The cost of the Iraq War and Reconstruction to the US is going to surpass $350,000,000,000. That’s $350 billion dollars. A far cry from the original estimate of $50 billion. This same administration in 2000 decided not to sign the Kyoto Protocol citing that its flawed (which I agree—the biggest flaw being the exemption of both China and India) and that it’s too expensive. Expensive because the administration estimated the total cost would have been $325 billion over decades and would’ve hurt the US economy. This administration, by starting a war and trying to clean up after itself, has spent well in excess of that in just 3 years! I doubt any numbers from Bush’s administration can really be trusted. (Remember this is the most secretive administration in US history.) So I’m sure the original cost estimate of becoming a more environmentally friendly country is grossly over-estimated. Besides, never doubt the capability of companies to innovate, reduce costs, and find loopholes, even when faced with new regulations. The Kyoto Protocol will detrimentally affect the US economy? I doubt that. Not as drastically as this particular war has by diverting money better spent elsewhere.
Now, there was a big loophole in the US tax code in 2003. This allowed a small business owner to get a $100,000 tax credit for the purchase of a vehicle over a certain gross vehicle weight. An unintended effect was that certain gas-guzzling SUVs, for example the Hummer, qualified and buyers would see a savings of nearly $20,000 on their purchase. What was the maximum tax credit for an electric vehicle? $4000. How many Hummers have I seen emblazoned with a company logo? I lost count. How many EVs have I seen with logos? Zero. The more interesting number would be the number of small business owners who bought a truck through their company for business and personal use—the business use being commuting to and from work. Good news is that something is being done about it.
So here we have a government that is putting $20,000 back into the pocket of small business owners who are incentivised to purchase SUVs and trucks with poor gas mileage. This drives up demand (less fuel efficient cars equals more gas to go the same distance of a more efficient car) and in combination with other factors (like a war that reduces supply) drives up prices which makes oil a valuable commodity. This then makes oil attractive to terrorists who are organized enough to steal oil and resell it for a decent profit. That is an overly simplified and tenuous argument but there’s certainly enough cause and effect to see that US consumption of oil helps fund terrorism. This is why it’s been said that a more effective way to fight terrorism is to reduce our demand for oil. Don’t tell me you haven’t seen those “Foreign Oil Funds Terrorism” bumper stickers?
I had pointed out the Tesla Roadster in an earlier post, an all-electric, high-performance sports car. This company has collected $60 million dollars in venture capital of which only $25 million dollars went into R&D. Of that $25 million dollars, the prototype vehicle cost $350,000. The Tesla Roadster has a street price of $100,000. Tesla motors is also planning on a $50,000 4-door sedan which is at the same price point of an H2 Hummer.
Imagine if that $350,000,000,000 were spent in an indirect anti-terrorist campaign through anti-oil rather than a direct anti-terrorist campaign. If the $100,000 tax break were applied to EVs, that $50,000 sedan now becomes a more reasonable $30,000 sedan. That could generate a potential demand of 17,500,000 customers while the incentive was active. That would be a record setting number. Another option would be to provide tax incentives for car manufacturers, regulate emissions (California did it and the EV1 was born), or simply direct funding of R&D. Seeing as the Tesla Roadster was developed on a budget of 0.007% of the cost of the war, all that money could have funded the R&D departments of 14,285 individual companies all working to ween us off oil! 14,000 new companies goes a long way to curbing unemployment, creating new tax revenue, and improving the economy. Of course these numbers are ideal and would be much less in real life. Still, money spent this way would’ve been more beneficial and even more effective than how it’s spent now.