More of Obama’s green bubble: subsidizing Wall Street to buy Chinese solar panels
December 10, 2011 – 3:45 pm by JohnI liked this column by T.J. Rodgers in the Wall Street Journal, Subsidizing Wall Street to Buy Chinese Solar Panels. It explains how American consumers are not the ones who benefit from the Obama administration’s subsidies on the purchase of household solar panels. It’s a nice, short economics lesson on the Law of Unintended Consequences. He summarizes at the end:
Here then, is a practical guide to the Obama administration’s nonsensical solar policy: Washington gives tax breaks to Wall Street to fund LLCs [limited liability corporations] that buy solar panels from the Chinese to “help” the American solar industry, while the ITC [United States International Trade Commission] threatens to levy a tariff on those solar panels, which would raise the price of solar energy to U.S. homeowners. In short, Wall Street pockets the money and consumers get higher solar-energy prices.
We should stop reflexively indicting Wall Street “greed” and focus instead on Washington as the disruptive force in one market meltdown after another. Solyndra, the poster child of the Law of Misguided Subsidies, borders on irrelevancy compared to the full impact of bad economic policy.
