On Energy, Ritter Earns an “F”

Posted by on Jan 11 2011 | Economics, energy, Government Largess, PPC, Taxes

While at Founders Night this year, I was interviewed by Energy Now TV-news magazine. We talked about Ritter’s “new energy economy” and the future of energy in our great state of Colorado. The interview is about 9 minutes long, check it out:

Reporter Susan McGinnis did a great job of playing devils advocate with me (hey, wait a minute). The interview eventually devolves into the predictable jobs conversation. As we’ve heard numerous times before, regarding all sorts of government interventions and manipulations – “but Mr. Caldara, program X will create jobs!” Each time I hear that assertion, my mind wanders to visualizing Frederic Bastiat doing somersaults in his grave. I would very much like to shout something like, “THAT IS THE SEEN. YOU ARE MISSING THE UNSEEN – THE OTHER HALF OF THE EQUATION!” But shouting economic logic generally gets me nowhere. So instead, I reply with a calm voice and a gleam in the eye, “The jobs government creates are visible and come at the expense of the jobs they destroy – the unseen.” My rule of thumb is, let Mr. Bastiat do the talking whenever possible. If you prefer, you can apply a more recent twist on that rule of thumb by changing Mr. Bastiat to Mr. Hazlitt.

Evidently Ari Armstrong agrees with me. He just wrote an op-ed on the Governor’s energy delusions appropriately titled, “Ritter’s New Energy Economy Based on Old Fallacies.” In the article, Ari tackles the age old jobs assertion with Bastiat’s economic insights. Here are a couple of my favorite quotes,

Corporate welfare does not just fall from the sky. It comes from taxpayers. That money is no longer available to those who earned it to create jobs and support businesses in other sectors. While Ritter creates jobs with one hand, he destroys them with the other. The difference is that the jobs Ritter creates serve political interests rather than the interests of consumers.

In the interview above, I mention several times that no energy company or sources should be getting any subsidies from taxpayers. Rather, we need a level playing field where energy companies compete with each other on the same terms. The market will pick the winners and losers – NOT politicians. The second great quote from Ari is a little trick called reductio ad absurdum, which exposes an argument’s fallacies by drawing its conclusions to their logical ends.

Consider, as Bastiat might do, the logical absurdities of Ritter’s position. If mandating “new” energy creates jobs, then why stop at 30 percent? Why not 100 percent? Why not expand subsidies 1,000 fold? Why not outlaw all coal, oil, and natural gas in Colorado, and force every property owner to install solar panels and windmills? Think of all the new jobs that would require!

Tasty isn’t it?

Bastiat himself used reductio ad absurdum to expose protectionist polices nearly 200 years ago. He wrote a mock petition arguing for extinguishing the sun’s light in order to protect candle makers and others who were in the artificial light business. This line of argument is just as effective today. Ari uses it perfectly in his new op-ed. I suggest you take up a little reductio ad absurdum in your next debate. It will be fun, I promise!

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