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Archive for September, 2013

Remarks Prepared for Delivery by Bernard L. Schwartz at Third Way & The Atlantic’s Infrastructure 2.0 Panel

September 30th, 2013

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The Case for Infrastructure

Before we dug the Erie Canal, it cost $120 to ship one ton of flour from Buffalo to New York City. After its construction, it cost $6. Because of that investment, business boomed, consumers lived better, and prices for products dropped.

That was almost 200 years ago, and the lesson hasn’t changed. Our national investment in the Grand Coulee Dam created millions of acres of arable land, whose wealth to our country cannot be estimated.  There is an unshakeable bond that links infrastructure to economic growth and to better lives for people. That is the story of America’s economic success and the creation of the greatest middle class in the world.

So why have we stopped investing? Why have we forgotten what made America and the middle class great?

Nothing would do more to put America back to work in good, long-term jobs than infrastructure investment. Nothing would be better for our long-term economy than making investments in better ports, roads, transmission wires, rail, and broadband so that we can move people, products, power, and ideas better, faster, and cheaper than the rest of the world.

And there is no better time to invest than now. Capital is available and cheap. The need is great. And the workforce is waiting.

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Ted Cruz: Blackmailer

September 27th, 2013

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On October 28, Sen. Ted Cruz (R-Tex.) and his supporters may wish to commemorate the feast day of Saint Jude. Jude is the patron saint of hopeless causes. Because if ever there were a hopeless cause, it is killing the Affordable Care Act.

Fighting for hopeless causes is not uncommon in politics. Think of the nearly two centuries it took to abolish slavery and segregation in the United States. Fighting for a hopeless cause can raise public consciousness about an issue and advance the career of the advocate. But it has to be seen as a noble effort. Sen. Cruz’s effort is anything but noble.

Defunding Obamacare is hopeless because the numbers aren’t there. Even if a bill were somehow to get through the House and Senate, President Obama has promised to veto it. It takes a two thirds majority of both houses of Congress to override a presidential veto. Republicans are not even close.

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Are Liberals Taking Over?

September 27th, 2013

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Immigration reform. Defunding the ACA. Marriage for gay couples.

Polls suggest there’s a gulf between Republicans and the public. And some Democrats have become emboldened, arguing that a new, liberal, Democratic majority has arrived.

Over the past few short weeks, everything from Syria to de Blasio to Summers has been touted as evidence of the growing strength of liberals. In a sprawling tome, Peter Beinart weaves all of these threads together, arguing that Occupy Wall Street should be the Democratic playbook and Sen. Elizabeth Warren should be the QB come 2016. President Obama? He’s been put on the Clinton DINO bench.

All of this is based on the prognosticators’ faith that what voters really want is a “real” Democrat. Translation? Liberal ideologue.

But what if that’s not what voters want? In our report on the new electorate, we examine ideology and partisanship among key growing demographic groups—Hispanic, Asian, and Millennial voters. We found that they are not overwhelmingly liberal, nor have they aligned strongly with the Democratic Party.

Ideology

Liberal Moderate Conservative
Hispanics 30% 31% 32%
Asians 31% 37% 24%
Millennials 28% 38% 28%

Source: Pew Research Center 

Partisanship

Democrat Independent Republican
Hispanics 32% 50% 13%
Asians 33% 34% 18%
Millennials 31% 45% 18%

Source: Pew Research Center and Gallup

Despite the temptations of recent events, Democrats should heed this data and be cautious to not take the support of Hispanic, Asian, and Millennial voters for granted. Independents and moderates represent large swaths of these groups, and of voters overall. Republicans may have ceded the center recently, but if history is any guide, they will adapt. And when they do, Democrats need to be ready.

EPA’s New Emissions Regulations Follow the Electricity Market

September 23rd, 2013

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There has been a lot of overheated political rhetoric from the right and the left about the EPA’s emissions standards for new power plants. If you strip that away, however, you’ll find that the new rule is really codifying what’s already happening in the utility sector. Thanks in part to the lower emissions and lower cost of natural gas, this is already benefiting public health, the environment, and the economy.

The bottom line is that for all of the build-up about the new standards, energy sector insiders know that low natural gas prices, the growth of renewables, and little demand growth are already reshaping electric generation. As an AEP spokeswoman acknowledged on September 20 in National Journal, “We have no current plans to build any new coal-fueled power plants both because we don’t need additional generation, and it would be difficult to make an economic case for coal with today’s low natural-gas prices.” The new regulations marry these market trends with intensive stakeholder input from the private sector. The result is a clear roadmap for new electricity generation in the United States.

While administrative actions never carry the democratic appeal of a Congressionally mandated solution, Congress has been unable to agree on a path forward. The Supreme Court required the EPA act, and the regulatory revamping was inevitable.

It would be great if Congress could develop and pass bipartisan legislation to accomplish the same goals as the EPA. That’s extremely unlikely in the current political environment.  There’s a lot Congress could do—that’s bipartisan and does not cost much if anything—to create new opportunities in coal states and to ensure we maintain fuel diversity in our electricity fleet. This includes helping the private sector accelerating the development of carbon capture and storage technologies and removing the regulatory uncertainty that surrounds it.

Remember, even the EPA’s new source regulatory decision had to be court-ordered. The regulatory uncertainty for utilities has been a killer, most will tell you, and the business climate has suffered. This is a step forward, both for the environment and the business climate. It had to happen, and it finally did.

This piece was originally published via National Journal.

Learning from Germany’s Clean Energy Missteps

September 20th, 2013

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American clean energy advocates like to tout the latest European energy accomplishments as proof that the United States is falling behind. Clean energy provides 25 percent of Germany’s energy demand! Germany has the greatest share of wind and solar among the G20 countries!

These are important accomplishments, to be sure. But this rapid growth has come at a cost: the highest energy prices in Europe. Are there ways we can achieve the milestones that Germany has reached while avoiding the economic downside of high costs? A new report by the respected German newspaper Der Spiegel provides some hard truths, and a look at three important lessons for us in the United States:

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For Syrian Weapons, Quick-and-Dirty Beats Slow-and-Steady

September 20th, 2013

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Now that Syria has ratified the Chemical Weapons Convention, the international community’s focus is shifting to how to destroy the country’s stockpiles of chemical weapons. The choice is simple: either the slow and methodical approach stipulated by the treaty that could take up to 10 years or more, as it has in the U.S., Russia and other countries; or a faster, cheaper approach that has been used in other countries such as Iraq after the Gulf War.

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