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Robert Zubrin writes


Congress could make an enormous step toward American energy independence within a decade or so if it would simply pass a law stating that all new cars sold in the U.S.A. must be flexible-fuel vehicles capable of burning any combination of gasoline and alcohol. The alcohols so employed could be either methanol or ethanol.

Zubrin continues,


Flexible-fuel vehicles (FFVs) offer consumers little advantage right now, because the high-alcohol fuels which they could employ are not generally available for purchase. This is because there are so few such vehicles that it doesn’t pay gas station owners to dedicate a pump to cater to them. Were FFVs made the standard, however, the fuel they need would quickly be made available everywhere.

...This chicken-and-egg problem can be readily resolved by legislation. One major country has already done so. In 2003, Brazilian lawmakers mandated a transition to FFVs, with some tax incentives included to move things along.


I have heard the "chicken-and-egg" excuse for hydrogen, as well. But Zubrin writes,

When hydrogen is made by electrolysis, the process yields 85 units of hydrogen energy for every 100 units of electrical energy used to break down the water. That is 85 percent efficiency. If the hydrogen is then used in a fuel cell in an electric car, only about 55 percent of its energy value will be used; the rest is wasted to heat and so forth. The net result of these two processes: the amount of useable energy yielded by the hydrogen will be only about 47 percent as much as went into producing it in the first place. And if the hydrogen is burned in an internal combustion engine to avoid the high production costs of fuel cells, the net efficiency of this vehicle will be closer to 25 percent.

Meanwhile, Peter Huber says,

Mr. Bush proposed modest new support for the development of technology to help displace gas-fired electricity with "clean coal," "safe nuclear" and "revolutionary solar and wind technologies." Wind and solar combined currently deliver about 0.02 BBOE a year, so the green revolution won't arrive any time soon. But we do use about seven BBOE of coal, uranium and natural gas to generate electricity. Simply shifting the mix toward coal and uranium, and away from natural gas will curb demand for oil -- significantly in the short term, and dramatically down the line.

On the wood chip issue, he writes,

The question isn't whether carbohydrates can be turned into hydrocarbons, it's whether corn and wood will ever be as cheap and easy starting points as fossils. Alberta's tar sands, for example, currently yield about 0.4 BBO per year, contain 180 BBO recoverable with current technology [more than 25 years of U.S. oil consumption], and hold another 1,000 BBO (at least) that will become accessible as technology improves.

I really think we should let the market sort all this out, rather than have an energy policy.


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COMMENTS (23 to date)
Boonton writes:

Speaking of Brazil, how about dropping the tax on imported ethanol from there? I understand that Brazil's climate and geography give it a nice comparative advantage towards producing fuel from sugar than anything we can do here in the US.

liberty writes:

That sounds like a good start, Boonton.

Ivan Kirigin writes:

Boonton,

The nice thing about eliminating tariffs is that it doesn't really matter if they can do it better. Consumers will get the best regardless.


I've been told FFV do not add additional cost, but that doesn't mean performance is left unchanged. In some cases, FFV versions get better horsepower when using E85.


I'm not sure legistlation is needed, considering where consumer demand is going. The SOTU will surely convince more people that they should pay for alternatives.

My dream car:
2-person covered motorcycle plug-in hybrid FFV with a large set of the newest Li-Ion batteries.

It could easily get hundreds of miles per gallon of E85, meaning at least two orders of magnitude less gasoline used. Look at something in the prototype stage:
http://drinktank.blogspot.com/2006/01/330-mpg.html

That this is around the corner makes me very unconcerned about oil security/environmental impact.

Still, something needs to be done about things like Iranian nukes...

Econ_in_AK writes:

Even though I've got some interest in seeing favorable legislation for ethanol, the all flex-fuel vehicle thing won't be necessary - especially if they lower tariffs from Brazil.

As ethanol becomes consistently cheaper, consumers will demand it. It will become cheaper too. Ethanol plants can make 3 or 4 products. Ethanol, a grain mash (for livestock feed), and CO2 for carbonated beverages. At least one plant makes a top-notch Vodka as well. They're getting more efficient and better exploiting these alternative income streams each year.

There's about 100 plants currently being built. Demand is probably growing even faster, thus, even if they make greap leaps in production efficiency the price at the pump will only be slightly less than gasoline. That slight difference is still enough to push people towards E85 fuels and flex-fuel vehicles. Obviously this means bigger profits for Ethanol producers.

If you think about it, it's a great time to be in the Ethanol business. Demand is growing faster than supply. The government wants to help you, and you can mark-up your product. All you have to do is beat the price of gasoline by a reasonable margin (to keep demand constant). The rest is profit.

daveg writes:

Which of these less than ideal choices would be preferred:

1) Just place a $2.00/gallon tax on gas and let everyone figure out how they best want to respond, including the auto companies.

2) have governmentfund research into "new" energy sources.

To me, 1) is far preferable in that it allow the power of the maket to "solve" the problem. However, 1) maybe more difficult politically.

liberty writes:

>To me, 1) is far preferable in that it allow the power of the maket to "solve" the problem. However, 1) maybe more difficult politically.

No. Leaving the market to solve it is leaving the market to solve it - the price goes up as supply goes down, you need to add any tax, let alone *more* taxes (it's already 70% taxes you pay at the pump).

How about another option:
...invest in businesses that are looking at alternatives, put out a magazine devoted to investing in such businesses, put out public service announcements on the subject, write editorials on the subject, work with scientists to discover new things, donate to charity foundations that fund such science...

T.R. Elliott writes:

I agree that we should let the market sort it out. But my experience with technologies as diverse as solid state physics, digital wireless communications, and the internet convince me that govt sponsored research leads to spin offs and side affects within the broader commercial world.

Many of the technologies that we are currently using today on the internet were spearheaded as the result of govt projects, for example. DARPA played a significant role in creating the internet, developing command and control systems, user interfaces, etc.

I think what commonly happens, in my experience, is that we have people with little familiarity with technology other than how to create a web page and brouse the web (and cursory understanding of what the letters TCP/IP means) assuming that this stuff just exploded from private interprise. It didn't. And anyone who thinks it did is uninformed.

daveg writes:

Hey, I am all for just letting the market sort it out.

I just got the sense that some on this blog thought GWB propossed energy policy was a good thing. You know, becuase the middle east oil gives "rouge" regimes too much power.

liberty writes:

>Many of the technologies that we are currently using today on the internet were spearheaded as the result of govt projects, for example. DARPA played a significant role in creating the internet, developing command and control systems, user interfaces, etc.

True but those were generally because the government, within its constitutionally limited sphere of powers, worked on a project for a specific purpose: eg military; and then others - private firms - saw other uses for the technology and took for example an unrecognizingly primitive computer and made a PC from it. Basic research grants, on the other hand, tend to produce endless reams of similar reports on global warming that focus on 100 year periods or two icecaps, missing the larger picture. Not to say all basic research grants - I do think education (though it can all be *private*) - should continue to give grants to basic research as part of their faculty work.

Jody writes:

I'm actually with T.R. on this one (blame the shared background of digital wireless), the method of letting the government fund basic research and then stepping out of the way has worked pretty well in the past, so if I must choose between a tax and government funding of research, I'll choose government funding.

My preference, however, is for prize-based research ala the Grand Challenge or the X Prize (or the Methuselah Mouse prize). 10 billion for a base on the moon that functions for one year; 10 billion for a functioning space elevator that can haul x amount of tonnage a year; some large sum of money for achieving a suitably high solar energy conversion efficiency.

That way, you a) foster the research b) only pay if it pans out, and c) probably end up with several different companies/people achieving the result - i.e., instant market.

liberty writes:

>My preference, however, is for prize-based research

That is certainly a much better solution than the other government interventions. If we use that cautiously for certain things that we deem important I would not be against it. If we taxed only for the basic limited role of government (army, police, congress, courts) and then had lottery funds for other project, we could use the money from the lottery funds for things like that. Lotteries can bring in billions of which millions are paid out to the winner and the remiander can go to prize-based science research. That way its a voluntary tax.

I know, far-fetched fantasy world, still it would be a great solution.

In addition, corporations and private foundations can always do prize-based research, paying only if it pans out and hence reducing the risk that they must take so that they would be willing to pay for much more basic research and far-fetched projects. In fact, that is pretty realistic and I think has been done before.

T.R. Elliott writes:

Most of the Govt R&D I refer to was used to solve specific problems. E.g. secure communications, reliable communications, low-power communications. And then a lot of interesting spin-offs came from them.

Truth be told. A lot of that money was wasted. A whole lot. But I've seen loads of waste in the private sector as well. I'd love to see an analysis of how much waste, economy wide, has been the result of inordinate bankruptcies and blind alleys (or market bubbles) in the last fifty years. I suspect the numbers would be mind boggling.

Nanotechnology, biofuels, hydrogen production and distribution, innovative nuclear, perhaps even fussion--are all areas in which govt can prime the innovation pump.

K writes:

I personally favor higher taxes on oil imports. Start at $5 per barrel This may not be possible the way we have tied the nation up with trade agreements.

Raise the tax by the rate of inflation pluse 2$ each year until a policy change makes sense.

Bulky imports are hard to conceal so collection is easy and smuggling difficult. The measure would have to apply to carbon in many forms - oil, gasoline, LPG, alcohols, etc. Still it isn't very hard to define the table for the big fuels, and the little ones hardly matter.

It certainly would begin to focus the population to the fact that overseas fuel supplies are the nations biggest problem.

Vorn writes:

liberty:

I don't see why the government needs to pay for police at all. Why not just have private individuals pay for their own police protection? Then, naturally, those assets and individuals most worthy of protection will receive the most and a more efficient allocation of protective services would result. Now, you have centralized bureacracy choosing the allocation of police officers, and they may not hire the optimal number of police officers nor direct police to perform optimal patrol patterns so that the loss of what is important to criminal behavior is minimized.

When you say it should be government should be limited, what does that mean? I don't think you can arbitrarily privilege certain services and then assert that this is principled. You may think that protection from crime is so important that government should pay for police; someone else may argue that protection from disease is so important that government should pay for medical care. I don't see a principled difference. Crime and disease are both unfortunate things that people have limited control of and would generally like the assistance of others in dealing with.

Why we are at it, why doesn't this analysis apply to the courts? People who want to prosecute people for crimes can pay a fee, as well as those who want to bring a civil suit.

Finally, why shouldn't members of Congress receive pay in the form of donations from their supporters? This would ensure that the attention of members of Congress are optimally allocated. Naturally, they would pay attention to the most important interests -- those that pay for their salaries, first. What is wrong with that? Sounds like a free market.

EVERYONE thinks government should be limited. The question usually is, limited in what ways and to what degree. And more importantly, limited based on what principles? You had better be careful, because the principles that allow for a government funding of Congressional salaries, police, or courts may in turn be used to justify government funding of a lot of other different things. It isn't principled to just choose your favorite government functions without being able to articulate a convincing principle concerning why others should agree. Unless, of course, you think it is all a matter of taste; in that case, any government function is on the table.

Jon writes:

Arnold Kling writes:

I really think we should let the market sort all this out, rather than have an energy policy

Does this mean bring the troops home from Iraq and ending foreign policies that support American interests? Probably not...

Would it be more efficient for us to stop spending billions on fighting wars to keep oil rich countries "stable" and instead spend half of it on nuclear and biomass?

While I agree markets are an important part of the solution, one must recognize that even solutions that appear "market based" often still have heavy government involvement, particularly in the area of national defense and foreign policies.

If anyone doubts this -- why do we worry about the mideast more than other parts of the world?

daveg writes:

If anyone doubts this -- why do we worry about the mideast more than other parts of the world?

OILI - Oil, Israel, Logistics & Islam.

liberty writes:

>I personally favor higher taxes on oil imports. Start at $5 per barrel

You mean like they have had in Europe for decades?

liberty writes:

>Why not just have private individuals pay for their own police protection?

Because we have the right of equality before the law and this is to be provided in part by government afforded police, courts and prisons as enumerated in the constitution.

>When you say it should be government should be limited, what does that mean? I don't think you can arbitrarily privilege certain services and then assert that this is principled.

Not arbitrary, its called a constitution.

>Why we are at it, why doesn't this analysis apply to the courts? People who want to prosecute people for crimes can pay a fee, as well as those who want to bring a civil suit.

Equality before the law.

>Finally, why shouldn't members of Congress receive pay in the form of donations from their supporters?

Read the constitution.

>EVERYONE thinks government should be limited. The question usually is, limited in what ways and to what degree.

That is why we wrote the constitution. It lays out the exact confines of what the government should do. It says nothing about providing redistributive functions or an EPA or social security retirments - those are quite arguably beyond the constitutionally defined role of government. But the constitution spells out the role of central government in protecting life, liberty and property by affording courts, equality before the law, police protection, military and prisons. Why don't you spend an afternoon reading it and thinking about it and then come back and ask further questions.

liberty writes:

>If anyone doubts this -- why do we worry about the mideast more than other parts of the world?

Because they have oil that also makes them more powerful. They are tyrants, dictators with a lot of oil money (even if we had alternatives, they would hardly go broke overnight) and have invaded their neighbors; many other tyrants are poor and can't or haven't invaded anyone yet. There is also a lot of terror cells there. This doesn't mean that other parts of the world should be ignored, but our interest in oil is hardly the only reason for focus.

Scott Peterson writes:

How about eliminating federal subsidies for sugar growers in the US? With the subsidy eliminated, tbe price of sugar would drop significantly and sugar producers would have plenty of incentives to find alternate markets for their product. I.E. turning sugar into ethanol.

Vorn writes:

liberty:

1>
Vorn:
Why not just have private individuals pay for their own police protection?

liberty:
"Because we have the right of equality before the law and this is to be provided in part by government afforded police, courts and prisons as enumerated in the constitution."

Response: There is no duty for the government to provide police protection in the Federal Constitution. Read it. State government would be free under the Constitution to eliminate their police forces. (Well, unless you revert to some sort of "living Constitution" approach.)

2>
Vorn:
When you say it should be government should be limited, what does that mean? I don't think you can arbitrarily privilege certain services and then assert that this is principled.

liberty:
Not arbitrary, its called a constitution.

Response:
Why don't you read the Constitution rather than spewing ignorant statements? You should be embarassed, you really should.

Further, just because something is in the Constitution does not mean it is not arbitrary. The Constitution said that slaves would count as "three-fifths" of a person for purposes of representation. That is obviously arbitrary.

So, not only do you not know what the Constitution says, your making an argument that is extremely flawed from a logical and historical perspective.

3>
Vorn:
EVERYONE thinks government should be limited. The question usually is, limited in what ways and to what degree.

liberty:
That is why we wrote the constitution. It lays out the exact confines of what the government should do. It says nothing about providing redistributive functions or an EPA or social security retirments - those are quite arguably beyond the constitutionally defined role of government. But the constitution spells out the role of central government in protecting life, liberty and property by affording courts, equality before the law, police protection, military and prisons. Why don't you spend an afternoon reading it and thinking about it and then come back and ask further questions.

Response:
First of all, why don't you go to law school, like I have, and actually study the Constitution. Then you can be educated rather than ignorant. Is there a clause in the Constitution that requires states to provide police. No. Is there a clause that requires the Federal government to provide police. No. Is there a clause in the Constitution that requires the government to make lower federal courts. No. Is there a clause in the Constitution that requires states to provide courts. No. Is there a clause in the Constitution that requires the Federal government to provide a military. No. (It says Congress shall have power to ... raise and support armies. Not Congress must do so.) Is there a clause that requires Congress to build prisons. No. Is there a clause that requires states to build prisons. No.

You amaze me. You really do. You are really arrogant enough to invoke the Constitution when you don't even know what it says.

Here is a link to the Constitution. Why don't you read it. And why don't you avoid ever citing it when you don't know what it says. By the way, the Constitution should be capitalized when referred to. Show some respect.

liberty writes:

Clearly you have no idea what the constitution is for. It does not tell us we the government must do, it tells us what the government can do.

That is the purpose, it was supposed to prevent the government from growing into the wild beast it has become. If it is allowed to do these things than clearly this is part of a reasonable role for government in protecting life, liberty and property (as in the declaration). We had these values (eg equal protection)
already, as stated in the declaration, yet we had political fights at that time too - hence terrible compromises on issues like slavery - and it was with our values in mind that we penned the constitution. It was imperfect but it was the delineating of the intrusiveness that government was granted, marking the boundaries outside of which it was not to tread. We have long since escaped the boundaries.

> Is there a clause in the Constitution that requires the government to make lower federal courts. No.

But it does grant this limited power to the government (unlike social security, medicaid, the EPA, the DMV, etc etc which power is not granted)

"Section 1 - Judicial powers

The judicial Power of the United States, shall be vested in one supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish. The Judges, both of the supreme and inferior Courts, shall hold their Offices during good Behavior, and shall, at stated Times, receive for their Services a Compensation which shall not be diminished during their Continuance in Office."

>(It says Congress shall have power to ... raise and support armies. Not Congress must do so.

Thank you, that is my point. I have read the constitution many times, though I admit I have not gone to law school. I have also read the declaration of independence and many other documents of the time, I have read the debates of the time between federalists and anti-federalists, etc.

The powers granted by the constitution explain what the limits to the federal powers shall be; in other words they explain what the government is expected to do and what it cannot do.

Vorn writes:

liberty:

Thank you for admitting that you have not gone to law school and not devoted serius time and effort to studying the Constitution. But still, you seem to insist that I have no idea what a Constitution is for, even though I have done the above. Huh? I suppose next your going to say that you know more about computer science than me, even though it wasn't your major in college like it was mine. Your arrogance knows no bounds.

You: "Clearly you have no idea what the constitution is for. It does not tell us we the government must do, it tells us what the government can do."

First note. If the Constitution does not tell us what government must do, then it can't be the source of your principles concerning what the government should do within the discretionary space left to Congress. Hence, your citing of the Constitution to dodge the original question concerning the principles that should be used to determine the role of government has already failed.

I never said anything about this, one way or another. I was focusing on correcting YOUR mistakes, which you have failed to acknowledge. The Constitution does not as you said it does, do the following: "It lays out the exact confines of what the government should do." (emphasis added).

Sorry. Wrong answer. Try again. If the Constitution said exactly what the goverment should do, there would be no necessary and proper clause in Article 1 section 8. Among the powers the government has is to "provide for the general welfare" and do anything "necessary and proper" to execute its enumerated powers, including the regulation of interstate commerce.

I really don't care what you think about Constitutional interpretation. Your opinion isn't worth a thing; you have read the Constitution, or so you say. But are you familiar with the history of interpretation over time? No, your not; otherwise your first post would not insist that the government is required to have a police force. By the way, providing a police force or a prison system is not among the enumerated powers of Congress in Article I section 8. And in any case, police have traditionally been provided by states, not the Federal Government.

I noticed that you quoted part of Article III. For some reason, you just randomly quoted part of the Constition and don't provide any commentary. Bizarre.

Finally, you end with a mistatement. "The powers granted by the constitution explain what the limits to the federal powers shall be; in other words they explain what the government is expected to do and what it cannot do."

The framers knew and intended that the powers exercised by the Federal government were somewhat open-ended. Hence the necessary and proper clause.

Look, the bottom-line is this; you have lost quite a bit of credibility here. One should not spew fourth as fact things that are not true when they don't really know what they are talking about. Basically, you cited the Constitution as supporting you in your suggestion that you don't need a principled explanation concerning the role of the government -- you claim it is all laid out by the Constitution. Your totally ignorant. There is such a thing as ambiguity. There is also such a thing as incompleteness. Our Constitution, partially by design, partially by accident, contains both ambiguity and incompleteness with respect to its terms.

Anyway, all this so you can dodge the substance of my original quesiton. What principles should we base the role of government on in our modern system? All you can do is make an argument from authority -- when you don't even know what that authority is -- rather than answer the question. Why did you resort to this argument from authority? Most likely, because you don't have a good answer to the original question.

In addition, and I hate to tell you this, but the Constitution is both principled and unprincipled, depending on the clause in question. Having blacks count as 3/5ths of a person is NOT principled. Seperation of powers, on the other hand, is principled. Thus, merely citing the Constitution does not establish a principled explanation for the role of government. You still have the hard work of explaining and justifying (1) your particular interpretation of the Constitution and (2) justify your methodology of interpretation and (3) the particular clause your interpreting so a to establish that it is principled rather than arbitrary. Of course, I applaud you for laziness in trying to dodge the question of principles in this manner.

There is a final problem with your mention of the Constitution. It does not limit the powers of the states, except in very specific ways. Thus, when I ask the question, what should be the principles that determine the role of of government, the question applies to both the Federal and state governments. States have general police power -- meaning there are no limits, except as specified by state constitutions and those very few limits contained in the U.S. Constitution. To answer my original question I guess you need to resort to principled explanation rather than argument from authority, even if your ignorant statements concerning the Constitution were correct.

Oh, by the way, the Constitution needs to be capitalized. If you are talking about a constitution, it can be lower case. If you are talking about the Constitution, then use upper case. If you know the rule but then violate it, your just being disrespectful; an odd stance by someone who wants to make an argument from authority using the Constitution.

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