Weekly Mulch: Obama Lacks Vision on Energy, Stomach to Defend EPA

by Sarah Laskow, Media Consortium blogger

President Obama made an energy speech this week that had little new to offer, while on Capitol Hill, Republicans were pushing to relieve the government of its last options to limit carbon emissions. In the House Republicans have passed a bill that would keep the EPA from regulating carbon, and in the Senate, Majority Leader Harry Reid repeatedly pushed back a vote on the same issue.

But as Eartha Jane Melzer reports at The Michigan Messenger, Sen. Debbie Stabenow (D-MI) has become the latest senator to propose taking away the EPA’s authority over greenhouse gasses this week. If the Senate decides it wants to pursue this policy, it will have plenty of options to choose from.

Conflicting news leaked out about how strongly the Obama administration was willing to stand up for the EPA’s right (granted by the Supreme Court) to treat carbon as a pollutant under the Clear Air Act.Grist’s Glenn Hurowitz noted an Associated Press story with a comment indicating that the White House was telling Congress they’d have to compromise on this issue. But on Thursday the White House reassured progressive bloggers that it was opposed to any amendments to funding bills that furthered “unrelated policy agendas.”

The energy speech

The energy speech that President Obama delivered at Georgetown this week, however, did not do much to reassure climate activists that the administration will put forward a strong vision on these issues. The president talked about decreasing our dependence on foreign oil and set a goal of having 80% of the country’s electricity come from clean energy sources by 2035.

But as David Roberts at Grist writes, Obama skirted some of the trickiest issues. “The core truth is that for the U.S., oil problems mostly have to do with supply and oil solutions mostly have to do with demand,” he says. “America becomes safer from oil by using less. From the Democratic establishment, only retiring Sen. Jeff Bingaman (D-N.M.) is telling the public that truth.”

Is clean energy green energy?

President Obama is right that the country has room to pursue more clean energy opportunities. As Public News Service’s Mary Kuhlman reports, America is behind in the clean energy race. The Pew Environment Group just released a report that, according to Kuhlman, “finds the United States as a whole is falling behind in the global clean-energy race….The U.S. maintained the top spot until 2008, according to research from the Pew Charitable Trusts, but fell in 2010 to third behind China and Germany.”

But as I point out at TAPPED, when politicians use the words “clean energy,” they’re generally talking about mid-point solutions like natural gas and nuclear energy. President Obama’s proposed standard does not necessarily support renewable energy — wind and solar projects that are truly sustainable.

The alternatives

And as Gavin Aronsen writes at Mother Jones, renewable energy projects need more support. “The near-term future of solar power in the US will also depend on whether President Obama’s stimulus money keeps flowing,” he explains. “For now, energy companies have until the end of the year toqualify for funding. Meanwhile, some solar advocates are suggesting alternatives like installing panels on urban rooftops.”

If these projects flag, the alternative to renewable, or even clean, energy is not appealing. The world is beginning to depend on energy sources that require greater effort and create more environmental damage. Oil from tar sands is one such source, although as, Beth Buczynski reports at Care2, “a research group at Penn State spent the past 18 months developing a technique that uses ionic liquids (salt in a liquid state) to facilitate separation of oil from the sands in a cleaner, more energy efficient manner. The separation takes place at room temperature without the generation of waste water.” Sounds like an improvement!

Does genetically modified alfafa do a body good?

The Obama administration is not only disappointing on energy issues. At GritTV, Laura Flanders talks to New York Times food writer Mark Bittman about the future of organic food, and the two agree that the only person whose agriculture and food policy they can wholeheartedly endorse is Michelle Obama’s. Too bad she’s not part of the administration.

One recent gripe is the Department of Agriculture’s decision to approve genetically modified alfafa. “Essentially it’s the beginning of the end of organic,” Bittman said. “Once you introduce alfafa, which pollinates by the wind, you can’t guarantee that any alfafa doesn’t have genetically modified seed in it. And alfafa is used as hay, hay is used to feed cows, there goes organic milk. There goes a lot of organic meat.”

This post features links to the best independent, progressive reporting about the environment bymembers of The Media Consortium. It is free to reprint. Visit the Mulch for a complete list of articles on environmental issues, or follow us on Twitter. And for the best progressive reporting on critical economy, health care and immigration issues, check out The AuditThe Pulse, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.

 

Out of Both Sides of His Mouth

Presidential hopeful Newt Gingrich is in mourning. He is very saddened by the sudden passing of Knut the polar bear in Germany. He tweeted:

“Sad news! Just learned Knut the polar bear died suddenly at 4,” Gingrich tweeted over the weekend. “Callista and I visited him in Berlin when he was 5 months old. He was cute.”

Knut’s passing was very sad. There is no question.

What I can’t get my head around is why Newt only cares about Knut? The government's own models show that polar bears face over an 80% chance of becoming extinct by mid-Century throughout much of their range. Polar bears may be extinct in my expected lifetime.

One of the major contributors of their decline is climate change. Newt Gingrich, who actually seems to believe in the perils of global warming, has flip-flopped on whether he will support doing anything about it.

In fact, instead of seriously exploring solutions that could address our changing climate, he played dirty politics by running an inaccurate TV ad labeling policy proposals as a tax. Those kinds of fear-mongering ads have set us back in the fight to pass federal legislation that will strengthen our security, create jobs, and reduce pollution.

That doesn’t sounds like someone who is serious about addressing real problems, which should be a prerequisite to be President. He is just someone looking to score political points with his base.

If you think Knut’s passing is sad, just wait until all polar bears are gone.

What’s Up With Germany?

Germany is a power on the rise. Unlike much of the Western world, the country’s economy is humming along as if the Great Recession had never even happened. Indeed, in the last quarter German GDP grew by a heady 2.2.%. This was the highest growth rate since the Berlin Wall fell two decades ago.

German employment is also holding up. At 7.6% in August 2010, German unemployment is actually lower than it was before the Great Recession. For those familiar with the depressing figures of American unemployment, this is quite shocking. How did Germany do it?

Not with an economic stimulus package. Conventional economic theory – i.e. that espoused by the great British economist John Keynes – dictates that the best solution for a recession is government stimulus. This can take two forms: spending and cutting taxes.

Germany’s record of spending and tax cut-less economic success is hard reconcile with this theory. Indeed, when the economic downturn began, there was a great policy debate about whether to focus on economic stimulus or balancing the budget. Most countries, including the United States, came down on the side of Mr. Keynes. German Prime Minister Angela Merkel, on the other hand, stubbornly held onto the position that balanced budgets were more important. Germany did not pass a substantial stimulus package during the recession. And now Germany’s economy is the strongest in the entire Euro zone.

As the case of Germany shows, the application of Keynesian theory to the real world has had mixed results. Stimulus did not work for Japan in the 1990s. In America today, unemployment remains high for all the jobs the stimulus saved.

Yet Keynesians can also boast of powerful successes. Stimulus in the form of WWII ended the Great Depression. China entirely avoided today’s recession through something like a trillion-dollar stimulus.

And other factors are involved in German success. Before the recession, Germany engaged in large scale restructuring and reform; it is reaping the benefits of that today. There is also its enormous welfare and short-term work program, designed specifically to fight unemployment. This is called Kurzarbeit, and no less than Angela Merkel herself stated that, “It is only thanks to Kurzarbeit that more jobs were not lost.” Finally, German banks have by and large avoided the financial implosion that initiated today’s downturn, so Germany is far away from the recession’s epicenter.

Yet in the end this does not get rid of two facts. Fact 1: Germany didn’t do a stimulus, and German unemployment is below what it was before the recession. Fact 2: The United States did a gigantic stimulus, and American unemployment is still in a terrible state. It is hard to believe in Keynesian economic theory when presented with this, no matter what mitigating factors there are.

--Inoljt, http://mypolitikal.com/

 

 

The Difference betweeen Germany and the United States Isn't Debt, It's an Industrial Policy

The libertarian economist Tyler Cowen has an op-ed entitled What Germany Knows About Debt in the New York Times today extolling the virtues of German fiscal prudence.

In many countries, including the United States, there are calls for the government to spend more to jump-start the economy, and to avoid the temptation to cut back as debts mount.

Germany, however, has decided to cast its lot with fiscal prudence. It has managed rising growth and falling unemployment, while putting together a plan for a nearly balanced budget within six years. On fiscal policy and economic recovery, Americans could learn something from the German example.

Twentieth-century history may help explain German behavior today. After all, the Germans lost two World Wars, experienced the Weimar hyperinflation and saw their country divided and partly ruined by Communism. What an American considers as bad economic times, a German might see as relative prosperity. That perspective helps support a greater concern with long-run fiscal caution, because it is not assumed that a brighter future will pay all the bills.

Cowen, who teaches economics at George Mason University and runs the libertarian Marginal Revolution blog, goes on to question the validity of Keynesian calls for another round of fiscal stimulus by pointing to the German experience after unification, the rather unequal absorption of the East by the much larger West.

Certainly, in Germany, the recent history of fiscal stimulus wasn’t entirely positive. After reunification in 1990, the German government borrowed and spent huge amounts of money to finance reconstruction and to bring East German living standards up to West German levels. Millions of new consumers were added to the economy.

These policies did unify the country politically but were not overwhelmingly successful economically. An initial surge was followed by years of disappointing results for output and employment. Germany’s taxes remain high, and overall West German living standards failed to rise at the same rate as those of most other wealthy countries.

Persuading former East Germans to spend more as consumers turned out to be less important than making sure that they had the skills to mesh with the economic expansion of the country. It is no surprise that many Germans are now skeptical about debt-financed government spending or excessive reliance on domestic consumers.

In recent times, Germany has shown signs of regaining a pre-eminent economic position. Policy makers have returned to long-run planning, and during the last decade have liberalized their labor markets, introduced greater wage flexibility and recently passed a constitutional amendment for a nearly balanced budget by 2016, meaning that the structural deficit should not exceed 0.35 percent of gross domestic product.

Amid the sluggish economies of much of Europe, Germany has booming exports and is nearing full capacity utilization. And many of its workers are postponing vacations to produce, and earn, more. The unemployment rate in Germany is 7.5 percent — below that of the United States — and falling.

The above was enough to send an already exasperated Paul Krugman into the throes of outright despair.

I’ll be frank: the discussion of fiscal stimulus this past year and a half has filled me with despair over the state of the economics profession. If you believe stimulus is a bad idea, fine; but surely the least one could have expected is that opponents would listen, even a bit, to what proponents were saying. In particular, the case for stimulus has always been highly conditional. Fiscal stimulus is what you do only if two conditions are satisfied: high unemployment, so that the proximate risk is deflation, not inflation; and monetary policy constrained by the zero lower bound.

That doesn’t sound like a hard point to grasp. Yet again and again, critics point to examples of increased government spending under conditions nothing like that, and claim that these examples somehow prove something.

There's more...

Candor Costs Germany's President His Post

Such candor is rare in geo-politics and it is rarely welcomed. Today, Horst Köhler, the President of the Federal Republic of Germany, resigned his largely ceremonial post of head of state over remarks made while on a visit to Afghanistan. Mr. Köhler had noted that “a country of our size, with its focus on exports and thus reliance on foreign trade, must be aware that military deployments are necessary in an emergency to protect our interests, for example, when it comes to trade routes, for example, when it comes to preventing regional instabilities that could negatively influence our trade, jobs and incomes.”

The reference is clear. NATO is in Central Asia to secure access to the region's vital energy supplies. 

The story in Der Spiegel:

German President Horst Köhler, under fire for controversial comments he made about Germany's mission in Afghanistan, resigned with immediate effect on Monday in a shock announcement that comes as the latest in a series of blows to Chancellor Angela Merkel.

German President Horst Köhler announced his resignation on Monday in response to fierce criticism of comments he made about Germany's military mission in Afghanistan.

"I declare my resignation from the office of president -- with immediate effect," Köhler, with tears in his eyes and speaking in a faltering voice, said in a statement, flanked by his wife Eva-Luise. The president is the head of state and his duties are largely ceremonial. But the resignation is the latest in a string of setbacks for Chancellor Angela Merkel since her re-election last September. The German federal assembly -- made up of parliamentary MPs and delegates appointed by the country's 16 federal states -- will have to vote for a successor to Köhler within 30 days, according to the federal constitution.

The president had become the target of intense criticism following remarks he made during a surprise visit to soldiers of the Bundeswehr German army in Afghanistan on May 22. In an interview with a German radio reporter who accompanied him on the trip, he seemed to justify his country's military missions abroad with the need to protect economic interests.

"A country of our size, with its focus on exports and thus reliance on foreign trade, must be aware that ... military deployments are necessary in an emergency to protect our interests -- for example when it comes to trade routes, for example when it comes to preventing regional instabilities that could negatively influence our trade, jobs and incomes," Köhler said.

It sounded as though Köhler was justifying wars for the sake of economic interests, in the context of the Afghan mission which is highly controversial in Germany and throughout Europe.

Horst Köhler is a former director of the International Monetary Fund and the European Bank for Reconstruction and Development. He was elected to his second five-year term in May 2009 by a single vote. Under German law, a successor must be chosen within 30 days by the so-called Federal Assembly composed from members of the Bundestag and from representatives chosen by Germany’s 16 länder or states.

One wonders if we will ever hear such candor from our own leaders.

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