Biofuel's Cost Torpedoes Navy Budget
Facing massive cuts to the defense budget, the U.S. Navy is being used to prop up the failing biofuel industry by converting the fleet to run on the so-called "green fuel" at $26 a gallon.
Failure to cut federal government spending by last year's Budget Supercommittee triggered automatic cuts to the defense budget estimated at some $600 billion over ten years. These cuts come on top of $400 billion in cuts over ten years under former Defense Secretary Robert Gates, and an additional $100 billion in cuts over ten years demanded by the Obama Administration.
Coming on the heels of our involvement in two major wars over the last ten years which left our military with worn out equipment and exhausted troops, military officials, defense industry leaders, and various congressmen have warned of the dire consequences such cuts could do to hollow out our military force. There is no question that the DoD faces a dire situation as the defense cuts proscribed under last year's budget deal were specifically designed to be so unrealistic that the Budget Supercommittee would be forced to act to prevent their coming to pass. Well, it didn't work and the DoD is now facing the threat of these cuts.
Despite the bleak budget prospects, the U.S. Navy is expanding its use of expensive biofuels under the guise of establishing alternative fuel sources for future fleet needs. At $26 a gallon, biofuel costs are almost seven times the cost of conventional fuels which are still so plentiful that the U.S. currently exports refined fossil fuels. A Navy official confirmed that the biofuel costs $26 a gallon compared to $3.60 for conventional fuel.
The biofuel industry was built on government subsidies and promptly folded once those subsidies were removed. Americans may ignore traffic laws, but they pay strict attention to the economic law of supply and demand, refusing to pay a cent more for fuel than is required. As part of the Obama Administration's push into subsidizing the alternative energy industry, the Navy has been enlisted to be the purchaser of last resort in order to keep the biofuel industry alive.
Despite the failures of numerous solar energy companies who received federal loans, the progressive liberals will not let go of Jimmy Carter's false pronouncement that fossil fuels are being depleted and we must act quickly to replace them with alternative fuels no matter the cost. It's an idea that's seductive on the surface, but fails to stand up to real-world scrutiny as ever increasing fossil fuel supplies are being discovered. These additional supplies further doom alternative fuels to the ash heap of economic history occupied by the likes of the Sony Betamax.
The DoD, recovering from two major wars and facing massive budget cuts, can ill-afford to waste precious financial resources propping up another failing alternative energy scheme. The military's purpose is to defend America from enemies both foreign and domestic, not to protect politically-connected crony capitalists from suffering defeat in the marketplace.
Tom Roberson blogs at tomroberson.wordpress.com.