A Tale of Two Countries

The juxtaposition on my coffee table was striking.  The daily newspaper had a front-page headline, “Big Oil Defends Its Tax Breaks,” accompanied by photos of the CEOs of the five largest oil companies as they testified before Congress against proposed legislation that would end a relatively modest set of tax breaks for the industry.  They claim it would cost jobs (though similar subsidies for clean energy would produce jobs).

The entrenched power of companies that produce 19^th century fuels (oil and coal) exists in a country where until the greatest ecological disaster in American history occurred a year ago, a popular slogan was “Drill, Baby, Drill.”  Many Americans seem to think that cheap gasoline is an American birthright.  Despite the deplorable state of bridges and roads in the country because gasoline taxes haven’t been raised in many years, people are clamoring for government to do something to reduce the price of gasoline, notably reduce gasoline taxes.  (They don’t seem to realize or care that it is those taxes that provide funds for repairing crumbling roads and bridges.)  Many still don’t grasp the simple math where the U.S. has between 2-4% of the world’s oil reserves, yet consumes 25% of global oil production.  Yet we’re supposed to cut the price of gasoline and consume more?  People do indeed have short memories.  With the Gulf oil disaster only a year ago, we now hear the slogan, “Drill Here, Drill Now.”

The political clout of these dirty businesses is couched in another means of duping the public--that of the myth of the miracle of an unfettered free market and the notion that government is inept.  Yet it was deregulation and out-of-control greed that caused the greatest financial disaster since the Great Depression just three years ago.

In contrast to this picture, also on my coffee table is a report on Denmark and why it is a leader in clean energy technology.  It is another myth that the capitalist U.S. is outperforming the sluggish, socialist Europe, particularly Scandinavia.  (Europe compares quite favorably on a GDP growth per capita basis versus the U.S., and the Swedish economy is growing rapidly while the government budget is in surplus.) 

Since 1980 Denmark has increased its GDP by 80% while keeping its energy consumption stable and reducing carbon emissions.  Denmark has a national goal of becoming independent from fossil fuels by 2050.  It is well on its way toward meeting this goal, as wind power already generates 20% of its electricity.  Denmark is a leader in “smart-grid” electrical distribution, and the country is home to a number of the leading companies in clean energy technologies.  Which country has a brighter, more sustainable future?  The one favoring 19^th century fuels that cause thousands of premature deaths each year, or the one providing global leadership in 21^st century fuels?

Steve Lehman

LehmanInvest.blogspot.com/