Friday, February 27, 2009


A couple of months ago I made a couple of cryptic posting regarding energy. Most people did not quite understand the point of titling them "He Gets it".

I had suspected what was going to happen, and Tuesday's speech confirmed it: The only way to make alternative energy viable is to artificially raise the cost of mainstream energy through a cap and trade system.

Though this will generate a fair amount of revenue for the government (at the expense of energy consumers) this approach will ultimately fail for the simple reason that oil is abundant, cheap to extract and package, and has a lower environmental footprint than ethanol, solar, or wind.

OPEC and other oil producing countries simply have to lower the price of oil temporarily to more than offset any tax burden and reshape the economic equation in favor of fossil fuel.

Alternative Energy will need to win on its own merit. No amount of government involvement will alter that.

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