willing to use their noggins-- how pathetic the mass media is.
Hillary Clinton has now joined John McCain in proposing the most irresponsible policy idea of the year-- an idea that actually could aid the terrorists. What's worse, both of them know that suspending the federal gas tax this summer is a terrible pander, and yet they're pushing it anyway for crass political advantage.

Clinton and McCain have learned a destructive lesson from the Bush era: as Bill Clinton said in 2002, it's better politically to be "strong and wrong" than thoughtful and right. The goal is to depict Barack Obama as an out-of-touch elitist. By any means necessary.

I could highlight a long debate among economists on suspending the gas tax, but there is no debate. Not one respectable economist [though all of McCain's and Hillary's repulsive cadres of lobbyists]-- and not one environmentalist or foreign policy expert-- supports the idea, unless they are official members of the Clinton or McCain campaigns (and even some of them privately oppose it). To relieve suffering at the pump, send another rebate check or provide tax credits or something else, but not this.

Why is this gas pander so bad? Let me count the ways:

* It's a direct transfer of money from motorists to oil companies, which are getting ready this week to again report record obscene profits. If the federal excise tax were lifted, oil companies would simply raise prices and pocket most of the difference. Clinton's proposal to recover the money with a windfall profits tax on oil companies sounds nice but won't happen. That tax was easily blocked by the Senate in December and would likely be blocked again.

* It offers taxpayers only peanuts. The Congressional Budget Office says the average savings to motorists this summer would be a total of $30. Did I miss something, or was that measly number somehow not included in Clinton's explanation of her support?

* It sends more hard-earned money to the Middle East, which is terrible for our national security. Remember, 15 of the 19 terrorists on 9/11 came from Saudi Arabia. How did they get the terrorist training? The madrassa indoctrination? Oil money.

* It worsens global warming by encouraging gasoline consumption. When you flee your house in 2020 because of flooding, remember which politicians pandered.

* It makes it more likely you'll have a car accident or will waste even more time in traffic. The proceeds from the gas tax go for highway construction and upgrades. Because the tax (24.4 cents a gallon on diesel fuel) was last raised 15 years ago, our infrastructure is a mess, with potholes and dangerous crossings practically everywhere. Thousands of repair projects will be further delayed.

* It will cost 300,000 construction jobs, according to the Department of Transportation. Makes it kind of ironic when Clinton starts her rallies saying she wants "jobs, jobs, jobs."

* It will cost the U.S. Treasury at least $8.5 billion and probably much more, according to state highway officials. For McCain that's no money at all-- merely one month in Iraq. For Clinton it's money she's already spent. She has said in the past that any proceeds from a windfall profits tax would go for renewable energy. The $8.5 billion figure assumes the tax would be reapplied after Labor Day. Fat chance. The one-year costs are probably closer to $30 billion.

* It won't happen anyway because Congress isn't usually quite that stupid, and if it is, President Bush would veto the bill.

So why are McCain and Clinton doing this? Because when they learned that Obama had supported a similar suspension of the Illinois gas tax in Springfield, Ill., before realizing it was a bad idea, they saw an opening. It was like Hillary's whiskey shot in the bar, only sleazier. Try to show that the guy just doesn't get it.

Of course, McCain and Clinton do get it. They get that people are hurting and want some relief, even if this form of it makes no sense. They get that voters have been conned into believing that both
candidates are responsible public servants because they're not as bad as some others, so they can trade on that reputation. They get that smacking Obama is more important than anything else on the planet right now, and that for Obama to respond by calling them panderers will take Obama about as far as it took Paul Tsongas in 1992 when he leveled the same charge at Bill Clinton.

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At 10:06 AM, Anonymous Anonymous said...

My fear for Obama is that he's pulled a Mondale -- he's told the truth, and we all know the general public cannot handle the truth. They prefer comfortable lies.

At 10:12 PM, Anonymous Anonymous said...

There is absolutely no need to have another post on what Friedman said. It's absolutely irrelevant.

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