The Federal bailout money should be used for projects that will set the U.S. on a path for long term prosperity.  Most Americans are convinced that the bailout is needed for the mortgage industry and quite a few are convinced it’s also necessary for the auto industry.  But, the new Obama administration will be developing an Economic Recovery Plan for long term prosperity.  

For example, the the construction of new Coal-to-Liquids plants in the U.S. should be included in the Economic Recovery Plan..  Each project would be about the same as size as the construction of a grassroots refinery.

Coal-to-Liquids is coal processing technology that does not release emissions into the air the way the existing coal power plants do.  Skeptical?  I don’t blame you.  But, consider this.  Refineries don’t BURN crude . . . they CONVERT into other useful products.  The same is true of Coal-to-Liquids plants.  CTL plants don’t BURN coal . . . they CONVERT it into other useful products much the same as a refinery.  Just as a refinery creates gasoline, diesel and jet fuel from crude oil, a CTL plant creates the same products gasoline, diesel and jet fuel from coal.  That’s not a typo.  It’s correct and coal-to-liquids technology is tested, in service and proven.

If you have seen some “Clean Coal” commercials on television, this is the technology.  It’s commonly referred to as clean coal technology, because the coal is converted in a closed loop system of pipes and equipment just like a refinery.  In a closed loop system, the synthetic products can be recirculated through specialized equipment until the contaminants are removed.  In fact, gasoline, diesel fuel and jet fuel are actually considered to be cleaner that the petroleum derived products. 

So Why Doesn’t The U.S. Have These CTL Plants?

1.  The oil industry lobby is powerful.

2.  The CTL plants are very expensive and government loans or loan guarantees are needed.

3.  The environmentalists are against anything that has the word “coal” in it. We’re all interested in protecting the environment these days, but this technology is as clean as refinery technology when the CO2 is sequestered or used for enhanced oil recovery.

The benefits of coal-to-liquids plants for the U.S. are staggering.  The U.S. has more proven coal reserves than any other country in the world including Russia and China and they are much larger land masses.  The U.S. is the Middle East of coal.  With an energy policy that supports both coal and petroleum, a coal-to-liquids industry in the U.S. can quickly achieve T. Boone Pickens dream of this county becoming energy independent and no longer dependent on foreign crude oil.  This is actually a strategic objective of the Air Force.  The gasoline, diesel and jet fuel products can be transported by truck or pipeline to where they are needed. In addition to long term prosperity and security, the construction of these plants will provide jobs for engineering companies, construction workers and equipment manufacturers.

Why it’s important now.

Up to now, the past administrations have taken the position that the Federal government shouldn’t be assisting private industry.  Finally in 2008, the Department of Energy offered to provide $8 Billion in loan guarantees for coal-to-liquid plants.  Each plant costs from $2 B to $5 Billion so this is a paltry amount especially when one considers that now the Federal government is spending more than $700 billion on bailouts.

The Economic Recovery Plan should include substantial loan funding and loan guarantee programs for the fledgling U.S. coal-to-liquids industry. This is the kind of Federal government support that the country needs to strengthen the economy.

Popularity: 11% [?]

The U.S. economy was purposely juiced by the administration to maintain a robust economy. When sports figures use steroids to boost their performance the common term is they are on ‘juice’ meaning steriods. Well, the U.S. economy has been on juice. The loose housing mortgage market juiced the U.S. econony.

Why would the current administration juice the U.S. economy. Certainly the only answer is that it was a tactic to maintain a strong economy. A rising housing market was thought to increase wealth and increase consumer spending. For several years, the finance and economy pundits on CNN, MSBN, and the major networks have said that the housing market has kept the economy from sinking. It’s clear that the housing market was let run wild with no mortgage lending regulation to stimulate the economy. Folks, what other logical reason is there?

It must have been a deliberate tactic to let the mortgage lending market run loose and wild with no meaningful oversight and regulatory actions. It hasn’t been very long since the U.S. experienced the last real estate meltdown due to loose mortgage lending practices. Anyone that is 50+ will remember the 1980’s real estate crisis when foreclosures hit unheard of highs. During the 1980’s the savings and loan industry made questionable loans to thousands of home buyers that were not qualified financially. The 1980’s real estate crisis was not that long ago and it just is not possible that the regulators, managers, bureaucrats and financial industry experts were not aware.

There had to be a conscious decision to let the mortgage lending market run free and wild. Keep in mind that billions in profits were made. Many investment firms, mortgage companies, home builders, title companies, lawyers and others made billions in profits. Consider another perspective. Why were interest only loans created and allowed in the last decade? Who can remember the radio and TV financial advisors recommending that buyers use interest only mortgages “if they were only going to own the house for one to two years”. All of the speculators planning to flip houses knew that “own the house for one to two years” was a euphemism for “flip the house”.

And then consider all of the special mortgages offers for no application fee, no closing fees, no PMI, etc. These are all red flags that the mortgage industry has been operating with no oversight. The important point though is that it wasn’t on accident, no folks, the purpose was to juice the economy by inflating housing prices and convincing Americans to over consume with the end goal to artificially inflate the economy.

My friends, you have a right to be outraged! You should be outraged! The situation that our country is in today was not an accident that couldn’t have been avoided. Are we so naive that we will believe that?

Popularity: 22% [?]

Congressman John Yarmuth linked the war to the sliding economy during a recent radio broadcast. He went on to say that the war is “not only linked to our economic skid, but the leading cause of it.” Most Americans know that the U.S. is spending a lot of money on the war and Congressman Yarmouthp pointed out that the U.S. has spent “more than a half trillion dollars” on the war effort.

It should not be a big leap of faith to expect that this kind of spending will impact the economy. The current administration has also reduced taxes during this period. Actually, it’s rather unrealistic and naive of American’s to believe that we can continue with our daily routines, Starbucks in the morning, country clubs, new trucks and BMer’s while the government is spending this heavily and reducing taxes at the same time.

This is the first generation that waged a war without suffering. Remember World War II? The population was forced to ration consumables and all able bodied men, women and children worked to support the war. This generation considers the war almost like a subcontractor that is paid to do a dirty job.

Yes, I think the Congressman is right. How can a logical person think otherwise?

Click on link for information on Congressman John Yarmuth.

Popularity: 25% [?]