No Matter Who's Elected, Alternative Energy Wins 12 comments
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It’s too early to tell whether Democrats or Republicans will make history in November. No matter who gets elected, though, alternative energy wins.
As a general rule of thumb, your humble Taipan Daily editor tries to avoid talking politics like the plague.
When forced to hear about the merits of Democrats or Republicans (having been cornered at a party or what have you), the closing paragraph from George Orwell’s Animal Farm comes to mind:
Twelve voices were shouting in anger, and they were all alike. No question, now, what had happened to the faces of the pigs. The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but it was already impossible to say which was which.
Having got that cynical bit out of my system, I’ll admit there are some substantive differences this time around.
From an investment trend standpoint, though, at least one thing seems certain: No matter who gets elected, alternative energy wins.
A Real Horse Race
To quickly recap events, both candidates stepped up and helped their own causes last week.
On the Democrat side, Obama was widely seen as meeting or exceeding expectations with his historic acceptance speech. The Clintons also did their part for party unity (and graciously refrained from wrecking the convention).
On the Republican side, John McCain shook up the race (and garnered huge media attention) with his surprise pick of Sarah Palin, governor of Alaska and mother of five, for VP. In response, the talking heads were either elated or infuriated. Debate rages on.
The bottom line is, this thing looks like a horse race. The polls are close as I write, though that could obviously change in a “heartbeat.” (Why do I suspect we’ll be sick of that word by November.)
History buffs are excited because 2008 will be a landmark year for the White House, no matter who wins. Here’s why alternative energy investors should be excited, too.
If Obama wins, the “greens” will have a powerful upper hand.
An Obama administration will be deeply beholden to the “greens” on multiple levels. Party players, green lobby interests, and grass-roots supporters will create a powerful alignment.
On the player side, think of elder party statesmen like Al Gore. Love him or hate him, Gore has reinvented himself as the larger-than-life face of environmentalism. If his party wins, he’ll play a big role... and get an even bigger megaphone. You’ll also see and hear more from green voices with clout, like New York Times columnist Thomas Friedman.
Green lobbyists and grass-roots supporters will not be shy in holding the Democrats’ feet to the fire if they win. With control of both the executive and legislative branch, there will be an overwhelming sense of “If not us, who? If not now, when?”
As for who will pay for the tens of billions (or even hundreds of billions) in green subsidies if Democrats win, that’s easy: Big Oil. (Three words: windfall profits tax.)
This is one of those cases where backroom politics and emotional sentiments perfectly align. The Dems are drooling at the thought of sticking it to the Big Oil fat cats, and using the money they extract to help save the planet at the same time.
One of the big worries for the green movement is too big a decline in fossil fuel prices. The general fear, already voiced loudly by pundits like Friedman, is that America might be tempted to go back to “business as usual” if a gallon of gas gets cheap again.
With Obama in the White House, though, the moral imperative of going green will keep the money flowing to green projects no matter what. Even if the price oil continues to fall, the greens will be humming along with The Who: “Won’t get fooled again.”
If McCain wins, the oil and gas “fear premium” will be back with a vengeance.
John McCain, on the other hand, relishes his image as a maverick warrior. His habit of playing the impulsive gambler has proven both a blessing and a curse over time (the raging debate over his VP choice serving as latest example).
On the plus side, McCain’s willingness to “tell it like it is” endeared him to many during the 2000 presidential campaign and cemented his reputation for blunt honesty.
On the negative side, McCain’s habit of making light of serious things has raised eyebrows in the past. (Like when he sang “Bomb, bomb Iran” to the tune of the Beach Boys’ “Barbara Ann.”)
And when it comes to Russia, the famed McCain temper comes into play... because the man simply hates Vladimir Putin’s guts.
In a foreign policy speech in March of this year, McCain openly called for booting Russia out of the G8 (a club of the world’s wealthiest democracies). In the rarefied world of international diplomacy, that’s the rough equivalent of spitting in someone’s eye.
McCain has also flatly accused Russia of “nuclear blackmail” and “cyber attacks.” And when the South Ossetia conflict broke out, McCain took sides aggressively, declaring “We are all Georgians” to the press.
For various reasons, as you can see, a McCain White House would be close to a war footing with Russia from Day One. (In Moscow they know this full well also.) Some columnists have joked about the possibility of McCain taking things to the brink with Putin... and then having “hockey mom” Palin step in. (It’s almost a funny thought but not quite.)
Make no mistake; the “new energy cold war” has already begun. On Monday, the UK Telegraph reported, “Fears are mounting that Russia may restrict oil deliveries to Western Europe... in response to the threat of EU sanctions and Nato naval actions in the Black Sea.”
If McCain is elected, though, energy traders will have something new and potent to chew on.
While an Obama White House is likely to err on the side of caution, geopolitically speaking, a McCain White House is far more likely to err on the side of aggression. With Russia especially, but others, too (like Iran or Venezuela).
That shift in the risk matrix would put global slowdown on the back burner of oil traders’ minds and make supply disruption worries a key factor once again.
Which, in turn, would send the price of oil climbing back towards $150 as the fear premium heats up... keeping the pressure on to find and fund alternative energy solutions.
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This article has 12 comments:
Russia is blackmailing the EU. But what the heck, its only Georgia. They just made an announcement that they will feel free to protect its citizens "wherever" they are. (Financial Times, a cple. of days ago) The Baltic States have large Russian Minorities, leftovers from the forced relocations during the USSR domination. NATO is planning military additions to them. Standing aside in Georgia will only feed more aggression elsewhere not less. History will repeat.
Does a Bully stop because you give whatever is wanted or just asks for more knowing full well what the reponse will be.?
Either we stand united or we will be picked off "one by one".
Liquid petroleum fuels are inelastic to a certain price point and starts to become more elastic above that. All we need is a congress with GUTS to do the right thing for the future of this country.
Rikiki
Do you need a bigger target then? How about the Ukraine next, Poland? If size is all that matters, we can reimpose the Monroe Doctrine and wait until we stand alone.
History repeats, Hitler started out small too.
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Animal Farm analogy doesn't wash
IMHO there is a big difference between the two parties:
I. Republican ideology:
1a. Find an enemy and blow them out of all proportion. Say it over and over again till enough believe it.
1b. Move the 51% by fear: they will get you so you better help up get em.
1c. Tell everyone that opposes the ideology they are weak liberals.
1d. Destabilize areas of interest that can make money, move in and say you're going to create democracy.
1e. Make money for your self and friends and trickle it down to your branded cattle.
What you fear has a better chance to manifest. People rise to your greatest expectations.
Be nasty to your enemy and they may get you back when they can.
If they don't see you as a threat than they are less likely to grow armor and weapons.
Understand President Lincoln was a Republican, that was fair and if alive today his ideology would be that of the democrats.
--
II. Democratic ideology:
2a. Help as many people as you can..
2b. All are created to rise to the best equal.
2c. Communicate, negotiate, care for an amiable outcome.
2d. Know that the majority of people are good and see the best in all things.
What you care for has a better chance to manifest. People rise to your greatest expectations.
Be good to your enemy and you may make a friend.
Grow strong in body, mind and spirit, to know defense is a last option, which one does not need to use unless no other option.
Adding a significant tax on gasoline, and using that money only to subsidize the purchase of clean and fuel efficient cars will solve two major problems.
The worlds car manufactures would follow the demand and make a huge shift to producing the most subsidized cars.
The US would quickly reduce our oil imports.
Help to avoid catastrophic climate change.
here
Hardly a rationalization for further government profligacy, and outright corrupt paybacks to those in the universities, government bureaucracies, and environmental and "community" organizations who elect the democrats, and who receive research grants, lifetime jobs, and massive state and federal funding in return.
I guess only the United States is morally fit enough to own nuclear weapons?
The primary source of energy for most of the economies in the world today is oil, coal and natural gas. These are commodities that are purchased on a worldwide market. We all pay the going rate and therefore we all have the same basic cost of energy.
We are currently faced with peak oil. In the next few years our existing oil will diminish and demand will increase. Supply and demand dictates that the world wide price of oil will continue to escalate.
A new paradigm for worldwide economic competition:
The country that has the lowest cost of energy will be able to supply goods and services to the world for a lower cost or a higher profit margin. This would also mean a higher standard of living and a more robust economy for a country that has the lowest cost of clean energy.
Sufficient amounts of clean energy, will probably necessitate constructing multiple large nuclear power plants. Wind, solar, geothermal, tide and wave power are all great and will probably not be enough to meet the realistic demands of our economy.
Basically we need to:
• Add a carbon tax or cap and trade system that will sufficiently add to the cost of those who pollute. Use the revenue from this tax to subsidize alternative energy.
• Carbon and pollution cost will also need to be added to imported goods.
• Fast track the construction of nuclear power plants and utilize the technology that will transfer large amounts of power for long distances with little or no line loss.
• Add a tax to gasoline that will gradually increase, on a timescale, to a very significant amount. This tax money will go into a fund that can only be used to subsidize the purchase of the cleanest most gasoline efficient cars.
The abundant power of the nuclear plants can also be used to generate hydrogen gas. The hydrogen gas can be used in many ways; a substitute for gasoline, diesel, home heating, etc.
The gasoline tax and subsidy for the purchase of small clean cars will dramatically change the cars that are produced. The manufacturers will be scrambling to create the cars that receive the greatest percentage of the subsidy. Theoretically one could buy the equivalent of a Toyota Prius and have the government pay for one half or more.
These are drastic economy shaking ideas.
The reality of our needing to eliminate our dependence on foreign oil and the immediate and real threat of catastrophic climate change, justify and demand drastic changes.
Creating our new energy environment, and fast tracking these changes, will invigorate our present economy. Fast tracking means, environmental impact report not needed and a moratorium on lawsuits. The environmental impact of the status quo is obvious.
Neil Davis in Rocklin Calif.
Ronna_and_neil@hotmail...
Our future economy and our competitive position in the world will depend on inexpensive and abundant energy. Energy is the basis of all of the world’s economies. The country that has the lowest cost of clean energy will have a significant leg up in the future world economy.
The primary source of energy for most of the economies in the world today is oil, coal and natural gas. These are commodities that are purchased on a worldwide market. We all pay the going rate and therefore we all have the same basic cost of energy.
We are currently faced with peak oil. In the next few years our existing oil will diminish and demand will increase. Supply and demand dictates that the world wide price of oil will continue to escalate.
A new paradigm for worldwide economic competition:
The country that has the lowest cost of energy will be able to supply goods and services to the world for a lower cost or a higher profit margin. This would also mean a higher standard of living and a more robust economy for a country that has the lowest cost of clean energy.
Sufficient amounts of clean energy, will probably necessitate constructing multiple large nuclear power plants. Wind, solar, geothermal, tide and wave power are all great and will probably not be enough to meet the realistic demands of our economy.
Basically we need to:
• Add a carbon tax or cap and trade system that will sufficiently add to the cost of those who pollute. Use the revenue from this tax to subsidize alternative energy.
• Carbon and pollution cost will also need to be added to imported goods.
• Fast track the construction of nuclear power plants and utilize the technology that will transfer large amounts of power for long distances with little or no line loss.
• Add a tax to gasoline that will gradually increase, on a timescale, to a very significant amount. This tax money will go into a fund that can only be used to subsidize the purchase of the cleanest most gasoline efficient cars.
The abundant power of the nuclear plants can also be used to generate hydrogen gas. The hydrogen gas can be used in many ways; a substitute for gasoline, diesel, home heating, etc.
The gasoline tax and subsidy for the purchase of small clean cars will dramatically change the cars that are produced. The manufacturers will be scrambling to create the cars that receive the greatest percentage of the subsidy. Theoretically one could buy the equivalent of a Toyota Prius and have the government pay for one half or more.
These are drastic economy shaking ideas.
The reality of our needing to eliminate our dependence on foreign oil and the immediate and real threat of catastrophic climate change, justify and demand drastic changes.
Creating our new energy environment, and fast tracking these changes, will invigorate our present economy. Fast tracking means, environmental impact report not needed and a moratorium on lawsuits. The environmental impact of the status quo is obvious.
Neil Davis in Rocklin Calif.
Ronna_and_neil@hotmail...