Buying the election: Obama throws away $1.6 billion on 1.6 mile subway

Obama throws cost considerations for local transportation projects under the bus in favor of "social equity and environmental considerations," rubber-stamping an impractical 1.6 mile subway project that costs $1.591 billion more [175 times more] than a more efficient and cost effective alternative endorsed by the Sierra Club. The "social equity" beneficiaries of the $1.6 billion tax dollars: housing developers.

The New Earmarkers

Cost analysis for transit projects gives way to 'social equity.'

WSJ.COM 5/1/12

President Obama has been heard of late ballyhooing what he's done to cut federal red tape. Left unsaid is what he is doing to fashion golden handcuffs for local transit agencies. Consider the work of his artisans at the Federal Transit Administration (FTA).

Transportation Secretary Ray LaHood has announced that "streamlined" regulations will make it easier for local transit agencies to procure grant funding under the New Starts program. Swept aside, says Mr. LaHood, are "certain time-consuming technical requirements that are duplicative or unnecessary."

Not so fast. Let's look closer at the old New Starts rules that Mr. LaHood characterizes as "technical requirements."

Under the existing New Starts guidelines, local governments competing for grants must compare the cost of their transit projects with alternative solutions. The Obama Administration's proposed rules would do away with this comparative cost analysis. The new rules put more weight on "social equity and environmental considerations." Such as? Such as the "degree to which policies maintaining or increasing affordable housing are in place."

Now let's have a look at how this noble goal works in real world.

At the top of the FTA's queue is San Francisco's proposed Chinatown subway, which couldn't get a full funding grant agreement under a more rational review process. The 1.6-mile line will cost $1.6 billion to build and draw just 5,000 new daily riders. Subway commuters would have to descend eight floors to catch the train and then walk the length of four football fields to connect with light-rail lines.

There is a cheaper alternative. A 2002 study by the city's transit agency found that a surface transportation solution to congestion on Chinatown buses would cost only $9.1 million [175 times less] to implement. The Sierra Club supports this plan, because improved bus service is more cost-effective and efficient than the subway.

So why spend $1.6 billion instead? Because San Francisco's Board of Supervisors and Mayor Ed Lee hope to deliver construction contracts to Bay Area developers, who are the project's biggest backers. The left coast Tammany Hall has already promised Chinatown developers $32 million to build affordable housing for displaced residents.

The Obama FTA hopes to rubber-stamp the Chinatown subway and as many other dubious transportation projects as it can before the November election. Future White Houses and Congresses would have a hard time reneging on the funding commitments once construction has started. Not least, the White House needs to give Congressional Democrats something to show for their time in D.C.

Republicans don't appear eager to kill the back-door earmark program. They had an opportunity to block New Starts funding in the surface transportation reauthorization act, but they didn't. Many hope to procure funding for projects in their districts. This is one way the Washington earmark machine will restart itself, unless the GOP shuts it down

New study finds US public concern about 'climate change' near lowest levels since 2002

According to a paper published in the April 2012 edition of Nature Climate Change, the results of 74 different opinion surveys from 2002-2010 show US public concern about climate change reached a high point of 54% in 2007 and declined to about 44% in 2010. The study attributes these changes to decreasing media exposure and "cues from political elites," but fails to even mention Climategate as a factor.

Black line indicates % of US public concerned about climate change

 

Yes, the ocean has warmed; no, it’s not ‘global warming’ And warm water does not sink

From the New Zealand Climate Conversation Group, a noted oceanographer debunks the myth of man-made global warming, explaining why greenhouse gases cannot heat the oceans, and that recent ocean warming is simply the result of natural ocean cycles [oscillations].

Levitus rewarmed

Richard Treadgold | April 28, 2012

Boundary conditions are complex.

Oceanographer Dr Willem de Lange has referred us to a really clear treatment of ocean warming and ocean-atmosphere interaction in an article by a noted oceanographer (now deceased). It appeared in 21st Century Science & Technology magazine in 2000 and carried the “Yes, the ocean has warmed” headline you see above. Though written 12 years ago, it makes a solid rebuttal to the substance of the modern warming scare, emphasizing, as though marine scientists needed to be told, that warm water cannot sink.

The author was Dr. Robert E. Stevenson, an oceanography consultant, who trained NASA astronauts in oceanography and marine meteorology, was Secretary General of the International Association for the Physical Science of the Oceans from 1987 to 1995 and was an oceanographer for the U.S. Office of Naval Research for 20 years.

Having completed the post, I’ve discovered the new Levitus paper. How does Levitus et al. 2012 compare with the old Levitus et al. 2000? The new paper is in press, so we only have the abstracts to compare. In 2000, the heat content of the world ocean increased by ∼2 × 10²³ joules between the mid-1950s and mid-1990s, representing a volume mean warming of 0.06°C. In 2012, the heat content of the world ocean increased by 24.0 × 10²² J for 1955-2010, corresponding to a volume mean warming of 0.09ºC.

With 24.0 × 10²² being 20% greater than 2 × 10²³, and the temperature going from 0.06 to 0.09°C giving an increase of 50%, we have a familiar picture. It’s deja vu, only warmer.

Here’s the article’s original introduction:

Contrary to recent press reports that the oceans hold the still-undetected global atmospheric warming predicted by climate models, ocean warming occurs in 100-year cycles, independent of both radiative and human influences.

Which echoes today’s headlines about ocean heat content trying to explain why climate models don’t predict the climate. For example:

• Search For ‘Missing Heat’ Confirms More Global Warming ‘In The Pipeline’ (19 Feb 2012)
• Has the Earth’s Missing Heat Been Found? (10 Feb 2012)
• Global warming: ‘Missing’ heat found deep in the ocean (18 Sep 2011)
• Global Warming: Why Aren’t Temperatures Even Higher? (20 Apr 2010)

Stevenson’s article in 2000 was prompted by a paper published in Science magazine that year which found warming to a depth of nearly 10,000 feet in the Atlantic, Pacific and Indian Oceans since the late 1940s. In each ocean basin, substantial temperature changes were occurring and much deeper than previously thought.

In an eery forecast of an identical period since his article, Robert Stevenson said that for 15 years, modellers had tried to explain their lack of success in predicting global warming. The climate models had predicted a global temperature increase of 1.5°C by the year 2000, six times more than occurred. Undiscouraged, the modellers argued that the heat generated by their claimed “greenhouse warming effect” was being stored in the deep oceans, and that it would emerge at some time. They had no observational evidence to support that contention until the Levitus article.

Stevenson quotes two people drumming up support for the new paper. Science news writer Richard A. Kerr claimed “The ocean-induced delay in global warming also suggests to some climatologists that future temperature increases will be toward the top end of the models’ range of prediction.”

Then the ever-faithful Dr. James Hansen, of the Goddard Institute for Space Studies, enthused: “Now the ocean-warming data imply that climate sensitivity [to the greenhouse effect] is not at the low end of the spectrum.”

One can imagine those worthy spokesmen thinking, “Ok, so 15 years of no warming is a hard sell, but not impossible; we’ll brazen it through.” Neither of them guessed yet another 15 years lay ahead.

Calculating the heat in the world’s oceans

In their paper, Syd Levitus and colleagues from NOAA’s Ocean Climate Laboratory attempt to quantify the heat content in the top 3000 metres of the world ocean from 1948 to 1998. They calculated an increase of about 2 x 10²³ joules from 1955 to 1995, computing a mean warming of 0.06°C. The increased heat content indicates a warming rate of 0.3 watts/m² over the Earth’s surface.

They concluded that substantial changes in heat content took place in the 300-metre to 1,000-metre layers of each ocean, and at depths even greater than 1,000 metres in the North Atlantic. From these changes, they determined that in the upper layer (0-300 metres), the mean temperature of the global ocean had increased by 0.31°C during the last half century…

The authors reported: “We compared the range of upper-ocean heat content with the range of the climatological annual cycle of heat content for the Northern Hemisphere” (Levitus and Antonov 1997). They determined that “there is relatively little contribution to the climatological range of heat content from depths below 300 metres.”

Deep water doesn’t contribute to weather? Hardly surprising. However:

The Levitus group looked particularly at the data for the deep waters of the North Atlantic, choosing to address a depth of 1,750 metres. They learned that that ocean had warmed in the period between 1955 and 1974, and again between 1974 and 1988. The warming was not uniform, horizontally or vertically, but they determined that the changes were not small, and could have made appreciable contributions to the Earth’s heat balance on decadal time scales. Maximum heat storage was at depths greater than 300 metres.

This confirms that heat does indeed penetrate downwards, but not far. This is less than 10% of the average ocean depth of 4000 metres — and it’s caused by moving currents; it’s not a result of warm water just sinking, which is impossible.

So, we have the added knowledge that the heat content of the North Atlantic is substantial at depths below 300 metres… Regarding the World Ocean, they reported: “The Pacific and Atlantic have been warming since the 1950s, and the Indian since the 1960s. The delay in the Indian Ocean may be caused by the sparsity of data before 1960.”

Findings

1. The world ocean has exhibited coherent changes of heat content during the past 50 years, resulting in a net warming.
2. There is no determination whether the observed warming is caused by natural variability or anthropogenic (man-induced) forcing.
3. The warming supports the contentions of global-climate modellers that the planetary radiative disequilibrium, for the period of 1979 to 1996, may be the result of “excess heat accumulating in the ocean.”
4. Sea-surface temperatures have had two distinct warming periods over the past century; from 1920 to 1940, then a cooling period until the second warming began in the 1970s.
5. In each period of warming, an increase in the ocean’s heat content preceded the observed warming of the sea-surface temperatures. The NOAA scientists concluded that it could be the result of natural variability, or anthropogenic effects, or more likely both.
6. It was speculated that the extreme warmth of the world ocean during the mid-1990s was caused by (a) the multi-decadal warming of the Atlantic and Indian oceans, and (b) a positive polarity in a possible bidecadal oscillation of the Pacific Ocean heat content.
7. And a final point, regarding the large change in Atlantic heat storage at depths exceeding 300 metres: The convection in the Labrador Sea, by mixing the ocean through a 2,000-metre-deep water column, may keep sea-surface temperature changes relatively small, despite a large heat flux from ocean to atmosphere. Such convection must be addressed, especially when anthropogenic forcing is being considered.

Stevenson observes:

It sometimes seems as if I’m living in a “time-warp” in which some people, and scientists, are unaware that rational life existed before their birth—or before they got out of the sixth grade. Yet, we marine scientists did not enter the second half of the 20th century without a fair bit of understanding of the thermal ocean.

For example, Prof. Hubert H. Lamb, the premier European climatologist of the 20th century, wrote in 1977 that “there has been a general warming of sea temperatures, by 0.5–1.0°C, from 1880 to 1965, defined from widely scattered points around the oceans of the world.”

Stevenson describes how he took sea water temperature readings during the 1950s,
“learning to deploy Nansen water bottles and reversing thermometers for deep-sea sampling.” He concludes: “Those of us who obtained the data are not going to be snowed by the claims of the great precision of “historical data found stored in some musty archives.”

Basic marine climatology

The basics of these interactions start where oceans and atmosphere meet. The atmosphere cannot warm until the underlying surface warms first. The lower atmosphere is transparent to direct solar radiation, preventing it from being significantly warmed by sunlight alone. The surface atmosphere thus gets its warmth in three ways: from direct contact with the oceans; from infrared radiation off the ocean surface; and from the removal of latent heat from the ocean by evaporation. Consequently, the temperature of the lower atmosphere is largely determined by the temperature of the ocean.

We would do well to remember the simple fact that heat rises, and that the warmer gas or fluid rises above the colder. For all the talk of the radiative effects of greenhouse gases interrupting the escape of long-wave thermal energy from oceans, land and clouds, the re-heating of ocean and land caused by that radiation is minuscule. As we see shortly, long-wave infra-red penetrates only a few microns into the ocean. Coupled with the fact that as soon as water warms up a little at the surface, it evaporates, thus immediately cooling, it’s impossible for this process to cause significant warming of the water.

How the oceans get warm

Warming the ocean is not a simple matter, not like heating a small glass of water. The first thing to remember is that the ocean is not warmed by the overlying air.

Let’s begin with radiant energy from two sources: sunlight and infrared radiation — the latter emitted from the “greenhouse” gases (water vapor, carbon dioxide, methane and various others) in the lower atmosphere. Sunlight penetrates the water surface readily, and directly heats the ocean up to a certain depth. Around 3 percent of the radiation from the Sun reaches a depth of about 100 metres.

The top layer of the ocean to that depth warms up easily under sunlight. Below 100 metres, however, little radiant energy remains. The ocean becomes progressively darker and colder as the depth increases. (It is typical for the ocean temperature in Hawaii to be 26°C (78°F) at the surface, and 15°C (59°F) at a depth of 150 metres.

The infrared radiation penetrates but a few millimetres into the ocean [Dr de Lange maintains this distance is actually in the tens of micrometres (microns). Confirmed at Real Climate, strangely -- though the discussion there of why the tiny thermal effect of that OLR (outgoing longwave radiation) on the "skin layer" warms the whole ocean is oddly complex and unconvincing. – RT]. This means that the greenhouse radiation from the atmosphere affects only the top few [microns] of the ocean. Water just a few [millimetres] deep receives none of the direct effect of the infrared thermal energy from the atmosphere. Further, it is in those top few millimetres in which evaporation takes place. So whatever infrared energy may reach the ocean as a result of the greenhouse effect is soon dissipated.

The warmists hope that heat could get into the deep water, since it might hide there for a long time. Stevenson says there have been a number of studies of this process (Nakamura 1997; Tanimoto 1993; Trenberth 1994; Watanabi 1994; and White 1998), and says it is clear that solar-related variations in mixed-layer temperatures penetrate to between 80 and 160 metres, the average depth of the main pycnocline (density discontinuity) in the global ocean. “Below these depths, temperature fluctuations become uncorrelated with solar signals, deeper penetration being restrained by the stratified barrier of the pycnocline.”

Consequently, he says, anomalous heat associated with changing solar irradiance is stored in the upper 100 metres. The heat balance is maintained by heat loss to the atmosphere, not to the deep ocean as the warmists keep hoping.

What about Thermohaline Circulation?

The fact that the surface ocean can become denser than the underlying waters, thereby sinking to depths of “density equilibrium,” has been discussed since surveys of the physical ocean began in the second half of the 19th century… Thermohaline circulation is responsible for the formation of the bottom-water masses in all the world’s oceans.

Stevenson explains that modellers who “need” to get warm surface waters into the deep ocean and remain there for long periods hope (or claim) that there can be occasions when salinity, rather than temperature, is the prime determining factor in the density of the surface waters. Then, warm water made dense by a higher salt content would sink.

It does not happen!

The primary physical factor in determining the density of sea water is the temperature (Sverdrup, Johnson, and Fleming, 1943). In the open ocean, top or bottom, salinity differences are measured in a few parts per thousand. Thermohaline circulation takes place where the surface waters become colder than the waters beneath. The large vertical movements occur in polar seas, where accelerated radiation makes the surface waters greatly colder than the deeper waters.

Note that the radiation he mentions is from the frigid atmosphere sucking heat from the water, entirely dwarfing any trivial infra-red radiation from airborne greenhouse gases to the water.

In [polar] waters, surface water temperatures are about -1.9°C, the normal salinity of the water keeping it from freezing into ice. The deep waters, being warmer than such surface waters, rise to the surface, as the upper layers sink slowly into the dark ocean depths. Because only very cold surface water is able to sink, it is simple to understand that the deep ocean can never warm up, regardless of how warm the surface ocean around the world may become. No deep lying “thermal lag” is going to take place. It is clear that there’ll be no Phoenix rising as a haunting spectre.

There we have it. If the surface water warms by any means, it doesn’t sink. If it gets into a current, it may move about in the top 100 metres or so, but no further because of the density boundary at the pycnocline. Claims of thermal energy “hiding” much deeper in the oceans are speculation and no mechanism is known to cause it. Further, when surface water warms it frequently evaporates, taking energy from the surface water and the lower atmosphere, thus cooling them, then rises rapidly by convection, taking its heat far above the ocean, since water vapour is only about 63% of the density of air.

The only way the ocean water warms is by the sun. The only way the lower atmosphere warms is by the water (and a little from the land).

The Big, Deep, Blue Sea

Stevenson says the oceans are the dominant influence on our climate because of their enormous density and heat-storage capacity. The energy that flows in and out of the oceans determines the mean temperature of the global atmosphere. These interactions, plus evaporation, are quite capable of cancelling the slight effect of man-produced CO2.

Robert Stevenson, in 1987, became Secretary General of the International Association for the Physical Science of the Oceans (IAPSO), part of the International Union of Geodesy and Geophysics (IUGG). In 1991, the IUGG met in Vienna to discuss a programme to forward to the International Commission of Scientific Unions (ICSU) for consideration at the 1992 Rio de Janeiro Conference. But Stevenson and his colleagues decided not to prepare any programmes for the Rio conference.

In their joint statement, they said: “To single out one variable, namely radiation through the atmosphere and the associated ‘greenhouse effect,’ as being the primary driving force of atmospheric and oceanic climate, is a simplistic and absurd way to view the complex interaction of forces between the land, ocean, atmosphere and outer space.”

Furthermore, they stated: “climate modelling has been concentrated on the atmosphere with only a primitive representation of the ocean.” Actually, Stevenson says some of the early models depicted the oceans as nearly stagnant. The logical approach would have been to model the oceans first (there were some reasonable ocean models at the time), then add the atmospheric factors.

ICSU and the United Nations Environment Program (UNEP) and the World Meteorological Organization (WMO) simply proceeded to evolve climate models from early weather models. Stevenson gives a fascinating insight into climate science by commenting: “That has imposed an entirely atmospheric perspective on processes which are actually heavily dominated by the ocean.”

This changes nothing — why write the paper?

Mentioning he was at first somewhat put off by the headlines about “missing warming,” after reading the Levitus paper Stevenson is left aghast by its general folly, contradicting as it did so much evident knowledge, saying: “here I sit in the middle of the Pacific Ocean [he lived in Hawaii], surrounded by papers (peer-reviewed, I guess I should add) which conclude:”

1. For the past two decades at least, and possibly for the past seven decades, the Earth’s true surface air temperature has likely experienced no net change; [while]
2. there should have been a sizable CO2-induced increase in atmospheric radiative forcing during that time, but there wasn’t. That must mean that a suite of compensatory feedbacks overwhelmed the “greenhouse” impetus for warming; implying, therefore,
3. that the planet will not warm from any man-produced increases in CO2; indicating
4. that any increases in temperature will likely fit the global trend of +0.048°C/decade, that is, about 0.5°C this century — the rate of warming that has existed since the Little Ice Age, centered around 1750 in Europe, South America and China; suggesting
5. that the heat storage in the upper ocean takes place in the upper 100 metres, and the magnitude provides a rise in temperature at those depths of 0.5°C in the past 50 years (in those parts of the ocean for which we have data); [and]
6. this global warming (and cooling) of the ocean occurs on biennial, ENSO, decadal and interdecadal period scales; thence,
7. the ocean thermal changes on centennial-period scales, which appear as the warming trend through the past 50 to 100 years, can be explained by means of intrinsic internal modes of the Earth going through their normal cycle of warming and cooling, independent of both radiative and anthropogenic influences.

I guess what I’m really wondering is “Why did Syd Levitus and his associates write their paper in the first place?”

I encourage readers to sample Stevenson’s entire article, for I have omitted much of interest.

---

Regrettably, Robert Stevenson passed away in August, 2001, aged 80.

New paper confirms IPCC exaggerates effect of man on climate by more than 5 times

A post today by Dr. David Stockwell notes that a recent paper on ocean heat content shows the IPCC has exaggerated the effect of man upon the climate by a factor of more than 5 times [1.6 divided by 0.3]. Climate scientist Dr. Roger Pielke Sr. concurs and states this implies net feedback is negative instead of positive as claimed by the IPCC.

 "...the 2007 IPCC WG1 report has a serious error in it"

As stated by Dr. Stockwell,

"It appears that Levitus et al [paper] confirms the skeptics, and the IPCC has been falsified."

Excerpt:

• 26
  APR

• Levitus data on ocean forcing confirms skeptics, falsifies IPCC

The IPCC, in the AR4 working group one, stated what could be called the central claim of global warming, the estimate of the net radiative forcing.

“The understanding of anthropogenic warming and cooling influences on climate has improved since the TAR, leading to very high confidence that the effect of human activities since 1750 has been a net positive forcing of +1.6 [+0.6 to +2.4] W m–2.”

Remember a forcing is an imbalance that causes heating, like a hot plate heating a saucepan of water. While the forcing continues, the temperature of the water will continue to rise. Global warming is the theory that increases in CO2 in the atmosphere are causing the earth to warm dangerously.

The IPCC level of forcing equates to the stated estimates for doubling of CO2 from around 1.5 to 6C per doubling, and the central estimates of warming to the end of the century from increasing CO2 of about 3C.

The paper by Levitus et al. uses the array of ARGO floats, and other historic ocean measurements, to determine the change in the heat content of the ocean from 0 to 2000m, and so derive the actual net radiative forcing that has caused it to warm over the last 50 years.

“The heat content of the world ocean for the 0-2000 m layer increased by 24.0×1022 J corresponding to a rate of 0.39 Wm-2 (per unit area of the world ocean) and a volume mean warming of 0.09ºC. This warming rate corresponds to a rate of 0.27 Wm-2 per unit area of earth’s surface.”

Thus the best, recent measurements of the forcing 0f 0.3Wm-2 are below the lowest limits of the IPCC estimate from 0.6Wm-2 to 2.4Wm-2. The anthropogenic component of the forcing is even less, as a large part of the 0.3Wm-2 is due to increased solar insolation during the Grand Solar Maximum.

This mild forcing is right in the ballpark that skeptic scientists such as Lindzen, Spencer, Loehle and Idso (and myself) have been consistently saying is all that is justified by the evidence. It appears that Levitus et al. confirms the skeptics, and the IPCC has been falsified.

Go to link for remainder of post, including the laughable attempt by Skeptical Science to spin the Levitus paper.

Engineers Cast Wary Eye on Role of Electric Cars

By JOSEPH B. WHITE   WSJ.COM  4/26/12

DETROIT—Auto-industry marketers are stepping up efforts to tout electric cars and plug-in hybrids to regulators and consumers, but at a gathering of industry technologists here, senior auto-company executives offered a sharply skeptical view of electric cars, predicting they will remain a marginal part of the U.S. market well into the next decade.

In presentations Tuesday and Wednesday at the annual Society of Automotive Engineers World Congress, senior auto-industry executives in charge of technology strategy, research, and regulatory issues delivered the same message: Barring an unforeseen breakthrough that significantly drops the cost of automotive batteries, fully electric cars and plug-in hybrid vehicles are likely to remain confined to a niche of under 10% of the market through 2025 and beyond.

More

"By 2025, we see battery electric vehicles still with too long a payback, and inadequate range," said Joseph Bakaj, vice president for powertrain engineering at Ford Motor Co.

Sam Winegarden, executive director of powertrain-engine engineering at General Motors Co. made a similar point with a chart comparing the amount of energy delivered by a given volume or mass of fuel. On his chart, lithium-ion batteries, used in electric cars such as the Nissan Leaf and GM's plug-in hybrid Chevrolet Volt, were ranked close to zero compared to gasoline and diesel fuels, which delivered the most energy for the least amount of weight and cost to the consumer.

"The rumored death of the internal combustion engine is premature," Mr. Winegarden said.

Chris Cowland, director of advanced powertrains at Chrysler Group LLC, offered some revealing figures. A conventional, gasoline-fueled internal combustion engine and transmission make up about 10% of the cost of a $30,000 car, or about $3,000, he said. Ford Chief ExecutiveAlan Mulally at a green-car forum in New York City last week said batteries for the electric Ford Focus cost $12,000 to $15,000 for a car that is priced at $39,200, about $15,000 more than a petroleum-fueled Focus.

Some industry executives are bullish on electric cars, notably Carlos Ghosn, chief executive of allied auto makers Renault SA and Nissan Motor Co. Mr. Ghosn has pushed an ambitious effort to mass produce electric vehicles, retooling a portion of Nissan's factory in Tennessee to build as many as 150,000 electric cars a year.

Industry executives agree that a large-scale shift to electric vehicles would be the surest way to cut the auto industry's contribution to global carbon-dioxide emissions, which are linked to climate change. Auto makers face pressure from governments in all the major auto markets of the world to reduce dramatically the carbon-dioxide emissions and smog-forming pollutants generated as cars and trucks burn oil. There are also signs—including the strong interest in Tesla's forthcoming Model S electric sedan and Model X electric SUV—that a significant cadre of affluent, trend-setting consumers want electric cars and are willing to pay substantial premiums to own one.

But the industry executives gathered at SAE, many of whom are directly responsible for delivering propulsion systems that are reliable, efficent and cheap, said they are worried that regulatory demands on manufacturers to reduce fossil-fuel pollution don't take into account the difficulty of persuading consumers to give up the power, convenience and comparatively low upfront buying costs of internal-combustion engines.

The doubts about the market appeal and competitiveness of electric cars aired by technologists and engineers at the SAE conference highlight the increasing tensions between Washington and Detroit over fuel economy and environmental regulation. Those tensions were largely sublimated during the past several years as the federal government poured billions of dollars into bailouts of GM and Chrysler and extended low-cost loans to Ford to subsidize development of advanced-technology vehicles, including electric cars.

The Obama administration has put promoting electric cars at the center of its auto-industry policy, offering $2.4 billion in grants from its economic-stimulus program to boost some 48 projects related to electric vehicles or battery production. President Obama has set a goal of putting one million plug-in vehicles on the road by 2015.

All three of Detroit's auto makers and several of their big technology suppliers benefited from the stimulus money. In addition, the Obama administration has loaned money through the Department of Energy to a number of companies in the electric-vehicle business, including start-up electric-car makers Tesla Motors Inc. and Fisker Automotive.

But at the SAE convention, there was little talk of President Obama's electric-car sales goal.

Instead, industry executives with responsibility for technology and regulatory strategies said their companies are focusing on steady improvement of the efficiency of cars fueled by gasoline and diesel as they aim to comply with the administration's proposal to require that auto makers' new car and truck fleets average 54.5 miles per gallon by 2025, roughly double the average mileage of the fleet sold in 2010.

Robert Bienenfeld, senior manager forenvironment and energy strategy at Honda Motor Co.'s U.S. arm, said that by 2025, a customer who buys a plug-in hybrid could wait 10 years to recover the added upfront costs, compared with a 2025 car outfitted with a more efficient gasoline engine and transmission. The payback for an all-electric car would be even longer.

"Long term it's hard to see how (government) incentives address this in any sort of sustained way," he said.

Industry executives at the SAE conference returned repeatedly to their concerns about how much consumers are willing to pay for fuel-saving technology and how ready they are to accept cars that behave differently because of new systems to curb gas-guzzling.

"It's impossible to know what consumer preferences will be," said Richard Gezelle, national manager of technical and regulatory affairs for Toyota Motor Corp., which makes the No. 1 selling hybrid, the Toyota Prius.

Notwithstanding Toyota's relative success with the Prius, Mr. Gezelle struck a note of caution on the potential for hybrid and electric cars. Even as the number of hybrid models on sale has increased, he said, "market share has remained flat at 2.5% to 3%. If you are a hybrid, and not a Prius, you have struggled."

BY ROBERT RAPIER ON APR 23, 2012 WITH 27 RESPONSES

The Hard Truth: Even Liberals are Big Fans of Oil Subsidies

Tags: Chuck Schumer, Ed Markey, oil subsidies, subsidies

inShare

Survey Says…

If you were to survey people and ask the question “Should we subsidize oil companies?” — the overwhelming majority would undoubtedly respond “No!” The notion that we are subsidizing oil companies generates outrage in many people, but in this article I will show why these subsidies aren’t going to go away any time soon. The reason may surprise you.

I decided to write this article following a a recent discussion in a CleanTech discussion group on the social networking site LinkedIn. The person who started the discussion asked the question “Why is it so Hard to Kill Fossil-Fuel Subsidies?” The discussion was prompted by a recent article by environmental activist and author Bill McKibben called Payola for the Most Profitable Corporations in History. In the article McKibben proposes “five rules of the road that should be applied to the fossil-fuel industry.” But McKibben himself demonstrated in his article that he doesn’t really understand the nature of these subsidies — and this sort of misunderstanding largely explains why so many people are outraged that they persist.

So let’s take the original question on subsidies and ask it in a different way: “Should we allow oil companies to take a tax deduction also available to any U.S. manufacturer such as Apple or Microsoft?” A lot of people will still answer “No” to that question, but certainly fewer than answered “No” to the original question.

Now ask the question “Should farmers be allowed a fuel tax exemption for the fuel they use on the farm?” In this case, some people are going to say “No”, but farmers are going to be near unanimous in saying “Yes!”

Let’s ask one final question: “Should low-income families who struggle to pay their heating bills be helped with programs like theLow Income Home Energy Assistance Program (HEAP)?” The irony in this question is that some of the people who are the most vehemently opposed to fossil fuel subsidies will argue that this is an important program that helps keep poor people from freezing to death in winter, and thus it would be inhumane to eliminate it.

Yet unless you answered “No” to all four questions you support programs that have been identified as fossil fuel subsidies. Bill McKibben himself indicates sympathy for subsidies when he wrote: “Many of those subsidies, however, take the form of cheap, subsidized gas in petro-states, often with impoverished populations — as in Nigeria, where popular protests forced the government to back down on a decision to cut such subsidies earlier this year.” However, he then incorrectly asserts “In the U.S., though, they’re simply straightforward presents to rich companies, gifts from the 99% to the 1%.”

That’s just not true, and a failure to understand this is why there is so much outrage over fossil fuel subsidies in the U.S. (As an aside, characterizing the oil companies as “the 1%” is also misleading, because oil companies are overwhelmingly owned by the 99%). During the course of the LinkedIn discussion, a link was provided to Oil Change International, an organization devoted to pushing a transition away from fossil fuels. On their site they have a page on fossil fuel subsidies, which includes a link to a spreadsheet from the OECD breaking down various fossil fuel subsidies. The summary of oil-related subsidies for 2010 totals $4.5 billion. That is a number often thrown out there; $4 billion a year or so in support for those greedy oil companies.

But look at the breakdown. The single largest expenditure is just over $1 billion for the Strategic Petroleum Reserve, which is designed to protect the U.S. from oil shortages. The second largest category is just under $1 billion in tax exemptions for farm fuel. The justification for that tax exemption is that fuel taxes pay for roads, and the farm equipment that benefits from the tax exemption is technically not supposed to be using the roads. The third largest category? $570 million for the Low-Income Home Energy Assistance Program. (This program is classified as a petroleum subsidy because it artificially reduces the price of oil). Those three programs account for $2.5 billion a year in “oil subsidies.” So the next time you hear someone express outrage over oil company subsidies, you may want to ask them exactly which ones they are talking about.

Oil Subsidies that Liberals Love

So why do we still have fossil fuel subsidies? Because almost nobody — not even Bill McKibben — wants to get rid of all of the programs that are classified as fossil fuel subsidies. I suspect McKibben would not advocate eliminating the Low Income Home Energy Assistance Program. Two of the most outspoken Democratic opponents of oil subsidies have strongly defended this particular program — even though it has been identified by the OECD as the 3rd largest petroleum subsidy. When Republicans tried to cut funding for the program,  Sen. Chuck Schumer, D-N.Y., called the proposal an “extreme idea” that would “set the country backwards.” Rep. Edward Markey, D-Mass, states on his website that he is a “longtime Congressional champion of providing assistance to low-income families to heat and cool their homes.”

In fact, look at the reaction from Democrats when President Obama tried to reduce funding for the program. Rep. Markey’s office said: “If these cuts are real, it would be a very disappointing development for millions of families still struggling through a harsh winter.” Sen. Jeanne Shaheen, D-N.H., noted her opposition: “The President’s reported proposal to drastically slash LIHEAP funds by more than half would have a severe impact on many of New Hampshire’s most vulnerable citizens and I strongly oppose it.” Sen. John Kerry, D-Mass., wrote a letter to President Obama that stated in part: “We simply cannot afford to cut LIHEAP funding during one of the most brutal winters in history. Families across Massachusetts, and the country, depend on these monies to heat their homes and survive the season.” Each one of these Democrats was defending a program that has been identified as a subsidy to Big Oil.

What is the Impact of Eliminating the Subsidy?

Of course there are other tax deductions that do more directly benefit the oil industry, just like every taxpayer has tax deductions that benefit them. Many of us take advantage of a mortgage interest deduction when we pay our taxes, but I bet most people would resent being told they are collecting subsidies just because they sliced a small portion off of their tax bill with that deduction.

Last year CNN did a story where they put together their own list of the so-called oil subsidies, and they wrote that the “largest single tax break” — amounting to $1.7 billion per year for the oil industry — is a manufacturer’s tax deduction that is defined in Section 199of the IRS code. This is a tax credit designed to keep manufacturing in the U.S., but it isn’t limited to oil companies. It is a tax credit enjoyed by highly profitable companies like Microsoft and Apple, and even foreign companies that operate factories in the U.S. Further, the deduction for oil companies is already limited. Apple is able to take a 9% manufacturer’s tax deduction, but ExxonMobil is only allowed to take a 6% deduction.

We can certainly debate whether the manufacturer’s tax credit is a subsidy that should be eliminated. But it is important to be informed as we discuss the issue. We need to ask three questions: 1). What is the purpose of this “subsidy?”; 2). Is the tax credit working as intended?; and 3). What is the projected impact from eliminating it?

The intended purpose of course is to keep manufacturing in the U.S. It is really irrelevant how profitable Apple might be; if there is a compelling financial advantage for them to build a factory overseas they will do so. This tax credit provides incentive for them to keep manufacturing in the U.S.

Likewise, ExxonMobil has access to oil fields and refineries in many foreign countries. If they are comparing projects here and abroad, that tax credit will factor into their decision. Whether it is enough to push them one way or another is something I don’t know. There should be some independent analyses to examine the impact. Many opponents of subsidies imagine that the impact will merely be taxpayer savings as ExxonMobil loses out on this tax credit. But what if the impact is that we lose domestic jobs as ExxonMobil shifts operations out of the U.S. (something that tax credit was designed to prevent)? What if the impact is that we continue to use just as much oil, but more of it now comes from overseas because we placed our domestic producers at a competitive disadvantage? Have those who are calling for an end to this tax credit actually studied the issue?

The Three Pinocchios

A recent fact check in the Washington Post took President Obama and the Democratic National Committee to task for characterizing these sorts of tax deductions as subsidies:

We explained in a previous column that reasonable minds disagree about whether it is appropriate to use the term “subsidies” to describe what are really just oil industry tax breaks. That’s because the average person understands the term “subsidy” to mean actual cash investments, the likes of which the Obama administration has given to alternative energy companies like the now-bankrupt solar-panel manufacturer Solyndra.

Technically speaking, the government has allowed only tax deductions to help oil companies recover the cost of doing business — this is standard in virtually all industries. No money from the U.S. Treasury goes to the oil industry, so it’s a stretch to describe the tax breaks as literal handouts like Solyndra received. Admittedly, we’re talking about a semantics issue here. But we can’t understand why the DNC and Obama continue to use the word “subsidies” in such a questionable way, especially when the term “tax breaks” is more accurate and indisputably true.

The subsidy claim being pushed by President Obama and others (like Bill McKibben) received a Washington Post rating of Three Pinocchios, which represents “Significant factual error and/or obvious contradictions.”

Conclusions

If we are to have a productive discussion of fossil fuel subsidies, it is important that participants understand what they are, their intended purpose, and what the impact of removing them is projected to be (and projected means conducting an actual analysis).  Because of misleading political rhetoric, people imagine these subsidies as cash payments to oil companies. But, these subsidies are not what people think they are, and in many cases they are benefiting people who have nothing to do with the oil industry.

That is why it is so hard to get rid of them; a majority of the population likely supports at least some of them. And until those who are loudly screaming that we must eliminate these subsidies actually take the time to understand what they are — as well as the impact of removing them — we can expect there will continue to be much heat and little light on this topic.

Link to Original Article: The Hard Truth: Even Liberals are Big Fans of Oil Subsidies

By Robert Rapier