- The Washington Times - Thursday, February 20, 2003

Examining reaction to President Bush's $1.2 billion plan to speed the deployment of hydrogen vehicles, announced in his State of the Union address, is like browsing the Sharper Image catalogue. It includes everything from the practical and constructive to the outlandish and the bizarre.
How Congress eventually addresses the issue of encouraging the development of hydrogen vehicles is as murky as a smoggy day in Los Angeles. Yet, the posturing and rhetoric surrounding it provides a unique glimpse into the future of environmental politics in this city.
Democratic presidential candidate Howard Dean's response was so outrageous one might speculate he bumped his head wandering in an old growth forest. The most constructive reaction belonged to Sen. Ron Wyden, Oregon Democrat, and Rep. Chris Cox, California Republican, who last week introduced constructive legislation that builds on the president's proposal. Others from the left and right reacted with predictable rhetoric.
Yet, there is a larger point about energy and environment policy buried in all the commotion. The fuel cell idea does more than burnish President Bush's environmental credentials it gives his allies a new way to communicate about these issues.
Fuel cells generate power through a non-combustible reaction between hydrogen extracted from natural gas, biomass, ethanol or other energy sources combined with oxygen. The hydrogen-oxygen reaction is captured and produced into electricity. While some prototype fuel cell cars are already on the streets in California, a number of practical problems remain. Power produced from fuel cells is still too expensive, storage of the feedstock on the vehicles is a problem, and there is no infrastructure to maintain and refuel these vehicles once on the road.
President Bush argues that moving to hydrogen-fueled vehicles holds significant promise in a variety of areas, including lowering the demand for oil by 11 million gallons per day by 2040, technological spinoffs and significant environmental benefits.
The left's response to the president's plan was typically demagogic. The Sierra Club said the plan "served as a shield to protect automakers from improving fuel economy." Rabble-rouser Dean said the Bush plan indirectly funds terrorism because U.S. oil money sent to Saudi Arabia is used to "build schools all over the Islamic world that teach small children to hate Americans, Christians and Jews." Cheap-shot rhetoric aimed more at raising money from liberal environmentalists than cleaning the air and water of this country.
Yet, some conservatives also scoffed. The Wall Street Journal called it "hydrogen car hype," saying Detroit should fund it. Granted, government should not pick winners and losers, but this view also oversimplifies the issue, shooting free-market bullets, but completely misses the target.
Who really thinks the energy sector in this country operates under free market conditions? Microeconomics 101 tells us externalities (pollution), production cartels (OPEC) and subsidies (current tax incentives for fossil fuels) all lead to market failure, the classic case for some government intervention. Moreover, the Bush plan does not favor one fuel over another as a hydrogen feedstock. Market forces pick winners. Finally, why should Detroit, and automaker shareholders, further subsidize "public goods" like reducing dependence on foreign oil or pollution? They already "give at the office," as they say, through government-mandated pollution controls.
Recognizing these points, the Wyden-Cox legislation is an example of a productive way for Congress to engage in the debate the president started in his State of the Union address. Again, without picking specific winners or losers, the legislation provides tax incentives for any type of technology that produces hydrogen fuel, vehicles and infrastructure. It promises to fill millions of fuel tanks with clean energy produced using powerful market and financial incentives, while the old school environmentalists offer nothing but hot-air hype.
Building on the president's plan, it accomplishes environmental objectives through technology, innovation and choice. It represents a stark contrast to mandating more pollution-control equipment on internal combustion engines and even more extreme policies like banning sports utility vehicles (SUV). The anti-SUV idea is so laughable that New York Times columnist Woody Hochswender summed it up well last Sunday, when he asked if this meant his car joined al Qaeda.
The real debate, like other elements of the president's agenda, is over means, not ends. The choice is clear: policies based on bureaucratic, command-control regulations or ideas that promote new technologies, innovation and choice. The president's fuel-cell proposal opens the door for his allies to talk about this issue, new terrain that rejects both indifference and one-size-fits-all environmental hyper-activism.
President Bush's transformational words on this issue, like education and welfare reform, could reshape the image of his party and political discourse in this country. In addition to electricity, the political megawatts generated by this idea are powerful byproducts of the fuel cell proposal.

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