Don’t Count Your Legislative Failures Before They Occur

Dave Roberts, who put in a strong bid to claim the mantle of resident blogosphere pessimist, brings further pessimism to the Green Bank issue.

One of the most excellent pieces of the climate bill now awaiting defenestration at the hands Senate Blue Dogs is its creation of a Clean Energy Bank that would help finance nascent clean energy projects. More specifically, it is “an autonomous Clean Energy Deployment Administration (CEDA) within the Energy Department” that would “provide a suite of financing options, including direct loans, letters of credit, loan guarantees, insurance products and others” for “energy production, transmission, storage and other areas that could reduce greenhouse gases, diversify energy supplies and save energy.”

For a clear take on why this is needed, read John Podesta and Karen Kornbluh.

Crucially, supporting the policy means acknowledging that actually existing markets are not perfect, and that government support can help correct market failures and achieve public goods that the market alone will not provide. Being a conservative these days, of course, means absolute ideological opposition to that notion. Naturally, conservatives are now coming out in opposition to the bank, as The Wall Street Journal reports.

While I sympathize with Robert’s dismay on health care and climate change this particular gripe is poorly founded. In general libertarian economic dogma does hold back necessary investments in infrastructure and experimental research. But it’s not particularly important factor in the current context.

Neither the House or Senate Blue Dogs are libertarians, there’s some overlap between their rhetoric but it’s not that strong. More frequently the issue with them is that their donor base or Districts/States aren’t friendly to the proposed legislation. I can’t see any particularly reason to think they’ll go out of their way to oppose this legislation.

Where there might be a problem is how they propose to pay for the Green Bank. House Blue Dogs might object to either borrowing or the particular proposal to pay for the Green Bank. You could also see them wanting some sort of guarantee that not-green tech like corn-based ethanol gets a cut, but not wholesale opposition. The balanced budget/PAY-GO crowd can be frustrating, but they don’t really base their conclusions on libertarian economics.

The real problem with the Green Bank proposal is that it’s too much of an orphan program. Everyone left, right, and center jostled to have their priorities included in ACES and funding Green tech didn’t have the support it needed to be adequately funded. I hope this program moves forward, but it’s premature to start assigning blame.



3 comments so far

  1. bronwyn41 on

    This is Chris Van Hollen’s proposition, really the jewel of his legislative efforts (that I know of). I hope it gets off the ground.

    Is there any way to get one of the groups that buys up one of the failed banks to restart it as a green bank in exchange for some extra government goodies? Not being an economist I have no idea how/if this would work.

  2. Chris on

    Supporting the Van Hollen Green Bank bill is definitely a something I’ve been thinking about. Two different high level staffers told us they thought green tech was underfunded in ACES and yet it’s so essential to responding to climate change.

    • bronwyn41 on

      We might want to think about how we could do this. You know I’m for it.

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