From yesterday’s Economist.com we find out that if there is one policy area that President Obama should not worry (about not being able to keep his promise), that is the renewable energy area as America has just become the world leader in wind power! They proudly say that last year America increased its wind-power capacity so much that it led to the overthrowing of Germany – the previous leader.
How cool… This seems to be excellent news that should make every American feel proud of his country and president. However, at a closer look, how good news is this?
First, I doubt that building more “capacity”, that is planting more wind farms, is necessarily a good thing for the economy. It depends on the efficiency of this form of energy in comparison with other possible alternatives. Questions such as, “what is the production rate per unit of time of all this newly created capacity?”, “What are the benefits provided by it in comparison with the costs of installing and maintaining it?” should have been answered in this article before jumping to easy conclusion.
Is it really so important for American people to know that they are nation is world’s number one in wind energy? May be, but I doubt they would enjoy it just for the sake of being number one as opposed to achieving it as a clear result of a competitive process.
Second, how can something like this be attributed to the current president? He has been in the office for only two weeks. This seems to be just one of those “lucky” coincidences in his case.
Well, you can’t use current prices for cost-benefit analysis because the entire point of the environmentalist agenda is that current prices are “broken” due to externalities and such and therefore they don’t reflect underlying true valuation.
I say, given all the sh*t going on in the world, some inefficient production of energy is the least of our worries.
Right, but “worrying” by adding up more “sh*t”, as you say, won’t solve world’s problems… for “the true valuation” we would ask God, if only we could, but we can’t.
Well, there’s no reason to be so nihilistic about our ability to know stuff. — We don’t need particular number. It’s enough to have a general argument, a.k.a. proof, that under certain circumstances, the prices that prevail will not support all mutually-beneficial trades.
Also, returning to the particular issue, part of the reason why wind is more expensive per [standard energy unit] is that coal and oil have been subsidized, directly and indirectly to some degree. Subsidized and also taxes and all that, so it’s pretty ambiguous. We can’t just look at prices.
In general, though, the larger philosophical point is, I think, to what degree we can read morality off The Economist’s back page with the latest commodity and stock prices