Energy Secretary Steven Chu, a winner of the Nobel physics prize and therefore in the mind of the public a certified genius, walks to work. At least part way. He engages in this strange activity because the gentleman does not own a car.
This is not especially eccentric. For example, yours truly also does not own a car, and has not owned one for twice seven years, a period of time that threatens to stretch even unto infinity. The difference between Secretary Chu and people like me is that I do not own a vehicle because of penury (and because I live in a metropolis where it is nuts to drive). Chu, a beneficiary of the bureaucracy, can afford a fleet of cars but chooses not to own because of religious reasons.
Chu walks (or rather is driven in a taxpayer-funded car) to “save the planet.” The danger that imperils the “planet”—a very large and historically robust astronomical object—is, according to Chu, gasoline. In 2008, Chu was asked about his animus regarding this miraculous substance, a driver of a large proportion of the world’s economy, and he said,
Somehow we have to figure out how to boost the price of gasoline to the levels of Europe.
Now the reason he said this is because he does not want people buying gasoline. He figures that if it is ridiculously expensive, as it is in Europe, that people will buy less of it. It is Chu’s economical theory that if people buy less of it, less of it will be used, and that therefore the planet will be “saved.”
It is also his view that if gasoline is prohibitively expensive, for all but the rich and for government bureaucrats who are driven wherever they wish to go and who never have to visit a gas station, innovation will be spurred and that “alternate fuel sources” will be developed.
There is a kind of logic at work here. But not of the kind found in textbooks. It is true, on average, that if a thing that is wanted is too costly, people will strain their gray matter to develop alternatives or workarounds. These replacements often, but not always, succeed. They also do not always meet needs in the time required.
But it is possible that by artificially increasing the price of gasoline—by taxing it, say, and adding the money to the Washingtonian beast—that some bright person will figure a way to replace that fuel by a new one. It does not of course follow that the new fuel will be “better for the planet” than the old fuel. It may even be, as seems likely, that gasoline is, among all alternatives, the best fuel.
At least the way the transportation system of the United States is now constructed. Most people in this grand country live far from everything: far from their jobs, far from grocery stores, far from their friends and relatives. Walking isn’t in it; driving is a necessity. It is thus exceedingly highly probable that abruptly increasing the price of gasoline to Chu-friendly levels will have the exact opposite effect as that intended.
That is, innovation will not be spurred because people will not be able to afford to do anything except pay for the fuel to drive them to work. The economy will suffer, as all evidence indicates it does when fuel prices rise “naturally.”
And that means that the money that comes from taxes (of all kinds) must decrease. The effect of that will be either larger deficits or increased taxation, or both, actions which further depress the economy. Even to the point of not having the funds to build “public transportation.” It should also be clear that the taxes raised on gasoline will decrease, even though the tax rate has been raised.
Well, so much is obvious, at least to average citizens. But not to Chu, who like many intelligent people, confuse their ability to know a lot about very little—Chu’s prize was for “for development of methods to cool and trap atoms with laser light”—into thinking they know a lot about everything. Even this would be okay, except that they conjoin this mistake with the additional belief that people who are not credentialed in knowing a lot about little, know nothing about anything.
Now that Mr Obama is up for re-election, and Chu’s earlier comments have been discovered, he has, in Washington speak, “backed away” from his economic vision and said that certainly he meant by saying that he wanted higher prices that he actually wanted lower prices.
Jay Carney, the president’s spokesman, finally forced to respond said, “I know that it’s part of the fun for folks to find these quotes and suggest that they have some deeper meaning.” I’m not sure what Carney means, because I find no humor in Chu’s words.