Spending DA - Brovero

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Gonzaga Debate Institute 2008 1Brovero/Lundeen/Moczulski Spending DA

Spending DA

Spending DA ..................................................................................................................................................................11NC 1/2........................................................................................................................................................................21NC 2/2........................................................................................................................................................................3Uniqueness: Fiscal Discipline High Now.......................................................................................................................4Uniqueness: Fiscal Discipline High Now.......................................................................................................................5Uniqueness: Fiscal Discipline High Now.......................................................................................................................6Uniqueness: Economy Stable Now.................................................................................................................................7Link: Government Spending...........................................................................................................................................8Link: Research and Development...................................................................................................................................9Link: Low Priority Programs........................................................................................................................................10Link: Solar Space Power...............................................................................................................................................11Link: Ethanol Development..........................................................................................................................................12Link: Ethanol Development..........................................................................................................................................13Link: Coal to Liquid......................................................................................................................................................14Link: Coal to Liquid......................................................................................................................................................15Link: Cap and Trade......................................................................................................................................................16Link: Nuclear Power.....................................................................................................................................................17

Internal Link: Deficit Spending ...................................................................................................................................18Internal Link: Deficit Spending/Fiscal .........................................................................................................................19Internal Link: Fiscal Discipline K/ Econ......................................................................................................................20Internal Link: US Econ K/ Global................................................................................................................................21Internal Link: Inflation..................................................................................................................................................22Internal Link: Oil Prices K/ Econ.................................................................................................................................23Internal Link: Oil Prices K/ Econ.................................................................................................................................24Internal Link: Electricity Prices K/ Econ......................................................................................................................25Impacts: Nuclear War....................................................................................................................................................26Impacts: Nuclear War....................................................................................................................................................27Impacts: Disease...........................................................................................................................................................28Impacts: China War ......................................................................................................................................................29AFF: Link Turn Cap and Trade..................................................................................................................................30

AFF: Link Turn Nuclear Power.................................................................................................................................31AFF: Link Turn Ethanol ............................................................................................................................................32AFF: Link Turn R&D................................................................................................................................................33AFF: Link Turn Alternative Energy...........................................................................................................................34AFF: Non U Econ Growth Low.................................................................................................................................36AFF: Non U Recession Now.....................................................................................................................................37AFF: Non U No Fiscal Now......................................................................................................................................38AFF: US Not K/ Global Econ.......................................................................................................................................39AFF: US Not K/ Global Econ.......................................................................................................................................40


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1NC 1/2

A. The economy is low now but recovery is on the horizon.

Robb 6/17/2008 (Greg, Staff Writer, Oh, by the way, the Fed will pause next week MarketWatch Online, http://www.marketwatch.com/news/story/way-fed-hold-next-

week/story.aspx?guid=%7BEFF3F4F9-11BE-43E9-834C-E39070F1827D%7D&print=true&dist=printMidSection )

At the moment, the Fed forecasts that the economy will begin to recover in the second half of this yearand strengthen further in 2009. The Fed also expects inflation to moderate in coming quarters asenergy prices level out. Top Fed officials have expressed comfort with rates where they are. "For now,policy seems well positioned to promote moderate growth and price stability over time," Fed chief BenBernanke said early this month.

B. Alternative energy development is incredibly expensive.

Alternative Energy Online 2007 (Disadvantages of Alternative Energy October 17th

2007)http://www.yourenergyalternitives.com/2007/10/17/disadvantages-of-alternative-energy/

Alternative energy is being studied to power our vehicles along with our homes. Hybrid cars have been inmarket for a while. They dont need to be plugged in to recharge otherwise they use the same idea as anelectric car. They have all of the power of a gasoline engine as they use their braking system to regeneratepower. Newer fuel cell technologies vehicle are currently being designed so as to work along with a hydro-powered hybrid which uses hydrogen. Alternative energy is expensive to incorporate into the already setup infrastructure. Most of the alternative energy resources will require an altogether different type of

wiring system than what people have. This would delay the conversion to alternative energy sources

until we have made adequate arrangements by which time the fossil fuels found on our Earth today

will be long depleted.
http://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.yourenergyalternitives.com/2007/10/17/disadvantages-of-alternative-energy/http://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.marketwatch.com/news/story/way-fed-hold-next-week/story.aspx?guid={EFF3F4F9-11BE-43E9-834C-E39070F1827D}&print=true&dist=printMidSectionhttp://www.yourenergyalternitives.com/2007/10/17/disadvantages-of-alternative-energy/


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1NC 2/2

C. New government spending leads to inflation

Saville 7/8/2008 (Steve, Editor of the Speculative Investor, Government Spending andInflation Safe Haven Online http://www.safehaven.com/article-10688.htm )

That being said, the seeds are being sown for the next round of monetary expansion. Those seeds are thefrenetic calls for increased government spending and other "stimulus packages" to address the economicdownturn, and the virtual certainty that politicians of all stripes will heed these calls. The bonds issued bythe government to finance the additional deficit-spending will lead to more inflation because they will

be purchased by the central bank or private banks with newly-created money . As noted above, anincrease in government spending cannot possibly help. Its likely effect will be to PROLONG thedownturn, but the longer it takes for a sustained recovery to begin the greater the opportunity for the

government to 'fight' the downturn via even more inflation-financed spending.

D. High inflation leads to economic stagnation and recession.

Sailor, Author of India Daily, 07(Tania, India Daily: Higher Inflation, lower short-term rates can push gold to $1500 an ounce but what the longterm prospect of yellow metal?, June 24, http://www.indiadaily.com/editorial/17296.asp, Date Accessed: July 7,2008)

The gold bugs are getting happier every day. The economy is facing stagflation. Stagflation is great forthe gold investor. The stagnating economy puts political pressure on the Fed to lower short-term rates.

But inflation in the economy just pushes gold fundamentally higher. The stagnating economy will also

create far higher budget deficit, which will lower the dollar and raise the price of gold. So gold is a totalwinner isnt it? Well before thinking about the gold homerun, let us analyze a few things. What happens afterstagflation? The inflation actually puts more pressure on the economy. The economy stagnates furtherand finally plunges into recession. With such high budget and trade deficit, if the long-term bond yields

cross the 10% level, it will plunge the economy into depression. Now what happens if economy staysdepressed for more than a quarter? Deflation starts. The inflation changes very fast into deflation. So, ifstagflation continues and get deeper, it will transform into depression accompanied by deflation. It happened

in Japan. The Japanese economy, since the late eighties, stagnated and collapsed into deflation under heavydebt. That shows depression is not needed for deflation to take over the economy. If the world economiesstart experiencing deflation, the gold will eventually collapse. Gold for now is bullish and may rise very high.But eventually as deflation takes over the economy gold will be trading far below it is trading today. There isone catch though. That wild card is dollar. If dollar collapse like pesos, gold will higher. If dollar holds underdeflation, gold will collapse below $300 an ounce.

E.Economic collapse causes extinctionBearden, Director of the Distinguished American Scientists (ADAS), 2000 (Thomas, Fellow Emeritus, AlphaFoundations Institute for Advanced Study (AIAS) Pg. http://www.cheniere.org/techpapers/)

History bears out that desperate nations take desperate actions. Prior to the final economic collapse, thestress on nations will have increased the intensity and number of their conflicts, to the point where the

arsenals ofweapons of mass destruction (WMD) now possessed by some 25 nations, are almost certainto be released. As an example, suppose a starving North Korea {i} launches nuclear weapons upon Japan and

South Korea, including U.S. forces there, in a spasmodic suicidal response. Or suppose a desperate China whose long range nuclear missiles can reach the United States attacks Taiwan. In addition to immediateresponses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict,escalating it significantly. As the studies showed, rapid escalation to full WMD exchange occurs, with agreat percent of the WMD arsenals being unleashed. The resulting great Armageddon will destroycivilization as we know it, andperhaps most ofthe biosphere, at least for many decades
http://www.safehaven.com/article-10688.htmhttp://www.safehaven.com/article-10688.htm


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Uniqueness: Fiscal Discipline High Now

Bush plans to decrease funding to Medicare and Medicaid showing fiscal discipline.

Trapp, writer for the AMNews, 2008

(Doug, Amednews.com, Bush budget cuts hospital funding but silent on Medicare doctor pay, http://www.ama-assn.org/amednews/2008/02/18/gvl10218.htm, 2/18/08, accessed 7/7/08)Washington -- President Bush's fiscal 2009 health budget, with steep Medicare spending cuts as a mainhighlight, sets the stage for a tough fight with Congress in the months ahead.The proposal, part of a wider $3.1 trillion plan, is just the first step in this year's health care budget debate.Health care organizations and congressional Democrats have found a lot not to like. Bush proposesreducing Medicare and Medicaid spending anticipated under current law by $196 billion over five

years, with hospitals as the main target. The plan would do nothing to prevent Medicare physicianpayment cuts.

Proposed budget cuts and money management creates fiscal discipline in the USFG

The Missourian, 2008(Columbiamissourian.com, Missouri Drug program may suffer under Bush budget cuts, 2/18/2008,

http://www.columbiamissourian.com/stories/2008/02/18/missouri-drug-program-may-suffer-under-bush-budget/,accessed 7/7/08)

KANSAS CITY (AP) One of the first major disagreements over President Bushs budget proposal couldhurt Missouris efforts to fight methamphetamine. Missouri, which has had more meth lab seizures than anyother state in the country for more than a decade, depends on money from the Edward Byrne MemorialJustice Assistance Grant Program to fund its drug-fighting efforts. Currently, the state gets almost $9million from the program, with $6.3 million going to state law enforcement and $2.7 million to city andcounty police departments. Last year, the president tried to kill the program. Under his current budgetproposal, the program would get an extra $30 million for 2009, with a total budget of $200 million. Since2002, the programs funding has been cut from $900 million. This years suggested funding is one-third

the amount sought by Missouri Republican Sen. Kit Bond and Iowa Democratic Sen. Tom Harkin.

Bond told The Kansas City Star that the Byrne program is vital and he criticized the budget because itdoes not invest enough money to support our state and local law enforcement in their efforts to protect our

communities from gangs, drugs and violent offenders.


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PAYGO rules will bolster commitment to fiscal restraint now breaking them

Auerbach et al., University of California-Berkeley economics and law professor, 8(Alan J. Auerbach, Jason Furman and William G. Gale, "Facing the Music: The Fiscal Outlook at the End of

the Bush Administration", 5-8-8,http://www.brookings.edu/~/media/Files/rc/papers/2008/0508_tax_gale/0508_tax_gale.pdf, accessed, 7-14-8)Several caveats are worth exploring. First, the budget outlook depends critically on the choices of policy-makers. Congress has recently passed pay-as-you-go rules as part of its respective budget resolution. If

those rules are maintained without significant loopholes or exceptions, the optimistic outcomes in thebaseline projection for the unified budget become more plausible because policymakers would be forced tofind offsets to pay for any tax cuts they chose to extend or for any AMT reform. As a result, the short-termunified budget would be in significantly better shape and the long-run deficit would be reduced .


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The 2008 Budget shows fiscal discipline with government money through budget reforms.

Whitehouse.gov, 2007 (Whitehouse.gov, http://www.whitehouse.gov/infocus/budget/2008/,The Presidents 2008 Budget; Reducing Deficits Each Year and Balancing the Budget by 2012,

7/12/207, accessed 7/7/2008)The Presidents FY2008 Budget reduces the deficit each year and reaches a balanced budget within fiveyears. A strong economy and better spending restraint will help us achieve this goal, while continuing

to invest in the Nations prosperity and security. Keeping the Economy Strong * The Budget makestax relief permanent to ensure our strong economic growth continues. * Since the Presidents tax

relief took effect, increased innovation and investment has created more than 7 million new jobs, and

helped boost wages. * Pro-growth polices that focus on providing quality education, affordable healthcare, energy security, and making Americans more competitive will sustain economic growth and prosperityfor future generations of all Americans. Spending Taxpayers Dollars Wisely * The Budget holds thegrowth in non-security discretionary spending to one percent, well below the rate of inflation. *

Budget reforms, including comprehensive earmark reform and a legislative line-item veto, will help

eliminate wasteful and unnecessary spending. * Sensible reforms are needed to slow the

unsustainable growth of entitlement spending. Combating Terrorism and Protecting the Homeland *

The Budget supports our troops fighting terrorism, strengthens our military for the future, supports our effortson the diplomatic front and protects our homeland from attack. * This Budget improves the timeliness andspecificity of the information provided to Congress and the American public about the cost of the war. * Itshows the full cost of the war through the rest of the Presidents term and also provides detailedjustifications.


7/41


Uniqueness: Economy Stable Now

Despite market distortions the US economy is on the upswing, but massive new funding will

push it over the edge.

Kalestky 7/14/2008(Anatole, is ajournalist and economist based in the United Kingdom.

He is Principal Economic Commentator and Associate Editor ofThe Times of London Wehave financial, not economic, problems The Times Online)

http://business.timesonline.co.uk/tol/business/columnists/article4327589.eceWhile Wall Street has gone into meltdown since the beginning of June, conditions in the real economy

have been unambiguously improving. The latest employment figures, published two weeks ago, confirmedthat economic conditions had stabilised after their sharp deterioration in the winter, while purchasingmanagers' surveys, the most reliable indicator of very recent economic trends, suggested a continuation of themodest but clear improvement that began in April. Sales figures from leading retailers were muchstronger than expected, showing that tax rebates designed to provide a shot of financial adrenaline to all butthe richest US households were doing exactly what the doctor ordered - offsetting the depressing effect onconsumption of the credit crunch and the housing slump. As a result, consumer confidence, although anunreliable and lagging indicator, showed its first improvement for six months . Even the figures on homesales have now been near-stable for four consecutive months, after almost a year of vertiginous falls. Mostimportant of all, the monthly trade figures, published on Friday in the midst of the Wall Street meltdown,proved that the remarkably adaptable US economy was responding to the credit crunch exactly as the

optimists had hoped - by undertaking an immense structural shift from consumer and housing-led growth togrowth powered by exports. The narrowing of the US trade deficit, despite the biggest monthly increaseon record in the cost of oil imports, almost guarantees that the second-quarter GDP figures , due to bepublished two weeks from now, will show the US economy accelerating from the stagnant conditions ofthe past two quarters to a near-normal rate of 2.5 or even 3 per cent growth
http://en.wikipedia.org/wiki/Journalisthttp://en.wikipedia.org/wiki/Economisthttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/The_Timeshttp://en.wikipedia.org/wiki/Journalisthttp://en.wikipedia.org/wiki/Economisthttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/The_Times


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Link: Government Spending

Government spending spikes inflation rates

McGraw Hill Companies, Global Publishing Company, 08(McGraw Hill Companies, EconExplorer Chapter 11: What Causes Inflation?,

http://www.dushkin.com/connectext/econ/ch11/inflation.mhtml, Date Accessed: July 8, 2008)

The most common cause of inflation is too much money chasing too few goods. If everybody had 5 timesas much money but the amount of goods and services produced remained the same, prices would naturallyrise by a factor of 5. So the answer to avoiding inflation is simply to avoid printing too much money. Easiersaid than done.Government leaders like to spend a lot of money on military equipment, roads, subsidies, buildingprojects, etc., because this keeps them popular with their constituents. But getting money to pay for thesethings is often difficult. Raising taxes is as unpopular as government spending is popular. One alternative isto borrow the money, but sooner or later you have to pay it back. Probably the easiest way to pay for thosepopular government spending programs is to "print" some more money.As we saw in chapter 10, in most countries the money supplied is controlled by a central bank. In the UnitedStates, Japan, Switzerland, and Europe the central banks are independent of government control, and the

government cannot force the banks to create more money to pay for its reckless spending . In manyLatin American and other developing countries, the government controls the central bank and can force it tocough up new money so it can pay for whatever it wants. The result? In the past these countries have hadinflation rates of a hundred to over a thousand percent a year!

Every couple of years, someone in the Congress or the Senate introduces a bill to take the control of the

nation's money supply away from the Fed and put it under the control of elected representatives . Theargument is that elected officials are accountable to the public, and the public should have some say insomething as important as the money supply.


9/41


Link: Research and Development

Research and Development is expensive.Science and Engineering Indicators 2008 Tuesday, July08, 2008http://www.nsf.gov/statistics/seind08/c4/c4h.htm#c4h4

In the president's 2008 budget submission, the federal government is slated to set aside $138 billion forR&D, amounting to 12.8% of its discretionary budget. Federal agencies are expected to obligate $113billion for R&D support in FY 2008. The seven largest R&Dfunding agencies (each with expected R&Dobligations of more than $1 billion) account for 96% of total federal R&D. Defense-related R&D dominatesthe federal R&D portfolio. The largest R&D activity in the FY 2008 budget is defense, with a proposedbudget authority of more than $82 billion (mostly on development), or about 60% of the entire federalR&D budget ($138 billion). In FY 2008, the Department of Defense (DOD) requested a research,development, testing, and evaluation budget of $78 billion . Health accounts for the largest share ofnondefense R&D support; 52% of the proposed FY 2008 nondefense R&D budget was for health-relatedprograms

The House denies energy research and development projects due to risk of unnecessary

spending.Executive Office Of The President Office Of Management And Budget June 13, 2007http://www.whitehouse.gov/omb/legislative/sap/110-1/hr2641sap-h.pdf Date Accessed: July 8, 2008

The Administration strongly opposes H.R. 2641 because, in combination with the other FY 2008appropriations bills, it includes an irresponsible and excessive level of spending and includes other

objectionable provisions. The President has proposed a responsible plan for a balanced budget by 2012through spending restraint and without raising taxes. To achieve this important goal, the Administrationsupports a responsible discretionary spending total of not more than $933 billion in FY 2008 , which is a$60 billion increase over the FY 2007 enacted level. The Democratic Budget Resolution and subsequentspending allocations adopted by the House Appropriations Committee exceed the Presidents

discretionary spending topline by $22 billion, causing a 9 percent increase in FY 2008 discretionary

spending and a nearly 10 percent increase in the projected deficit for FY 2008. In addition, theAdministration opposes the House Appropriations Committees plan to shift $3.5 billion from the Defense

appropriations bill to non-defense spending, which is inconsistent with the Democrats Budget Resolutionand risks diminishing Americas war fighting capacity. In combination with other spending bills, H.R. 2641would lead to spending and tax increases that put economic growth and a balanced budget at risk. [NOTE: H.R. 2641= ENERGY AND WATER DEVELOPMENT AND RELATED AGENCIESAPPROPRIATIONS ACT, 2008][NOTE: THE ADMINISTRATION = HOUSE]

http://www.whitehouse.gov/omb/legislative/sap/110-1/hr2641sap-h.pdf
http://www.whitehouse.gov/omb/legislative/sap/110-1/hr2641sap-h.pdfhttp://www.whitehouse.gov/omb/legislative/sap/110-1/hr2641sap-h.pdf


10/41


Link: Low Priority Programs

( ) Cutting low priority programs is necessary to offset the economic effects of other

projects.DRG/C51 Ronald D. Utt, Ph. D. Herbert and Joyce Morgan Senior Research Fellow, Heritage Foundation,

CONGRESS FACES PRESSURE TO SURRENDER PORK FOR FLOOD RELIEF, September 15, 2005, p.http://www.heritage.org/Research/Budget/wm841.cfm accessed 5/19/06.

Shortly after Hurricane Katrina struck, it became apparent that the vast scope of devastation would requirea costly federal relief effort to supplement the hundreds of millions of dollars already raised

voluntarily from ordinary citizens. Heritage Foundation analysts suggested that some or all of thefunding should come from offsets in lower-priority federal spending programs that could be eliminated

or postponed. In particular, we recommended that the $25 billion of pork-barrel spending recently approvedin the highway reauthorization bill (H.R. 3) be redirected to reconstruct damaged infrastructure in the hard-hit Gulf Coast communities.

( ) Spending on low priority projects hurts the economy.DRG/C52 Veronique de Rugy, Research Fellow, American Enterprise Institute, HURRICANE RELIEFSPENDING, September 12, 2005, p. http://www.aei.org/publications/filter.all,pubID.23186/pub_detail.asp accessed

5/19/06.

Like millions of Americans who have made personal sacrifices to help the survivors of Katrina'sdevastations, the President and Congress should make a sacrifice of their own. They must cut low priorityspending and wasteful programs to offset the new hurricane relief spending increase. Failing to do so

would impose excessive costs on the American economy. Being compassionate should not preventlawmakers from being responsible leaders.

Cutting low priorities offsets economic burdens.

De Rugy, Research Fellow, and Bate, Resident Fellow, 2005 (Veronique, and Roger, American EnterpriseInstitute, HURRICANE RELIEF SPENDING, December 2, 2005,http://www.aei.org/publications/pubID.23517,filter.economic/pub_detail.asp accesed 5/19/06.)

Following the devastating hurricane and flooding in the Gulf region, President Bush sent Congress twoseparate requests in hurricane relief, which the House and the Senate passed without delay. They raiseKatrina's cost to federal taxpayers to $62.3 billion so far. This of course is on top to the billions of dollarsprivate citizens have donated to come to the rescue of the victims of the hurricane. Now, members ofCongress must make a sacrifice of their own and cut low priority spending and wasteful programs--

such as broken international aid programs--to offset the new financial burden our nation faces.


11/41


Link: Solar Space Power

High costs and lack of compatible large-scale systems make space solar power unprofitable

Smith, the President, Long Island Space Society, 03(Arthur, Space Daily: Your Portal to Space, The Case For Space Based Solar Power Development Aug 11, 2003,

http://www.spacedaily.com/news/ssp-03b.html, Date Accessed: 7-6-08)

Worldwide over a trillion dollars a year goes to the energy industry, and utilities routinely construct multi-billion-dollar power plants. The energy industry has a bigger wallet than the entire US federal discretionarybudget. Money is not directly the problem here; profitability is. The two essential factors in the costequation are the cost per delivered Watt of the solar power components, and the cost per delivered Watt ofgetting those components to their final destination in space. Current costs put the capital investment neededfor a space solar power system well above the $2/Watt of competitive terrestrial options such as fission plantsand wind turbines. R&D work is needed to bring these costs to where the vast energy resources of spaceare within reach of a large utility project. The cost of components is the first problem here . Currentprices forsolar electricpower systems are about $2.50 per peak Watt, a price that has been declining about7% per year for the last few decades. The day/night cycle, non-ideal sun angles, weathering, and cloud coverreduce power output enough to make the final cost per average Watt $10 or more. Terrestrial solar power is

still too expensive for wholesale utility use, but it is now competitive for home owner installation in manyareas. In space you can get peak power almost all the time. The $2.50/Watt homeowner systems are notspace-rated, but the space market is still small; with a larger market suitable photovoltaic elements couldbe produced at comparable cost. Transmitting power from space will have somewhat higher losses thantransmitting from a terrestrial power plant.[NOTE: R&D = Research and Development]

High transportation costs discourage investment in Space Solar Power projects

Zwaniecki, Bureau of International Information Programs writer, 07(Andrzej, America.gov, Space Solar Energy Has Future, U.S. Researchers SaySmall Demonstration Project Could Help Justify Further Research August 20, 2007,http://www.america.gov/st/washfile-english/2007/August/20070820153255saikceinawz0.864773.html, DateAccessed: 7-6-08)

Martin Hoffert, former chair of the Department of Applied Sciences at New York University, told members ofthe Capitol Hill Club in August that space solar power research and development can proceed with existingtechnologies. But the potential costs remain high, discouraging entrepreneurs and the government frominvesting in it. The major expense -- transporting equipment and materials into orbit aboard a spaceshuttle -- is $20,000 per kilogram of payload, or the carrying capacity of a space vehicle. Proponents of

space solar power believe the project would become viable economically if the payload cost could be

reduced to below $200 per kilogram, and the total expense of delivery and robotic assembly on orbit

could be brought below $3,500 per kilogram. That is not likely to happen any time soon and a reusable

launch vehicle, needed to reduce costs drastically, eventually would require government investment ,Mankins said. He said, however, that a small-scale demonstration project of the space solar power conceptcould help convince skeptics and provide a strong political justification for such an investment.
http://www.spacedaily.com/news/ssp-03b.htmlhttp://www.spacedaily.com/news/ssp-03b.htmlhttp://www.spacedaily.com/news/ssp-03b.html


12/41


Link: Ethanol Development

( ) Most facts about ethanol are fallacies - ethanol is extremely expensive to manufacture.

Taylor, CATO Senior Fellow, and Van Doren, CATO Senior Fellow, 2007. (Jerry and Peter, CATO Institute, "Ethanol Makes Gasoline Costlier, Dirtier", January 27, 2007,

http://www.cato.org/pub_display.php?pub_id=7308, Date Accessed: July 6, 2008)

In his State of the Union address, PresidentBush spoke a lot about energy independence andalternative energy sources such as ethanol.According to the president, ethanol is the magical elixirthat will solve virtually every economic, environmental, and foreign policy problem on the horizon. In

reality, it's enormously expensive and wasteful.Untruths and misconceptions about ethanol include:Ethanol will lead to energy independence. If all the corn produced in America last year were dedicated to ethanolproduction (14.3 percent of it was), U.S. gasoline consumption would drop by 12 percent. For corn ethanol tocompletely displace gasoline consumption in this country, we would need to appropriate all U.S. cropland,turn it completely over to corn-ethanol production, and then find 20 percent more land for cultivation on topof that. The U.S. Energy Information Administration believes that the practical limit for domestic ethanolproduction is about 700,000 barrels per day, a figure they don't think is realistic until 2030. That translates toabout 6 percent of the U.S. transportation fuels market in 2030. Ethanol is economically competitive now.

According to a 2005 report issued by the Agriculture Department, corn ethanol costs anaverage of $2.53 to produce, or several times what it costs to produce a gallon of gasoline.

Without the subsidies, costs would be higher still. A study last fall from the International

Institute for Sustainable Development found that ethanol subsidies amount to $1.05-$1.38 per

gallon, or 42 percent to 55 percent of ethanol's wholesale market price.

( ) Ethanol has many hidden costs that just doesn't make it worth the expenses

Greenberg, MarketWatch Senior Columnist, 2008.(Herb, MarketWatch, "Corn Field Folly for Pacific Ethanol", March 18, 2008,http://blogs.marketwatch.com/greenberg/2008/03/corn-field-folly-at-pacific-ethanol/, Date Accessed: July 6, 2008)

Turns out, according to an NT-10-K SEC filing: There was an unauthorized deviation of $3.9

million was taken from the companys credit line for the purpose of optimizing our cashposition. (In other words, they robbed Peter to pay Paul.) Unfortunately, by doing that, the company

created an automatic violation of a number of loan covenants. Meanwhile, another $3.4

million earmarked for a debt service account related to the construction of two plants never

arrived at their designated destination, resulting in an automatic default of the credit

agreement. Oh, and according to that credit agreement, the company can only have seven Eurodollar loansoutstanding. It has eight. Oops. The company says its hoping to get a waiver from its lenders. If it cant, itsays its auditors will have to formally question the companys status as a going concern. But wait, theresmore: Thanks to loopy ethanol economics, the company says it expects to report that revenue last quarter

rose 62% to $130.4 million. However (and this is where it gets to be a real bummer), its gross profit

margin slumped to 1.3% from 14.6% a year earlier as its loss ballooned to $14.7 million from

$3.1 million. Oh, and almost forgot: The company said the loss includes a non-cash expense of

about $4.4 million from interest rate derivatives related to future periods and approximately$2 million from write-downs of deferred financing fees associated with the companys

suspension of construction of a plant in California.


13/41


Link: Ethanol Development

( ) More ethanol plans will push us off the brink -- recent skyrocketing prices of corn and

foreign markets have been caused because of conversion to ethanol

Miller, Hoover Institution Research Fellow and Physician, and Carter, UC Davis

Agricultural and Resource Economics Professor, 2007.(Henry and Colin, Los Angeles Times: "Why Ethanol Backfires", May 17, 2008,http://articles.latimes.com/2007/may/17/opinion/oe-miller17, Date Accessed: July 6, 2008)

President Bush has set a target of replacing 15% of domestic gasoline use with biofuels (ethanol

and biodiesel) over the next 10 years, which would require almost a fivefold increase

in mandatory biofuel use, to about 35 billion gallons. With current technology, almost all of this

biofuel would have to come from corn because there is no feasible alternative. However, achieving the

15% goal would require the entire current U.S. corn crop, which represents a whopping 40%

of the worlds corn supply. This would do more than create mere market distortions; the

irresistible pressure to divert corn from food to fuel would create unprecedented turmoil.

Thus, it is no surprise that the price of corn has doubled in the last year from $2 to $4 a

bushel. We are already seeing upward pressure on food prices as the demand for ethanolboosts the demand for corn. Until the recent ethanol boom, more than 60% of the annual U.S.

corn harvest was fed domestically to cattle, hogs and chickens or used in food or beverages.

Thousands of food items contain corn or corn byproducts. In Mexico, where corn is a staple

food, the price of tortillas has skyrocketed because U.S. corn has been diverted to

ethanol production.

( ) US corn is 60% more costly than some areas of the world -- adapting to ethanol would take achunk out of our economyLuhnow, Wall Street Journal, Latin America Deputy Bureau Chief, 2006.(David, The Wall Street Journal, As Brazil Fills Up on Ethanol, It Weans Off Energy Imports,January 16,2008, http://yaleglobal.yale.edu/display.article?id=6817, Date Accessed: July 6, 2008)

The most recent U.S. energy bill, signed into law in August, calls for more than doubling ethanol

use by 2012. But U.S. ethanol, which is made from corn, costs at least 30% more than Brazil's

product, in part because the starch in corn must be first turned into sugar before being

distilled into alcohol. It may take the U.S. a few more decades to bring the cost of ethanol

down to 80 cents a gallon -- equivalent to Brazil's most efficient producers -- according to the U.S.

Department of Energy. U.S. trade barriers make Brazilian ethanol and its sugar expensive to

buy.


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15/41


Link: Coal to Liquid

The coal industry needs more than a $10 billion subsidy to establish coal to liquid plantsMontague, Environmental Research Foundation director, 2007

(Peter, Rachels Democracy & Health News, The Coal Industry is Deep in Trouble, September 20, 2007,

http://www.rachel.org/lib/07/prn_coal_news.070920.htm Date Accessed: July 6, 2008)

Last week Alan Greenspan, the nation's financial elder statesman, acknowledged that the Iraq war "is largelyabout oil." Big Coal is hoping instability in the Middle East will spook Congress into a $10 billion subsidyfor 10 or more coal-to-liquid (CTL) plants, to make diesel fuel from coal instead of from oil. Coal-to-liquid (CTL) is Big Coal's best hope for remaining viable, but the chances of success grow dimmereachpassing day.

The $211 billion investment needed to replace 10% of current gasoline makes Wall Street

investors nervous and unwilling to invest in the production of coal to liquid plantsMontague, Environmental Research Foundation director, 2007

(Peter, Rachels Democracy & Health News, The Coal Industry is Deep in Trouble, September 20, 2008,http://www.rachel.org/lib/07/prn_coal_news.070920.htm Date Accessed: July 6, 2008)

CTL plants are expensive. The industry estimates that building an 80,000-barrel-per-day coal-to-

liquids refinery would cost $7 to $9 billion, compared with less than $2 billion to build a similar-size

petroleum refinery. Despite endless lip service to "free markets," Wall Street investors are not going togamble such large sums without a substantial return guaranteed by the government. Long-term contracts tosell expensive fuel to the Air Force is what the CTL industry has in mind. Presently the Air Force isprohibited from making contracts longer than 5 years-- so Congress would have to extend that to at least 20years (and then come up with additional subsidies, loan guarantees, and price supports) to kick-start the CTLindustry. In Congress, it is Democrats who are most keen to subsidize the CTL industry, the New York Timesreports. A massive study of the coal-to-liquids, released by a team at M.I.T. last March [7 Mbytes PDF]estimated that it would take an investment of at least $70 billion to build enough plants to replace 10

percent of American gasoline consumption. And the M.I.T. team pointed outthat past cost estimates of CTLplants have been "wildly optimistic." All this makes Wall Street investors nervous. They don't want more

blather about free markets. They want substantial gains guaranteed by government. Virginia is a coalstate, but a June 5 editorialin the Roanoke Times, titled, "Billion-Dollar Boondoggle" said, "The NationalCoal Council, an industry-laden advisory board, painted an even bleaker picture. It estimated that a $211billion investment would be needed over the next 20 years to replace 10 percent of current gasoline

usage.

[CTL = coal to liquid]
http://www.precaution.org/lib/greenspan_says_oil_caused_iraq_war.070916.htmhttp://www.precaution.org/lib/greenspan_says_oil_caused_iraq_war.070916.htmhttp://www.precaution.org/lib/ctl_faces_uphill_battle.070819.htmhttp://www.precaution.org/lib/ctl_faces_uphill_battle.070819.htmhttp://www.precaution.org/lib/big_coal_seeks_military_support.070911.htmhttp://www.precaution.org/lib/big_coal_seeks_military_support.070911.htmhttp://www.precaution.org/lib/democrats_favor_loans_for_coal.070613.htmhttp://www.precaution.org/lib/democrats_favor_loans_for_coal.070613.htmhttp://www.precaution.org/lib/lawmakers_favor_ctl.070529.htmhttp://www.precaution.org/lib/lawmakers_favor_ctl.070529.htmhttp://www.precaution.org/lib/the_future_of_coal_mit.070614.pdfhttp://www.precaution.org/lib/the_future_of_coal_mit.070614.pdfhttp://www.precaution.org/lib/billion-dollar_boondoggle.070605.htmhttp://www.precaution.org/lib/billion-dollar_boondoggle.070605.htmhttp://www.precaution.org/lib/greenspan_says_oil_caused_iraq_war.070916.htmhttp://www.precaution.org/lib/greenspan_says_oil_caused_iraq_war.070916.htmhttp://www.precaution.org/lib/ctl_faces_uphill_battle.070819.htmhttp://www.precaution.org/lib/big_coal_seeks_military_support.070911.htmhttp://www.precaution.org/lib/democrats_favor_loans_for_coal.070613.htmhttp://www.precaution.org/lib/lawmakers_favor_ctl.070529.htmhttp://www.precaution.org/lib/the_future_of_coal_mit.070614.pdfhttp://www.precaution.org/lib/billion-dollar_boondoggle.070605.htm


16/41


Link: Cap and Trade

The new taxes from a cap and trade system could cripple the nations economy.

Fordney, Energy Daily Correspondent, 8(Jason, Global Power Report, Cap-and-Trade System for Carbon is a Tantamount to Tax: MidAmerican Chairman,

February 21, 2008, http://construction.ecnext.com/coms2/summary_0249-273257_ITM_platts, Date Accessed: July6, 2008)

Implementing a national carbon cap-and-trade system without new technology to implement it is

nothing more than a tax that could cripple the nation's economy if not done wisely, MidAmericanHoldings Chairman and CEO David Sokol said February 19. "Early implementation of a cap-and-tradesystem needs to be called what it is: It's a tax," Sokol told attendees at the National Association of

Regulatory Utility Commissioners meeting in Washington, adding that cap and trade, "without

providing for a technology period, would be a mistake." Sokol helped steer the company from anowner/operator of one geothermal plant in 1991 into a company with 17,000 employees and annual revenuesof $12.4 billion. It was acquired by a partnership controlled by Berkshire Hathaway in 2000. This weekSokol warned of the effects of the bill proposed by Senator Joseph Lieberman, an Independent Democratfrom Connecticut, and Senator John Warner, a Virginia Republican, saying that without new technology the

bill's goals are unrealistic.[NOTE: David Sokol MidAmerican Holdings Chairman and CEO]

Cap-and-trade exacerbates current economic problems, we wont see immediate warming

solvency

Carroll, Foundry Editor, 2008(Conn, The Heritage Foundation Online, Morning Bell: Economics 101, 5-13-08,http://blog.heritage.org/2008/05/13/morning-bell-economics-101/, Date Accessed: 7-6-08)

Trillions in new taxes, trillions lost in GDP and a huge global trade war . These are the costs of aLieberman-Warner cap-and-trade style approach to global warming . And for what? Even if the U.S.meets Kyotos ambitious goals, the Earths surface temperaturewould be reduced by an imperceptible

0.14F per 50 years. You dont need an economist to tell you this is a bad deal for the United States.
http://www.indiancountry.com/content.cfm?id=1096417367http://www.indiancountry.com/content.cfm?id=1096417367http://www.indiancountry.com/content.cfm?id=1096417367http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/http://www.indiancountry.com/content.cfm?id=1096417367http://www.indiancountry.com/content.cfm?id=1096417367http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/http://blog.heritage.org/2008/02/07/morning-bell-avoiding-our-own-cap-and-trade-calamity/


17/41


Link: Nuclear Power

Building just one nuclear power plant costs ten billion dollars.

Hughes, Citizen Power executive director, 99.(David, Post-Gazette News [Pittsburgh Post-Gazette], Nuclear Power- Unsafe, Dirty, and Expensive, March 28,

1999, http://www.post-gazette.com/forum/19990328edhughes7.asp, Date Accessed: 7/5/08)

You may remember when we were told that nuclear power would be "too cheap to meter." Well, it is not. Infact, nuclear is one of the most expensive ways to produce electricity. When nuclear proponents providetheir figure of what nuclear cost to produce electricity they often leave out the cost ofbuilding the plant.Indeed, it was the high cost ($10 billion) to build the Perry 1 and Beaver Valley 2 nuclear plants that nowcause Duquesne Light customers to have to pay some of the highest rates in the country. And, it is the highcost of nuclear plants that accounts for most of the "transition" charge on your new electric bill, no matterwho supplies your generation. A gas-fired plant can be built for $350 per kilowatt (kW); wind turbines arebeing installed at less than $1,000/kw. A nuclear plant costs $3,000 to $4,000 per kw to build. Nuclear fuelis relatively cheap compared to other fuels, but only if you ignore spent fuel permanent storage costs. Whenthese and plant decommissioning costs are included, nuclear power is prohibitively more expensive, on atotal cost basis, than other energy sources. Even nuclear power advocates are frightened by the prospect

that these costs will be astronomical.

An influx of nuclear energy projects will cost billions more than previously expected.Loder, St. Petersburg Times Staff Writer, 7.(Asjylyn, Nuclear Power Costs Surge, St. Petersburg Times, December 12, 2007,http://www.sptimes.com/2007/12/12/State/Nuclear_power_costs_s.shtml, Date Accessed: 7/5/08)

Nuclear energy - billed as the cheap, carbon-free energy source of the future - isn't sounding so cheapanymore. In fact, the price for a new nuclear plant has soared as the rush to construct nearly 30 facilitiesacross the country over the next 15 years has pushed up the cost of labor, raw materials and possibly even theplants themselves. New industry estimates double and even triple prices quoted a year ago by utilitiesthroughout the Southeast, including those for Progress Energy Florida's planned nuclear plant in LevyCounty. Based on cost estimates for other nuke plants and analyst reports, Progress Energy's costs could

balloon to more than $10-billion, farmore than early estimates of $4-billion to $6-billion.


18/41


Internal Link: Deficit Spending

A perception of large, sustained budget deficits threatens the economy

Gale, Senior Fellow of Economic Studies at Brookings, 04

(William, The U.S. Budget Deficit: An Unsustainable Path, December,http://www.brookings.edu/views/articles/20041201orszaggale.pdf, Date Accessed: July 7, 2008)

The negative consequences of sustained large deficits may be larger and occur more suddenly than this typeof traditional analysis suggests, however. Chronic, substantial deficits can cause a fundamental shift inmarket expectations and a related loss of confidence both at home and abroad. The scale of the long-

term fiscal gap is so large that, if left uncorrected, the nation faces a real risk of a fiscal crisis.

Deficits slow down the economy with lowered family incomes and loss of productivity

Rivlin, Senior Fellow in Economic Studies program at Brookings, 04(Alice, director of Greater Washington Research Program & founding director of the Congressional Budget Office,Growing Deficits and Why they Matter, 2004,http://www.brookings.edu/es/research/projects/budget/fiscalsanity/chapter1.pdf, Date Accessed: July 7, 2008)

Our colleague Charles Schultze once likened deficits not to the wolf at the door, but to termites in thewoodwork. By this he meant that deficits gradually weaken the ability of workers to produce goods andservices, thereby constraining wage increases and the growth of family incomes. Wage increases

depend on how fast worker productivity grows. A major key to productivity growth, in turn, is

investment in expanded business facilities and know-howeverything from robotics on the factory

floor to a computer on every desk. But when governments run deficits, they must compete with

businesses for scarce financial capital, driving up its cost or reducing its availability to the private sector.8Just how much damage currently projected deficits will do depends on several assumptions, such as howmuch money we are able to borrow from abroad. But a conservative estimate is that a $5.3 trillionaccumulation of additional debt over the next ten years would reduce national income by $212 billionannually at the end of the period. This translates into about $1,800 less annual income for the average

household than they otherwise would have earned.9


19/41


Internal Link: Deficit Spending/Fiscal

Fiscal Discipline Key to EconDeficit spending

Fraser 06 (The real worry about U.S. budget policy? Spending Alison Acosta Fraser Director of the Thomas A.Roe Institute for Economic Policy Studies. August 19, 2006, accessed 07/03/07

http://www.heritage.org/Press/Commentary/ed081906a.cfm)But what about spending? This is where the single-minded focus on the deficit becomes a problem. The goodnews is unexpected revenue growth overshadowed the bad news of persistent spending growth.Federal spending has grown 45 percent since 2001, 8 percent this year alone. Not just for defense, but forthings like the Rock and Roll Hall of Fame and Museum, an indoor tropical rain forest in Iowa, and hugesubsidies to farmers to not grow crops.When George W. Bush took office, spending was 18.4 percent of GDP. By the end of this year it will reach20.3 percent. While his strong tax policy has helped the economy, his spending policies have not. Ifpolicymakers had reined in spending to grow at the same rate as the economy, they would have

virtually eliminated the deficit by now.

The real worry about Washington's budget policy is spending. As baby boomers start to retire, thebudget will spiral out of sight, fueled by Social Security, Medicare and Medicaid. That comes on top ofrecent spending growth. By reasonable accounts, the budget could reach 50 percent of GDP by 2050 - and

continue to grow after that. The deficits and spending levels of today don't foretell the harm this willbring. However, the stagnant economies of Europe, complete with high tax-and-spend welfare policies andsoaring unemployment, do.To be sure, pro-growth tax policies are working. As a pleasant distraction, they are also driving down thedeficit, masking the effect of high spending. But don't be fooled by all this crowing about reducing thedeficit. Washington shouldn't rest on its deficit-reduction laurels.

Deficits Bad- Recession

Colburn 06(Why Deficits Matter Melanie Colburn, Economics Commentator June 5, 2006 Mother JonesMagazine http://motherjones.com/commentary/columns/2006/06/deficit_worries.html?welcome=true)

In general, deficits can hamper future economic growth by ensuring that a bulk of future wealth will be

dedicated to paying back loans. Sustained deficits can also drive up interest rates and divert funds awayfrom private investment.In theory, Americans care about the national deficit, but most consumers are seeing benefits from all thisborrowing now, and they won't see the downsides until long in the future. Asian governments continue toborrow billions of dollars from the federal government in order to keep the dollar artificially high, floodingthe United States with cheap imports that benefit consumers. That buying spree has also kept interest ratesartificially low, helping to fuel the current economic boom. At present, the people who benefit from thissystem have very little incentive to change it, and every reason to push the associated problems onto futuregenerations.At some point the debt will become unsustainable , but it's tough to pin down exactly where that point ofno return is. If foreign central banks started worrying about the United States' ability to repay itsobligations, and began to sell or even buy fewer dollar-denominated assets, it could lead to a run on thedollar, which would force up interest rates and potentially put the U.S. economy into a recession. Among

economists, a debate continues to rage over how painful the correction to the current account deficit may be,but a rare consensus is emerging that the fiscal and current account deficits are unsettling and demand somesort of response.
http://www.heritage.org/Press/Commentary/ed081906a.cfmhttp://www.heritage.org/Press/Commentary/ed081906a.cfm


20/41


Internal Link: Fiscal Discipline K/ Econ

Fiscal Discipline Key to Economy

Levy 06( Fed Rate Hikes, Protectionism, Weaker Dollar Pose Threats To Economy, Bank of America EconomistSays Mickey Levy, chief economist at Bank of America Jul 6, 2006

http://www.wral.com/business/local_tech_wire/opinion/story/1168396/)The high U.S. budget deficits are a primary source of low national saving, and fiscal policy reformwould play a crucial role in reducing the current account deficit . I am mostly concerned with the hugelong-run budget imbalances that reflect the unfunded liabilities for Social Security, Medicare and

Medicaid, which in terms of magnitude overwhelm near-term budget deficits.It is imperative to adjustfuture benefit structures for social security and retirement programs to make them affordable for futuregenerations and fair for the elderly. Reform of Medicare and Medicaid necessarily will involve theintroduction of incentives that influence the supply of and demand for medical services.It is important to emphasize that the primary objective of such fiscal reform efforts should be to fix U.S.government finances to make them conducive to maximum sustainable economic growth.Efforts to reduce the current account deficit without regard to how changes in the structure of theunderlying tax and spending programs would affect economic performance are unwise and could generateunintended economic side effects.


21/41


Internal Link: US Econ K/ Global

A U.S. economic collapse will destroy the global economy

Mead, Senior Fellow at the Council on Foreign Relations, 04 (Walter Russell, Foreign Policy,April 1, pg. Lexis)

Similarly, in the last 60 years, as foreigners have acquired a greater value in the United States--government andprivate bonds, direct and portfolio private investments--more and more of them have acquired an interest inmaintaining the strength of the U.S.-led system. A collapse of the U.S. economy and the ruin of the dollar woulddo more than dent the prosperity of the United States. Without their best customer, countries including China

and Japan would fall into depressions. The financial strength of every country would be severely shaken

should the United States collapse. Under those circumstances, debt becomes a strength, not a weakness, and othercountries fear to break with the United States because they need its market and own its securities. Of course, pressedtoo far, a large national debt can turn from a source of strength to a crippling liability, and the United States mustcontinue to justify other countries' faith by maintaining its long-term record of meeting its financial obligations. But,like Samson in the temple of the Philistines, a collapsing U.S. economy would inflict enormous, unacceptabledamage on the rest of the world. That is sticky power with a vengeance.THE SUM OF ALL POWERS?

The United States' global economic might is therefore not simply, to use Nye's formulations, hard power thatcompels others or soft power that attracts the rest of the world. Certainly, the U.S. economic system provides theUnited States with the prosperity needed to underwrite its security strategy, but it also encourages other countries toaccept U.S. leadership. U.S. economic might is sticky power.


22/41


23/41


Internal Link: Oil Prices K/ Econ

Oil prices affect the world economy it has been empirically proven

International Energy Agency, 2004(Analysis of the Impact of High Oil Prices on the Global Economy, May,

www.iea.org/Textbase/Papers/2004/High_Oil_Prices.pdf, accessed 7/7/08)

Oil prices still matter to the health of the world economy. Higher oil prices since 1999 partly the result of OPECsupply-management policies contributed to the global economic downturn in 2000-2001 and are dampening thecurrent cyclical upturn: world GDP growth may have been at least half a percentage point higher in the last two orthree years had prices remained at mid-2001 levels. Fears of OPEC supply cuts, political tensions in Venezuela andtight stocks have driven up international crude oil and product prices even further in recent weeks. By March 2004,crude prices were well over $10 per barrel higher than three years before. Current market conditions are moreunstable than normal, in part because of geopolitical uncertainties and because tight product markets notably forgasoline in the United States are reinforcing upward pressures on crude prices. Higher prices are contributing tostubbornly high levels of unemployment and exacerbating budget-deficit problems in many OECD and other oil-importing countries.[Note: OECD means Organization for Economic Cooperation and Development]

A change in oil prices changes the global economy and causes inflation with increased

unemployment.

International Energy Agency, 2004(Analysis of the Impact of High Oil Prices on the Global Economy, May,www.iea.org/Textbase/Papers/2004/High_Oil_Prices.pdf, accessed 7/7/08)

The vulnerability of oil-importing countries to higher oil prices varies markedly depending on the degree to whichthey are net importers and the oil intensity of their economies. According to the results of a quantitative exercisecarried out by the IEA in collaboration with the OECD Economics Department and with the assistance of theInternational Monetary Fund Research Department, a sustained $10 per barrel increase in oil prices from $25 to $35would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. Inflationwould rise by half a percentage point and unemployment would also increase. The OECD imported more than half

its oil needs in 2003 at a cost of over $260 billion 20% more than in 2001. Euro-zone countries, which are highlydependent on oil imports, would suffer most in the short term, their GDP dropping by 0.5% and inflation rising by0.5% in 2004. The United States would suffer the least, with GDP falling by 0.3%, largely because indigenousproduction meets a bigger share of its oil needs Japans GDP would fall 0.4%, with its relatively low oil intensitycompensating to some extent for its almost total dependence on imported oil. In all OECD regions, these losses startto diminish in the following three years as global trade in non-oil goods and services recovers. This analysis assumesconstant exchange rates.[Note: OECD means Organization for Economic Cooperation and Development][Note: IEA means International Energy Agency]


24/41


Internal Link: Oil Prices K/ Econ

Oil prices help determine the global economy and trade.

International Energy Agency, 2004(Analysis of the Impact of High Oil Prices on the Global Economy, May,

www.iea.org/Textbase/Papers/2004/High_Oil_Prices.pdf, accessed 7/7/08)

Oil prices remain an important determinant of global economic performance. Overall, an oil-price increase leads to atransfer of income from importing to exporting countries through a shift in the terms of trade. The magnitude of thedirect effect of a given price increase depends on the share of the cost of oil in national income, the degree ofdependence on imported oil and the ability of end-users to reduce their consumption and switch away from oil. Italso depends on the extent to which gas prices rise in response to an oil-price increase, the gas-intensity of theeconomy and the impact of higher prices on other forms of energy that compete with or, in the case of electricity, aregenerated from oil and gas. Naturally, the bigger the oil-price increase and the longer higher prices are sustained, thebigger the macroeconomic impact. For net oil-exporting countries, a price increase directly increases real nationalincome through higher export earnings, though part of this gain would be later offset by losses from lower demandfor exports generally due to the economic recession suffered by trading partners. Adjustment effects, which resultfrom real wage, price and structural rigidities in the economy, add to the direct income effect. Higher oil prices lead

to inflation, increased input costs, reduced non-oil demand and lower investment in net oil- importing countries. Taxrevenues fall and the budget deficit increases, due to rigidities in government expenditure, which drives interest ratesup. Because of resistance to real declines in wages, an oil price increase typically leads to upward pressure onnominal wage levels. Wage pressures together with reduced demand tend to lead to higher unemployment, at least inthe short term. These effects are greater the more sudden and the more pronounced the price increase and aremagnified by the impact of higher prices on consumer and business confidence.

Oil prices are a macroeconomic variable and affect the global economy as a whole

empirically proven

International Energy Agency, 2004(Analysis of the Impact of High Oil Prices on the Global Economy, May,www.iea.org/Textbase/Papers/2004/High_Oil_Prices.pdf, accessed 7/7/08)

Oil prices remain an important macroeconomic variable: higher prices can still inflict substantial damage onthe economies of oil-importing countries and on the global economy as a whole. The surge in prices in 1999-2000 contributed to the slowdown in global economic activity, international trade and investment in 2000-2001.11 The disappointing pace of recovery since then is at least partly due to rising oil prices: according tothe modeling results, global GDP growth may have been at least half a percentage point higher in the last twoor three years had prices remained at mid-2001 levels. The results of the simulations presented in this papersuggest that further increases in oil prices sustained over the medium term would undermine significantly theprospects for continued global economic recovery. Oil- importing developing countries would generallysuffer the most as their economies are more oil-intensive and less able to weather the financial turmoilwrought by higher oil-import costs


25/41


Internal Link: Electricity Prices K/ Econ

Electricity is essential to the US economy.

Edison Electric Institute, 2006(EEI.org, Straight Answers about Rising Electricity Prices,

www.eei.org/.../electricity_policy/state_and_local_policies/rising_electricity_costs/Straight_Answers.pdf, July 2006,accessed 7/7/06)

Electricity is the lifeblood of the U.S. economy. It powers our homes, offices, and industries; providescommunications, entertainment, and medical services; runs various forms of transportation; and powers an ever-growing array of devices and technologies, including more than 175 million personal computers and a nationalnetwork of more than 200 million cellular phones. Since 1940, the percentage of U.S. energy consumed in electricform has quadrupled! Not only is electricity the most flexible and most controllable form of energy, its versatility isunparalleled. Today the electric industry faces a new challenge. The costs to generate and deliver electricity toAmerican homes, businesses, and industries are now increasingat a time when the nations demand for reliableelectricity continues to grow. Electric utilities make continuous efficiency improvements and are working to containcosts and to keep electricity prices as low as possible. In fact, for many years price of electricity declined in realterms. However, as utilities face increasing costs, rising electricity prices are becoming inevitable throughout the

United States.

High electricity prices have a greater threat to the US economy than gasoline prices.EnergyTechStocks.com, 2008 (U.S. Power Agency Warns High electricity Prices Could Plague America ForYears to Come, June 30, http://energytechstocks.com/wp/?p=1396, accessed 7/8/08)

The FERC assessment, rendered on June 19, is particularly worrisome since sky-high electric rates would appear torepresent an even greater threat to the U.S. economy than high gasoline prices. Thats because electricity is an evenmore pervasive aspect of American economic life than gasoline. Indeed, after the oil shocks of the 1970s, allAmerican business essentially became electrified in order to improve efficiency, meet new environmentalregulations, and minimize exposure to another oil shock.

[Note: FERC means Federal Energy Regulatory Commission]


26/41


Impacts: Nuclear War

Economic collapse causes nuclear war

Lewis, environmental historian, 1998, (Chris H., University of Colorado-Boulder, THE COMING AGEOF SCARCITY, 1998, p. 56)

Most critics would argue, probably correctly, that instead of allowing underdeveloped countries towithdraw from the global economy and undermine the economies of the developed world, the United

States, Europe, Japan, and others will fight neocolonial wars to force these countries to remain within

this collapsing global economy. These neocolonial wars will result in mass death, suffering, and evenregional nuclear wars. If First World countries choose military confrontation and political repression tomaintain the global economy, then we may see mass death and genocide on a global scale that will makethe deaths of World War II pale in comparison. However, these neocolonial wars, fought to maintain thedeveloped nations' economic and political hegemony, will cause the final collapse of our global industrialcivilization. These wars will so damage the complex economic and trading networks and squandermaterial, biological, and energy resources that they will undermine the global economy and its ability tosupport the earth's 6 to 8 billion people. This would be the worst-case scenario for the collapse of

global civilization

Economic collapse causes extinctionBearden, Director of the Distinguished American Scientists (ADAS), 2000 (Thomas, Fellow Emeritus, AlphaFoundations Institute for Advanced Study (AIAS) Pg. http://www.cheniere.org/techpapers/)

History bears out that desperate nations take desperate actions. Prior to the final economic collapse, thestress on nations will have increased the intensity and number of their conflicts, to the point where thearsenals ofweapons of mass destruction (WMD) now possessed by some 25 nations, are almost certain

to be released. As an example, suppose a starving North Korea {ii} launches nuclear weapons upon Japan

and South Korea, including U.S. forces there, in a spasmodic suicidal response. Or suppose a desperate China whose long range nuclear missiles can reach the United States attacks Taiwan. In addition to immediateresponses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict,

escalating it significantly. As the studies showed, rapid escalation to full WMD exchange occurs, with agreat percent of the WMD arsenals being unleashed. The resulting great Armageddon will destroycivilization as we know it, andperhaps most ofthe biosphere, at least for many decades


27/41


Impacts: Nuclear War

Impact US economic decline risks World War III.Mead, Council on Foreign Relations Senior Fellow, 1998 (Walter Russell, Council on Foreign Relations SeniorFellow, August 30, 1998, THE HOUSTON CHRONICLE, p. 1)

The United States and the world are facing what could grow into the greatest threat to world peace in60 years. Forget suicide car bombers and Afghan fanatics. Its the financial markets, not the terroristtraining camps, that pose the biggest immediate threat to world peace. How can this be? Think about themother of all global meltdowns: the Great Depression that started in 1929. U.S. stocks began to collapse inOctober, staged a rally, then the market headed south big time. At the bottom, the Dow Jones IndustrialAverage had lost 90 percent of its value. Wages plummeted, thousands of banks and brokerages wentbankrupt, millions of people lost their jobs. There were similar horror stories worldwide. But the biggestimpact of the Depression on the United States- and on world history- wasnt money. It was blood: WorldWar II, to be exact. The Depression brought Adolf Hitler to power in Germany, undermined the ability ofmoderates to oppose Josef Stalins power in Russia, and convinced the Japanese military that the country hadno choice but to build an Asian empire, even if that meant war with the United States and Britain. Thats thething about depressions. They arent just bad for your 401(k). Let the world economy crash far enough,and the rules change. We stop playing the Price is Right and start up a new round of Saving Private

Ryan.


28/41


Impacts: Disease

Economic collapse would lead to the spread of AIDs, famine, sickness, crime, and cause

global ethnic wars leading to the extinction of civilization.Silk, Professor of Economics at Pace University and Senior Research Fellow, 1993 (Leonard, Professor of

Economics at Pace University and Senior Research Fellow at the Ralph Bunche Institute on the United Nationsat the Graduate Center, City University of New York. "Dangers of slow growth," Foreign Affairs, Wntr v72 n1p167(16).)

In the absence of such shifts of human and capital resources to expanding civilian industries, there arestrong economic pressures on arms-producing nations to maintain high levels of military productionand to sell weapons, both conventional and dual-use nuclear technology, wherever buyers can be

found. Without a revival of national economies and the global economy, the production and proliferation ofweapons will continue, creating more Iraqs, Yugoslavias, Somalias and Cambodias - or worse. Like the GreatDepression, the current economic slump has fanned the fires of nationalist, ethnic and religious hatred aroundthe world. Economic hardship is not the only cause of these social and political pathologies, but itaggravates all of them, and in turn they feed back on economic development. They also undermineefforts to deal with such global problems as environmental pollution, the production and trafficking of

drugs, crime, sickness, famine, AIDS and other plagues. Growth will not solve all those problems by itselfBut economic growth - and growth alone - creates the additional resources that make it possible toachieve such fundamental goals as higher living standards, national and collective security, a healthier

environment, and more liberal and open economies and societies.


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Impacts: China War

US economic decline spreads globally, undermining US leadership and making WMD

conflict with China inevitable

Mead, Senior Fellow at the Council on Foreign Relations, 2004 (Walter Russell Mead, Foreign Policy, 4/1/04 pg.

Lexis)Similarly, in the last 60 years, as foreigners have acquired a greater value in the United States--governmentand private bonds, direct and portfolio private investments--more and more of them have acquired an interestin maintaining the strength of the U.S.-led system. A collapse of the U.S. economy and the ruin of thedollar would do more than dent the prosperity of the United States. Without their best customer,

countries including China and Japan would fall into depressions. The financial strength of every

country would be severely shaken should the United States collapse. Under those circumstances, debtbecomes a strength, not a weakness, and other countries fear to break with the United States because theyneed its market and own its securities. Of course, pressed too far, a large national debt can turn from a sourceof strength to a crippling liability, and the United States must continue to justify other countries' faith bymaintaining its long-term record of meeting its financial obligations. But, like Samson in the temple of thePhilistines, a collapsing U.S. economy would inflict enormous, unacceptable damage on the rest of theworld. That is sticky power with a vengeance. THE SUM OF ALL POWERS? The United States' global

economic might is therefore not simply, to use Nye's formulations, hard power that compels others or softpower that attracts the rest of the world. Certainly, the U.S. economic system provides the United Stateswith the prosperity needed to underwrite its security strategy, but it also encourages other countries to

accept U.S. leadership. U.S. economic might is sticky power.


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AFF: Link Turn Cap and Trade

Cap-and-trade policy generates government money for the research and development of

new technology

Mufson, Washington Post Energy Reporter, 2008

(Steven, Outlook: Fighting Warming Takes Cold Cash, Washington Post, April 21, 2008,http://www.washingtonpost.com/wp-dyn/content/discussion/2008/04/18/DI2008041802549.html, Date Accessed:7/5/08)

"In recent weeks, a number of experts concerned about climate change have called into question the politicalfocus on a federal cap and trade system, saying that the emphasis should instead on clean energy technologydevelopment. I am afraid these comments reveals a deep misunderstanding of the climate legislation pendingin Congress and an ignorance of the market-based and government funding philosophies which the billsembody. The major climate bills-Lieberman-Warner and Bingaman-Specter in particular-explicitly call forputting a price on greenhouse gas emissions to incentivize private sector clean technology developmentand deployment. But the bills also generate tens of billions of dollars per year specifically for

government spending on R&D on new technology, and on other policy mechanisms-grants, tax credits,

and so-to create clean technology and deploy it. Indeed, the cap and trade systems create an "off-budget"

revenue stream for government investment in these critical areas which would like otherwise be hardto find funding for. In short, a cap and trade approach will create a revenue stream to fund

government technology investment-just as was called for in the National Commission on Energy Policyreports in 2004 and 2007. The larger question may be not will we invest enough in clean energy developmentand deployment-but will we be able to spend this money wisely and efficiently. The recent demise ofFutureGen and the Syn-Fuels episode of the 1970s suggest this is easier said than done."


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AFF: Link Turn Nuclear Power

Federal incentives bring down the inflated cost of building nuclear reactors.Totty, Journal Report News Editor, 8.(Michael, The Wall Street Journal, The Case For and Against Nuclear Power, June 30, 2008,

http://online.wsj.com/article/SB121432182593500119.html?mod=googlenews_wsj, Date Accessed: 7/5/08)

So, what's the case against nuclear power? It boils down to two things: economics and safety. Neither holdsup to scrutiny. First, economics. Critics argue that the high cost of building and financing a new plantmakes nuclear power uneconomical when compared with other sources of power. But that's misleadingon a number of levels. One reason it's so expensive at this point is that no new plant has been started inthe U.S. since the last one to begin construction in 1977. Lenders -- uncertain how long any new plantwould take because of political and regulatory delays -- are wary of financing the first new ones. Sofinancing costs are unusually high. As we build more, the timing will be more predictable, andfinancing costs will no doubt come down as lenders become more comfortable. Loan guarantees andotherfederal incentives are needed to get us over this hump. They are not permanent subsidies foruneconomical ventures. Instead, they're limited to the first half dozen of plants as a way to reassure investorsthat regulatory delays won't needlessly hold up construction. It's important to remember that although nuclear

energy has been around a while, it's hardly a "mature" industry, as some critics say. Because of the lack ofnew plants in so many years, nuclear in many ways is more like an emerging technology, and sosubsidies make sense to get it going.


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AFF: Link Turn Ethanol

( ) Despite current ethanol costs, biotech companies are investing in them to lower the cost

Heuser, Boston Globe biotech writer, 2007.(Stephen, Boston Globe, April 30, 2007,

http://www.boston.com/business/technology/articles/2007/04/30/biotech_firms_sprint_to_cut_ethanols_cost/, DateAccessed: July 6, 2008)

Despite the uncertainties, the field has also sparked enthusiasm of investors. Venture

capitalists invested $774 million in biofuels companies in 2006, according to a trade group

called the Cleantech Venture Network. That's a huge leap from the $111 million in 2005.

Down the line, even if the companies get the process right, other obstacles loom. Fewer than 5

percent of American cars sold today can burn ethanol as fuel, according to the National EthanolVehicle Coalition , although the substance is mixed in small quantities into current gasoline. And even peoplewith "flex-fuel" cars, which can take both gasoline and ethanol, are limited by the paucity of stations thatpump it.


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AFF: Link Turn R&D

Research and development of alternative energy techniques are expensive.

McCool 2005 (Jim, Manager of Environmental Science, Economic Incentives for AlternativeEnergy November 5th 2005)

http://www.coolmccool.com/WhitePapers/AlternativeEnergyIncentives.PDFAs incentives provided to energy users encourage them to switch from conventional to alternative sources ofenergy, the increased demand for alternative energy will drive investment in new sources of alternativeenergy. However, development of alternative energy is expensive . When congress failed to renew a taxcredit for wind energy in 2004, new wind farm development came almost to a halt (Tax Credits). Therelationship between tax credits and new wind farm development illustrates the important role of governmentin providing additional incentive for development of new energy sources. Through the use of incentives,the government can lower the high cost of developing and maintaining alternative energy sources,

making this kind of energy more competitive in the market. When Congress delayed renewing the 1.8cents per kwh credit for wind power [] the business tanked until the credit was restored (Carey, et al).Alternative energy production is not yet able to compete without this support


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AFF: Link Turn Alternative Energy

Alternative energy is the main way to get the US economy back on track.

The Washington Times 6/8/2008 (Newt Gingrich, speaker of the House of Representatives

from "1995 until 1998 How to Impose Fiscal Discipline Lexis)

Fourth, the federal government must allow greater energy production in the United States as part of astrategy to lower energy costs. The high cost of energy directly affects the federal budget for two reasons.First, the federal government is the largest single purchaser of energy. Lower energy prices would lowerfederal spending dramatically. Second, selling energy production rights and receiving royalties fromenergy production is a huge potential source of income for the federal as well as state governments.


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AFF: Non U Econ Growth Low

United States economy growth low other projects weighing downAgence France Presse, a global news network covering events from around the world 24/7, 2008(Paulson says US economy enduring 'rough period', July 2 2008, p. Lexis,

http://www.lexisnexis.com/us/lnacademic/results/docview/docview.do?docLinkInd=true&risb=21_T4111190384&format=GNBFI&sort=RELEVANCE&startDocNo=1&resultsUrlKey=29_T4111190388&cisb=22_T4111190387&treeMax=true&treeWidth=0&csi=10903&docNo=1, Date Accessed 7/7/08)

US Treasury Secretary Henry Paulson Enhanced Coverage Linking Treasury Secretary Henry Paulson-Search using: Biographies Plus News, Most Recent 60 Days said Wednesday that the US economy wasenduring "a rough period" and warned that home foreclosures would likely remain high in the near future.The US Treasury chief said soaring crude oil prices, a widespread credit crunch and a two-year long

housing market slump had taken some of the wind out of the sails of the US economy. "The USeconomy is going through a rough period. US foreclosures will remain elevated and we should not besurprised at continued reports of falling home prices," Paulson warned during a speech in London. Paulson'sremarks were also released by the Treasury in Washington. The Treasury chief and former banker stopped offin London Wednesda

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