Why didn’t the Haas business school at Berkeley just ask me about electric car subsidies?

ford-focus-electric-2Allow me to quote myself from a post I wrote exactly a year ago when we got ourselves an electric car:

Between federal and state incentives for electric vehicles, we get almost $12,000 towards a three-year lease.

That last factor makes the car eminently affordable. We’ll be paying only slightly more per month on the lease than I was already paying for gas. We’ll keep the old car for short trips or heavy loads (or for times when all three drivers in the family are heading in completely opposite directions), but we’ll use only the Leaf for the local trips. Our electric bill will increase negligibly, our gasoline bill will decrease dramatically, and our monthly cash flow will be affected minimally.

Nice as they are, I’m actually somewhat embarrassed by those incentives. Yes, it’s true that I pay substantially more in taxes than someone who doesn’t live a nice upper middle class life in Marin. But precisely because I am able to live this nice upper middle class Marin lifestyle, I don’t really need the incentive.

The incentives certainly encourage me to buy or lease an electric vehicle, so they fulfill the government goal of getting more people into EVs, but I think it’s wrong that lower-income taxpayers are compelled to support me in any way. They, after all, are still paying taxes but, even with the taxpayer-funded incentive, they still can’t afford a lease.

I refer to my musings because the Haas School of Business at UC Berkeley (yes, wacko, Leftist Berkeley) has come out with a study about the economic benefits and burdens of the government’s investment in “green” energy. (Incidentally, those electric cars aren’t so green.) The working paper’s extract pretty much says it all (emphasis mine):

Since 2006, U.S. households have received more than $18 billion in federal income tax credits for weatherizing their homes, installing solar panels, buying hybrid and electric vehicles, and other “clean energy” investments. We use tax return data to examine the socioeconomic characteristics of program recipients. We find that these tax expenditures have gone predominantly to higher-income Americans. The bottom three income quintiles have received about 10% of all credits, while the top quintile has received about 60%. The most extreme is the program aimed at electric vehicles, where we find that the top income quintile has received about 90% of all credits. By comparing to previous work on the distributional consequences of pricing greenhouse gas emissions, we conclude that tax credits are likely to be much less attractive on distributional grounds than market mechanisms to reduce GHGs.

I found the above link at Power Line, and Steven Hayward adds the perfect coda: “The ‘green energy’ world is corrupt all the way down.”

That study at Haas probably cost a lot of money.  It would have been better if they’d read my post, applied some basic common sense, and just sent the money to me!

And just a random aside:  We ended up getting Ford’s Focus electric car and it is a delight.  The downside is that it has a really big turning radius and has a low driving range for an electric car (about 70 miles).  The upside is that it is an absolute delight to drive.  Not only does it handle well, the interior is so well designed, and the electronic interface so much fun, that I get a kick every time I’m in the car.  Moreover, when we went on vacation back East, our rental car was a Ford sedan — a nice one, since my husband has car rental membership perks.  It was just as delightful to drive and sit in as the Focus.  Next time I’m in the market for a new car, I’m going to give Ford cars a very close look.