On August 2, Senate Majority Leader Democrat Harry Reid announced that his first order of business when the Senate re-adjourns after its month long siesta will be to take up energy legislation under the guise of creating jobs. Between that and President Obama’s appointments to key economic positions this year, I don’t know whether to laugh or to vomit – probably both are appropriate.
Earlier this year, President Obama tapped General Electric (GE) CEO Jeff Immelt to head the President’s Council on Jobs and Competitiveness. Immelt knows a great deal about creating jobs – just not in the U.S. China has been a huge beneficiary of GE’s job machine since Immelt took over. Having Immelt as your lead advisor on domestic job creation and competition is akin to offering Bernie Madoff the job of government investment advisor: you’re not going to like the results (though in Immelt’s case, there will likely be no illegality involved).
I’m not sure whether Immelt is himself a committed environmentalist, but the corporate “Ecomagination” program is his baby and it’s all about green technologies.
There is just one problem, most of the energy products in the Ecomagination portfolio don’t work as well as the products they are replacing, can’t compete in the marketplace and thus need government support – big government support. Under Immelt’s leadership GE has gone from a company that competed well in the marketplace to one that curry’s favor with dictators (in China for example), sucks on the government teat at every turn, supports policies that are bad for consumers, bad for our energy security, bad for GE’s workers. For example, despite GE’s long history of making high quality incandescent light-bulbs, GE under Immelt’s leadership supported a Federal ban on incandescents. GE’s last incandescent bulb factory closed in 2010 and its new CFL bulbs are made in China.
Immelt’s GE is also one of the biggest boosters of the Obama administration’s plan to limit greenhouse gas emissions. Any scheme to limit emissions necessarily raises the costs of energy in general, but of fossil fuel generated energy in particular – which would help wind and solar power reach price parity.
Under GE’s previous CEO, the famous (some would say infamous) Jack Welch, GE made money by serving consumer demand for well-made, cost-competitive products. Under Immelt, GE receives (notice I didn’t say earns) an increasing share of its revenue in the form of government subsidies, grants and tax credits. Rather than competing to satisfy consumer demand, Immelt’s GE tries to bugger the competition with costly regulations while encouraging consumers to want different products, and, absent that, forcing them to purchase the goods he believes in his green wisdom, they should desire.
I have written about the effect that Immelt’s initiatives have had GE’s stock price, value and taxes paid elsewhere – check it out, I think you’ll find it interesting reading.
If anything, President Obama’s choice of John Bryson for Commerce Secretary is even worse news for the economy than his choice of Immelt.
Mr. Bryson may be many things but a friend of capitalism and free markets – especially for energy – isn’t one of them. He was a co-founder of the Natural Resources Defense Council one of the most aggressive environmental lobbying groups fighting through lobbying, lawsuits (Bryson was a lawyer for them), and grass roots organizing against almost every technology that modern industrial civilization was built upon and which Americans’ relatively high standard of living still depends upon. They have fought to shut down power plants – and to prevent new ones from being built – they have helped to foist numerous environmental regulations and costly conservation requirements on factories, power plants, and consumers – raising the price of energy and consumer goods and causing unemployment in the process. In the last 40 years almost no government agency has done more to retard economic progress than the U. S. Environmental Protection Agency, and it has had no greater friend (directly and indirectly) in these efforts than the NRDC.
Since his time with the NRDC Mr. Bryson has gone on to work in the both the public and private sectors – hurting the economy every step of the way. When he served on the California Public Utilities Commission, under his influence, it separated utility profits from power use in an effort to force conservation upon utilities and ratepayers. Later, when he joined the utility Edison International as CEO and chairman he worked with the California Public Utilities Commission to define the terms of the state’s catastrophic electric restructuring.
California’s restructuring led to blackouts, energy shortages, near bankruptcies – and ultimately did little or nothing to reduce consumer prices or increase competition. In short, Bryson, both in the public and private energy sector in California, has overseen or helped shape a situation in which, while power use is down, prices are among the highest in the nation and even with a declining economy and companies and jobs fleeing the state, California lives just one hot day away from blackouts – planned and unplanned.
In addition, Edison, under Bryson’s leadership, has been front and center in pushing the potentially catastrophic cap and tax energy plan that the Obama administration would like to foist upon the nation.
Bryson is also on the board of a number of green energy companies and associations, all of which depend upon government support and/or mandates for their existence and continued growth.
It’s not surprising that Bryson, with his background as a leading environmental lobbyist would support these companies, what is surprising is that with his support of these companies he would even be considered to represent the U.S. economy and trade to the world. Rather than a proponent of free markets and consumer choice – what the position of Commerce Secretary deserves – he is like one of the bad guys in an Ayn Rand novel: a welfare industrialist who supports industries and companies that people won’t freely choose to support and thus can’t compete and so uses the force of government to gain power and advantage.