• Home
  • Climate Skeptics Win by Revealing Costs Not Disputing Science

Climate Skeptics Win by Revealing Costs Not Disputing Science

William L. Kovacs

December 2023

Climate Skeptics Win by Revealing Costs Not Disputing Science

(Part II of III parts) 

Part I discussed how the Progressive Left transitioned their climate strategy from one of oppressive regulations during the Obama administration to giving away massive amounts of money during the Biden administration. This policy change made all the difference in gaining general support from the American business community for the uncontrolled development of green technology. If the climate skeptics are to compete for public support, they must change their strategy from scientific studies that are largely unread to a clear presentation of the real costs of green technology to the general public.

Winston Churchill provided the world with sage advice on how to understand politics when he stated, “I no longer listen to what people say, I just watch what they do. Behavior never lies.” It’s time for the climate skeptics to transition from discussing scientific flaws in the Progressive’s climate policy to implementing a strategy that focuses on what changes the public’s behavior. To undertake this approach, the skeptics must recognize:

(1) their real opponent, in addition to the federal government, is now the American business community;

(2) the American people believe climate change is occurring; however, they are not willing to pay for costly climate change policies or bear the burden of hosting the massive facilities in their communities and

(3) the competitive market still works; skeptics must aggressively use it to defeat unprofitable projects before they harm the nation.

Adopting this approach requires the climate skeptics to lay bare the values of the American business community. Business is agnostic on principles. It does not care if our government is capitalist or socialist or a deep-state faux Republic. Business follows the money no matter who is giving it out, the federal government or the Chinese Communist Party that provides subsidized slave labor to U.S. businesses. Trillions flow from the government to corporations to produce what the government wants to be made and purchased, notwithstanding the costs to its citizens or the effect on a functioning society. Climate change is merely the vehicle the federal government uses to buy support to control society.

Understanding the greed of American businesses explains why automakers make more electric vehicles than they can sell, even when faced with significant losses such as Ford’s Mustang Mach E and its F-150 lightning. Subsidies explain why American businesses make lightbulbs, dishwashers, air conditioners, low-flush toilets, and dozens of other products that perform less effectively than older products and are considerably more expensive. It’s money, money, money that makes business go round.

As part of the federal global warming misinformation campaign that supports its green agenda, numerous federally funded groups reviewed 88,125 climate studies. Amazingly, more than 99.9 % supported the proposition that humans cause climate change. Unfortunately, few studies release the underlying data for peer review and reproducibility. Moreover, the federal government refuses to implement the Information Quality Act. Such refusals mean the federal government and its climate supporters can misinform the public about its science.

The climate skeptics cannot compete with the federal government’s propaganda machine and the greed of big business. A new approach is needed since the climate skeptics cannot give up and move to Galt’s Gulch.

Taxpayer support stops when they have to pay for or live with the consequences of government policies.

71% of Americans believe climate change is occurring and caused entirely or mainly by human activity. Gallup found that 80% of Americans believe they understand global warming very well or fairly well, and 58% want policies that dramatically reduce fossil fuels within 10 – 20 years. Yet, while firmly believing that human activity causes climate change, a Reuter poll found that only one-third of Americans would spend $100 a year to address it. Americans clearly do not understand they are already paying handsomely for the federal government’s green tech follies.

The adage “Don’t tax you, don’t tax me, tax that fellow behind the tree!” seems to be the prevailing American philosophy for addressing climate change.

Americans do not want to pay to address climate change and do not want the green energy facilities in their backyards. The “Renewable Rejection Database” proves this point. Between 2015 and 2023, 435 communities in the U.S. rejected or restricted big wind projects. The solar industry has seen local communities reject 173 big projects since 2021. The reasons are too much land utilized, noise, sleep disturbance, red-blinking lights all night, too ugly, conflicts with community growth plans, reduced food production, and fear of depreciating land values.

Markets still work, so the skeptics must find ways to allow them to work.

While the American business community loves free money from the government, it still hates losing money. Even with trillions in subsidies, an increasing number of wind and solar projects across the nation are running into problems that harm the economics of the projects. Thousands of these projects need help connecting to local power grids that might need more extensive power lines and new transformers. The high cost of these upgrades translates into canceled projects.

Other projects are abandoned due to a lack of credit. While the government shovels subsidies to green industries, many banks won’t extend the additional needed credit to complete construction because of a facility’s poor balance sheet. A cancellation of wind farms in New Jersey is a recent example. Orsted, a sizeable Danish wind farm developer, dropped two mega-projects offshore due to $4 billion in cost overruns.

The Wall Street Journal noted offshore wind power is “bleeding cash.” Today, offshore wind project costs are 49% more than in 2019. About  60% of all offshore wind projects awarded have been canceled or are at risk of cancellation.

The Li-Cycle battery recycling facility’s initial construction cost was $ 700 million. Today, its completion cost is estimated at $ 1 billion, a price so significant that it likely will force the federal government to honor its loan guarantees if the project is to be completed.

Overall, the green industry is in the proverbial toilet. The Environmental, Social, and Governance (“ESG”) woke investment funds, the baskets holding the industry’s stock for consumers to invest in, are having their worst year since 2011. The green industry is not a good investment. Over time, many of these government monuments to green technology will be abandoned across the national landscape, creating more of a drain on the treasury and local communities as they litter the nation with hazardous waste.

For the climate skeptics to bring sanity back to the climate change debate, they need to clearly explain to the American people the significant costs the government is imposing on them to implement its climate agenda.

William L. Kovacs has served as senior vice president for the U.S. Chamber of Commerce, chief counsel to a congressional committee, chairman of a state environmental board, and a partner in law D.C. law firms. His book Reform the Kakistocracy received the 2021 Independent Press Award for Political/Social Change. Kovacs also led the business coalition’s lobbying activities against Obama’s legislative climate proposals. He can be contacted at [email protected].

Part I. Memo to Climate Skeptics: You’re Losing, Change Strategies

 

 

 

 

 

 

  • Home
  • Memo to Climate Skeptics: You’re Losing, Change Strategies

Memo to Climate Skeptics: You’re Losing, Change Strategies

William L. Kovacs

December 2023

Memo to Climate Skeptics: You’re Losing, Change Strategies

(Part I of III parts)

As 90,000 corporate and environmental elites land their private planes in Dubai to be exquisitely wined and dined at the UN Climate Conference (“COP 28”) from November 30 to December 12, 2023, they will be demanding more reductions in fossil fuels and trillions more dollars for whatever controls they want to impose on humanity. Their newest demand is no more cows, no more meat. This is on top of restrictions on thousands of products. Twenty-eight years of COP parties demonstrate the persistence of the movement to shut down human progress. Those opposing this insanity argue the facts, science, and common sense. These are useless arguments in a world where tweets, influencers, money, and misinformation rule. It is time to challenge this brave new world of hypocrites at its source of power.

The Progressive Left is winning the climate war it should be losing.

Those skeptical (“climate skeptics”) of the Progressive Left’s claim that the world is coming to an end due to manmade greenhouse gas emissions are a dwindling group. They are fighting the good fight with few supporters and little financial assistance. To prevail, the skeptics need to gain visible support from common-sense citizens who are unwittingly impacted by the increased costs of green technology. To achieve this feat, climate skeptics should move away from their current lobbying strategy that relies on well-documented science and technology briefing papers that discuss the technical inadequacies of the green agenda and focus on the adverse economic and community impacts of the Biden administration’s policies.

The transition from regulatory oppression to costly giveaways.

The Progressive Left’s change in its climate lobbying strategy between the Obama and Biden administrations illustrates why the Progressive Left is winning the climate fight to limit fossil fuels to “stop the rise of the oceans.”  While both administrations initiated aggressive attacks on the use of fossil fuels, their strategies are radically different. Obama went the traditional route of complex legislation to regulate most industries in the economy. The Biden administration gives away lots of money, which makes all the difference.

The climate skeptics in 2008-2016 organized the business community and used data in eye-catching, easy to understand charts to illustrate the complexity, costs and burdens of Obama’s legislative and regulatory agenda on business and citizens. By explaining how business, jobs, citizens, and communities were adversely impacted, the skeptics defeated Obama’s major proposals in Congress, even in years when Democrats controlled both Houses of Congress.

The Biden administration changed strategies in 2021. It recognized giving away taxpayer money is a proven path to the heart of the business community. Giving away money for a “public purpose” is also unreviewable by the courts. As such, it is easier for spending legislation to pass. Moreover, it also avoids a regulatory conflict with industry, as happened to Obama’s Clean Power Plan. Using giveaways, Biden enacted the Inflation Reduction Act (“IRA”) to build more green technology than can be absorbed by the grid or afforded by consumers. Additionally, by placing such a massive amount of green technology into the economy, Biden makes reversing his policies very difficult.

Beginning in 2021, climate skeptics challenged Biden’s climate agenda by developing excellent policy papers explaining the technological flaws in achieving zero emissions with green technology. Unfortunately, for the climate skeptics, business prefers subsidies over well-reasoned technical reports that might upset their gravy train., Moreover, most common-sense citizens do not read technical policy papers, nor are they persuaded by them.

American business is Congress’ Pavlov’s dog, and tax credits are its treats.

With a massive national debt approaching $34 trillion and annual combined deficits and interest payments approaching $2 trillion, Congress fails to understand how it is wasting the taxpayer’s money. Worse, when it spends by enacting tax expenditures, it has no control over how much is wasted.

Tax expenditures are defined by law as “revenue losses attributable to provisions of the Federal Tax laws which allow a special exclusion, exemption, or deduction from gross income or which provide a special credit, a preferential rate of tax, or a deferral of tax liabilities.” When Congress enacts these expenditures, it creates public policy by changing behavior, i.e., rewarding corporations that do what the government wants done. It transforms American businesses from defenders of competitive markets into the government’s Pavlov dog. The government offers a treat, and business gets rewarded if it does what Congress wants done.

Unlike policy determinations that must be authorized and subsequently funded by Congress, tax expenditures are not viewed as direct spending programs since Congress places them outside of the budget process. As such, they are an unlimited charge on the federal treasury since anyone who conforms to the government’s desires gets credits that reduce their income tax. For example, taxpayers purchasing an electric vehicle can receive up to $7,500 in credits to reduce their federal income taxes.

Additionally, the IRA includes a $ 400 billion loan guarantee fund that allows green energy developers to secure lower interest rates on loans that the federal government guarantees in case of default. These unfunded liabilities are also off budget.

The cost of dog treats is expensive.

The IRA gives tax credits for activities legislatively deemed to reduce emissions causing climate change. Those activities include battery storage, energy efficiency, residential green energy, hydrogen, carbon capture, solar and wind generation, and electric vehicles. The Congressional Budget Office (“CBO”) initially estimated these tax credits would cost the treasury $391 billion between 2022 and 2031.

The IRA tax credits for anything “green” incentivized more pigs to show up at the trough than CBO estimated. Within months after the program started, Goldman Sachs raised its estimated cost of the credits to $1.2 trillion for the same period. The original forecast missed the cost of the credits for electric vehicles by $379 billion; energy manufacturing, $156 billion; renewable electricity production, $82 billion; energy efficiency, $42 billion; hydrogen, $36 billion; biofuels, $34 billion; and carbon capture, $31 billion.

These federal tax credits create few jobs. “Total [cost for each green job created] range from $ 2 to $ 7 million per job.” Unfortunately, the jobs created will have an average annual wage of $45,000. Where have all the billions gone? Into corporate pockets everywhere!

Tax credits are only one type of government gift. The tax code is stuffed with over 2000 subsidy [gift] programs. Companies that receive the gifts are given a competitive advantage over non-recipients in the market. Farming is an excellent example. The federal government distributes $30 billion a year in subsidies to the farm industry. “The largest 15 percent of the farm businesses receive 85 percent of the total farm subsidies.”

The Center on Budget and Policy Priorities estimates that in 2019, IRS tax expenditures carried a value of $1.3 trillion for the recipients. Additionally, the IRA tax credit adds another $1.2 trillion. None of these $2.5 trillion tax credits is part of the appropriations process. No wonder Congress cannot control spending. These same companies also received $3.5 trillion in subsidies in 2020 from state and local governments.

As long as green technology is infused with unlimited tax credits, businesses will take the credits until the government stops giving them or the project suffers losses the government will not cover. It is up to the skeptics to educate the public on these costs.

William L. Kovacs has served as senior vice president for the U.S. Chamber of Commerce, chief counsel to a congressional committee, chairman of a state environmental board, and a partner in law D.C. law firms. His book Reform the Kakistocracy received the 2021 Independent Press Award for Political/Social Change. Kovacs also led the business coalition’s lobbying activities against Obama’s legislative climate proposals. He can be contacted at [email protected].

 

 

 

  • Home
  • Using the Antitrust Laws to Open the U.S. Political System to Competition

Using the Antitrust Laws to Open the U.S. Political System to Competition

William L.Kovacs

December 2019

Using the Antitrust Laws to Open the U.S. Political System to Competition

This series of articles explores options to break the monopoly control of our government by the two major political parties. Article I, describes the monopoly. Article II, discusses tactics used to maintain the monopoly. Article III, suggests using a civil rights law to secure reasonably permanent ballot access and compensation for injury. This article explores using antitrust laws to open up the U.S. political system to competition.

There are no reported attempts to apply U.S. antitrust laws to a denial of ballot access. Historically antitrust laws addressed restraints on commerce, not politics. Additionally, states and political parties will claim immunity from antitrust liability. While the legal obstacles seem insurmountable; when separated, each are scalable.

The Sherman Antitrust Act (“Sherman Act”) applies to agreements or conspiracies in restraint of trade or commerce, i.e. conduct that monopolizes a relevant market in commerce. Violators are subject to treble damages. Since the two major parties’ control 99.96% of elected offices, they have monopoly control of the political market. The question is whether these activities restrain commerce?

Political Activity Is Commerce

The term “commerce” in the Sherman Act, is redundantly defined to mean trade or commerce among the several states. Understandable definitions are found in dictionaries, e.g.  the “exchange of goods and services along with activities…to complement the exchange,” or “the whole system of an economy that constitutes an environment for business” including legal, economic, political, social, cultural and technology.

Antitrust law has been applied to large and small businesses, trade associations, professional organizations and even farmers, and labor unions (now statutorily exempt). So why not apply the antitrust laws to political parties, which are corporations that nominate, support and fund the persons who actually control the commerce of the nation.

Politics is big business. In the 2012 election over $6.2 billion was spent on the election; and $6.6 billion on lobbying. Spending resulted in big financial returns; 0.26% of the population gave 68% of the money. The big donors wanting policy changes were twice as likely to get the change wanted as the average person. A 2014 report by Andrew Prokop, notes that “Some studies have found companies can get as much as a 22,000 percent return on their lobbying dollars”.

The two major political parties organize to control our government so they can control the nation, including its commerce, e.g. trade, advertising, finance, communications, food production. By limiting third-party access to the ballot, the two parties maintain perpetual control over commerce.

The two major parties limit competition specifically to protect themselves, i.e. incumbents. David Dodson wrote about his experience challenging an incumbent Senator. He notes Democrat and Republican campaign committees blacklist companies that do business with challengers. The same blacklisting is likely to apply to businesses working for third-parties.

Since business, i.e. commerce, always wants government help, it supports those holding power in government. By excluding third-parties from the ballot, and denying top consultants to challengers, the two major parties help big donors protect their investment, and share of commerce.

Simply, political parties provide services for money, these services are the lifeblood of commerce.

The Major Political Parties Are Not Immune from Antitrust Liability

The two major parties will assert they are immune from antitrust liability under the Noerr-Pennington immunity doctrine (“NP immunity”) which protects competing entities from antitrust liability when they seek to influence government action, even for an anticompetitive purpose. Their argument is simple, they lobbied for ballot restrictions on third-parties to avoid voter confusion or to prevent voter fraud.

NP immunity is not blanket immunity, it is “content and nature specific” requiring an evaluation of the private parties’ conduct and the nature of the governmental process. Determining the application of immunity is a balance between the First Amendment rights of those lobbying government for an anticompetitive outcome, and economic freedom sought by the antitrust laws.

Ballot access disputes many times involve efforts by states and political parties to impose overly-restrictive conditions on third-parties or involve aggressive challenges to signature petitions with the sole purpose of preventing a party, with adequate signatures, from being on the ballot, e.g. Ralph Nader examples in Pennsylvania and Oregon.

In cases where the political parties seek unreasonable restrictions on third-parties, the proceedings are more likely sham proceedings. Government cannot grant private parties the right to deprive another of constitutional rights. The application of the antitrust laws in ballot access situations is fact dependent. A political party is more likely to have immunity if petitioning for reasonable ballot access whereas, if the anticompetitive action sought is unreasonable, it is subject to antitrust action.

The Two Major Parties Are Not Immune from Antitrust Liability Under the State Action Doctrine

Under the “State Action Doctrine” private parties are immune from antitrust liability when the challenged conduct is a clearly articulated by state policy that allows private parties to act anticompetitively. The state however, must actively supervise the anticompetitive conduct.

In ballot access matters, states argue that ballot restrictions are needed to protect the voting process. This is a façade of righteousness in which the state claims virtue by protecting the voting system, while denying the constitutional rights of the third-parties. This situation requires analysis of the facts. If the conduct is found unreasonable, it should be subject to the antitrust laws.

Action: To apply the antitrust laws to the anticompetitive conduct of the two major parties, third-parties must develop a strong rationale for political activity affecting “commerce”. The facts abound, it is a matter of organizing them. If the two major political parties do not impact commerce, then no one does. Once over this threshold issue, the immunities will disappear if the conduct is unreasonable. The potential of antitrust liability, by itself, should temper the unreasonable anticompetitive conduct of the two major parties.

This article was first published in The Libertarian Republic, September 27, 2019.