That Necessary Socialism

Economically I’d describe myself as a capitalist with a touch of socialism. If anyone is actually honest and knows what they are talking about that is also an accurate description of the American economy. In the following paragraphs I’ll apply it to a current challenge facing America.

Climate change is real despite what many Republicans are saying. It is simple: we either take action or it will beat us. (By the way, we are currently behind in the game and the clock is ticking.) As the world’s leading economy and one of the world’s leading polluters America is in a unique position and must show leadership. We can choose to ignore climate change only at the peril of future generations. I’m 70. Personally, I will die before the worst effect of climate change are seen (the beginnings have been upon us for several years now). My grandchildren are another story. Perhaps, that is why their generation (and my hope to save America and the globe as we know it) are much more exercised about the topic.

Among the solutions is replacing most of our automobiles with electric vehicles. The technology, although still somewhat challenged, is improving very rapidly. With that the costs of building electric vehicles are coming down while their range is rising.

Today the biggest challenge is we don’t have the necessary infrastructure to support a huge electric vehicle fleet in place. Under a purely capitalist system I don’t see it happening unless some people with extremely deep pockets fund the project knowing they will not see a return on investment for years, perhaps in their lifetimes. Going back to my banking days the project is not “bankable”. I wouldn’t make that loan. The revenue stream to service the debt, especially in the early years, simply isn’t there.

This is where the “socialist” aspect must enter. The federal (and to a lesser degree state) government must provide a combination of tax incentives and grants to “kick start” a massive electrification project. On its simplest level we need a huge nationwide network of recharging stations similar to the network of gas stations we now have. In the future, on the long haul at least, instead of filling up your tank you would plug in your automobile while you had lunch or a cup of coffee and a snack. Think of the cross-marketing opportunities. (Sorry, my management degree is showing.)

I have always felt that in a blended economy like ours, (and anyone who says we are a pure capitalist economy simply doesn’t know what they are talking about), one of government’s roles is to help needed emerging industries get off the ground. The trick is to know when the industry has matured to the point the help is no longer needed. To cite a current mistake; we are still subsidizing the petroleum industry to the tune of about $4 billion a year. That may, at least in part, account for why they have refused to make the transition from a petroleum industry into an energy industry. Who is better situated to build the national network of recharging stations that I outlined above. (In their case often just remodel.) Why should they when their lobbying efforts keep getting them $4 billion a year to run a dinosaur?

This is neither a complete solution nor an exclusive one. However, its pretty straight forward and doable. The question is whether our Congress will do it.

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