Corrupt Government
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Title: Eco-moonbat taxpayer funded "Green Jobs" crash
Source:
Wash. Examiner / NPR
URL Source: http://washingtonexaminer.com/polit ... sucks-subsidies-then-goes-bust
Published: Feb 7, 2011
Author: Timothy P. Carney / Tovia Smith
Post Date: 2011-02-07 11:40:19 by Happy Quanzaa
Keywords: billions & billion pissed away
Views: 6285
Comments: 12
By: Timothy P. Carney 02/06/11 8:05 PM To turn wood chips into ethanol fuel, George W. Bush's Department of Energy in February 2007 announced a $76 million grant to Range Fuels for a cutting-edge refinery. A few months later, the refinery opened in the piney woods of Treutlen County, Ga., as the taxpayers of Georgia piled on another $6 million. In 2008, the ethanol plant was the first beneficiary of the Biorefinery Assistance Program, pocketing a loan for $80 million guaranteed by the U.S. taxpayers. Last month, the refinery closed down, having failed to squeeze even a drop of ethanol out of its pine chips. The Soperton, Ga., ethanol plant is another blemish on ethanol's already tarnished image, but more broadly, it is cautionary tale about the elusive nature of "green jobs" and the folly of the government's efforts at "investing" -- as President Obama puts it -- in new technologies. Late in the Bush administration, corn-based ethanol started to get a bad rap. Corn for ethanol was crowding out other crops, and food prices were soaring. Mexicans rioted as tortilla prices spiked. So Bush started talking up "advanced biofuels" including "cellulosic ethanol": roughly, ethanol distilled from plants that were not also food products. Bush mentioned wood chips and switchgrass in two consecutive State of the Union addresses Georgia politicians saw an opportunity here. "The Saudi Arabia of Pine Trees" became an unofficial state motto among Peach State politicians, and Gov. Sonny Perdue declared, "I'm confident the bioenergy industry and sector is going to be a cornerstone of the new Georgia." Amid all this hopeful talk by politicians, there were naysayers among the scientists. One Nobel Prize-winning physicist talked to the New York Times about these startups trying to turn logging waste into fuel. "You have to look at starts with a grain of salt, especially starts where they say, 'It's around the corner, and by the way, can you pay half the bill?' " But that same scientist, Steven Chu, is now the secretary of energy, and his Energy Department has recently offered a loan guarantee of as much as $1 billion to a Texas company looking to squeeze fuel out of wood. The Texas company, KiOR, isn't trying to produce ethanol and methanol as Range Fuels is doing in Soperton. KiOR's end product would be synthetic crude oil, which can do everything ethanol can do (except spike a punch) and much more. This could be part of why the Soperton plant is having trouble finding new investors: Why turn wood chips into white lightning when you can turn them into black gold? If KiOR's efforts produce a useful fuel, politicians will take credit. But the fact that it has apparently supplanted subsidized wood-to-ethanol makes you wonder what will supplant wood-to-crude before it ever gets to market. More to the point, how much private investment capital has been dragged to useless fuels because of the promise of subsidies? Range Fuels alone attracted more than $100 million in private investment. Without subsidies, that money would have gone to projects whose promise was not taxpayer money but market demand -- that is, somewhere useful. Our "green" subsidies could be postponing the day we get an alternative to foreign oil. Range Fuels is a politically connected, mostly through its founder, venture capitalist Vinod Khosla. Khosla has given more the $350,000 to federal candidates and campaign committees in recent years, a vast majority going to Democrats. In his home state of California, Khosla has famously and openly bankrolled ballot measures to direct state funding to his own "green" ventures or use regulation to make his investments more valuable. Range Fuels' lobbying budget is small, having spent only about $50,000 over the past three years. Their lobbyists have been former top staffers for powerful Democratic Sens. Patty Murray, Ron Wyden, and Max Baucus. Despite these Democratic ties, it's been Republicans who have lathered the subsidies on Soperton and celebrated them -- Gov. Perdue, President Bush, Sens. Johnny Isakson and Saxby Chambliss. On the GOP side, Range Fuels' most politically connected asset may be the aptly named Pat Wood. Wood is a revolving-door veteran -- he's the former chairman of the Federal Energy Regulatory Commission, having won that job on the recommendation of then-Enron Chairman Ken Lay. Just as Enron sucked up subsidies before collapsing, the wood-to-ethanol project in Georgia is yet another dog in Uncle Sam's "investment" portfolio. January 28, 2011 Hundreds of employees of a solar panel factory in Massachusetts are looking for new jobs after the company announced that it's moving the plant to China. Three years ago, Massachusetts wooed Evergreen Solar to locate in a former Army base in Devens that had been converted into an office park, hoping it would help boost the state's reputation as a hub for green industry. Now, many are second-guessing if and how government should be in the business of helping private business. A Match Made In Heaven Breaks Up On paper, it was a match made in heaven. Evergreen moved in and began to reap millions of dollars in fringe benefits, from tax breaks to free rent and cash grants. Evergreen grew from 100 to 800 employees. This month, the state woke up to what was basically a note on the kitchen table saying Evergreen was leaving. "I was in shock for about a week," says Eric Grieman who works as a wafer fabricator at the company. "I have no clue what I'm going to do next." "There was shock at every level," echoes Jack Burroughs, an environmental health and safety engineer, who got the news just one week after starting work at Evergreen. "I left a very good job in order to come here. I thought this was a more long-term career opportunity." A Lack Of Federal Support While many have directed their anger at Massachusetts for giving too generously to Evergreen, Burroughs says the problem may be that the manufacturer didn't get enough assistance at the federal level. "I like the idea of the state supporting an industry such as this," he says. "But maybe there needs to be more federal support to help a company be successful." Gov. Deval Patrick and Greg Bialecki, the state's secretary of housing and economic development, agree. "We feel like we gave it our best shot," Bialecki says. "And I think, realistically, we have to talk about what role the federal government is going to play to keep manufacturing here and not to let it go overseas." Evergreen's CEO Michael El-Hillow agrees, saying U.S. manufacturers cannot compete with companies in China that get far more government support. He says Washington needs to do more to nurture fledgling industries, including changing government procurement policies to require buying American, and easing bank regulations and import duties that put American manufacturers at a disadvantage. "It's also the role of government to make jobs for our citizens — our children," El-Hillow says. "That's their role. Or let's acknowledge that we're going to lose in the job creation stream." But others scoff at the notion of a company that was given so much looking for even more. "It sort of has remarkable chutzpah," says Harvard University economics professor Edward Glaeser. He says government should not be in the business of playing venture capitalist in the first place. And, Glaeser says, Massachusetts officials should have known better than to believe that a manufacturing plant could make it in such a high-cost labor market. A New Review Process Bradley H. Jones Jr., a Republican state representative, is one of many voices calling for a new review process for future government subsidies and incentives to private businesses. He says the state was seduced by the lure of a sexy new industry. "There was a leading with your heart and not your head," Jones says. Officials were all caught up in the idea that "this is going to put us on the map, and we're going to be green, green, green, and this is going to be great," Jones says. "And I think that served to cloud judgment." 'Get A Better Prenup' Even Democratic supporters, like state Sen. James Eldridge, whose district includes Fort Devens, where the plant is located, are now expressing morning-after regret. "I admit I was mistaken," Eldridge says. "I learned my lesson." Perhaps the most important lesson, he says, is to "get a better prenup." The state's contract with Evergreen does contain so-called clawbacks — some stronger than others. State officials concede their deal could have been tougher, but ultimately, they say they will recover most of their investment if one includes taxes that have come in, future benefits that will never be paid out, and the fact that the state still gets to keep roads and utilities that were built for Evergreen. Officials say their costs should also be offset by the fact that hundreds of state residents had jobs through three really tough economic years. But Harvard's Glaeser says it would be a big mistake to measure the state's energy policy by how it works as a jobs program. "We need good energy policy," he says. "But the point of that policy should not be to maximize the number of employees. If we try to do energy and jobs together, I think we get neither a good energy program nor a good jobs program. " In other words, Glaeser says, Massachusetts may have lost 800 jobs, but if the state's investment helps reduce long-term costs of green energy, then it's better to have loved and lost than never to have loved at all.
Green-energy plant sucks up subsidies, then goes bust
Loss Of Solar Jobs Has Mass. Rethinking State Aid
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#7. To: Happy Quanzaa (#0)
(Edited)
The internet...another foolhardy undertaking. The nuclear age yet another... Exxon-Mobil's [or Exxon and Mobile if you prefer] 2009 tax bill - $155MM refund.
The nuclear age yet another... Space......
#11. To: Godwinson (#9)
cadet.
Between your ears.
Top • Page Up • Full Thread • Page Down • Bottom/Latest...and the folly of the government's efforts at "investing" -- as President Obama puts it -- in new technologies.
#9. To: war, Happy Quanzaa (#7)
The internet...another foolhardy undertaking.
Replies to Comment # 9. Space......
#12. To: Godwinson (#9)
Space......
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