President Obama’s GE Problem
Today Japan’s Prime Minister Naoto Kan said for the first time that a damaged nuclear plant’s tsunami defenses were inadequate. Indeed, as noted by a former GE engineer who resigned in protest some 35 years earlier, Fukushima’s “Mark 1” reactors, designed and manufactured by General Electric, were not designed to withstand loads possible in a large-scale accident.
Yet, President Obama considers GE a “model” for American corporations and GE CEO, Jeffery Immelt, serves as Chair of Obama’s ‘Jobs and Competitiveness Council’. GE paid no taxes in 2010, despite making a healthy profit. Rather than paying taxes, GE is set to collect generous welfare handouts from Obama and Congress. In his recent budget proposal, Obama made a request for more than $54 billion in loan guarantees to support nuclear plant construction, much of which is to GE’s direct benefit. This is on top of heavy subsidies that have long benefited the nuclear power “industry”:
- In 1957 Congress enacted the Price Anderson Act, limiting utility liability in the event of a major nuclear accident.
- In 1982 Congress passed the Nuclear Waste Policy Act obligating the taxpayer to underwrite costs of managing waste.
In addition, it seems the Obama administration is pulling strings for GE overseas, applying diplomatic pressure on behalf of the company. India has resisted efforts to limit nuclear power industry liability in the event of a catastrophic failure like Fukushima, Three Mile Island, or Chernobyl. A senior U.S. government official said recently that India will still have to “bring its nuclear-liability regime in line with international norms” to ensure that U.S. nuclear equipment suppliers feel comfortable doing business in India. In addition, bribery seems part of the act — WikiLeaks recently released a U.S. diplomatic cable that reported money was offered to lock down Indian legislators’ support for the nuclear pact. According to Brahma Chellaney, a professor at the New Delhi-based Center for Policy Research and former adviser to India’s national security council, the Indian government has been weakened by scandals and therefore despite the best efforts of the Obama administration “it is safe to say that the Indian [liability] legislation will not be amended to accommodate the interests of GE and Westinghouse.”
Although Republicans and others would like you to believe that the nuclear power industry is being hamstrung by Greenpeace kids, the truth of the matter is that the “industry” is not financially viable without massive government assistance. The truth is that Wall Street investors will not invest unless the taxpayer is on the hook for waste clean-up and liability in the event of a disaster. Nuclear-powered energy costs 14 percent more than gas to produce a unit of electricity, and it costs 30 percent more than coal. Furthermore, according to Gilbert Metcaf’s recent National Bureau of Economic Research paper on energy, this increased cost of nuclear energy includes a baked-in taxpayer subsidy of nearly 50 percent of nuclear power’s operating costs. The nuclear power “industry” are wards of the State, dependent on corporate welfare and favoritism. As such, they also have a real problem with competition, especially from Green Energy:
- The nuclear industry was successful four weeks ago in the House of Representatives in preserving $18.6 billion in loan guarantees for nuclear power and simultaneously killing all the loan guarantees for wind and solar and other renewable energy construction.
Obama enjoyed more financial support from GE than any candidate in history:
Top Recipients of GE cash, 1990-2010
|Barack Obama (D)||$513,080|
|Hillary Clinton (D-NY)||$253,476|
|George W Bush (R)||$190,616|
|Chris Dodd (D-CT)||$186,380|
|John Kerry (D-MA)||$175,631|
And GE has doubled the amount of $$$ spent on lobbyists in the last two years, from 20 million to 40 million. CEO Jeffery Immelt recently accompanied Obama on the President’s tour of South America. To be a fly on that wall…