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George Allen Pants-on-Fire Wrong: New Study Finds No “Free Market” in U.S. Energy History

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As usual, George Allen is not just wrong, but wildly, crazily, pants-on-fire wrong on an extremely important topic. I guess we shouldn’t be surprised, as Allen was wrong when he voted 96% of the time with George W. Bush. And he was wrong when he said that Northern Virginia, and the people who live there, are not “real” Virginians. And he was wrong when he said this:

If everything were on the free market system, what would win? Coal, oil and natural gas. There’s not much subsidies at all for coal, it’s highly regulated. The depreciation allowances for oil are about the same that you would want to do for any sort of investments. If there weren’t the enormous mandates and subsidies that have really gotten out of control in the ethanol area, wind power, solar, there’s no way they could compete in the marketplace. We almost have a Don Quixote type energy policy in our country, where we’re using the medieval technology of wind power, tilting at windmills…If you had a pure, free marketplace approach, what would win are those that are the most reliable, the most efficient, and the other thing is they’re American as well…

In fact, according to a new study by DBL investors, George Allen has things totally, 180-degrees wrong and bass-ackwards. Of course, given that he’s paid a lot of money to lie for the dirty energy industry, that’s not a big surprise, but still…those are some serious Big Lies by our pal “Felix Macacawitz” right there.

It turns out, according to a careful analysis of the history of energy subsidies in this country, that “[f]ar from there being a perfect ‘free market’ in energy throughout America’s history, actually “[e]nergy innovation has driven America’s growth since before the 13 colonies came together to form the United States, and government support has driven that innovation for nearly as long.” Let’s repeat that: since the days of the U.S. colonies, the government has had its finger on the scale, big time, in the ways we produce, transport, and consume energy in this country. Anything else is nothing more than a fanciful, farciful myth/Big Lie spun by industry hacks like George Allen.

Where has that government support gone? Check out the pie chart above (click to “embiggen”). What it shows is clear: cumulative federal subsides for oil and gas, at $447 billion, utterly dwarf those for non-ethanol renewables (solar, wind, geothermal, etc.), which received just $5.9 billion in federal largesse. That’s a 75:1 ratio in favor of oil and gas. And that’s not even counting state subsidies to fossil fuels, which have been enormous as well. It’s also not even counting indirect subsidies, such as military operations in support of oil flows from the Persian Gulf, etc. — another enormous number. Finally, it’s certainly not counting the environmental “externalities” of fossil fuels. But even if we don’t get into either indirect subsidies or externalities, the findings here remain crystal clear: federal support for fossii fuels has been enormous in U.S. history, continues to this day, and utterly dwarfs support for renewable energy.

In sum, there hasn’t been a “free market” in energy in U.S. history, going back to a protective coal tariff in 1789, and there most certainly isn’t one today. So George Allen’s wrong if he thinks there ever has been a free market in energy in this country. But he’s even more wrong, pants-on-fire wrong, when he claims that fossil fuels haven’t received much in terms of government welfare, and he’s also pants-on-fire wrong when he says that subsidies to renewable energy have been larger than for dirty energy. In fact, the numbers clearly show that it’s the exact opposite, with government support for dirty energy (plus nuclear and hideous corn-based ethanol as well) dwarfing support for wind and solar. As usual, in George Allen/Tea Party land, up is down, black is white, bad is good, war is peace, etc.

  • glennbear

    Thanks for posting this lowkell even though facts seem to be disregarded by far too many conservatives. As far as tilting at windmills, a drive to western PA as I used to do on a regular basis will take you past wind farms which are happily generating electricity and have been doing so for a long time. The problem in VA is getting the windmills built on the hilly western part of the state before all the mountaintops are blown off to mine dirty coal.

  • kindler

    In other words, a pol who, once he’s been bought — in this case by Big Oil, Gas and Coal — stays bought.  You’ve got to admire his loyalty to his sugar daddies.  Or not.

    Why anyone would vote for a Senator who is in the pocket of these dirty industries is well beyond me. But I guess I haven’t learned how to think like a Tea Partier. Or not…think.  

  • commentator1

    Thanks for this article. I just listened to a program on “On Point” last night on this very topic. The program went even further and described the current ‘arms race’ for renewable energy.

    According to the guests we are in an arms race with China on green energy and we are losing big time. That’s because China is offering massive government subsidies to the solar energy sector. Each municipality must meet quotas for producing solar energy products.

    This is the real reason Solyndra went bankrupt. Between the time they received their loan and now the cost of solar panels from China went down 50%. Solyndra just couldn’t compete.

    According to the China Bureau Chief of the New York Times, China plans to institute a carbon tax soon to spur growth on solar technology. In short, because our government is not offering enough incentives and tax breaks to our green energy sector we have been left behind. If our government doesn’t act soon we will be the left behinds in all areas of green energy.

    The Republicans want to live in a mythical land of free trade in energy. What they really want is to please their oil and gas contibutors (Koch brothers, etc.)

    You can listen to the “On Point” show on this topic here:

    http://onpoint.wbur.org/2011/0