In November 2011, American citizens gathered at the White House to protest the Keystone XL pipeline project, which has been proposed to bring oil from Canadian tar sands through and to the United States.  At roughly $7 billion, this project is a massive undertaking.  Keystone is an interesting topic because it pits the needs of economic growth (during a recession) with the sensitivities of the environment.  TOC chose this particular topic to segue way into a discussion around the role of government in protecting our environment while maintaining the principles of free market capitalism.  There is no doubt that capitalism and free markets have performed better than other economic systems in terms of growing wealth and creating value.  There is no reason why a well-functioning system cannot do the same for the protection of the environment.  Often, we get trapped into believing free markets and environmental protection are in conflict.  TOC strongly disagrees with this notion and believes that a different paradigm is needed.

To be clear, a free market does not exist unless you eliminate market failures.  Government must be focused on eliminating the failures that cause environmental harm.  We can look at examples by using Wikipedia (please see the references provided at the bottom of the linked Wikipedia article, as TOC does not believe that Wikipedia itself is reliable but can be used as a link to reliable sources when provided).  The first market failure to consider is the existence of information asymmetries and externalities.  The second is the existence of oligopolies and the lack of substitutes, creating non-competitive markets.

Consider first externalities and information asymmetries.  When governments subsidize the true cost of using fossil fuels by failing to have suppliers or consumers pay for the external cost of carbon (more specifically, the consumption/destruction of carbon-free air) and by providing subsidies to the oil, coal and gas industries, the market fails to reveal to the consumer the true cost of a gallon of gas or a kWh of energy.  Subsidies are not just tax breaks, but are also the failure to enforce laws that allow externalities, such as protecting citizens of Appalachia from coal-mining by mountain-top blasting.  If I do not understand the true cost of energy as a consumer of energy, I am less likely to consider alternatives; however, I still pay an invisible cost of higher health care (borne by certain citizens and impacting me indirectly), higher tax burdens for other industries and individuals, and (allegedly) the indirect and direct costs of climate change.  Note that, even if you do not believe in climate change, you have to agree that there are other externalities caused by the usage of fossil-fuel based energy.  The invisibility of these costs is the information asymmetry that causes consumers (buyers) to have less incentive to seek alternatives.  There has to be a process of disclosing these hidden costs.

Next, there is the oligopolistic nature of energy, which drives the cost of almost everything consumers purchase.  While a lot of conservatives strongly disagree with the concept of governments investing in alternative energy due to the definition of a free market, they fail to realize that there is no free market when we consider energy.  We power most of our automobiles with gasoline or natural gas.  Most of the remaining vehicles are powered with a battery through hybrid technology (realistically, just a more efficient usage of fossil fuel) and plug-in electrical power.  A majority of power on the electrical grid is generated by fossil fuels in the US.  Consumers do not have relatively many sources of electrical power or gasoline (While it is true that consumers have many distributors of gasoline, they do not have many sources of gasoline, increasing the market price).  Furthermore, the lack of substitutes forces consumers to participate in the fossil-fuel-based energy market.  By providing subsidies that support a well-crafted comprehensive energy plan, government can be an investor into such a system and work to lessen this failure as long as the rationale behind such investments is objective and economical, not political.  The eventual growth in these investments will pay off in terms of the elimination of externalities and the growth of alternative industries.

TOC believes government has a role as the entity that can eliminate these inefficiencies.  This has to be an objective, not political, process.  Admittedly, this is an idealistic viewpoint that is virtually impossible in our world of polls, sound bites, politics and 24-hour news cycles; however, it is achievable if the citizenry takes responsibility for the environment, forcing governments to make decisions promoting disclosure in order to empower the public.  Maximizing disclosure allows the citizenry to take responsibility for the environment and seek and create less costly goods and services (in terms of true cost).

This is where conservatism comes in.  Some conservatives argue free markets must be free of government interference.  A true conservative believes in and wants to preserve free markets.  Free markets can only exist when there is an entity present that is strong enough to eliminate or limit market inefficiencies and failures.  This is why TOC touts conservatism and not an affiliation with a political party.  TOC believes we have a major confusion in this country between these two concepts.  Political parties exist to advance a political agenda through alliances and mutually beneficial pacts, not necessarily to advance a certain ideology.

In closing we return to the protestors and the pipeline.  TOC is not prepared to say if the pipeline project should be allowed or not. Indeed, an objective, informed discussion may reveal that the pipeline has environmental benefits, such as the reduction of truck traffic to haul crude to refining centers.  That is not the purpose of this blog post; instead what TOC wants is to make sure we address the larger issue – that there is a need for the pipeline in the first place – and ensure we are investigating realistic solutions to the same.

Herman Cain’s recent troubles with accusations of sexual impropriety have all but ended his campaign for President.  He has been accused by two . . . three . . . four . . . and now five women.  The press has been back and forth with trivialities around who these women are, what is proper for an anonymous accusation and what the difference is between a “settlement” and a “severance.”   First, TOC is dumbfounded with why the press and the public did not take this level of investigation and scrutiny on Cain’s 9-9-9 jingle.  In other words, where is the thorough investigation on 9-9-9’s tax revenue potential and whether it adds to the deficit, does it crowd out sales tax revenue in states that depend on sales taxes already (because we already know a federal sales tax is going to decrease consumption) and what will happen when these states creep towards bankruptcy and require bailouts.  Little discussion took place on these questions, but we got plenty of discussion on how the public is reacting to 9-9-9’s “simplicity” and how it is helping Cain in the polls.

The goal of this blog post is not to dissect the jingle that was being passed as a tax policy for a country of 309 million people with a federal budget of roughly $3.75 trillion.  Instead, TOC wants to go consider a troubling trend illustrated during the impropriety allegations and discuss something that is not being discussed in conservative or liberal media.  According to recent articles, the Cain campaign turned to racism as the basis for the “attacks” on Cain.  Worse, Cain himself stated that race is a driving factor (as if whites have never been accused of sexual harassment for political reasons) without any ability to give any proof.

We do not know (nor should we really care) what really happened with these women.  We know that some amount of money was given to some women in order to settle a dispute and that the Georgia businesswoman had some relationship with Cain.  The rest is only a combination of conjecture and “he-said, she-said,” and the truth may never be revealed to the general public.  To inject race into the discussion, manipulating the pain that racism has caused all races in our society, just to ensure you remain at a certain point in the polls is despicable.  Cain’s willingness to manipulate racism and its emotional wounds says a lot about him.  As a black conservative, TOC was elated to see him run; however, TOC also wanted to OBJECTIVELY investigate his campaign and find a reason to ignore his lack of experience in public service.  The 9-9-9 catchphrase was enough to end TOC’s belief that Cain was the right choice; however, this last month has caused a loss of respect for Cain.  Black conservatives have claimed for years that Democrats manipulate race and play the race card to unfairly attack conservatives while lamenting the fact that conservatism is never given a fair chance in Black America.  We ask the question, when is “the dream” achieved and we judge people on their ideas and not the color of skin.  Then, Cain resorted to the same tactics in order to save his political life.

Cain is not alone in manipulating race in order to cover up otherwise embarrassing accusations.  Charley Rangel found trouble and conveniently realized that all accusations against him were racist and baseless – as if hiding assets for tax purposes and obtaining kickbacks such as vacations in the Caribbean are immaterial.  Maxine Waters also found race convenient when she was accused of ethics violations.  TOC thought that overseeing a minority bank being selected for receipt of TARP funds while a major shareholder of that bank is your husband could be considered as a potential conflict of interest; however, Maxine has redefined the definition of racism and included such an allegation within racism’s definition.

TOC would like to apologize to the likes of Martin Luther King, Rosa Parks, Medgar Evers, Frederick Douglass, W.E.B. Dubois and countless other Civil Rights Leaders that literally gave their lives to change the very world in which we live.  They worked so hard to eradicate racism and achieved so much.  It is shameful to see so-called black leaders come after them and their legacy and walk backwards.  They worked to rid our nation of racism, but now there are those acting in their own self-interest saying that we still are mired in that racism.  Did you all not have great accomplishments and bring the world so far ahead?  The answer is no, as long as racism is defined as a tool to distract people from their own shortcomings and lack of ethics.

Racism and its legacy still exist in America today.  The tragedy is that when we throw around baseless accusations of racism, we run the risk that the silent majority grows numb to the higher cause of addressing racism and its legacy and eradicating their effects from our society.

For those that disagree, ask yourself these questions:  Does racism and its legacy look like black kids born in single-parent poverty due to generational disadvantages, or does it look like a black CEO being asked normal questions during the very political process of selecting a Presidential nominee?  Does racism and its legacy look like blacks falling further and further behind in education and income in light of increased globalism with little reason to believe these gaps can be closed, or does it look like Charlie Rangel being asked tough questions when he says he is not responsible for accepting kickbacks and blaming it on his staff?  In asking these questions, we need to have laser-like focus on the real problems and denounce the distractions – else, racism’s legacy will doubtlessly continue.