UPDATED: Senate says "I see your 150 pages and raise you 300 pages"
I posted this earlier without an explanation due to "work" constraints, but I feel I owe a bit since I have some insight. One of the bills added into the big bail is a revision of HR 6049. This bill will extend the production tax credits for wind and the investment tax credits for solar. These incentives have driven the record growth of both markets within the US over the past 5 years. Along with this growth has come significant jobs and the revelation that renewable energy sources have the potential to carry a significant amount of the nation's load.
HR 6049 passed the House in May, however needed revisions to make it through the Senate and be guaranteed to make it out of the executive branch. Essentially, the big kicker was where to get the money. The Senate made these revisions and passed it overwhelmingly on Sept. 23rd (only two nays).
Unfortunately, while the bill was walking over to the House for final passage the economy took a dump and McCain suspended his campaign. By the time the poor bill made it to the House, it was really crowded and angry. As recently as yesterday, the industry was expressing very real fear that the bill would not be able to make it through this year. This would have most likely ensured a dramatic downturn in renewable installations next year and would have been very difficult for the industry to rebound from.
The Senate in a rare glimpse of brilliance rescued the bill and pinned it in with the big daddy bail. Everything in HR 6049, now in HR 1424, has been agreed to in advance. There may be some fluffy things in there, but all in all it is solid. Yes I actually read it.
This move shows that the Senate is very serious about renewable energy and this should be reassuring in this time of a second guessing. Of course, hardly anyone is talking about this fact.
This is NOT a Wall Street “bailout” plan, it is a bank “rescue” plan. Actually, it’s a rescue of the world economy, but nobody should get bogged down in details right now.
The Senate produced new rescue legislation September 30, turning the rejected 150-page House proposal into a reported 450 pages of goodies. Among the goodies is some version of the New Energy tax credit extensions, most likely a version similar to H.R. 6049, passed by the Senate 93-2 on September 23.
H.R. 6049 included: An 8-year extension of the solar energy industry’s investment tax credit (ITC), a 1-year extension of the wind energy industry’s production tax credit (PTC), a 2-year extension for other forms of New Energy power generation and tax credits for energy efficiency measures and for plug-in hybrid electric vehicles.
There is little doubt this package will pass in the Senate, where the vast majority of Senators regard the need for a rescue with ponderous gravity. Their idea is to create an offer the House can’t refuse. Given the deep dark complexities of politics in the House of Representatives, that would be difficult on even the sunniest of days, which this is not.
The biggest obstacle is the House’s “pay-as-you-go” rule, which many fiscal conservatives take extremely seriously. The new Senate rescue measure lacks pay-fors. It is the flaw that stymied the New Energy tax credits last week. But the House might just overlook a lack of $18 billion in New Energy pay-fors if it decides to spend $1 TRILLION.
- Nathaniel's blog
- 60 points
Maybe I am just stupid or ill-informed, but I do not understand the "bailout plan" or "rescue plan" or whatever you want to call it. I do not have a degree in Econmonics, nor have I ever found the economy to be a particularly scintillating topic, but I do understand that this is an important moment in our history and I am vexed by the fact that I don't even understand what's going on. I know that credit is freezing up around the country and I have heard the dire predictions that things are only going to get worse. But how is our bailout of these Wall Street giants going to fix it all? In a free market capitalist society, isn't each individual or business responsible for the consequences of their choices--both good and bad? Why should my tax dollars pay for the bailout of these corporate giants, whose CEOs receive multi-million dollar severence packages when they are fired? I know that I must be looking at this way too simplistically, but no one is explaining it to me or to other Americans. I follow current events pretty closely and have yet to hear a media organization explain the basics of the situation succinctly. I think that if we as American citizens were better informed about why this bailout is so necessary, we would be more supportive of it. Maybe then the House wouldn't have shot down the bailout plan yesterday in fear of what their constituents would have to say about it come November.
I don't have a ton of expertise in this arena either but I am scared to death right now of the possibilities. One thing that continues to get lost in all of this is the speed at which everything moves in today's world. The internet has really intertwined everything.
I think the real question at hand is how much time is available. If you believe there are weeks or even months, then getting this thing right on the first shot is doable. If you believe that we are sitting on the edge of the cliff, that the risk grows exponentially, then get this thing through warts and all and get some money in to free up the credit markets and at least give the economy a fighting chance.
We are already seeing the impacts in my sector, companies are canceling orders and projects insanely fast. If you know my world, then you know these are projects that we need both environmentally and for infrastructure.
The worry is that this can spread so fast that by the time it is decided that we have to do something, the money may not be available. That is what happened during the Great Depression when Hoover kept saying it was going to get better and also in Japan as outlined yesterday.
I compare it to getting shot in the arm. You don't argue about why you got shot, you don't argue about how the arm will heal, you stop the bleeding so you don't die. Perhaps a bit extreme, but I have seen some scary stuff today.
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