Utopia, you are standing in it!

That heavily subsidised and chaotically intermittent wind and solar are driving power prices into orbit has been proved beyond all reasonable doubt.

No country that ‘invested’ in the unreliables (ie threw $millions in subsidies at wind and solar) has ever seen their retail power prices fall. No, the evidence on that score is all to the contrary.

In Europe, wind and solar ‘powered’ Germany and Denmark jockey for top spot on the power prices league table. Australia’s renewable energy capital, South Australia set the benchmark down under for crippling power prices years ago and its denizens still pay prices well above their coal-fired neighbours.

It’s no mystery, really.

The cost of additional transmission lines running from the back of beyond; the staggering cost of running highly-inefficient Open Cycle Gas Turbines (or diesel fuelled ship engines) to cope with total collapses in wind and solar output; and running traditional coal-fired…

If we want to avoid the kind of Greek-style fiscal collapse implied by this BIS and OECD data, we need some external force to limit the tendency of politicians to over-tax and over-spend.

That’s why I’m a big advocate of tax competition, fiscal sovereignty, and financial privacy (read Pierre Bessard and Allister Heath to understand why these issues are critical).

Simply stated, I want people to have the freedom to benefit from better tax policy in other jurisdictions, especially since that penalizes governments that get too greedy.

I’m currently surrounded by hundreds of people who share my views since I’m in Prague at a meeting of the Mont Pelerin Society. And I’m particularly happy since Professor Lars Feld of the University of Freiburg presented a paper yesterday on “Redistribution through public budgets: Who pays, who receives, and what effects do political institutions have?”.

His research produced all sorts of interesting…

This short post is mainly for those readers who don’t follow me on Twitter.

You may recall that a couple of months ago I highlighted as being highly inappropriate the appointment to the new board of the Reserve Bank (and the establishment “transitional board”) of Rodger Finlay, who was also chair of the state-owned enterprise New Zealand Post, which in turn was the majority owner of Kiwibank, the 5th largest bank in New Zealand.

The appointment was not illegal – itself a serious weakness in the new Act – but was clearly highly inappropriate in that the new Board was picking up responsibility for prudential supervision, most notably of banks.

When a couple of journalists got interested in the story, we were given to understand that Finlay’s term as chair of NZ Post would expire on 30 June 2022, and as the new Board only took legal responsibility for the…

Further to my post this morning, I’ve read a few more of the papers a bit more carefully.

It is still clear that when Rodger Finlay was appointed last October to the “transitional board” of the Reserve Bank and (from 1 July 2022) to the full Reserve Bank Board that no one (Treasury, Reserve Bank, Minister of Finance) seems to have been bothered by the stark conflict of interest between his twin roles as NZ Post chair (majority owner of 5th biggest bank in New Zealand) and the proposed role on the Board of the prudential regulatory authority. Any conflict was sufficiently unimportant (in the eyes of officials) that discussions were not documented, and ministers were not even advised of the issue in the relevant Cabinet and Cabinet committee papers.

To be fair, at that point it appears that Finlay’s term as NZ Post chair expired in the first…

What accounts for Switzerland’s “improbable success“? How did a small, land-locked nation with few natural resources become so successful?

Switzerland routinely ranks very high in international comparisons of economic liberty, so that means that there are many good policies.

But since I’m a public finance economist, I think this map from the Tax Foundation helps to explain why Switzerland is a role model. As you can see, the tax burden on workers is dramatically lower than in other European nations. Indeed, Switzerland is almost 10 percentage points lower than the next-closest country.

The map shows the tax burden on a single worker with no dependents, but you find a similarly large gap when looking at the tax burden on a four-person household.

By the way, Switzerland’s value-added tax is far lower than any other European nation, so ordinary workers aren’t being indirectly pillaged (and tax “progressivity”…

Robert Bryce explains in his Real Clear Energy article Carbon Capture Didn’t Make Sense 12 Years Ago And It Doesn’t Make Sense Now.  Excerpts in italics with my bolds and added images.

It appears the reconciliation bill that includes some $370 billion in energy-related spending is going to become law. The measure includes a panoply of tax credits for alternative energy technologies, including incentives for electric vehicles, hydrogen, energy storage, and of course, billions of dollars in tax credits for wind and solar energy.

The measure also includes, according to the Congressional Budget Office, some $3.2 billion in tax credits for carbon capture and sequestration, a technology that has plenty of supporters but precious little in the way of commercially successful projects. Back in 2018, Al Gore blasted CCS, calling it “nonsense” and an “extremely improbable solution.”

The new tax credits for CCS remind me that I…

Political commentator CHRIS TROTTER writes ….   …