Ramping Up Government Control of the Energy Sector

If insanity consists of "doing the same thing over and over and expecting it to come out different," President Obama is surely mad.  He has spent four years funding green energy start-ups that have failed, one after another.  Now he wants to spend the next four years funding green energy firms that are again likely to fail.

To understand the president's thinking, or what passes for thought, all that's necessary is to grasp one simple fact: that for the left, profits are evil, and therefore businesses that make a profit and succeed are evil.  Only businesses that fail are virtuous.

A corollary of this is, of course, that all businesses must be made to fail.  The function of government, as the left sees it, is to transfer control of the economy from the private sector to government.  The funding of successful businesses will not accomplish this.  But the transfer of profits from successful businesses to companies that are bound to fail will.  That, in a nutshell, has been Obama's approach to the energy sector.

One would think that the job description of the secretary of energy would involve promoting the development of cheap and reliable energy for the American people.  As I see it, Secretary Chu has spent four years doing just the opposite.  His policy of subsidizing failure is one reason the economy is growing at an annual rate of 1.7%, why 23 million are still without jobs, and why 550,000 continue to drop out of the labor force each month.  A vigorous energy policy would encourage the development of fossil fuels and contribute to a growing economy.        

But the ultimate objective of the left is to destroy the private sector, and since fossil fuels are profitable, while alternatives are not, the policy of this administration is to block fossil fuels while subsidizing and mandating alternatives.

Biofuels are a case in point.  In August, the USDA extended a $99-million loan to fund a biofuel plant in North Carolina -- one of eight new bio-refineries funded by USDA.  Perversely, it seems that there is nothing in the mandate of the USDA's Bio-refinery Assistance Program to suggest that it fund businesses that make a profit.  Its mandate includes creating jobs and "promoting "resource conservation," whatever that means.

According to the latest report from the International Energy Agency, the U.S. controls what will soon be the world's largest recoverable reserves of oil and gas (to say nothing of coal).  Conservation is not what the nation needs -- it is exploration and development.

In any case, does the USDA believe that subsidy of a biofuel plant with limited output and 65 in-house workers will have a measurable impact on resource-conservation?  If government is to involve itself in energy at all -- which it should not -- why not promote, fund, and subsidize companies that actually do create energy in large quantities?  A $99-million interest-free loan to Exxon-Mobil would create a great deal of energy, and, as an added bonus, it would almost certainly be repaid, since Exxon's credit rating is one notch higher than that of the federal government itself.  As for the standing of those companies funded by the USDA and the Department of Energy, that is another matter.  Some are not even rated. 

God forbid that any of the green energy schemes subsidized by the Obama administration should ever post a profit.  That would defeat the whole purpose of government: to shift control of the means of production from the private sector to the political elite.  Almost by definition, federally subsidized enterprises must be hemorrhaging money.  Otherwise, they would be evil capitalists who don't need government funding to begin with.

The purpose of government, as the left sees it, is to continue sucking the lifeblood out of the private sector until the entire economy is controlled by the state.  One way to do so is to distort the energy market to the point where otherwise viable fossil fuel companies are driven out of business while alternative energy-producers, those who are incapable of producing profits, continue to operate with the help of perpetual subsidies and mandates.  Once the private market has collapsed, government can dole out whatever meager energy supplies remain, and the public can be grateful for what they get.  The rationing of energy, like that of health care, food, and other necessities, is an integral part of the left's economic thinking.

Rationing and the suppression of the private sector can be brought about only by force, for the simple reason that the desire to overcome scarcity and to live well is hardwired into human nature.  In order to impose their economic model, liberals always resort to some form of coercion.  A prime example is FDR's National Recovery Administration (NRA), which attempted to dictate wage and price controls across the nation.  Obama's appointment of aggressively pro-labor members to the National Labor Relations Board (created by the Wagner Act after the Supreme Court ruled the NRA's actions unconstitutional) is evidence that Obama is every bit as dictatorial as his liberal predecessor.   

Liberals share with Karl Marx the assumption that a "vanguard of the proletariat" (i.e., liberals themselves) should be allowed to rule by dictatorial means, purportedly for the benefit of the masses.  A direct line of thought leads from Marx's antidemocratic radicalism to leaders such as Benito Mussolini -- a European fascist who in his time was lauded by Franklin Roosevelt, who wrote in 1933 that he was "impressed by what [Mussolini] has accomplished."

FDR was not the only American liberal to praise Mussolini; adoration was widespread.  Liberals at the New York Times compared il Duce to America's Founders.  Richard Washburn Child, who founded the forerunner of the Progressive Party, was the American ambassador to Italy and a close friend of Mussolini.  After 1928, Washburn was employed by Mussolini as the latter's chief American propagandist.  Another misguided liberal was Thomas W. Lamont, who influenced the foreign policy of Wilson, Hoover, and Franklin Roosevelt.

With the rise of the New Left, progressive self-righteousness hardened into liberal fascism.  The high point of this movement was the election of Barack Obama, who brought the antidemocratic assumptions of the New Left to the White House.  Obama has not been at all averse to the idea of governing without the consent of the governed and in defiance of Congress and the courts.  Like many in the liberal tradition, he considers himself "a majority of one."   

Obama and his ilk truly believe that Americans wish to be governed by a cadre of "choice advisers," as Cass Sunstein has called them.  (Hitler, who relied on a similar core of policy czars, called them "reichsministers.")  This dictatorial view of the country is not only alien; it is insane in its extremism and conceit.  Again, Obama's energy policy is proof enough.  Pumping endless subsidies into failing green energy companies while increasing regulation of fossil fuels will increase government control of the energy sector, but it is not what the American people want.

Unfortunately, Obama has always been ensconced in fantasy.  Despite the bankruptcies of more than one government-subsidized firm, Obama proposes to ramp up funding even further in his second term.  What Obama is promoting is not just the suppression of fossil fuels -- it is the suppression of capitalism altogether.  Despite the president's claims that he received a mandate for larger government spending, socialism is not what the American people voted for.

Eventually, the public will realize what this administration is up to.  At that point, it won't be just energy policy that is reversed.  It will be everything Obama has done to our nation.

Jeffrey Folks is the author of many books on American culture, including Heartland of the Imagination (2011).