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Eleanor Vaughan

U.S. Energy Subsidies Must Go

Some called it a green miracle. On Thursday, a supermajority in the U.S. Senate voted to scrap a $6 billion annual corn ethanol subsidy. The amendment, sponsored by Sen. Dianne Feinstein (D-CA), removes the 45 cent tax break that oil companies receive for every gallon of ethanol that they blend into their gasoline. The amendment also ends the 54 cent per gallon import tax on foreign ethanol designed to protect domestic industry. If enacted, the amendment would save an estimated $6 billion per year. The victory is, however, a symbolic one. It is doubtful that the amendment will actually be enacted as the underlying bill—a new push for green subsidies—is unlikely to pass through the House or Senate. President Obama also opposes the amendment, claiming ethanol helps reduce foreign energy dependence.Yet, the battle against ethanol subsidies—and indeed all energy subsidies—must be pursued. Broad support from a motley coalition of Republicans and Democrats highlight the widespread consensus on ditching ethanol subsidies. While corn producers have tried to claim that bio-fuels reduce greenhouse gas emissions and foreign energy dependence, these arguments don’t hold up to scrutiny.Ethanol does not significantly reduce carbon emissions. Growing huge amounts of corn and distilling it to produce ethanol consumes vast amount of energy and stresses natural resources. It takes more energy to produce a gallon of ethanol than that gallon actually contains and its gas mileage is poor compared to conventional gasoline. The Energy Information Administration reports that a gallon of fuel ethanol is equal to only 0.67 gallons of conventional gas. Ethanol puts out 11% less energy per gallon than petroleum diesel. Ethanol subsidies also damage the environment by encouraging farmers to irresponsibly expand corn production, often on ecologically sensitive land.Ethanol subsidies also increase global corn prices, leading to food shortages and starvation around the world. Livestock producers,… Read More

Interview with Chris Edwards, Director of Tax Policy at the Cato Institute

In 1994, Canada was facing the same fiscal situation the U.S. today: fears of debt defaults, credit downgrades, and even I.M.F. intervention. Yet, Canada successfully turned around its economy, and today has lower unemployment and higher growth than the United States. I sat down with Chris Edwards, Director of Tax Policy Studies at the Cato Institute in Washington, D.C., to talk about what the United States could learn from Canadian economic policy.Vaughan: Americans often stereotype Canada as the socialist North, a land of big government and high taxes. Is this characterization true today?Edwards: Twenty years ago that was true, but today there’s increasing realization that Canada’s economy has reformed. The Canadian economy fundamentally changed direction in the 1990s under—oddly—a left-of-center Liberal government. They cut spending, privatized a bunch of stuff including air traffic control, cut the corporate tax rate, instituted Canada Tax-Free Savings Accounts, decentralized spending power to the provinces, and partly funded the social security and retirement system. These were all great, extremely successful reforms. Total spending as a share of GDP is now about the same in Canada and the U.S. Canada is no longer the hopelesswelfare state that Americans wrote it off as a decade ago.Vaughan: Policymakers here in Washington are very concerned with the high, stagnant unemployment rate. But while American unemployment hovers at a worrying 9.2 per cent, Canadian unemployment is at a healthier 7.4 per cent and falling. What accounts for the difference in these numbers?Edwards: Keynesian economists say that the big stimulus package prevented the American economy from really losing jobs in the 2008 recession. In reality, the stimulus bill didn’t help the American economy: the U.S. has incurred its biggest deficit since WWII to pay for its stimulus package, while experiencing the worst recovery of its ten economic downturns since WWII.Most normal people… Read More

A love letter to the Duchess of Cambridge

Oh Kate,You’ve captured the hearts of a generation. Toasting your marriage with tea and scones at five in the morning, I was giddy. Streets lined with well-wishers from London to Ottawa, your happiness brought joy to all. On your recent trip to Canada, you made an entire nation fall hopelessly in love with you in seven days flat. I guess you need to be charming to seduce a prince.How do I love thee? Let me count the ways:You’re stylish. Scanning WhatKateWore.com each morning, I am delighted by your tasteful yet youthful ensembles, nude stilettos, restrained jewels, and long, unchanging hair.You’re down to earth. Living in rural Wales, you shop at Tesco, push your own grocery cart, and look fabulous doing it.  A commoner born, you haven’t forgotten the wonder of your Cinderella story.You respect tradition. You refashion Princess Diana’s earrings, make conversation with the Queen, and possess an unshakable sense of occasion, whether on state visits or at polo matches.You’re a thoroughly modern girl. Princess comparisons aside, you’re nothing like Princess Diana, married at twenty and scared witless by obligation. You met your prince in university, then waited nine years to marry him. Understandably, you wanted to be completely sure before you committed to his eccentric family.You’re frugal. Your mix of Phillip Treacy hats and Smythe blazers with Zara dresses indicate the new royal generation considers frugality when using public funds to shop. Your thriftiness helps me to forgive how fabulous you always look.You’re classy. You are a breath of fresh air amongst celebrities more concerned with rehab, court sentencings, and shoplifting than with courtly etiquette. The biggest scandal to yet embroil you was your unfortunate choice of black shoes at a wedding. I suppose we’ll have to forgive you that one, Kate.Most important, you pull off those outrageous, whimsical hats with… Read More

Conservative Environmentalist? Not an Oxymoron

New Environment Minister Peter Kent, take heed: to be a Conservative and an environmentalist is not an oxymoron. In recent years, Stephen Harper’s adamant refusal to ratify the Kyoto Protocol has obfuscated this fact. Concerned about economic cost, the Conservative government’s inaction on emissions reduction has led Canada to become the world’s laughing stock. Liberals chuckled to themselves in 2006 when the Climate Action Network declared Canada a ‘fossil’, tied with Australia for worst offender in climate change inaction. Environmental policy, however, does not need to be the Tories’ Achilles heel. Nor does environmental regulation necessarily entail economic harm as the Harper government has worried.To be sure, the Kyoto Protocol is inadequate and the Harper government has been right to reject it. Under the Protocol, developed nations under ‘Annex I’ like Canada commit to reducing their green house gas emissions by 5.2% below 1990 levels. Meanwhile, non-Annex I countries, including emerging economies like China and India, make no similar commitment to emissions reduction. The Protocol is problematic as the states with the majority of the world’s population and its largest emerging markets are not bound to its rules. But, in light of the Protocol’s inadequacies, the Tories have not put forward a viable policy alternative.Harper should recognize that action on the environment is indeed compatible with conservative principles like individual freedom. The standard approach to environmental policy, put forth by the Liberals and others, has advocated for preventing or limiting individual behavior: less energy, less driving, less production. Yet, what this standard policy approach has failed to consider is the unlimited human capacity to innovate. Yet, environmental governance does not need to – and indeed should not  – rely on draconian self-denial. Rather than reducing demand and standard of living, environmental policy must focus on pushing forward, increasing production and quality… Read More

A love letter to the Duchess of Cambridge

Oh Kate,You’ve captured the hearts of a generation. Toasting your marriage with tea and scones at five in the morning, I was giddy. Streets lined with well-wishers from London to Ottawa, your happiness brought joy to all. On your recent trip to Canada, you made an entire nation fall hopelessly in love with you in seven days flat. I guess you need to be charming to seduce a prince.How do I love thee? Let me count the ways:You’re stylish. Scanning WhatKateWore.com each morning, I am delighted by your tasteful yet youthful ensembles, nude stilettos, restrained jewels, and long, unchanging hair.You’re down to earth. Living in rural Wales, you shop at Tesco, push your own grocery cart, and look fabulous doing it.  A commoner born, you haven’t forgotten the wonder of your Cinderella story.You respect tradition. You refashion Princess Diana’s earrings, make conversation with the Queen, and possess an unshakable sense of occasion, whether on state visits or at polo matches.You’re a thoroughly modern girl. Princess comparisons aside, you’re nothing like Princess Diana, married at twenty and scared witless by obligation. You met your prince in university, then waited nine years to marry him. Understandably, you wanted to be completely sure before you committed to his eccentric family.You’re frugal. Your mix of Phillip Treacy hats and Smythe blazers with Zara dresses indicate the new royal generation considers frugality when using public funds to shop. Your thriftiness helps me to forgive how fabulous you always look.You’re classy. You are a breath of fresh air amongst celebrities more concerned with rehab, court sentencings, and shoplifting than with courtly etiquette. The biggest scandal to yet embroil you was your unfortunate choice of black shoes at a wedding. I suppose we’ll have to forgive you that one, Kate.Most important, you pull off those outrageous, whimsical hats… Read More