{"id":276,"date":"2012-11-29T23:05:57","date_gmt":"2012-11-29T23:05:57","guid":{"rendered":"http:\/\/www.wallstreetandkstreet.com\/?p=276"},"modified":"2012-11-30T16:07:21","modified_gmt":"2012-11-30T16:07:21","slug":"the-other-euro-crisis-u-s-markets-trump-european-science","status":"publish","type":"post","link":"https:\/\/www.wallstreetandkstreet.com\/?p=276","title":{"rendered":"The Other Euro Crisis \u2013 U.S. Markets Trump European \u201cScience\u201d"},"content":{"rendered":"

A smart sociologist once noted that every nation has a metaphorical mass movement that captures its mentalite<\/em> — for Americans, it is the trek into the frontier; for the French, storming the Bastille; for Chinese Communists, the Long March; for the Jews, wandering in the desert.<\/p>\n

And for the European Union? \u2013 A few dozen well-dressed politicians and technocrats, huddled in a conference room drafting rules, regulations, and \u201cdirectives\u201d for their fellow citizens.\u00a0 It is a non-stop process.\u00a0 Long-time readers of The Financial Times<\/strong> know there is always at least one urgent negotiation under way in Brussels — crafting the Maastricht Treaty, drafting the EU Constitution, deciding whether to admit new members, launching the Euro, or formulating the \u201c20\/20\/20 directive\u201d to address climate change.\u00a0\u00a0In the words of Bjorn Lomborg, 20\/20\/20 \u201caims to cut greenhouse gas emissions to 20 per cent below 1990 levels by 2020 (and ensure 20 per cent renewable energy).\u201d<\/p>\n

And now Eurocrats have spent three years arguing about how to contain the Euro-crisis they set in train by creating a single currency for 17 economies that have separate and distinctive labor markets, fiscal policies, and banking systems. \u00a0This colossal blunder has obscured the costly failure of Europe\u2019s climate change policy, which was nicely delineated by Dieter Helm in a recent New York Times<\/strong> article.\u00a0 Unlike your scribe, Mr. Helm, a professor of energy policy at Oxford University, is not a benighted climate change skeptic; on the contrary, he fervently believes in \u201cputting a price on carbon\u201d to save the planet.<\/p>\n

So why does Mr. Helm believe Europe\u2019s carbon policy has failed?\u00a0 For reasons that, frankly, could have been foreseen years ago.\u00a0 Europe has invested heavily in expensive \u201crenewable\u201d power such as wind and solar, but this has had a negligible impact on global greenhouse gas emissions because A) the high cost of energy has chased energy-intensive industries to China and other coal-based economies,\u00a0 B) any small emission reduction achieved in Europe has been overwhelmed by massive emission increases in China.\u00a0 Europe fancied itself a \u201cleader\u201d on global climate change, but no one followed.\u00a0 European pain has produced trivial global gain.\u00a0 The resulting \u201clack of competitiveness\u201d has exacerbated the Euro-crisis we read about every day.\u00a0 (California is in the process of making the same mistakes.)<\/p>\n

But it gets worse for Europe\u2019s greenies.\u00a0 While they were \u201cdoing the right thing\u201d to lead on global climate change and failing miserably, across the pond in the U.S. greedy capitalists who refused to ratify the Kyoto Treaty were doing something that actually managed to both A) reduce carbon emissions and B) strengthen the U.S. economy and raise living standards.\u00a0 Using fracking technology, U.S. energy companies produced vast quantities of natural gas, which is much \u201ccleaner\u201d than coal (if you consider CO2 a pollutant). \u00a0In the U.S., Mr. Helm notes, emissions \u201care falling faster than Europe\u2019s.\u201d \u00a0No thanks to America\u2019s enviro-gentry.\u00a0 Tom Friedman\u2019s 2008 book on energy policy, Hot, Flat, and Crowded, <\/strong>does not even mention fracking.<\/p>\n

Europe\u2019s misadventures in both economic policy and \u201cclimate science\u201d illustrate the stark limitations of top-down planning by elites, be they in Brussels, Washington, Moscow or Beijing.\u00a0 Self-admiring progressives\u00a0like Paul Krugman love to contrast their brainy, empirical, coolly analytical approach to policy issues with that of Republicans who are \u201cfundamentally hostile to the very idea of objective inquiry.\u201d\u00a0 But it was Democrats who wanted to follow Europe\u2019s disastrous energy policy.\u00a0 What is more \u201cirrational\u201d \u2014 \u00a0believing the world was created in seven days, or believing that China, which is building a new coal-fired power plant every week, would \u201cfollow our lead\u201d if the U.S. foolishly spent trillions on renewable energy?\u00a0 The Chinese are not that dumb; they know wind and solar cannot come close to meeting the energy needs of an advanced industrial economy.\u00a0 Come to think of it, so does Uncle Sam; the EIA forecasts that in 2035 only around 5% of U.S. electricity will be generated from wind and solar.<\/strong>*<\/p>\n

 <\/p>\n

*Energy Information Agency, Annual Energy Outlook 2012<\/strong> (June 2012), Table 25.\u00a0\u00a0 The EIA estimates total electricity generation plus imports of 5004 billion kilowatt hours, of which 780 or 15.6% are \u201chydroelectric\/other.\u201d\u00a0 The 5% figure assumes that a third of this 780 is wind and solar, which may be generous given that the category is broad and includes \u201cconventional hydroelectric, pumped storage, geothermal, wood, wood waste, municipal waste, other biomass, solar and wind power, batteries, chemicals, hydrogen, pitch, purchased steam, sulfur, petroleum coke, and miscellaneous technologies.\u201d\u00a0 These sources seem to be listed in order of importance, and \u201csolar and wind\u201d only rank eighth.<\/p>\n

Copyright Thomas Doerflinger.\u00a0 All Rights Reserved.<\/p>\n","protected":false},"excerpt":{"rendered":"

A smart sociologist once noted that every nation has a metaphorical mass movement that captures its mentalite — for Americans, it is the trek into the frontier; for the French, storming the Bastille; for Chinese Communists, the Long March; for … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[63,64,65],"class_list":["post-276","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-eurozone","tag-global-warming","tag-renewable-energy"],"_links":{"self":[{"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/posts\/276","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=276"}],"version-history":[{"count":5,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/posts\/276\/revisions"}],"predecessor-version":[{"id":281,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=\/wp\/v2\/posts\/276\/revisions\/281"}],"wp:attachment":[{"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=276"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=276"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.wallstreetandkstreet.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=276"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}