Mitt Romney is making a genuinely conservative effort to free up the market by requesting that the production tax credit (PTC) for wind energy expire at the end of this year. Per contra, President Obama is hoping to squeeze some juice out of his lemon of a re-election campaign by telling voters that their tax dollars should continue to fund the prolonged death of a failing industry.
The PTC is a subsidy that pays for a king-sized portion of the costs of energy investors to build windmills that generate electricity. The subsidy credits producers 2.2 cents per kilowatt-hour of electricity that the windmills produce. The going price for electricity is anywhere from 3 to 4.5 cents per kilowatt-hour. This means that the PTC makes up 50 to 70-percent of the wholesale price of electricity.
That’s your money, taken by Washington reprobates, being used to incentivize wealthy businessmen to produce inefficient energy. Don’t worry that it’s not financially viable for them. You’re footing the bill!
Explaining Romney’s opposition to the $5.2 billion subsidy, spokesman Shawn McCoy said: “[Romney] will allow the wind credit to expire, end the stimulus boondoggles, and create a level playing field on which all sources of energy can compete on their merits. Wind energy will thrive wherever it is economically competitive, and wherever private sector competitors with far more experience than the president believe the investment will produce results.”
Obama defended the PTC by claiming that 37,000 jobs would be created in the next year if the credits were extended. He, of course, left out liberals’ favorite economic question to not ask: at what cost? The answer to that question is over $140,000 per employee.
At a rally in Pueblo, Colo., the President said: “It’s time to stop spending billions in taxpayer subsidies on an oil industry that’s already making a lot of profit – (applause) – and let’s keep investing in new energy sources that have never been more promising.”
Let’s pause for a moment and size up Obama’s “never been more promising” remark. Twelve green energy companies have received Department of Energy (DOE) loan guarantees and gone bankrupt (including Solyndra which went under after Obama granted them half a billion of our tax dollars).
$6 million of tax credits and a $15.6 million DOE loan went to the company Armonix. Since then, Armonix has laid off approximately 200 employees and has closed its North Las Vegas solar plant. Raser Technologies got itself $33 million in a grant to build a power plant. The company is now bankrupt. Nevada Geothermal Power received $98.5 million in loan guarantees. After laying off 100 workers, an auditor for the company has said that it is unlikely they will stay afloat.
Mr. President, I am not interested in your prescient ability to graph the prospects of green energy. You’re terrible at it.
Romney not only stands in direct contrast to President Obama’s startling naiveté, but also to the crony greed of establishment Republicans. Fat cat Senators like Charles Grassley (R-Iowa), Orrin Hatch (R-Utah) and others would prefer that the PTC remain intact for their constituencies, or if it must be ended, that it be phased out very slowly. Candidate Romney’s opposition to the subsidy even caused it to be removed from a tax-extenders plan that the Senate voted on earlier this month.
Romney could have easily fallen in line with the establishment on this issue; it’s a topic not too many outside of states like Iowa and Colorado are familiar with, and it would have helped him steal some of those votes from Obama. But he’s recognized, with his pick of Paul Ryan as VP and with this, that grassroots fiscal conservatives are going to be an integral part of his campaign, and are not worth getting in a fight with.
Now that Romney’s beginning to embrace our ideas, it’s time we really got behind him to fight a common enemy. Our tax dollars are as green as green energy, and President Obama is hungry for both.
Keith Fierro | Cal State Fullerton | @KJFierro