Wednesday , November 13 2019
Home / EconLog Library / Trump failed to save Big Coal; can Warren succeed?

Trump failed to save Big Coal; can Warren succeed?

Summary:
The Trump administration promised to revive the declining coal industry, but has failed to do so: Robert E. Murray, the U.S. coal baron who pressed the Trump administration to help save America’s struggling miners, placed his company into bankruptcy as demand for the fossil fuel continues to weaken. Even a determined administration has difficulty going against powerful market forces.  One tactic that Trump did not try would be to help coal by putting its competitors out of business.  Perhaps the coal barons should take a look at Elizabeth Warren’s policy proposals: Ms Warren sees environmental policy as an opportunity to play favourites and to protect American manufacturing. She wants an accelerated phase-out for carbon-free nuclear electricity and a ban on

Topics:
Scott Sumner considers the following as important: , , , , ,

This could be interesting, too:

Bryan Caplan writes Can Republicans Afford to be Pro-Immigrant?

Scott Sumner writes Regulation creates concentration

Bryan Caplan writes Freiman: How Is Voting Like the SAT?

Don Boudreaux writes Some Links

The Trump administration promised to revive the declining coal industry, but has failed to do so:

Robert E. Murray, the U.S. coal baron who pressed the Trump administration to help save America’s struggling miners, placed his company into bankruptcy as demand for the fossil fuel continues to weaken.

Even a determined administration has difficulty going against powerful market forces.  One tactic that Trump did not try would be to help coal by putting its competitors out of business.  Perhaps the coal barons should take a look at Elizabeth Warren’s policy proposals:

Ms Warren sees environmental policy as an opportunity to play favourites and to protect American manufacturing. She wants an accelerated phase-out for carbon-free nuclear electricity and a ban on fracking, which has not only made America the world’s top oil producer but also provided it with a lot of cheap natural gas. This appeals to the Democrats’ base; but it would also make America’s transition to cleaner energy more expensive and less effective. Ask someone selling coal-fired electricity what they want for Christmas and an end to nuclear power and cheap gas will come high on the list.

As the Trump administration demands that China abandon its industrial policy, they are going in the opposite direction back at home:

The Trump administration wants to dictate how and where global auto companies make cars and parts to secure duty-free treatment under the new Nafta — in its most direct intervention yet to manage trade and production, according to people familiar with the effort. . . . The push comes amid Trump’s tariff-led assault on supply chains that run through China. It illustrates how much his administration has drifted from Republicans’ free-market ways and is willing to employ the sort of coercive tools used in command economies like China to force domestic production.

Some worry about giving the president so much power:

People familiar with the discussions say the language gives the White House a chance to abuse the transition-plan approval process to pressure companies into making politically expedient investments. To avoid an opaque process ripe for meddling by politicians, auto companies and Congress are asking USTR to commit to uniform rules so they can plan accordingly and don’t have to fear retribution for opening a plant in Mexico, for instance, instead of the U.S.

As long as America voters elect philosopher kings who are not vindictive and are not focused on the next election, then there is no reason to fear that these powers would be abused.

Trump failed to save Big Coal; can Warren succeed?

Scott Sumner
Scott B. Sumner is Research Fellow at the Independent Institute, the Director of the Program on Monetary Policy at the Mercatus Center at George Mason University and an economist who teaches at Bentley University in Waltham, Massachusetts. His economics blog, The Money Illusion, popularized the idea of nominal GDP targeting, which says that the Fed should target nominal GDP—i.e., real GDP growth plus the rate of inflation—to better "induce the correct level of business investment". In May 2012, Chicago Fed President Charles L. Evans became the first sitting member of the Federal Open Market Committee (FOMC) to endorse the idea.

Leave a Reply

Your email address will not be published. Required fields are marked *