The truth is out there. Indeed it is Mulder and Scully. In fact, the truth can sometimes be found in such unpromising soil as a column by conservative pundit James Poulos or an address to investors by the CEO of Exxon. Poulos is known, if at all, for posing in print the antediluvian question: “What are Women For?” Yet Poulos provides real insight into how to solve anthropogenic global warming (“AGW”). As improbably and in conjunction with Poulos, top polluter Exxon’s Rex Tillerson blazed an unmistakable path to a clean green energy future earlier this week.
We may be seeing a bit of a shift in conservative commentary on climate change. Rather than deny it outright, some on the right now acknowledge its existence but downplay its costs or even claim mankind may reap significant benefits from underwater cities, super-storms, and desertification.
In a May 26 opinion piece, however, Poulos opts not to dump more manure on the steaming pile of denialism and Panglossianism that right-wing fossil fuel industry shills have spent decades building, shaping, and drenching in perfume. Instead, he acknowledges the scope of the problem and then loudly proclaims in his title no less, “Silicon Valley could save the world from climate change. But we don’t want them to.”
All we need do says Poulos is “turn Washington into the biggest venture capitalist in the world, and hand Silicon Valley a blank check marked ‘climate’” Forget about messy solutions like cap-and-trade or top-down approaches like higher CAFE standards. If we just open up the back of the Brinks truck at the corner of El Camino Real and Woodside in Palo Alto, the Zuckerbergs and Kalahnicks will save us.
This suggestion surely reflects genius of a kind. Recognizing that AGW is real and here to stay, Poulos figures why not make a grab on behalf of Silicon Valley elites for cold hard federal cash to combat it. Flush with billions, newly minted alternative-energy billionaires will spare a few million for that smart guy Poulos who came up with the “blank check” idea in the first place.
Now I’m no venture capitalist but after watching the ones who play themselves on Shark Tank a couple of times, I’ve gotten the idea that they don’t hand out blank checks. They crawl down the front and up and inside the backside of every would-be tycoon. When funds are offered, they are often less than the amount requested and invariably come with conditions. Small-fry tinkerers and inventors go on Shark Tank because they have nowhere else to turn for seed money.
Unlike the Papa John’s delivery guy whose board game will make us all forget Monopoly, NASA rocket scientists, Harvard engineers, Cal Tech physicists, and Neal DeGrasse Tyson don’t need a special introduction to get five minutes with and $5 million from Mark Cuban. But if Poulos is right, they’re not seeking or getting the money.
The VC boys aren’t the only ones sitting on their hands when it comes to AGW. As of July 2013, Exxon was sitting on some $50 billion in cash. Berkshire Hathaway had over $160 billion. These companies and others like them have far more than enough to finance lavishly alternative energy ventures without going near the sharks. Yet they too don’t appear to be focusing on alternatives.
Why? The answer is hiding in plain sight in CEO Tillerson’s retort this past Wednesday to a climate change activist who asked why Exxon doesn’t invest in renewable energy. “We choose not to lose money” the boss bon moted. Plutocratic financiers and immensely wealthy corporations will back planet-saving technologies in an environment where doing so successfully is likely to result in big profits. Putting gazillions of no-strings-attached dollars in the hands of entrepreneurs, as James Poulos urges, will not create such an environment.
There’s another huge problem with Poulos’s “solution” to AGW. As anyone who took econ 101 in college can tell you, government bureaucrats are the last people we should ask to distribute funds among aspiring clean energy magnates. The functionaries are unlikely to be true experts in asset allocation. If they were, they’d be in the private sector. Moreover, they’d be risking public assets, rather than their own, which means at best they’re not going to be as careful as a private investor would be. At worst, they’d demand kickbacks and other favors in return for conferments of largesse.
The blank check gimmick is a bad idea and would cost the American public dearly. Still I come not to bury Poulos but to praise him sort of. Buried in his commentary is the kernel of truth that can lead us to the promised land of nearly 100% renewable energy with minimal effect on living standards. That truth is technological innovation.
We know that technology can be a major part of the solution because it already is. Europeans enjoy a standard of living approximately equal to our own yet they consume far less fossil fuels per capita. California has taken huge strides towards fossil fuel independence with solar energy. In Hawaii, expensive power-plant electricity is supplemented by geothermal energy from the volcanoes that form the islands.
But we’re not moving nearly fast enough towards nirvana. Paraphrasing Tillerson, capitalists choose not to lose money. Presumably then clean green energy is not now sufficiently profitable for investors.
How could this be? The sun is a ubiquitous carbon-free energy source. Energy-suffused rays of sunlight pour down on the Earth constantly. Scientists say we receive more energy from the sun on an on-going basis than we use.
Yet coal, petroleum, and natural gas remain much cheaper per calorie generated. Fossil fuels are nearly pure energy from the sun that our planet received over eons and distilled naturally. Solar and wind energy harvesters and distributors therefore face a daunting competitive disadvantage as long as fossil fuels remain available to extract. Sadly, there’s still plenty. No wonder Tillerson was so flippant.
So what’s the answer? We must artificially raise the price of fossil fuels to a point where super-normal returns can be generated from alternative energies and technologies that reduce consumption. At that point, venture capitalists will compete to get in on promising ideas. The easiest and most efficient way to do this is by levying a very high tax on all forms of fossil fuel energy.
We owe James Poulos and Rex Tillerson a debt of gratitude for helping lead us inexorably to this conclusion.