Monday, May 4, 2009

Coming Around on the Carbon Regulation Thing

Just as Mowgli was raised by wolves, I was raised by Republicans, and the vestiges of their teachings still resound within my pained and indecisive heart. So, despite my well documented love of algae farming as a prospective alternative oil source, I've been filled with enough free-market claptrap to have my doubts about carbon caps, credits, and regulations. I have stated that I fear the creation of a new market overlaying the existing one -- that such an artificial construct will not last.

But it has come to me like this. Any time a lobbyist has influence in government, this is also not a free market force . . . correct? So there goes Exxon spending 9.32 million on lobbying in the first quarter of 2009 in attempts to get its way with environmental regulations, drilling rights (on federal land), and tax breaks.

And there went the corn ethanol lobby trying to prevent Schwarzenegger from passing California's plan to cut carbon emissions by gas and Diesel producers by 15% over the next 11 years.. The lobbyists were worried that the corn ethanol industry would be harmed. But their very existence seems to me the result of governmental forces in the form of subsidies. From 2006 to 2011, the corn ethanol industry will receive 5.7 billion in federal tax cuts. Who knows where these large corporate bastions of capitalism would be if they really had to compete in a truly free market, without government intervention?

So given that so much non-market governmental influence has steered the course of our private sector anyway, I've decided I will no longer express doubts about reasonable and gradual enforced reductions in carbon emissions, or about carbon caps and trading. It seems to me to amount to the government helping one industry or another, but not necessarily an overall increase in government influence.

California passed that regulation. This has eliminated that state as a market for corn ethanol. Obama wants to set similar regulations to a national level. I say, bring it. And if this helps the algae to flow as a very low carbon-footprint product, then that's all the better.

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