Published October 22, 2010
Last week’s disappointing Labor Department employment report is a stark reminder of the failure of President Obama’s $787 billion economic stimulus package to initiate job growth. The national unemployment rate remains at a stubbornly high 9.6 percent, with payrolls falling by 95,000.
However, the failure of Obama’s economic recovery plan to keep unemployment at or below 8 percent has not deterred the president from using stimulus funds to drive his green economy fantasy. On the contrary: During a recent radio address, Obama touted his recovery plan is plowing over $90 billion of taxpayer money into clean energy projects.
While these funds have failed to stimulate job growth and kick-start economic expansion, they have bailed out Obama’s big-business allies, who are betting on the president’s green agenda. Dolling out stimulus money to corporate interests serves a key political need for Obama: it rewards companies for lobbying for his energy policy.
Despite all the rhetoric of Obama’s anti-business leanings, visible when he speaks of energy policy just as with health care reform, the president has carefully tailored his legislative goals to appeal to corporate special interests.
Consequently, it’s not surprising to discover that many of the remaining corporate members of the United States Climate Action Partnership cap-and-trade lobbying group, including General Electric, Duke Energy, NextEra Energy, Exelon, and Honeywell, all received economic stimulus funds.
These companies have banked on a federal law, like Obama’s, to reduce carbon dioxide emissions.
General Electric is perhaps the company reaping the most from Obama’s stimulus plan. As noted in a 2009 Wall Street Journal story, “General Electric Pursues Pot of Government Stimulus Gold,” GE CEO Jeff Immelt geared up his lobbying army to exploit President Obama’s economic stimulus package.
According to Recovery.gov, GE is the beneficiary of over $49 million in grants and contracts from a wide range of government departments, including Energy, Defense, Justice and Health and Human Services.
Taxpayer support of GE’s business, however, is not guaranteed to translate into job gains.
CNSNews.com tried to confirm that GE was the recipient of 14 grants worth $24.9 million and to determine if the company added employees as a result of taxpayer money. GE declined to comment on the request.
Although GE apparently will happily feed from the taxpayer trough from any government source, it seeks its biggest payout from Obama’s energy policy.
GE will profit from the Department of Energy’s recently announced plan to guarantee a $1.3 billion loan for the world’s largest wind farm. If finalized, the loan would support the Caithness Shepherds Flat wind venture in Oregon, a project co-sponsored by GE.
In announcing the plan, U.S. Energy Secretary Steven Chu credited the Recovery Act for supporting the loan program. The wind farm project will use 338 wind turbines supplied by GE.
In addition to direct government support of its energy business, GE will likely benefit from the hundreds of millions of dollars that were given to three of GE’s utility customers, Duke Energy, NextEra Energy and Exelon. Each of the aforementioned utility companies received a $200 million grant from the Department of Energy to develop the smart grid.
Although Obama’s energy suffered a setback when cap-and-trade failed to pass in the Senate (so far), the president and his big-business allies have been very resourceful in working their green energy partnership thorough the economic recovery plan. At some point, however, those funds will dry up.
The next target for the Obama/big-business alliance is a renewable energy standard. Sens. Jeff Bingaman (D-NM), Chairman of the Senate Energy and Natural Resources Committee, and Sam Brownback (R-KS) recently introduced a renewable energy standard bill in the Senate that mandates 15 percent of electricity must be derived from energy sources such as wind and solar power by 2021.
Mandating the use of renewable energy products to generate electricity will boost GE’s profits, since it will force utilities to buy wind and solar power products that the company makes. The renewable energy standard also fits nicely with Obama’s promise to pursue his energy agenda in “chunks.”
Unfortunately, a renewable energy standard will not help our economy or promote long-term job growth.
The experience of countries such as Spain found that a green energy economy falls far short of its goals.
Unless we find a way to break up Obama’s big-business alliance, our economy will be saddled with greater deficits, higher energy prices and slower economic growth. We need to cap bailouts, not carbon emissions.
Tom Borelli, Ph.D., is director of the Free Enterprise Project at the National Center for Public Policy Research.