2012 SECOND PLACE ESSAY
by Spencer Kolssak, Age 15
Submitting Teacher: Hillary Kolssak
The candidate for school president was anxious as he waited for the final voting results. Ever since he promised the class free candy every day for the rest of the year, many students had pledged their support. It was a great idea—students could have candy every day for free, but it was strange how the teachers opposed it. Of course, someone would have to pay for it, but as long as it wasn't anyone in the class, it was fine, right?
This is an example of a politician's promise—something he claims he will do so people will vote for him. While not all promises have negative consequences, many do, like this example with candy and the class president. While the students may enjoy the sugar and the candidate may have won the election, the candy may give them cavities at the expense of the taxpayer.
The politician's promise is almost as old as the invention of the political system, but many of these promises have had unintended consequences. The current United States President, Barack Obama, has made many promises on the campaign trail and in office. One of his most frequent promises has been the idea of alternative energy subsidization. On July 31, 2008, candidate Obama said, "As President, I'll invest in renewable energies like wind power, solar power, and the next generation of homegrown biofuels." And on February 24, 2009, he said, "To... save our planet from the ravages of climate change we need to ultimately make clean, renewable energy the profitable kind of energy." But he wasn't the only politician to make such a promise; Hillary Clinton, Jimmy Carter, Tom Vilsack, and numerous others have promised to subsidize alternative energy. Politicians defend "clean energy" proposals with the promise of protecting the environment, creating safer energy, and reducing our nation's dependence on foreign oil. These are noble aims that sound good to voters' ears, but do such proposals help our country's situation? Is subsidizing alternative energy with taxpayer dollars really the best solution?
In John Stossel's television special, Politicians' Top Ten Principles Gone Wrong, he addresses the issue of government subsidies, specifically the subsidization of ethanol. The principle is rather simple. When lawmakers believe that a product like ethanol is superior to its alternatives, they will give its producers government money to manufacture it. Their good intention is the hope that Americans will switch to these "superior" products and the hope of creating American jobs. While this method seems to make sense, there are numerous problems and unintended consequences that follow.
Today, the government uses its money to give tax breaks and subsidies to companies that produce "alternative" products. According to the Energy Information Administration, the United States spent $8.2 billion in energy subsidies in 1999. In 2007, less than ten years later, it doubled its subsidy spending to over $16.6 billion, with more increases to come. An example is the government's willingness to cover the cost of investments like windmills and solar panels, so they become nearly free to build. The equipment may be free for the business owner, but that doesn't mean that it was entirely free. After all, someone had to pay for it. The government merely turns to the taxpayer to support its "green craze," putting the burden of subsidies on its citizens.
While politicians may see results in their energy subsidies and may increase the green energy market, they fail to see how those results are artificial. By supporting one specific product with subsidies, they prop up that product using taxpayer money. In reality, this program does not create any growth in the market. Rather than encourage competition for quality products at a fair price, a government handout gives one product an unfair advantage over its alternatives. If a product requires artificial support from the government, it is a product that cannot compete well without the subsidy and therefore is not a truly desirable product. But if it can compete in the capitalist system against its competitors without the help of federal money, it is a worthwhile investment for the business owner and consumer alike. Therefore, when the government heavily subsidizes an industry, it dictates how private-sector resources are utilized. Businesses then become driven by subsidy and government mandate rather than consumer demand. As a result, quality and production decline.
Perhaps the worst consequences, however, are the unforeseen results caused by subsidy legislation. In Stossel's special report, David Boaz of the Cato Institute speaks about the hidden consequences of ethanol production, "... We don't look at what is not seen, which is the rising price of milk and the excessive amount of fertilizer and fuel that was used to produce this additional corn." In the case of ethanol, since government dollars drove the production of the fuel rather than consumer demand, corn producers started growing corn for the production of ethanol. As a result, corn became more expensive to use as feed, driving up milk and meat prices. This happens in other industries, too. Whenever the government strives to favor one product over the other and will pay to ensure its popularity, investors will flock to such industries hoping for government dollars. The rest of the nation sees the results in the form of lost jobs, reduced investment in other products, and unintended rising prices.
In the end, energy subsidies crush the capital market and create new classes of businesses dependent on the taxpayers. The politicians promise to support clean, renewable energy, but they do not see the consequences their promises create. As prices rise, taxpayers must cover the politician's mistakes. Though energy subsidies may have good intentions, they are a prime example of a politician's promise gone wrong. Promises may be necessary to the success of the politician, but they may also be detrimental to the health of the nation. Instead of giving away free candy, politicians need to consider the consequences of their promises and support the ones that will be beneficial to the United States, its Constitution, and its citizens.