Free Markets, Free People

Daily Archives: July 2, 2012


Why is the Navy willing to pay $27 a gallon for biofuel?

This sort of stuff drives me crazy.  Why is Secretary of the Navy Mabus fooling around with this sort of nonsense under the guise of being “necessary for national defense” when we’re in the middle of a oil shale revolution that shows the US with the most proven oil reserves in the world?  Secondly and just as important, why during times of tight budgets is he willing to pay $27 dollars for biofuel when conventional fuel costs $3.60?

Example:

A U.S. Navy oiler slipped away from a fuel depot on the Puget Sound in Washington state one recent day, headed toward the central Pacific and into the storm over the Pentagon’s controversial green fuels initiative.

In its tanks, the USNS Henry J. Kaiser carried nearly 900,000 gallons of biofuel blended with petroleum to power the cruisers, destroyers and fighter jets of what the Navy has taken to calling the "Great Green Fleet," the first carrier strike group to be powered largely by alternative fuels.

Now I know it says “blended”.  Apparently it’s a 50% blend, because:

For the Great Green Fleet demonstration, the Pentagon paid $12 million for 450,000 gallons of biofuel, nearly $27 a gallon. There were eight bidders for that contract, it said.

Oh, and you’ll love this:

The Pentagon paid Solazyme Inc $8.5 million in 2009 for 20,055 gallons of biofuel based on algae oil, or $424 a gallon.

Because, you know, that 8.5 million couldn’t have been used to improve the lot of our troops, could it?

Instead:

Solazyme’s strategic advisers, according to its website, include T.J. Glauthier, who served on Obama’s White House Transition team and dealt with energy issues, but also former CIA director R. James Woolsey, a conservative national security official.

If you’re not disgusted, you’re not paying attention.

Meanwhile the administration has refused to approve the Keystone Pipeline and has just essentially reinstated the offshore drilling ban that stood for 27 years.

Hint: The military is not and should not be a proving ground for ideological goals.  It is the blunt instrument of foreign policy.  It is a well oiled machine (note the word!)  But it is an institution that cannot afford stupid profligacy like this.

Cruisers and fighters don’t run on chicken fat.  They run on petroleum.  Something we’d have plenty of if this bunch would get the hell out of the way.

~McQ

Twitter: @McQandO


Economic Statistics for 2 Jul 12

Here are today’s statistics on the state of the economy:

The ISM manufacturing index shows a contacting manufacturing sector for the first time since July 2009, falling to 49.7 in June. New orders, at 47.8, show contraction for the first time since April 2009, and point to the possibility of a slower July, as well. Inventories and prices also fell.

Markit Economics’ PMI for the US slowed to 52.5 in May, vice 54 for April.

Construction spending rose a better-than-expected 0.9% in May, following a 0.6% rise in April. On a year-over-year basis, spending was up 7.0%.

~
Dale Franks
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US manufacturing slows for first time in 3 years

A report out today says:

U.S. manufacturing shrank in June for the first time in nearly three years, adding to signs that economic growth is weakening.

Production declined, and the number of new orders plunged, according to a monthly report released Monday by the Institute for Supply Management.

The slowdown comes as U.S. employers have scaled back hiring, consumers have turned more cautious, Europe faces a recession and manufacturing has slowed in big countries like China.

"This is not good," said Dan Greenhaus, chief economic strategist at BTIG, an institutional brokerage. Though the report "does not mean recession for the broader economy, it is still a terribly weak number."

But the “private sector is doing fine”.

Forward!

~McQ

Twitter: @McQandO


ObamaCare: The fallout

I’ve read all the pundits and listened to all the talking head elite tell us how incredibly nuanced and subtle the Chief Justice was by approving the law as a tax.  In fact one described him as “"a chess master, a statesman, a Burkean minimalist, a battle-loser but war-winner, a Daniel Webster for our times."

I say “BS”.  He sold out.  He ended up being more worried about the perception of the court and his legacy than upholding the Constitution of the United States.  And I’m not the only one who feels that way.  The Wall Street Journal also throws a punch or two at Roberts:

His ruling, with its multiple contradictions and inconsistencies, reads if it were written by someone affronted by the government’s core constitutional claims but who wanted to uphold the law anyway to avoid political blowback and thus found a pretext for doing so in the taxing power.

If this understanding is correct, then Chief Justice Roberts behaved like a politician, which is more corrosive to the rule of law and the Court’s legitimacy than any abuse it would have taken from a ruling that President Obama disliked. The irony is that the Chief Justice’s cheering section is praising his political skills, not his reasoning. Judges are not supposed to invent political compromises.

"It is not our job," the Chief Justice writes, "to protect the people from the consequences of their political choices." But the Court’s most important role is to protect liberty when the political branches exceed the Constitution’s bounds, not to bless their excesses in the interests of political or personal expediency or both. On one of the most consequential cases he will ever hear, Chief Justice Roberts failed this most basic responsibility.

Precisely.  And Roberts caved.  From the lecture the court got from Obama during a State of the Union address till now, he became a cautious old lady more concerned with his reputation in perpetuity than serving the people and the Constitution he swore to uphold. 

That, as the WSJ says, is “more corrosive to the rule of law and the Court’s legitimacy” than anything he could have done.  He didn’t have the spine to take the heat from a controversial but proper decision so he took the easy way out.  He threw away his integrity for popularity and peace.   A judicial Chamberlin if you will.

Jacob Sullum at Reason gives you the rest of the bad news:

The Journal notes that the tax power endorsed by Roberts is no less sweeping and dangerous to liberty than the Commerce Clause argument he rejected. "From now on," it says, "Congress can simply regulate interstate commerce by imposing ‘taxes’ whenever someone does or does not do something contrary to its desires." Worse, as I pointed out last week, the tax trick allows Congress to dispense with claims about interstate commerce altogether. As long as a mandate is disguised as a tax (and as long as it does not violate explicit limits on federal power such as those listed in the Bill of Rights), "because we said so" is reason enough.

Mandates “disguised as a tax” give Congress almost limitless power to control your life.  That is the power Roberts handed our elected officials. 

Oh, but the apologists say, that will never happen.  They’d never abuse that power.  Yeah, a little lesson in history.   When the Constitutional amendment for the income tax was being debated some wanted to put a 2% limit on it. “Don’t do that,” the others said, “it will encourage Congress to immediately go that high.”

And here we are.

The Congress no longer need wrestle with intrusion in your life via the Commerce clause.  Justice Roberts just gave them an infinitely easier route that doesn’t require a Constitutional check.  He effectively removed the Court from its role in protecting you from increasing government intrusion.

And clever politicians will find a way to use that power he handed them when necessary.  Don’t you ever doubt that.

As for Roberts.  I have little or no use for a man who sits on the bench of the Supreme Court and puts politics in front of the Constitution he’s sworn to uphold.

~McQ

Twitter: @McQandO

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