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Friday, June 28, 2013

Paul Krugman, "Invest, Divest and Prosper": Prospering from a War on Coal

Engulfed in scandal at home and faced with crises demanding decisions overseas, President Obama has scurried off to the wilds of Tanzania, a center of human trafficking (see: http://allafrica.com/stories/201306121100.html), but not before declaring war on coal.

In his latest New York Times op-ed entitled "Invest, Divest and Prosper" (http://www.nytimes.com/2013/06/28/opinion/krugman-invest-divest-and-prosper.html), Paul Krugman blithely writes:

"The new Obama plan is, to some extent, a war on coal — because reducing our use of coal is, necessarily, going to be part of any serious effort to reduce greenhouse gas emissions. But making war on coal won’t destroy jobs. In fact, serious new regulation of greenhouse emissions could be just what our economy needs."

Making war on coal is "just what our economy needs" and "won't destroy jobs"? How can this be? Krugman explains:

"Suppose that electric utilities, in order to meet the new rules, decide to close some existing power plants and invest in new, lower-emission capacity. Well, that’s an increase in spending, and more spending is exactly what our economy needs."

Just a moment, Paul: You're going to close plants and invest in lower-emission capacity, and over the short-term and medium-term, this is not going to eliminate jobs? As reported by The Washington Post (http://www.washingtonpost.com/blogs/the-fix/wp/2013/06/25/is-obama-waging-a-war-on-coal/):

"Still Kyle Danish, an attorney at the law firm Van Ness Feldman, said utilities that already have to spend heavily to control their toxic emissions are anxious to see exactly how the federal government will regulate carbon dioxide from existing plants.

'They want to make the investment in scrubbers and other very expensive equipment to meet the mercury and toxics standards, but they don’t want those investments to be stranded if they end up closing the plant anyway,' Danish said."

Or stated otherwise, I can see why utilities will now place spending on new power plants on hold, pending clarifications from the federal government. Meanwhile, however, coal has become taboo, and this of necessity will cost jobs of those who need them most as plants are closed, but nothing arises in their stead.

Consider Krugman's prior New York Times op-ed entitled "Et Tu, Bernanke?" (http://www.nytimes.com/2013/06/24/opinion/krugman-et-tu-bernanke.html?_r=0), in which he wrote:
"The first thing you need to understand is how far we remain from full employment four years after the official end of the 2007-9 recession. It’s true that measured unemployment is down — but that mainly reflects a decline in the number of people actively seeking jobs, rather than an increase in job availability. Look, for example, at the fraction of adults in their prime working years (25 to 54) who have jobs; that ratio fell from 80 to 75 percent in the recession, and has since recovered only to 76 percent."

Krugman truly cares about unemployment? Not when it affects coal workers.

"Invest," "divest" and "prosper"? Sounds a bit like "hope," "change" and "forward."

Ah yes, the Conscience of a Liberal . . .

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