The Green New Deal will Make the Housing Bubble Seem Like Child's Play
- The housing bubble was a failure of central planning.
- The Green New Deal is central planning, and is doomed to fail in exactly the same way Bill Clinton's home ownership 'strategy' did.
- California is repeatedly cited as a model of sustainability and what the Green New Deal can do.
- In reality, California displays how difficult it will be to achieve the goals of the Green New Deal as well as the economic and engineering incoherence of the entire program.
- Here are just of few aspects of the California energy market that make it a particularly poor lodestone for a national central plan for electricity generation;
- California can't provide all the electricity it consumes; no state imports more electricity than California.
- On a per-capita basis, California uses one-half the national average of electricity. While part of this is the result of California's mild climate, its also the result of California having no energy intensive industries. Californian's use products like steel, cement and chemicals but they don't make them. (Calculation below)
- After approximately 20-years of renewable energy investments, California generates the same percentage of electricity with natural gas as Texas does. (See Table 4 and Endnote 1)
- After 20-years of renewable energy investments, California generates over twice as much of of its electricity from natural gas as it does from wind and solar combined. (Table 2)
- In 2011, California generated more electricity from its four nuclear reactors at the San Onofre and Diablo Canyon generating stations than it did from solar in 2019. (Table 2)
- San Onofre has already shut down (2) and Diablo Canyon will shut down in a few years. California's renewable energy production will need to soar just to keep pace with the shutdown of Diablo Canyon.
INTRODUCTION and BACKGROUND DATA:
The housing bubble was a spectacular failure of central planning. While Wall Street and the Fed also played enormous roles, it was Bill Clinton's 'strategy' to increase home ownership to 67.5% that was the first link in the chain of disaster. Here is Bill Clinton on June 05, 1995 describing his central plan and all that would be achieved by it.
"...And I can say this without knowing that I'm overstating it, that if we succeed in doing this, if we succeed in making that number (67.5%) happen, it will be one of the most important things this administration has ever done, and we're going to do it without spending more tax money....The goal of this strategy , to boost home ownership to 67.5% by the year 2000, would take us to an all-time high, helping as many as 8-million families cross that threshold...I want to say this one more time, and I want to thank again all the people here from the private sector who have worked with Secretary Cisneros on this. Our home ownership strategy will not cost the taxpayers one extra cent. It will not require legislation. It will not add more Federal programs or grow Federal bureaucracy, its one-hundred specific actions that address the practical needs of people who are trying to build their own personal version of the American dream..." (3)
It didn't take the benefit of hindsight to recognize the madness of Bill Clinton's central plan. Indeed, the collapse of the Soviet Union just a few years before should have conclusively demonstrated the perils of central planning. However, career politicians never see the failure of central planning as an indictment of central planning. Instead, its an indictment of the politicians who did the central planning. "Their" plan will always be better because "they" will be the ones doing the central planning. This seems to be the only explanation behind the 'Green New Deal' and its goal of generating 100% of the country's electricity with "renewable and zero energy sources" in just ten years. This isn't a plan; its madness.
Over the next few weeks, the economic and engineering aspects of this program will be discussed. If the politicians behind it suck as hard as they blow and implement it in any major way, the damage this program will cause to the United States will make Bill Clinton's housing bubble seem tame by comparison.
TABLE 1 - US Electricity Generation (2000 - 2019)
TABLE 2 - California Electricity Generation (2010 - 2019)
TABLE 3 - California Electricity Generation (1998 - 2009)
TABLE 4 (Percentages from Table 2)
Per Capita Energy Use (See Tables 1 and 2 Consumption Figures):
Sugar Land, TX
March 28, 2021
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1. See Table 2 and note that in 2020 Texas generated 45.7% of its electricity with natural gas.
3. University of California at Santa Barbara, The American Presidency Project, William J. Clinton, "Remarks on the National Homeownership Strategy," June 5, 1995 http://www.presidency.ucsb.edu/ws/?pid=51448