Obama Cabinet picks show his coziness with industry

WhiteHouse.gov

President Obama nominates Ernest Moniz as the next Secretary of Energy, Gina McCarthy as Administrator of the Environmental Protection Agency, and Sylvia Mathews Burwell as Director of the Office of Management and Budget.

Article Highlights

  • Obama’s recent appointees to the EPA & Energy dept. received cheers from the heavily subsidized green energy industry.

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  • Nominees to the EPA & Energy dept. seek to increase government’s role in the energy sector with the cooperation of business.

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  • If you want a smaller government role in energy, Obama’s nominees McCarthy and Moniz aren’t for you.

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President Obama's recent appointees to the Energy Department and the Environmental Protection Agency have received sneers from liberal environmentalists and free-market advocates but mostly cheers from the energy industry, especially dealers in heavily subsidized green energy.

Obama this week chose Gina McCarthy to run the EPA and Ernest Moniz to run the Energy Department. Both nominees fit nicely into the pragmatic mold of Obamanomics, seeking to increase government's role in the energy sector with the cooperation of business. The industry plaudits poured in.

"President Obama has made an outstanding choice in his decision to nominate Gina McCarthy to be the next administrator of the EPA," said Tom Buis, CEO of Growth Energy. Growth Energy is the leading lobby for ethanol subsidies in the U.S.

The group strongly supports the federal mandate requiring refiners to blend ethanol with gasoline. Growth Energy, which represents ethanol giants like POET LLC, advocates subsidies for ethanol blender pumps. It also is lobbying to outlaw the sale of new cars that don't run on high-percentage blends of ethanol.

Buis, a registered lobbyist, is a former top aide to Obama confidant Tom Daschle. White House visitor logs show 21 White House visits for "Tom P. Buis" and "Thomas P. Buis."

Other ethanol lobbyists applauding McCarthy's nomination, included Brooke Coleman, executive director of the Advanced Ethanol Council. Ethanol Producer Magazine reported that Coleman "said McCarthy was a perfect choice."

Although Obama regularly talks about ending "corporate welfare," battling the "special interests" and creating a "level playing field," he has steadfastly supported government favors for the ethanol industry -- favors that increase costs for drivers, taxpayers, ranchers and grocery shoppers.

The Solar Energy Industries Association also applauded Obama's nomination of McCarthy and Moniz. Solar companies profit from a production tax credit that Obama recently fought to extend, and a plethora of stimulus subsidies such as loan guarantees, tax credits and grants.

Check who's investing big in solar energy, and you'll notice a lot of politically connected names, such as Al Gore, Warren Buffett and Vinod Khosla.

Moniz, a big green energy supporter, has a long history of working with large energy companies producing

both fossil fuels and renewables.

Moniz, an alumnus of the Clinton administration, now directs Massachusetts Institute of Technology's Energy Initiative. MIT's Energy Initiative draws its funding from corporations. To name a few: BP, Chevron, Siemens, Duke Energy, Entergy and EDF. Names like BP and Chevron don't exactly evoke thoughts of renewable energy, but Siemens, Duke and Entergy are all close to the Obama administration and backers of green energy subsidies. EDF is a wind giant based in Europe and a major beneficiary of stimulus money.

Moniz, while serving on the President's Council of Advisors on Science and Technology, coauthored a report recommending federal energy taxes to fund $16 billion a year in federal research and development of renewable energy.

Moniz has upset some liberals by partnering with big oil, by embracing natural gas as a "bridge" to some all-renewable-energy future and by defending fracking (while calling for more regulation of it).

Read and listen to what Moniz says on energy, and he comes across as a pragmatic environmentalist. Take this stance into real-world politics, and it yields partnerships between large energy companies and government. Government steers the ship, while business rows. Put another way: Politicians and bureaucrats tell business what to do, and business gets to make a profit doing it.

The industry praise for Moniz and McCarthy helps undercut one well-worn conservative attack on Obama -- that he is anti-business. Obama never has been anti-business. His stimulus amounted to billions in corporate subsidies. His health care bill is a boon to hospitals and drug-makers. He was the most important supporter of Bush's bailout outside the Bush administration in 2008.

But Moniz and McCarthy also demonstrate the gulf between the way Obama talks and the way he governs. It's clear that special interests and big businesses that can cut big checks have heavy influence with these Obama appointees. That doesn't make them stooges for industry. It just demonstrates that when government gets involved in trying to guide the energy sector, large players with big name lobbyists will get seats at the table.

If you want a smaller government role in energy, McCarthy and Moniz aren't for you. If you want government to stick it to big business, you're also out of luck. But if you're a green energy lobbyist, it's time to stand and applaud President Obama for his picks.

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About the Author

 

Timothy P.
Carney
  • Timothy P. Carney helps direct AEI’s Culture of Competition Project, which examines barriers to competition in all areas of American life, from the economy to the world of ideas. Carney has over a decade of experience as a journalist covering the intersection of politics and economics. His work at AEI focuses on how to reinvigorate a competitive culture in America in which all can reap the benefits of a fair economy.


     


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