A Master-Class in How Not to Oppose Subsidies

Jazz Shaw of Hot Air has a complaint about some "renewable" energy subsidies, but it isn't what you might expect from an ally of capitalism:

If you think leftists are the only ones who complain about recycling or renewable energy that makes actual economic sense, read Jazz Shaw. (Image from Wikipedia article on black liquor.)

["Black liquor"] isn't actually a "new" form of energy. Paper mills have been burning it since the 30s and there have been complaints about the burning of black liquor for years now. The Washington Post featured a number of paper mills engaging in this type of scheme back in 2013, finding them in various spots around the nation. And they're all using the corrosive substance as a way to either get around or even profit from government mandates requiring the use of renewable energy.

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It's not just the pollution angle that has people angry. This scheme is allowing the paper mills to not only comply with, but exceed government mandates for using renewable energy. This means that they're not only saving money on fuel and earning subsidies, but they can sell renewable energy credits to other industries (such as fossil fuel plants) who can't meet their government quotas. This is the same sort of scheme that goes on with the RINs (renewable identification numbers) in the ethanol game.

At any rate, next time somebody wants to talk to you about all the progress we're making on renewable energy, ask them how much of it is coming from black liquor in their state. It's yet another example of government mandate programs running off the rails and being wide open to fraud and abuse. [link in original, bold added, other minor format edits]

Let that last sentence, in bold, sink in for a moment.

Of all the things to complain about with a government subsidy that is fraudulent to begin with, the fact that a company  inadvertently gets extra rewards for an intelligent work-around to a nasty waste problem is about the last thing I'd complain about. Indeed, unlike the "renewables" (read: unreliables) these subsidies are intended for, black liquor actually represents an economical source of energy, as witness the fact that it has been in use for nearly a century. Unfortunately, Shaw comes across like he is an environmentalist himself. This is  because his post amounts to complaining that the subsidies aren't being directed efficiently enough to those who would continue throwing money down the rat-hole of "renewable" energy. Worse, in his last paragraph, he basically dares leftists to fix this problem. His time would be much more productive if he stopped worrying about what they think. Instead, he should focus on reaching an audience receptive to the idea that the use of black liquor, despite its flaws, represents a counterexample to the argument that government meddling is necessary to cause people to find creative ways to extract energy or control pollution.

Government subsidies are immoral no matter who gets them, because, as wealth-redistribution schemes, they necessitate picking someone's pocket, which is exactly the opposite to what the government ought to be doing. Likewise for mandates, in which the government, rather than protecting freedom so that we might live according to our best judgement, issues marching orders. The real problem here is that there are mandates and subsidies in the first place, not that someone has managed to game the system for a tidy profit. Worse, from the standpoint of improving the situation, Shaw has opted to focus on some penny-ante profiteering rather than on the greater problem, and missed an opportunities to (a) name that real problem (misuse of government) and (b) suggest an alternative (such as better enforcement of property rights) that offers us more freedom and a real way to prevent companies or individuals from poisoning land, water, or air.

I'm not thrilled with paper companies getting subsidies, either, but at least what they are doing is in line with how pollution problems would get solved in a capitalist economy. Rather than complaining that they get free money that shouldn't be on the table in the first place, or don't live up to some improper government mandate or other, we should applaud their enterprise and work to put an end, altogether, to "green" command-and-control schemes by our government.

-- CAV