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Maximillian's avatar

What do you think about "Green" Incentives?

Asked by Maximillian (948points) October 25th, 2010

Ok, so I’m in my local FBLA chapter, and my team is doing Emerging Business Issues. Usually, I wouldn’t ask, but last year my team came across a problem: there weren’t enough published opinions. So, I come to you, The Collective. What do you think? Here is the question:

There is a great deal of emphasis in our economy to build and operate businesses in an environmentally efficient manner. Should state or the Federal government offer special incentives for companies who choose to build with green materials, harness
green power, and employ other green tactics in their operations?

If you can state you opinion, explain why, and support it, that’d be great.

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18 Answers

Nullo's avatar

More often than you might think, ‘green’ is more about branding and image management – and bonhomies – than anything else.

I think that they shouldn’t bother, since I don’t think that global warming has anything to do with people and might not be all that bad anyhow. The Federal government doesn’t have any money to go around handing out incentives, and state governments.
I think that the cause (though it would be ugly for everything else) would be better served by taxing the living daylights out of polluting industries and letting some clever young entrepreneur come up with a solution. Thus we have a solution that’s molded to fit the problem, nobody has to spend tax dollars, and you get your green.
And jobs get outsourced to China and India where nobody cares about this stuff.

Katexyz's avatar

Yes, I think this is a good idea. First off it is better for the environment. Environmental concerns are often considered secondary to economic concerns, but it must be noted that people are part of the global ecosystem, and changes or damages to it, invariably effects us. I don’t think it is every feasible to assume or expect a business to consider environmentalism before profit, and honestly, I can’t really blame them, they exist to profit, but if left unchecked they can cause damage, and that is something that should not be allowed. Green incentives allow businesses to further reduce their environmental impact, without seeing it as a loss to profit. In fact in today’s economy most businesses would profit from the image boost of a green program, and they would also benefit from tax incentives, so it is actually in their best interest to elevate environmental concerns. These programs also often create a variety of new jobs, which in an economic situation like we are in now, that can never be a bad thing. Essentially, green incentives and programs create a new sub-economy.

I personally believe the environmental concerns are primary, but I understand not everyone does, but economically it is also most beneficial to “go green”

@Nullo, reverse incentives would also be a good idea (penalties for noncompliance). Both could be integrated to create a strong package emphasizing both economy and environment, in a way which greatly benefits both.

ETpro's avatar

We have a choice. We can say it costs way too much, and let China continue to invest heavily in alternative energy, or we can create green jobs here. Jimmy Carter drew jeers and laughter when he suggested we turn the thermostat down in the winter and wear a sweater. Perhaps it is fashionable among certain circles in the USA to be willfully wasteful, but I submit that it isn’t wise.

Since Carter left office, oil imports have jumped from 6 million barrels a day in 1978 to more than 12 million a day now. We are shipping supertanker loads of money off to foreign nations, many of them wishing us dead. But we can’t afford jobs here and an end to reliance on foreign oil? I am sorry, but that makes no sense.

I understand being fiscally responsible and living within your means. But when it comes to energy,. it isn’t like foreign oil is free or even cheap. It is bankrupting our balance of trade. Refusing to invest in future technology is a good deal of what brought the Detroit auto industry to the point where US taxpayers had to bail it out. Let’s not keep repeating that mistake again and again.

xxii's avatar

I do think green incentives are a good way to go. Money makes the world go round. Companies won’t commit to helping the environment unless it helps their bottom line. That can mean drawing more customers because they brand themselves as green, but it can also mean getting better tax rates because they use energy-efficient machinery. Energy efficiency is key to solving the energy crisis, but it’s largely a self-enacted process. It won’t happen unless there is some private benefit involved, and that’s where incentives come in.

whitenoise's avatar

Yes, I think it is a good idea.

The problem with the environmental impact of our ways of life is that the bill will be served later and will be served to others. For that reason, our traditional free market systems do not work very well in looking after the environment.

There is a well known tragedy for common property in a capitalistic, free market system: there is no one looking after its interest. I feel that’s one of the primary reasons we (should) have governments for. It is their job to guarantee freedom and security to everyone and to look after the interests of those that cannot fend for themselves. For instance those that have no economical power, are not born yet, or are just not part of the system.

Our governments are responsible for the way we treat our environments, since we all are and there is no effective natural stimulus to take care of it. The government can do two things; tax and stimulate. It should do what is most effective. Likely both.

For all those that are skeptical of ‘global heating’ and same, there should also just be the realization that we are running out of resources. Not just oil, but also out of other raw material, such as coltran, lithium, etceteras. On top: even if the chance of the majority of our scholars and scientists being right would be very small, say 3%, we should err on the side of caution, given the enormous potential impact on our future generations.

With reference to China: it is having its own issues. It is polluting itself at an enormous rate, while running out of fresh water and arable soil. It is doing that while producing goods, to a large extent for foreign owned corporations, of which most profits do not end in China, but, for instance, in the US, Hong Kong or Singapore.

It is not about saving the planet, it is about saving our way of life and that of our future children.

Cruiser's avatar

IMHO, “green anything” bottom line, costs more if not significantly more to produce PLUS the carbon footprint more often than not is bigger than the fossil fuel version. ANNNNND…they generally suck more than the fossil fuel version. If this were not the case, we would have been using them in the first place a long while ago.

We have to face facts, people just won’t pay more for a cleaner, more expensive version, that sucks more than what we produce now. I work in the chemical industry and all the green based chemicals cost double what the petroleum bases chemicals cost and frankly are no where near as good and the finished products we would make with them just don’t cut it! So I cannot imagine selling a product to a customer saying “here you go our new product with 80% renewables that costs twice as much and last half as long. Plus it took twice as much energy to produce plus you will have to expend very costly time and energy to remove it to reapply a lot sooner than if you used what I used to sell you.

Just not a good scenario UNLESS our Government steps up and changes the mind set of we the people to accept the task at hand and be smart about the choices we can make and not make this a wholesale approach that is shortsighted in it’s goal to go green just because.

ETpro's avatar

@Cruiser It is common to run actual carbon footprint analysis for green energy projects. It is simply not true that they are generally worse than big oil and big coal, which are no pikers when it comes to global carbon footprint from mining through processing/refining, delivery and consumption. Most renewable energy is considerably less expensive than oil or coal over the long haul. Many of them have big front-end investment requirements, and so may take years to begin returning their savings. But those costs are for early adopters. As technology improves, costs will fall exponentially. Renewable energy is so technology linked I would expect a cost/performance curve not unlike that of computers to unfold over the next 30 years.

Cruiser's avatar

@ETpro I would argue you need to look deeper in the actuals and past the hype or post some links supporting this.

There are oodles of reports that demonstrate the cause and effect relationships and the law of unintended consequences at play with these Green alternatives. This Congressional Budget Office report shows a strong correlation between increased use of Ethanol with a 10–15% rise in food costs!! I don’t know many people who can really afford that kind of additional burden on their household budget.

Because of hugely costly air scrubbers on coal fired plants I can no longer get a zeosphere I need for my products domestically and once the Chinese follow suit (if ever) my cost will be 5 times what it is for a greener substitute. Because people want greener homes and are opting out of nylon carpeting, I can barely get AEP which was a waste byproduct of carpet production and WAS a very effective low cost amine for me that I now have to pay dearly for a replacement that costs 10x’s the energy to produce!! AEP and these Zeospheres were waste products they had to pay to get rid of now my customers and ultimately you are paying more for what they buy! Green often means more and a LOT more!

ETpro's avatar

@Cruiser Ethanol is not one of the alternatives I would support. On that one, I totally agree with you. It’s just another way to transfer taxpayer money to companies like Cargill.

whitenoise's avatar

@Cruiser, whatever incentive is put on green initiatives, sense must still be the guideline. Ethanol comes with a lot of problems too many, I feel to be a feasible and sensible alternative.

There are however other ways to improve our footprint. The US footprint is a lot bigger than, for instance that of the EU-countries, so it must be possible to reduce footprint and still lead a quality life.

The European taxation on gasoline has made that carmarket far more focused on fuel economy, for instance. And the benefit is that taxation influences the price of gasoline, but in essence can be offset by other tax reductions, so that it shouldn’t need to cost society on the balance.

Cruiser's avatar

@ETpro…easy there Cargill and ADM are two of my better customers and keeping us busy!! ;)

@whitenoise Herein lies part of the problem as these green initiatives will clearly put us at a cost disadvantage to EU or Asian countries that do not have these added costs to their energy cost basis hence the Carbon Credit red herring being bantered about to try and equalize the playing filed and which is a whole other discussion.

ETpro's avatar

@Cruiser See how it works. Our politicians feel the same way. :-)

As to cost disadvantages to European nations, they already do far more than we do. Germany is well ahead of us. They are the world’s largest lender nation, a position we used to enjoy till the Reagan tax cuts. Now we are the world’s largest borrower nation. Maybe we should look at what Germany has done riight and we have done wrong over the last 30 years.

Nullo's avatar

Someone made an interesting point once about ethanol: isn’t it kind of awful that we would grow corn specifically to make it into ethanol to run our cars, when there are millions of starving people in the world?
Since hearing that observation, I haven’t been able to get very excited about ethanol as an alternative fuel.
I figure that it’s the farmer’s business what he plants, but still.

@ETpro Somehow I don’t think that taxing a few more people is going to make that much difference. The real problem, IMO, is that we hardly have any industry left in the country.

mattbrowne's avatar

It’s either going green and innovate or going to ruin.

Sorry to say this, but if the majority of Americans follow @Nullo‘s ill-fated advice, I fear for the America’s mid-term future. More and more high-tech products will have to be imported from Europe and Asia, not only cheap toys and clothes.

Already today many leading green technology companies are European. Here’s a recent article:

US to build $6 billion solar farm in Californian desert

US Secretary for the Interior Ken Salazar approved what will be the world’s largest solar farm project, producing 1,000 megawatts of energy once the $6billion project is completed in California.

German firm Solar Millennium has been given permission to proceed with the solar thermal plant that could power up to 750,000 homes in the surrounding regions of the Mojave desert near Blythe, California, according to the US Department of the Interior.

The massive project will generate over 1,000 construction jobs, before requiring 295 permanent staff to maintain the solar thermal plant. The Blythe site will be the first of four solar thermal plant developments that will eventually produce 2,800 megawatts of electricity, powering up to two million homes in the region.

ETpro's avatar

@Nullo Supply side tax cuts are a serious part of the problem, as this shows. The sudden, dramatic reversal from paying down national debt to it skyroicketing came when Reagan slashed taxes on the rich. See this for how that is killing the middle class.

But I agree we have to get back to making things of value. Pushing money around, repackaging it, and calling it profit isn’t going to be a solution for the future.

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