American Elephants


How They Spend Your Hard-Earned Money: by The Elephant's Child

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And was paying your hard-earned money to the IRS painful? $600,000 of taxpayer money is going to the National Science Foundation to study — why people cheat on their taxes.

The National Science Foundation approved the 2015 proposal which set out to “advance basic understanding of how tax compliance behavior emerge”, to determine if there is a link between taxpayers feeling that tax policies are unfair and trying to avoid paying, by cheating. Any several thousand of you willing to write a clear response for, say, half the price? Thought so.

The IRS itself estimates that 83 percent of Americans file and pay on time.

If you are bothered by government waste, which is voluminous,  let your representatives know. They won’t do anything about it unless they know there is some blowback.



As The Sun Sinks Slowly in the West, So Does the Solar Industry by The Elephant's Child

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Back in 2010, President Obama hailed a Spanish Company, Abengoa, saying its new solar technology would supply tens of thousands of American homes with renewable power, and create local employment.

Since then the Spanish company has built two American plants, one in Arizona and one in California, which supply electricity to more than 160,000 homes based on the capacity of the solar thermal plants. Remember that “capacity” is what the plants would provide on perfectly sunny days, and ignoring clouds or rain.

It appears that Abengoa got overambitious, and saddled with debt from its expansion, is scrambling to avoid what would be the biggest bankruptcy in Spanish corporate history. Abengoa’s American projects in Gila Bend, Arizona, and Barstow, California, still have around $2 billion in outstanding loans guaranteed by the United States government. The plants were partly financed by $605 million in federal grants and tax credits, besides the federal loan guarantees. The New York Times adds:

“The whole reason Abengoa Solar had to get the guarantee from the government is that no private lender thought the risk was worth it,” the Institute of Energy Research, a prominent renewables critic that has received financing from the oil industry, said in 2011.

Do note the NYT phrasing, and the “oil industry” link doesn’t seem to lead anywhere at all. Abengoa has legal problems as well from shareholders and creditors, with claims of misleading investors, and against individual executives. The company lost $1.3 billion last year and paid employees late.

They’ve also done projects in Central and South America. In 2007 they established the world’s first commercial solar thermal power plant on the outskirts of Seville. That year their stock hit a record high of €7.39 a share. In November, the share price had fallen below 40 euro cents. It’s now hovering around 71 euro cents.

Meanwhile up north in Maine: from Bloomberg:

Despite long winters, a famously foggy coastline and relatively few solar panels in operation, Maine is emerging as a pivotal U.S. state for determining how consumers will pay for power generated by the sun.

U.S. solar installations have boomed more than 10-fold in the past five years, driven in part by a policy known as net metering that requires utilities to pay their customers for extra solar energy from rooftop panels. That’s lowered consumers’ monthly bills, and also cuts into revenue for utilities that still must contend with their own fixed costs — spurring conflict between traditional power companies and solar providers.

The permanent problem with the sun is that sunlight is diffuse. The major greenhouse gas is water vapor, which we recognize as clouds. especially here on the Northwest coast where there is not a speck of blue sky today. Note the lovely photograph of the sun at the top of this post, and — the extensive clouds.

US solar installations have increased by 10-fold in the past five years driven by a federal policy  called net metering that requires utilities to pay their customers for extra solar energy from rooftop panels. That has lowered customers’ monthly bills, but the utilities still have their own fixed costs, and it cuts into their revenue.

Maine has proposed replacing net metering with a system that lets utilities sign 20-year contracts with residential solar customers. And instead of paying the retail price, as called for under current policies, utilities would pay rates set by regulators.

Because this is the Twenty First Century, as we are so frequently reminded, the greens are sure there is a technological fix just around the corner, and energy storage will cease to be a problem. But every known rare earth has been tried and found wanting.

Elon Musk’s Tesla Powerwall is meant to be a daily use battery. Tesla has announced prices of $3,000 and $3,500, but that does not include the inverter, and with installation it comes to $7,340. It requires about 7.5 kilowatt hours to charge the Powerwall, providing about  5.4 kilowatt hours of power once charged. The Institute for Energy Research found that it would require a payback period of 38 years which is almost 4 times the warranty period of 10 years for the Powerwall. Even if solar power were used to charge the Powerwall the payback period would be 31 years. The obvious problem is that for home use, we require electricity most when the sun has gone down.

The government’s idea was that by stimulating greater consumer demand with subsidies, production would increase and costs would go down, but in the meantime the industry believes that solar is a complete non-starter unless utilities are forced to pay extremely unrealistic prices for solar energy produced by households with solar panels. It’s not just Maine, even in sunny Nevada solar requires huge subsidies.

Progressives are sure that the government can just order utilities to charge less for their services, much like ObamaCare just assumes that hospitals and doctors can be forced to accept less payment for their services and all will be well. Most of the problems with our frighteningly large national debt and yearly deficits are due to the fact that Progressives just don’t understand the free market at all. They only understand the pursuit of power and an ever-larger government.



This May Be The Most Spectacular Failure Of Solar Power Ever by The Elephant's Child

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“Natural” is a ubiquitous word, especially for all things environmental. Wind and solar energy are held in high esteem largely because they are “natural.” Unfortunately, the word doesn’t mean much of anything, you only have to consider its opposite —”unnatural”— to point out how meaningless it is.

But for the environmental movement, natural is a very big deal indeed. We should draw our energy from the wind and the sun, eliminate unnatural chemicals from our diet, stop cutting down trees, save endangered species, but stop putting animals in cages, and stop eating meat. The word “natural” moved right to the top of the advertising buzz-word list.

So it is no surprise that in the panic about Global Warming, which was the next big thing after we stopped panicking about a new ice age in the 1970s, and the threat of a nuclear winter receded, we turned to trying to harness the power of the sun. Sensible people pointed out that the power of the sun was very diffuse, the sun had the habit of sinking below the horizon at night, and there was the problem of cloudy days and clouds on even nice days. But this is America, and the Twenty-First Century, as we are so frequently reminded, and we have technology!

The 2.2 billion Ivanpah solar project in California’s Mojave Desert is definitely high-tech. Those tiny white rectangles in the picture above are more than 170,000 mirrors, each about the size of a garage door, that rotate to follow the path of the sun across the sky. Solar-thermal technology was meant to supersede old-fashioned solar panel farms. The mirrors would reflect the sunlight to the huge “power towers,” enormous pillars to create steam which would generate electricity. It is not only the world’s largest solar project, it is also known as “the world’s largest outdoor bird fryer.”

The facility was built by Bright Source Energy Inc, and operated by NRG Energy Inc. NRG owns the facility along with Bright Source, Google and other investors. When I wrote about Ivanpah last November, they were delivering only 40% of their promised electricity, and they were trying to get a federal grant to pay off their $1.6 billion federal loan.

Now comes news that the Ivanpah solar plant may be forced to shut down. It is not producing the electricity it is contractually required to deliver to PG&E Corp., which says the solar plant may be forced to shut down if they don’t receive a break from state regulators. PG&E is asking the California Public Utilities Commission for permission to overlook the shortfall and give Ivanpah another year to sort out its problems. The extension request is opposed by some consumer groups, who are complaining that the cost of the electricity from the struggling plant is exorbitant. There is no mention in the article of whether or not they got the federal grant to pay off their federal loan. The high-tech power towers just aren’t working as advertised.

The huge array is owned by BrightSource Energy Inc., NRG Energy Inc. and Alphabet Inc.’s Google. Government subsidy is what brings these projects to fruition and what brings investors who expect to be rewarded by the government subsidies. Over and over, across the world, when taxpayer subsidy is removed, the project shuts down.

In neighboring Nevada I had read recently that when Nevada withdrew the state subsidy, Elon Musk pulled out, but I apparently didn’t save the article.When I consulted Google, the headlines from the articles about Elon Musk and SolarCity are so completely fascinating that I couldn’t resist linking to that page. Do scroll down slowly to get the full picture. The federal government has no business using taxpayer money to pick winners and losers in the business marketplace.

California’s one remaining nuclear power plant, Diablo Canyon, produces more than twice as much clean, environmentally friendly electricity than all of California’s solar power installations combined. Environmentalists, of course, are trying to shut it down. (click to enlarge)

Diablo(h/t: Steven Hayward@ Powerline)



Government: Is It Ever Big Enough? by The Elephant's Child

Can the government ever be too big? How much spending is enough spending? And if there can be too much spending, where is that point? William Voegeli, Senior Editor of the Claremont Review of Books, explores these complex questions and offers some clear answers.



Tax Hungry States Are Going After Internet Retailers by The Elephant's Child

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The rise of internet retailers is changing the world of retailing. There are still lots of customers who want to see the product in person, or in the case of clothing—try it on. For clothing and shoes, buying on the internet gets pretty iffy unless you reliably fit a standard size. But for the states, sales and use taxes are a very big deal,

The Commerce Clause “gives Congress the power to regulate trade “among the several States.”

The state of Alabama is openly defying the U.S. Supreme Court in an effort to squeeze millions of dollars of tax revenue from businesses beyond its borders. Tax officials in Montgomery are insisting that out-of-state firms must, effective Jan. 1, collect and remit sales and use taxes if they annually sell over $250,000 in tangible goods to Alabamans.

This unconstitutional tax grab cuts to the heart of the Commerce Clause, which gives Congress the power to regulate trade “among the several States.” Alabama’s regulation directly contravenes the Supreme Court’s 1992 ruling in Quill v. North Dakota. In that case, the court held that North Dakota could not require an out-of-state office-supply company to collect sales taxes because the firm had no offices or employees there.

To get around that, Alabama’s revenue commissioner, Julie Magee, is putting forward an untested and suspect legal theory: The state claims that if its residents buy more than $250,000 a year from a remote business, then the seller has an “economic presence” and should be treated the same as a brick-and-mortar shop in Mobile or Birmingham.

That will be headed back to court. Online retailers, or catalog retailers have three options— they can assume that since the new regulation from Alabama violates Quill they can disregard it, in which case they would face tax assessments and audits from Montgomery. They can comply with the regulation and start collecting Alabama’s taxes, or they can simply quit selling their products in Alabama.

I have worked in the head office of a major retailer who sends out millions of catalogs and has stores in most states, and simply pays taxes in every state, for if they don’t have a store there they probably will soon. In the current climate, many chains are closing unprofitable stores, including Walmart, the nation’s largest employer.

Lots of catalog companies have gone out of business, as have many retailers who do maintain a physical presence. Retail business changes with the economy. But proposals like Alabama’s hit small online retailers particularly hard. Rep. Bob Goodlatte (R-VA) proposes focusing tax collection on the seller’s location. A small online retailer would pay taxes only from the state where it actually operates.

Congress needs to legislate, or tax-hungry states will attempt to overturn the Supreme Court Quill decision by regulatory fiat even if it circumvents the legislative process. It’s complicated, but a very big deal for online retailers. Amazon is working hard on the delivery issue, trying to cut down the time it takes to get a package to a consumer, in order to make ordering online more attractive. And not just delivery by drones. There is plenty of room for a cooperative effort to be fair to everybody, including the customers and the states.

I order from small online retailers who do not have a physical presence in my state. I’ve seen way too many of my favorite small retail shops go out of business. Successful retailing is hard, and not many businesses thrive for a very long time, especially in a climate of heavy governmental regulation. It’s easier to find something new to tax, or a new tax to impose, than it is to be a very good manager of changing economic conditions in your own state.

The battle between government and business has gone on since time immemorial, but everyone is better off when governments recognize that economic growth doesn’t happen in the government sector. A good business climate benefits everyone.



The Ugly Side of the Environmental Movement, And it’s Deplorable Actions by The Elephant's Child

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Aubrey McClendon, former CEO of Chesapeake Energy, “died March 2 in a car wreck the day after being indicted for conspiracy to rig bids on oil and natural gas leases. He will likely be remembered for two things: being a pioneer of the shale gas boom and a possible criminal who, in death, may have eluded a prison sentence. But McClendon may have had one other lasting legacy: he helped hasten the collapse of the coal industry in the United States.”

Between 2007 and 2012, McClendon and his associates contributed around $26 million to the Sierra Club to oppose the building of new coal-fired power plants. McClendon’s motivations were hardly pure; he knew that preventing new coal plants meant more demand for his company’s product, natural gas. And the contributions led to a scandal for the environmental group, whose well-funded “Beyond Coal” campaign has been instrumental in not only preventing new plants, but also shutting down aging ones.

Executive director Michael Brune had a simple explanation for accepting money from a big gas company that was drilling hundreds of wells using hydraulic fracturing: the enemy of our enemy is our friend. “The Sierra Club board of directors … determined that natural gas, while far from ideal as a fuel source, might play a necessary role in helping us reach the clean energy future our children deserve,” Brune wrote in <aref=”http://sierraclub.typepad.com/michaelbrune/2012/02/the-sierra-club-and-natural-gas.html”>a 2012 blog post. “The idea was that we shared at least one common purpose [with Chesapeake]—to move our country away from dirty coal.”

The Sierra Club turned down further contributions from McClendon and his Chesapeake colleagues as it began to worry about the boom in natural gas fracking. That didn’t affect the outcome: McClendon’s philanthropy helped make it very unlikely that any new coal plants will be built in the U.S.—and helped push coal, the backbone of America’s power sector for more than a century, into a sudden and dramatic twilight.

Here’s another excellent example of the rot in the Green movement. If you can get rid of coal as a resource for power generation by claiming that it is the cause of anthropogenic global warming, what’s the big deal if you cause thousands of coal miners to lose their jobs, if you can force the country to depend on your natural gas for their electric power, and make your company and yourself rich by so doing?

The Sierra Club was once a nice organization with the goal of protecting the Sierra Mountains. They sponsored catered pack trips through the Sierras, and publicized Ansel Adams beautiful photography of the Sierras and Yosemite National Park. But at some point they became a leftist political agency under the cover of being a nice environmental club.

But then the coal industry once supplied nearly half of America’s power needs, and kept the cost of power low for American homes and businesses, enabling the prosperous industrial country we live in.  Mr. McClendon is hardly the only person who has been trying to enrich himself and his business by using the fear of a crisis of global warming that has been pushed by so many environmental organizations.

The cheap and affordable energy that coal-fired plants produce cannot be replaced by renewables, no matter how much investors hope it to become fact instead of wishful thinking. Wind is highly intermittent — we had a minor wind storm today that deposited bushels of fir cones and branches on the roof and on the streets (and on the driveway I laboriously swept yesterday) yet there were long periods with no wind at all, and even some blue sky.

Wind energy proponents talk about optimum performance — what a wind farm could produce if all the turbines were turning at the speed that would be produced by a perfect flow of wind. But Mother Nature doesn’t work that way.Wind is intermittent at best, and even shuts down for long periods. When it isn’t blowing at the perfect speed, then the power has to come from somewhere else. Hopes for battery walls ignore the availability and expense of the rare earths required which largely come from China, who has cornered the market and can raise prices as they choose.

President Obama’s Clean Power Plan will prevent 0.03 degrees of warming by 2100.

Christiana Figueres, executive secretary of the United Nation’s Framework Convention on Climate Change, admitted that the goal of environmental activists is not to save the world from ecological calamity — but to destroy capitalism.

“This is the first time in the history of mankind that we are setting ourselves the task of intentionally, within a defined period of time, to change the economic development model that has been reigning for at least 150 years, since the Industrial Revolution,” she said.



Donald Trump is the Ultimate Insider by The Elephant's Child

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Matthew Continetti, writing at the Washington Free Beacon today, said “Donald Trump has become the Republican frontrunner because GOP primary voters want an outsider who is angry at the condition of the country and the party establishment.” this really struck me — because it is just dead wrong. I don’t know whether Continetti is correct or not, but if GOP primary voters assume that Donald Trump is an outsider, they are mistaken. Mr. Trump is the ultimate insider.

He has told us so repeatedly. Trump explains that he donates to both parties because he is in business, and that’s just what you do. Of course. He donates because he is buying access. If he gives a significant sum to a politician, whether a national candidate, a state candidate or someone in city administration, they will see him when he calls. They will look with favor, if they are able, to his requests, favor at least partly, his side of the latest ‘deal.’ That is by nature — an insider. That’s how you make deals.

Forgive me, but the party “establishment,” whoever that is:  Party Chairman Reince Priebus? Senate Majority Leader Mitch McConnell? House Speaker Paul Ryan? Who precisely are you angry at and why? The Republican “establishment” did not pass ObamaCare, but have voted to repeal it in full six times, and in part over 50 times.

Those changes that you resent so much are a direct result of President Obama having a House and a Senate with Democrats in charge, and Republicans couldn’t do a thing about it. Even when the voters revolted and gave control of the House and the Senate to Republicans, there was little that they could do beyond putting a bill on the president’s desk, which he promptly vetoed, as he has. Shut down the government? That only frightens voters who fear that they won’t get their Social Security checks, or their welfare checks, or their food stamps, or their medical care. They depend on those payments, and shutting down the government really frightens them, and loses votes for Republicans at the polls.

The founders designed a Constitutional system that was meant to be slow, with participants thinking and arguing over potential legislation extensively to be sure that it was good legislation. They had no concept of a federal government with hundreds of agencies, departments, offices and bureaus all with the power to issue regulations. Who knew that it would take a Freedom Of Information Act (FOIA) lawsuit which could take months and years to pry loose information that Congress needed to do their work? That many arguments about authority would go to the Supreme Court for a decision, and those can take years proceeding through the courts.

Of course there should not be hundreds of agencies, departments, offices and bureaus, and they shouldn’t be issuing regulations. Congress is supposed to be making the laws, not palming them off. It is the Democrats who are in favor of BIG government, and essentially believe that most everything should be done by government. I believe Bernie Sanders recently said that charities should be abolished and the government should take that task over. It is of course about power. And that’s why Democrat plans seldom work.

If  you are angry at the vast number of people who have dropped out of the labor market, the huge numbers on food stamps, the sluggish economy that Obama keeps claiming is growing and prospering — why aren’t you angry with Obama?

If you are distraught at open and unenforced borders, at illegals placed all over the country, and criminal illegals in sanctuary cities, blame the Democrats. If you are disturbed by President Obama’s announced numbers of “Syrian” refugees to be admitted to the country, Republicans are trying valiantly to stop some of these things.

If you worry about ISIS, then don’t fall for the Democrats’ propaganda about “Bush Lied, People Died.” Bush did not lie, every intelligence agency in the world believed that Saddam had WMD — and so he did. He had 500 tons of yellowcake, enough to make 168 nuclear weapons. He had vast warehouses full of “agricultural chemicals” which are the precursors of nerve gas and other poison gasses, and the chemicals that turned them into nerve gas were stored in Saddam’s scientists’ home refrigerators. ISIS has found vast stores of Saddam’s poison gas, which are still turning up. ISIS exists because Obama did not make any effort to make a status of forces agreement and just pulled all the troops out, leaving Iraq to fend for itself.

Republicans are doing what they can to prevent Obama’s overreach but as he has told us—he has a phone and a pen— and he is going to do as much as he possibly can to go around Congress and accomplish his ends with executive orders and signing statements and whatever other executive tricks he can think up. He has no intention of working with Congress at any time. Be as angry as you want, but at least direct your anger constructively at the source of the problems, not at those who are trying to remedy them.




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