Wednesday, July 28, 2010

Funding Electric Vehicles is a Battery-Dead Idea




Can a bunch of technocrats in Washington really make better decisions than free consumers in the marketplace? No economic or scientific case exists for subsidizing the electric vehicle. The government should remain technology-neutral. Subsidies hinder the ability of free enterprise to innovate and develop other advanced auto technologies like the hydrogen fuel cell. The right way to create a diverse market for advanced technologies is to limit government involvement and introduce real tax reforms.

Government subsidies serve only to tilt the playing field and constrain the market's ability to operate. They are not in America's best interests.  Funding electric vehicles is a battery-dead idea.

~From my article in the Sacramento Bee

16 Comments:

At 7/28/2010 1:42 PM, Blogger Benjamin said...

PHEVs are a better idea than ethanol, any day.

Note to Morganovich:

See http://www.themoneyillusion.com/?page_id=3447

 
At 7/28/2010 1:46 PM, Blogger fboness said...

Better than ethanol isn't saying much.

 
At 7/28/2010 2:13 PM, Blogger morganovich said...

so the GM volt has announced pricing. $41,000. what an utter joke. this is a crappy, crappy car comparable to some $15k rental econobox. it has 146 HP and all the crummy build quality you expect in an entry level chevy.

to see what a bad proposition owning one actually is, let's compare it to a car that is clearly better in terms of comfort, build, and ride, a honda accord which sells for $21k.

so, for $20k less, you have an accord, which gets about 30 MPG. average US gas price is $2.71/gallon. that means that before you even break even on having the volt in your driveway you can drive the accord:

20,000 X 30 / 2.71 = 221, 402 miles. even if you accept that about 1/3 of that price difference gets paid by me and the other poor bastards who actually pay taxes, you can still put 140k miles on the accord before break even.

compare it to the sun $20k honda insight with its 43MPG, and it's a truly egregious waste.

very few low end GM cars can accumulate anything like that kind of mileage.

one can argue about the emissions benefits, but if this thing is anything like a prius, then just the eco impacts of building the highly toxic battery will more than offset any CO2 benefits (assuming you believe in such things).

it really does seem to me that a great deal of the "greentech" industry is predicated on its customers being bad at math...

 
At 7/28/2010 2:18 PM, Blogger morganovich said...

and benny, that's a ludicrous argument. it essentially amounts to "drive infinite inflation so long as we get nominal GDP growth".

that view is so insane i don't even know where to start. it destroys savings. it makes borrowing incredibly difficult. ultimately, you wind up in the 70's.

sorry to be so blunt, but this guy from chicago is a crackpot.

even so, it's still not an argument that money is tight. it's just an argument that we should go from extremely loose to infinitely loose.

 
At 7/28/2010 3:05 PM, Blogger fboness said...

Thomas Edison was bulding electric cars in the 1890s. The electric car is an idea whose time will never come.

 
At 7/28/2010 3:56 PM, Blogger Benjamin said...

MOganovich--I think you misunderstand the situation..but hey, just check in on his blog for a while. No harm done to be exposed to another viepoint.

Many others are also calling for QE--some say it will be inevitable, if deflation persists. I fall into that camp.

Good luck. Buy UVAN stock on the Thai SET.

Last word--I reject the idea that all we can do is have a long recession, maybe a deflationary depression because we are overindebted.

If we have debts to pay, we need a larger economy with more income to pay down debts. Shrinking the economy is not a good idea. Some reasonable amont of inflation will alos help deleverage America.

 
At 7/28/2010 4:24 PM, Blogger James said...

I challenge the alternative energy crowd to show me one of their solutions that was not tried and found wanting before 1950. I further challenge them to tell me something the hundred of millions of dollars spent on those solutions tells us anything about those solutions that we did not know before 1950.

 
At 7/28/2010 4:57 PM, Blogger Benjamin said...

James-

The reason for slternative energy is not only economic; it is for national security. According to the CBO, the Iraqistan war will end up with a $3 trillion price tag for taxpayers.

Cheney said the occupation-wars were about oil.

If so, it would be a lot cheaper to subsidize domestic energy sources.

PHEVs look very promising, BTW. The GM Volt is an incredible advance in many regards--at $6 a gallon, I think it would even be a hit. At $4 a gallon--not so sure. I do not think we had PHEVs 50 years ago, though I do remember rotary dial phones.

I think GM made a mistake in not intoducing the PHEV as a luxury concept, in Cadillacs. The $10k battery is an expense, but allows you to snub smelly gasoine stations, save time, and accelerate faster than any ICE.

$10k is a lot, but then some people spend $5k on leather seats.

 
At 7/28/2010 6:24 PM, Blogger Paul said...

"Cheney said the occupation-wars were about oil."

Where's your source for that, Benji?


"PHEVs are a better idea than ethanol, any day."

Your boyfriend is an advocate of wasting tax dollars on both.

 
At 7/28/2010 6:35 PM, Blogger Cloudesley Shovell said...

A diesel/electric locomotive is powered by diesel fuel.

A plug-in electric car in the US is overwhelmingly powered by a combination of coal, natural gas, and nuclear power, with a dash of hydroelectric.

The same car in France is powered mostly by a combination of nuclear and hydroelectric power.

Moving the source of the electric generation far away from the vehicle doesn't change the nature of its true power source.

 
At 7/28/2010 7:01 PM, Blogger Jason said...

By all means, we should keep subsidizing fossil fuels. This is just like Republicans defending Medicare in the face of Romney-care, (oh, oh sorry, off the party line for a second) I mean, Socialist Obamacare.

 
At 7/28/2010 9:59 PM, Blogger juandos said...

"Cheney said the occupation-wars were about oil"...

Yet another bizzare and unattributed weirdness from the pseudo benny...

Hey pseudo benny, you're from California, right?

Are you one of these Californians?

From AutoProphet: Some Volt Math

Buying a Volt just doesn't add up...

 
At 7/29/2010 8:44 AM, Blogger Tom said...

The heavily subsidized 40 mile battery car is a tribute to the fatal conceit of liberals.
1. The electricity costs $33 per million btu. Gasoline costs $22/mbtu.
2. 51% of electricity comes from coal, dirtier than gasoline
3. The Volt costs twice as much as a regular car
4. The Volt and others are a distraction from other, better R&D
5. There is virtually no global warming, so there's no reason to push this kind of junk policy.

If government is involved, it is by definition a bad idea. It diverts the market from providing genuine solutions.

Government has destroyed the housing market, food prices, energy prices, medical prices, education quality, and retirement savings. Just six items of the top seven in household budgets. Now they're trying to destroy a seventh item, transportation.

Big government IS the problem.

 
At 7/29/2010 11:54 AM, Blogger nates said...

When people even mention Fuel cells their credibility is instantly shot.

Fuels Cells are far worse than even ethanol in efficiency and viability.

 
At 7/29/2010 12:05 PM, Blogger Hydra said...

I think there is an argument to be made for TEMPORARY subsidies to help jumpstart promising technologies or businesses which can reasonably expect better pricing with improved technology and economy of scale which a start up cannot manage on its own.


This isn't one of them.

 
At 7/30/2010 10:44 AM, Blogger juandos said...

"I think there is an argument to be made for TEMPORARY subsidies to help jumpstart promising technologies or businesses..."...

Sure Hydra as long as its you and your like minded ilk that are ready to use YOUR money to subsidize said 'promising technologies or businesses'...

No reason to use extorted tax dollars for someone else's silly ideas...

That's what venture capital is for...

 

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