Four years into a pitiful economic recovery, what are the prospects for the next four? In the last four years, the government footprint in the economy has gone up by 4 - 5% of gdp -- no sign that that is going to go down any time soon. Social Security, Medicare, and Medicaid continue to increase at rates far in excess of overall economic growth, with no good prospect of reform. Taxes on the top producers have just gone up. But the U.S. economy is a huge and remarkably resilient engine. Can't it get going and outrace these things?
If you were thinking of getting your hopes up, consider this from Obama's second inaugural address:
We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations. Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires, and crippling drought, and more powerful storms. The path towards sustainable energy sources will be long and sometimes difficult. But America cannot resist this transition; we must lead it. We cannot cede to other nations the technology that will power new jobs and new industries — we must claim its promise. That is how we will maintain our economic vitality and our national treasure — our forests and waterways; our croplands and snowcapped peaks. That is how we will preserve our planet, commanded to our care by God. That's what will lend meaning to the creed our fathers once declared.
And this wasn't just buried somewhere. From all indications, it appears that he intends to make it the signature initiative of his second term.
There were no policy specifics mentioned. However, every policy idea that has ever been on the table as to "climate change" has two essential features: (1) it attempts to decrease the use of carbon-based energy either by direct prohibition or by raising the price, and (2) its effect on total world use of carbon energy, given rapid increases in third world use, cannot have any but completely negligible effect on world temperature, even if you believe that more atmospheric CO2 will increase temperatures.
Over at the Washington Post's wonkblog, Steve Plumer has a list of policies that Obama might try: have EPA force the closing of coal-fired power plants (sure to raise the price of electricity); force the use of more "renewable" energy (costing a multiple of carbon-based energy); back to cap and trade (specifically intended to raise the price of energy to force the people to use less, aka intentional impoverishment of the people). Or how about a really high, really regressive "carbon tax"? Maybe that will "save the planet" by forcing the low income people to stay home and keep their homes heated to only 50 degrees. Or how about a few more billions -- make it trillions! -- for renewable energy subsidies? Of course, the renewables can't possibly compete with fossil fuels on equal terms, so when the subsidies end, all of the wind and solar producers go out of business the next day.
Meanwhile, it's been fifteen years since world temperatures have increased -- fifteen years in which carbon emissions from the third world and former third world (China, India) have soared. One would think that the climate campaigners by this time would be looking for a way to climb down inconspicuously and slink away before they make themselves look even more ridiculous. Nope, they're doubling down.
In the old days the government thought it was its business to make electricity available and inexpensive. From the 1930s to 1990s we had the Rural Electrification Administration, that handed out big grants to bring carbon-based electricity to every farm in America. What happened to that? Well, no Federal bureaucracy ever goes away. In 1994 they turned it into the Rural Utilities Service. According to allgov.com, that agency dispensed some $9 billion from 2002 - 2012. And one of the key missions? Making electricity less expensive in rural areas! Here's a press release from December 19, 2012:
USDA ANNOUNCES FUNDING TO HELP REDUCE ENERGY COSTS IN REMOTE, RURAL AREAS
Well, nobody ever said the government had to be consistent. The point is to pass out money and to make yourself look like the sugar daddy.
Anyway, everything about "climate change" policy is a war on the efforts of entrepreneurs to make the economy more productive and efficient, and the people wealthier. So what is the chance of the economy improving any time soon?