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Greens Exploit Wall Street Bailout

By Steven Milloy
October 2, 2008

Will the Wall Street bailout be the beginning of the New (Green) Deal?

Environmental activists are trying to figure out ways to advance their global-warming-regulation agenda by exploiting the current financial crisis, including the Wall Street bailout bill to be voted on by the House.

The good news for them is that they may not need to succeed, since someone with a very Green agenda will be in charge of implementing the bill should it become law.

As reported by Carbon Control News (Sep. 24), "Environmentalists and some Democrats are seizing upon the financial sector crisis to call for major federal investments in energy efficiency and improvements in the electricity grid as a way to address climate change and spur a lagging economy."

Michael Moynihan, former Clinton administration economic adviser and director of the Green Project for the New Democrat Network, has called for a national infrastructure bank to fund clean energy projects.

Following up on this idea, two house Democrats introduced a bill last week to establish a "Clean Energy Investment Bank."

Although Moynihan claims this would be an improvement over the current earmark system, the bank seems to be little more than a permanent Green earmark.

The activist group Friends of the Earth (FoE) is lobbying for the Treasury Department to conduct global-warming impact reviews under the National Environmental Policy Act (NEPA) — the federal law requiring federal agencies to conduct environmental-impact studies of their actions.

Through its citizen-lawsuit provisions, the Greens often use NEPA to block energy, highway and logging projects that involve federal agencies and lands.

FoE claims that as the Treasury Department becomes a significant shareholder in financial institutions that it bails out, it would be obligated to carry out environmental impact studies since, to some extent, the activities of those financial institutions would also be activities of the Treasury Department.

"Subjecting entities that receive financial backing from taxpayers to NEPA could provide a hook for environmentalists to force greater scrutiny of actions by those entities that increase greenhouse gas emissions, including the underwriting of fossil fuel projects," reported Carbon Control News (Sep. 26)

Anti-nuclear Greens are trying to use the recent bankruptcy of Lehman Brothers to block the construction of the first nuclear reactor built in the U.S. in 30 years.

This column previously reported on how the Greens are trying to stop Maryland from permitting the construction of a third reactor at Constellation Energy's Calvert Cliffs power plant by arguing that emission-less nuclear power actually worsens global warming.

Lehman's bankruptcy raised concerns about the financial health of Constellation, leading to a buy-out offer from the Warren Buffet-led Mid-American Energy Holdings Company.

The Greens called for the project to be halted "in light of the nation's worsening financial crisis and serious concerns about the stability of the company building the project," according to Carbon Control News (Sep. 26).

Monday's rejection of the Wall Street bailout bill by the House has opened the door for the alternative-energy industry to again try to renew the tax credits about to expire for wind power projects such as the Pickens Plan.

The Senate bill passed Wednesday night extends the much-lobbied-for tax credit.

New York Times columnist Thomas Friedman called on Congress to "Green the Bailout" (Sep. 28).

Friedman quoted a green-collar jobs proponent who said, "You can't base a national economy on credit cards. But you can base it on solar panels, wind turbines, smart biofuels and a massive program to weatherize every building and home in America."

Finally, even if none of these provisions make it into the bailout bill, the Greens will likely be able to count on Treasury Secretary Hank Paulson to implement their agenda for them.

The former head of Goldman Sachs — who simultaneously headed up the Nature Conservancy and recently told Fortune magazine that action on global warming is crucial to the U.S. — is no stranger to using "other people's money" to implement the Green agenda on land secured by distressed debt.

Paulson could use bailout money to purchase debt securities that are secured by property either coveted by Greens or targeted for energy or natural resource development projects that the Greens oppose.

Once the U.S. Government owns the securities (and, thereby, the property) an omnipotent Paulson could essentially take the land out of circulation by "preserving" it as public land.

He could even claim — through the economic device of "contingent valuation" — that the acquired land has more value as pristine public land than as, say, an energy or logging project.

Contingent valuation uses opinion surveys to value intangible assets for which there is no market, such as scenic views and crystal-clear air.

Respondents are asked hypothetical questions like, "How much would you pay to preserve a seashore view from oil drilling?" or "How much is it worth to keep a forest pristine and un-logged?"

Though the whole process is pretend — the respondents know they won't actually spend any of their own money for this preservation — the government uses the method to establish monetary values of preserved lands.

It doesn't take too much imagination to see how contingent valuation could be used to gin up phony bailout profits through land preservation.

Paulson has already said that he would bequeath the bulk of his fortune — in the neighborhood of $500 to $800 million — to Green causes.

Imagine what he would be willing to do with your money.