President Joe Biden’s economy-destroying policies have been bad enough. Now he wants to intervene directly for favored green industries, making matters worse.
The United States was built on a market economy. This means individuals and businesses buy and sell goods and services with minimal government interference. The public sector has a role to play when it comes to enforcing contracts, ensuring public safety or providing infrastructure, but tilting the rules of the game towards certain interests is both unfair and inefficient.
Bureaucrats don’t know as much about the best use of scarce resources as a vast array of businesses and consumers who make millions of collective decisions every day. Prices, in the absence of government intervention, contain a wealth of information that allows consumers and other businesses to make informed decisions. This is one of the reasons why government interference creates asset bubbles and shortages. Intervention distorts price signals that otherwise might have controlled the situation.
The free market enabled American entrepreneurs to create the largest and most successful economy in the history of the world. But most politicians can’t help but help their favorite industries. It usually doesn’t end well. Look at Venezuela or other socialist havens.
Count Mr. Biden among those who think he can do it better than the market. Earlier this month, it invoked the Defense Production Act to increase manufacturing of solar panels and other green energy products. He did so “so that the United States can take ownership of its clean energy independence,” Energy Secretary Jennifer Granholm said.
The Defense Production Act is meant to promote national defense, not give the president authoritarian powers to temporarily nationalize certain industries for political gain. And imagine the reaction of progressives if a Republican president invoked this authority to increase fossil fuel production. Don’t look now, but Mr Biden hinted he would do precisely that as he continued last week to blame Big Oil’s “evil capitalists” for the runaway inflation his own economic illiteracy has caused.
The Defense Production Act is a blunt tool that should be used sparingly, such as in times of war or during a pandemic. “The constitutional risk is that the president will increasingly use emergency powers to delegate private industry to do his political bidding,” the Wall Street Journal noted.
The irony, of course, is that the Biden administration’s attacks on the US energy industry, as well as its drive to force green technologies on consumers before they are able to meet the nation’s energy needs, caused the very problem the President is now seeking to solve. solve. Perhaps a coherent energy policy not guided by wishful thinking about renewables would be a more promising alternative than bypassing the private sector.