Stimulating Rent Seeking
President-elect Obama’s proposed economic stimulus package (on which Doug Bandow commented recently) isn’t even in Congress yet, and the the rent-seeking has already started. ClimateWire reports:
As lawmakers and President-elect Barack Obama mull another economic stimulus package, businesses and congressional leaders are jockeying to be in position to receive the first trickles of federal cash intended to stem losses of jobs and raise energy efficiency.
Two sectors, in particular, stand to benefit, judging by the debate so far. Labor unions are pressing for a package that focuses on “green jobs” like renewable energy generation and retrofitting buildings for energy efficiency, as well as traditional construction projects aimed at roads, bridges, schools and transit.
The other major beneficiary is shaping up to be “smart grid” improvements, or advanced technologies aimed at increasing the efficiency of the country’s aging electricity infrastructure and accommodating emerging energy sources such as solar power….
An example of the type of business that stands to capitalize is Silicon Valley’s Echelon, a 20-year-old company that makes systems that allow energy systems and office buildings to communicate with each other online. Echelon’s LonWorks platform is used in buildings and transportation systems worldwide, most notably in Honeywell heating and air conditioning systems but also in the New York City subway system, Army Corps of Engineers facilities and McDonald’s restaurants.
If new power grid systems are so efficient, why would they need to be subsidized? Granted, some utility franchises may create distortions and inefficiencies, due to their government-granted monopoly status, but utilities are still businesses, and businesses always seek to cut costs. Going “green” may soon become the last refuge of the rent seeker. (Paid subscription required for ClimateWire link.)