We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are

Life, Liberty and the pursuit of Happiness.

That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed,

Monday, June 25, 2007

Pork-barrel spending: Greasing the "Dawn of the Solar Age"

by J. Christoph Amberger

Lobbying groups, popular wisdom has it, are bad. Evil. Criminal even. Nefarious shysters pushing shady deals out of sheer self-interest on corrupt politicians who will squander the taxpayers’ hard-earned money on lining the pockets of a few fat cats with filthy lucre.

By and large, I believe this description to be accurate... and the outrage at the practice as futile as it is staged. Because, let's face it, squandering your money on Bridges into Nowhere, endowments of experimental theater, and grants for the scientific exploration of flatulence in mice are what government is all about -- independent of what party wields the majority whip.

Fueled by billions in government money, politics creates economic realities. Alternative energy technologies, for example, still wouldn't be able to exist on a rational, commercially viable level, if they were not greased with liberal applications of pork-barrel spending, a fact that is not lost on anyone involved in the industry.

What most people don’t realize is that solar energy in particular owes a large part of its viability as an investment to the efforts of a high-powered lobbying group. Silicon Valley’s lobby group, TechNet, pushes for new laws that encourage solar energy. Quite successfully, if you look at the recent spate of "renewable energy" legislation rolling out of Sacramento... and even Washington.

TechNet executives -- including Cisco Systems CEO John Chambers -- just recently made the rounds in Washington for closed-door meetings with cabinet-level lawmakers. Their message: double spending on energy research. For Silicon Valley, solar energy has “tipped” from a cottage industry into a global market that will reach $40 billion in three years. Celebrities from politics, finance and entertainments are investing hundreds of millions of dollars into solar technologies, whose cost side will be buffered and absorbed by direct and indirect government subsidies:

State and federal subsidies helped push the U.S. solar-energy market up 33% in 2006 over the previous year, says market researcher Solarbuzz.

President Bush created solar-energy subsidies of up to $2,000 for homeowners, with even more in store for businesses.

In New Jersey, incentives make it more affordable than ever to own a solar energy system. The rebates can cover more than 50% of the cost. The program proved so popular that New Jersey’s Clean Energy Program is currently oversubscribed.

And as part of its Million Solar Roofs program, California intends to create 3,000 megawatts of new solar-produced electricity by 2017. That equals the peak output of six modern natural-gas-fired power plants.

With this kind of setup, is it any wonder that Peter Lynch, who managed the enormous Magellan Fund to 29% average annual returns, called 2005 “The Dawn of the Solar Age"?

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