Monica Leslie SENS 100 Reflection Paper May 7, 2010 Bursting the Bad Energy Bu le

I spent lunch on Thursday May 6th, watching stock news on CNBC. My attention was brought to some very important economic and policy uestions that have been raised in light o! the recent B" oil spill. The spill, which occurred on #pril $%, $&'& in the (ul! o! Me)ico, was called an event o! *National +igni!icance ,-il +pill .pdate/.0 #ccording to the news report, many environmentalists are criti uing the 1hite 2ouse response on the issue re!erring to this environmental disaster as "resident -bama3s 2urricane 4atrina. #s a result, B" market shares have lost more than 56$ million dollars in value and analysts speculated that this disaster would present a per!ect opportunity !or Congress and the 1hite 2ouse to make progress on biodiesel legislation ,2argreaves/. 1hile some members o! Congress have stepped up to withdraw their support !or current legislation that would allow the e)pansion o! o!!shore drilling, e!!orts by Congress and the 1hite 2ouse to introduce legislation that would pave the way !or clean energy legislation have been very minimal. 7riday, May 8th, "resident -bama announced the introduction o! two Congressional proposals during a press con!erence ,-bama 9:99 ; 6:6&/. This legislation asks Congress to provide ta) rebates !or #mericans that upgrade the energy e!!iciency o! their homes and to e)pand the clean energy manu!acturing ta) credit that provides incentives !or clean energy companies that provide <obs building wind turbines and solar panels. "resident -bama believes that the !irst o! the two bills, known as the 2ome +tar proposal, will be the ne)t step in creating <obs in hard hit sectors such as construction and manu!acturing *since windows and insulation are overwhelmingly made in the .nited +tates.0 #nd the proposal was passed during a bipartisan vote in the 2ouse o! =epresentatives on May 6th. #dditionally, *7lorida (ov. Charlie Crist is considering calling a special legislative session to discuss renewable energy and other topics a!ter the legislature ended its regular session 7riday without approving a bill that would enable utilities to buy more renewable energy ,4ho/.0 #nd though to potential market investors who are looking to rebuild their stock port!olios a!ter this week3s ma<or economic down turn, the lack o! private sector education o! the macroeconomic implications o! investing in poor uality renewable such as ethanol, creates bad market speculation and bubbles that impede the ..+. government o! making any real progress that can be made on alternative energy legislation even a!ter incidents like this most recent oil spill. #ccording to Todd Becker the current "resident > C?- o! the biodiesel company (reen "lains =enewable ?nergy ,("=?/, .+ !armers have recently achieved a record planting corn and beans which have provided a bigger corn and soy bean surplus in the .nited +tates since than be!ore the ethanol boom started, even without the oil spill ,-il +pill .pdate/. Becker believes that even with concerns about ethanol production !acilities boosting !ood prices through their

practice o! wasting *!ood stu!! that can be used to !eed people and burns it,0 Becker !eels con!ident that the increase in subsidi@ed ethanol production gives #mericans access to the best and cheapest !ood supplies available and gives the ..+. the power to achieve energy independence. Becker also stated that he believed that claims regarding the damage can cause to cars engines and increased pollution were *ridiculous.0 #s <usti!ication !or this statement he re!erenced the !act that *Bra@il0 has been using $9A ethanol ,?B'9/ !or a long time, neglecting to note that Bra@il3s government subsidi@ed sugar cane ethanol produces a more clean kind o! alternative !uel. Becker believes that the B" oil spill will boost (reen "lain market shares because ethanol production can be produced !rom a renewable source o! energy at a market value o! 8& cents under gasoline. But although his company3s !irst uarter earnings generated a net income o! CC million dollars, market shares !or the end o! the week declined by &.C8 points by the end o! the week. But I believe that Becker3s misguided responses to these concerns in addition to his in!lammatory speculation about !easible land use as *bad science0 may have undermined his company3s credibility toward potential market investors. Becker3s !ormer positions as the 7ormer D" o! International Marketing !or Con#gra and 7ormer "resident o! Con#gra, a company known !or its mistruths, environmental, sa!ety and ethical violations also do not inspire investor con!idence that the company can be managed and operated well, which could strike a signi!icant blow to the ethanol industry ,+mith/. But with all o! the erroneous in!ormation saturating consumer markets about the e!!icacy and implications o! renewable energy as well as the misin!ormation o! marketing representatives !rom energy sector moguls who wish to promote an image o! their company being *cleaner0 or *greener,0 how will private sector market investors know which renewable energy alternatives will provide the best returns !or their social and environmental investmentE 1ithout updated standardi@ed data and easily communicated in!ormation about which sources o! alternative energy can be provided a!!ordably and environmentally conse uence !ree, the 1hite 2ouse and Congress will not be able to gain enough political backing and support !or legislation that can have a large scale impact on #merican energy consumption without pushing legislators who continue to drag their !eet on these issues. 1hile the creation o! <obs in unskilled labor sectors such as construction and manu!acturing are important, the !iscal and economic backlash o! disasters like the B" oil spill will continue to !eed the cycle o! energy and economic prices that keep the .nited +tates dependent upon making bad energy and environmental choices. 1ithout low emitting and a!!ordable alternative energy sources, an increase in manu!acturing will undermine the environmental progress that has been made through initiatives like *cap and trade,0 and will also position workers who !ind new <obs in a position where they still are not able to provide their own basic needs. -! the '%$,F6&,&9C documented people in the .nited +tates who !ell below the poverty line between $&&6 and $&&F, '96,6$6,'F9 o! those people were employed ,.+ Census Bureau/. That means that F&A o! the people who lived below the poverty line did not make enough !rom their earnings to provide their basic needs. #nd with rising !ood and !uel costs caused by commodities such as corn, soy and gasoline, I believe that market speculators like Becker !ail to reali@e the socioeconomic implications o! the e)pansion o! bad !uel initiatives like Becker3s

ethanol distilleries. #ny signi!icant short or longBterm investment in poorly researched alternative energy renewable could create a bubble that could burst #merican3s dreams o! energy and economic independence. #nd the .nited +tates Congress !ails to reali@e the socioeconomic implications o! poorly guided energy and in!rastructural initiatives and what that could mean !or the #merican and global economy, !or #merican <obs and !or the #merican people3s needs. !or"s #ited Beutler, Brian. G1hy # Catastrophic -il +pill Makes Clean ?nergy Hegislation 2arder In The +enate.G Talking Points Memo. N.p., &9 May $&'&. 1eb. 8 May $&'&. Ihttp:JJtpmdc.talkingpointsmemo.comJ$&'&J&9JwhyBaBcatastrophicBoilBspillBmakesBcleanB energyBlegislationBharderBinBtheBsenate.phpK. GCon #gra 7oods.G Responsible Shopper. (reen #merica, n.d. 1eb. F May $&'&. Ihttp:JJwww.greenamericatoday.orgJpro(ramsJresponsibleshopperJcompany.c!mE idL$&6 K. G(reen "lains =enewable ?nergy, Inc. ,("=?/.G Yahoo Finance. 1eb. F May $&'&. Ihttp:JJ!inance.yahoo.comJ EsL("=? K. 2argreaves, +teve. G-il spill costs: 1hat will B" really payE.G CNNmoney.com. CNN, &6 May $&'&. 1eb. 8 May $&'&. Ihttp:JJmoney.cnn.comJ$&'&J&9J&6JnewsJeconomyJB"MliabilityJK. 4ho, Nenni!er. G-il +pillOs Impact: Bad !or the ?nvironment, (ood !or Clean ?nergyE +ee !ull article !rom Paily7inance: http:JJsrph.itJd&1pDm.G Daily Finance. #-H, &9 May $&'&. 1eb. F May $&'&. Ihttp:JJwww.daily!inance.comJstoryJoilBspillsBimpactBbadB!orBtheB environmentBgoodB!orBcleanBenerJ'%C6C8C9J K. G-bama comments on economy, market swings.G msnbc.com. 9:99 ; 6:6&. 1eb. 8 May $&'&. Ihttp:JJwww.msnbc.msn.comJidJ$''6C9C&JvpJ66%%666'Q68&'%686 K. G-il +pill .pdate.G msnbc.com. 1eb. 8 May $&'&. Ihttp:JJwww.msnbc.msn.comJidJ$''6C9C&JvpJ66%%666'Q66%%666'K. G+'8&6. +elected Characteristics o! "eople at +peci!ied Hevels o! "overty in the "ast '$ Months .G U.S. Census ureau! "merican Fact Fin#er. 1eb. F May $&'&. Ihttp:JJ!act!inder.census.govJservletJ+TTableEMbmLy>BgeoMidL&'&&&.+>B rMnameL#C+M$&&FM6R=M(&&M+'8&6>BdsMnameL#C+M$&&FM6R=M(&&M K. +mith, Con#gra. G +ustainable 7ood 2omepage 2ot Topics S Hocal 7ood S Industrial 7arming S -rganic S 2ealth Monsanto and Con#gra =ank Terribly #longside (reenest Companies.G Sustainable Foo#. change.org, $% +eptember $&&%. 1eb. F May $&'&. Ihttp:JJ!ood.change.orgJblogJviewJmonsantoMandMconagraMrankMterriblyMalongsideMgre enestMcompanies K.