Monthly Archives: April 2008

Expensive gas can be a problem for suburban sprawl


Who built the electric car?

Marc Gunther updates entrepreneur Shai Agassi’s still-quite-plausible plan to bring electric vehicles to the masses:

How does the business work? Essentially, by exploiting what Agassi argues are the cost advantages of electric cars over vehicles powered by gasoline and, yes, you read that right—he says it’s significantly cheaper to operate an electric car than a gas-powered one, particularly with oil priced at more than $110 a barrel. (The economics work with much cheaper oil, too, he says.) The low-cost advantage for electric cars is even greater in Europe, he says, where gas prices are the equivalent of $7 to $9 a gallon.

His claim depends on a lot of assumptions—that a battery with a sufficient range can be produced for $10,000 or less, that he can bring the cost of renewable energy down by committing to buying lots of it, and that the costs of building distributed networks of recharging points and service stations will not spiral out of control.

If he’s right, the cost of powering the electric car will be about 5 cents a mile. As for a gas-powered car, you can do the math, but fuel costs for a car that gets 25 miles to the gallon with gas priced at $3.75 a gallon amount to 15 cents a mile.

Even so, there’s a problem—many people don’t want to pay an extra $10,000 up front for a battery, not knowing how long it will take for them to get their money back in the form of reduced fuel costs. So Agassi isn’t asking for that money up ront. Instead, he intends to sell his customers the cars for much less than they cost, provided that they agree to long-term service plans that will supply them with electricity, battery changes when needed, replacement batteries, etc. He estimates that he could afford to give people a free car if they agree to sign onto a service agreement for six years.

Bad arguments about farming

It’s too beautiful a day here to be indoors typing (and indeed I haven’t been — I’ve taken down a fence and painted some of a porch and I’m glad of both — but I’ll raise Tom Axworthy’s piece on Canada’s food policy in the Toronto Star

We have not had a national policy to help the family farm since Eugene Whelan was minister of agriculture in the 1970s. Ever since, we have had a policy of industrial farming, consolidation, agribusiness and globalization. But this policy rests on the fatal flaw of cheap energy. That era is over. We must return to a policy of local food through the family farm…

With farmers squeezed by low prices and high costs, half of the farm families had one or both partners working off the farm to make ends meet, though farming is more than a full-time job. As a result, farmers are leaving their profession in droves: in 1991 there were 390,000 Canadians in farming but by 2006 there were only 327,000. In 1991, there were 78,000 young farmers taking over from their parents, in 2006 only 30,000. If the trend continues, who will be left to grow the food?

We need a national food policy that relies on the family farm to produce local supplies.

… just long enough to point out the built-in assumption that Canada requires a federal policy on where food comes from. Whatever we decide we want, government must act to get us there.

Note, also, two sleights-of-hand:

  1. Only two alternatives are offered: large industrial farms run by corporations, and small locally oriented farms run by families. Supporting a family farm is not necessarily the same as supporting a small farm. Family-run businesses come with all kinds of challenges that public policy is not necessarily well suited to manage.
  2. The absurd idea that because fewer people are growing food now than used to, the logical endpoint of this is that someday nobody will grow food, whereupon we all presumably starve.

Same-old-same-old prairie-leftie arguments, cloaked in environmentalism. Bleah.

Now, back outdoors.

Stop subsidizing ethanol

I haven’t had very much time for the National Review since it devolved from Republican-oriented conservatism into full-throated Bushism a few years ago, but maybe its editors are looking ahead to a post-GWB America and realizing they’re going to have to stand for some principles again.

And this is a good one: mandating the consumption of ethanol and subsidizing its production is bad policy, for the United States and for the world.

Congress has created an artificial demand for ethanol to satisfy the farm lobby, which is one of the most powerful in Washington. To make matters worse, almost every major candidate for president in the last 20 years has supported ethanol subsidies because of the program’s importance in the capital of corn, Iowa, which holds the nation’s first presidential caucuses. Hillary Clinton and Barack Obama are not exceptions to this rule. Both voted for the 2007 energy bill, and both declared their support for ethanol while campaigning in Iowa. Obama, from the corn-growing state of Illinois, has been singing ethanol’s praises for a long time.

But John McCain somehow made it through the early primary gauntlet without going back on his long-held opposition to ethanol subsidies. To be sure, he took a lower profile on the issue and made some comments about how ethanol “makes sense” now that oil prices are so high, but when questioned about these pro-ethanol comments he reiterated his opposition to the federal government’s meddling in the market.

The Iowa caucuses are over, and McCain no longer has any reason to obscure his opposition to U.S. ethanol policy. In fact, he has several good reasons to voice his opposition to the ethanol mandate loud and clear. For one thing, he can point to it as a clear difference between himself and both remaining Democrats. They support a policy that is contributing to higher food prices for Americans. McCain opposes it.

Both Democrats (and McCain) appear to be in favour of doing all they can to make gasoline cheaper, too, even as all three paint themselves as greenies. It’s not what you’d call a consistent position, and it speaks to the difficulty that even a U.S. president who wants to tackle pollution and global warming will have in actually doing so.

Climate security

It shouldn’t be news by now that climate change could be — already is, on a small scale — a driver of very, very nasty wars. Desertification is the source of the underlying pressure that emerges as a slow-moving genocide in Darfur, for instance, and a warmer planet will be a lot drier in a lot of places and more flooded than others.

Thirsty people, hungry people, people who can’t grow food to feed their children: these are not the constituents of mutually supportive liberal democracies.

But it’s worth repeating from time to time, as Britain’s Royal United Services Institute, a defence think tank, has done:

In the next decades, climate change will drive as significant a change in the strategic security environment as the end of the Cold War. If uncontrolled, climate change will have security implications of similar magnitude to the World Wars, but which will last for centuries.

Again, this isn’t new. Policymakers ought to consider the costs of preparing for this sort of thing when they’re fretting about the costs of cutting carbon emissions. It’s not a zero-sum game.

The threat, incidentally, is neatly summed up in the term “climate security,” which isn’t one I’d heard before but which make perfect sense.

Earth Day, you say?

Earth Hour, x 24. Whatevs.

Who’s to blame for the biofuels mess

It’s almost not worth commenting on, but I can’t resist pointing out that the lead of this Lorne Gunter column in the Edmonton Journal is simply false.

Note to environmentalists: Remember, you were the ones who demanded biofuels the loudest.

Actually, Midwestern corn farmers, plus drivers complaining about high gasoline prices. Most of the rest of the column on the havoc being wreaked by biofuels production from food is bang on, but no evidence whatsoever is advanced in support of this particular lead.