Two studies spotlight how the Obama administration’s political drive to make economic winners of “green” ventures with public subsidies is creating bubbles, obscuring true costs and threatening taxpayers.
A Taxpayers Protection Alliance study finds that subsidies have so distorted the solar-energy market as to create “an artificial demand,” reports The Washington Times. And that will lead financial institutions to further inflate “a ‘bubble’ that will burst when federal and state backing begins to dry up.”
Noting the Solyndra debacle that cost taxpayers $530 million, the study warns that government, unwilling to let the industry sink, might decide to use taxpayer money to keep it afloat when this bubble bursts.
A report from Utah State University’s Institute of Political Economy says when subsidies, infrastructure and other factors are taken into account, generating wind power costs about 48 percent more than its advocates claim.
The American Wind Energy Association responds by attacking the institute’s funding by the conservative Koch brothers and saying the report omits subsidies for other energy sources, such as natural gas.
But wind and solar, unlike natural gas, can’t compete successfully on their own merits. They rely on government intervention to artificially prop up markets.
When Washington engages in picking winners, taxpayers and the economy become losers.
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