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Bill Gates: Only Socialism Can Save the Climate, ‘The Private Sector is Inept’

 

Bill Gates explains why the climate crisis will not be solved by the free market.

In a recent interview with The Atlantic, billionaire tech magnate Bill Gates announced his game plan to spend $2 billion of his own wealth on green energy investments, and called on his fellow private sector billionaires to help make the U.S. fossil-free by 2050. But in doing so, Gates admitted that the private sector is too selfish and inefficient to do the work on its own, and that mitigating climate change would be impossible without the help of government research and development.

“There’s no fortune to be made. Even if you have a new energy source that costs the same as today’s and emits no CO2, it will be uncertain compared with what’s tried-and-true and already operating at unbelievable scale and has gotten through all the regulatory problems,” Gates said. “Without a substantial carbon tax, there’s no incentive for innovators or plant buyers to switch.”

Gates even tacked to the left and uttered words that few other billionaire investors would dare to say: government R&D is far more effective and efficient than anything the private sector could do.

“Since World War II, U.S.-government R&D has defined the state of the art in almost every area,” Gates said. “The private sector is in general inept.”

“When I first got into this I thought, ‘How well does the Department of Energy spend its R&D budget?’ And I was worried: ‘Gosh, if I’m going to be saying it should double its budget, if it turns out it’s not very well spent, how am I going to feel about that?'” Gates told The Atlantic. “But as I’ve really dug into it, the DARPA money is very well spent, and the basic-science money is very well spent. The government has these ‘Centers of Excellence.’ They should have twice as many of those things, and those things should get about four times as much money as they do.”

In making his case for public sector excellence, the Microsoft founder mentioned the success of the internet:

“In the case of the digital technologies, the path back to government R&D is a bit more complex, because nowadays most of the R&D has moved to the private sector. But the original Internet comes from the government, the original chip-foundry stuff comes from the government—and even today there’s some government money taking on some of the more advanced things and making sure the universities have the knowledge base that maintains that lead. So I’d say the overall record for the United States on government R&D is very, very good.”

The ‘Centers for Excellence’ program Bill Gates mentioned is the Center for Excellence in Renewable Energy (CERE), which is funded in part by the National Science Foundation (NSF). The NSF, which operated with roughly $7.1 billion in 2014, is the source of one-fourth of federal funding for research projects at over 2,000 colleges, universities, K-12 schools, nonprofits, and businesses.  The NSF has even funded research by over 200 Nobel laureates, including 26 in just the last 5 years alone. The NSF receives more than 40,000 proposals each year, but only gets to fund about 11,000 of them. Bill Gates wants this funding to be dramatically increased.

“I would love to see a tripling, to $18 billion a year from the U.S. government to fund basic research alone,” Gates said. “Now, as a percentage of the government budget, that’s not gigantic… This is not an unachievable amount of money.”

As evidence around the world shows, the U.S. doesn’t have to reinvent the wheel to be a green energy juggernaut — it can simply look to currently-existing examples in countries with socialist policies — like Germany and China, for instance — on how to become a leader in green energy. And according to Bill Gates, the rest of the world will follow the lead if the biggest countries set the bar.

“The climate problem has to be solved in the rich countries,” Gates said. “China and the U.S. and Europe have to solve CO2 emissions, and when they do, hopefully they’ll make it cheap enough for everyone else.”

This past July, Germany set a new record by generating 78 percent of its electricity from renewable sources, beating its previous record of 74 percent in May of 2014. Germany generated 40.65 gigawatts from wind and solar energy, 4.85 gigawatts from biomass, and 2.4 gigawatts from hydropower, for a total of 47.9 gigawatts of green energy when total electricity demand was at 61.1 gigawatts. Over the past year, Germany decreased its CO2 output by 4.3 percent. This means greenhouse gas emissions in Germany are at their lowest point since 1990.

But in terms of raw investment, China’s $80 billion green energy investment is more than both the U.S. ($34 billion) and Europe ($46 billion), combined. And those investments are already paying dividends. While coal is still China’s biggest source of electricity, the world’s biggest polluter aims to have its use of fossil fuels peak in 2030, and trend downward after that. Additionally, China’s solar production outpaces all other countries combined.

Between 2000 and 2012, China’s solar energy output increased dramatically from 3 megawatts to 21,000 megawatts. And its solar output increased by 67 percent between 2013 and 2014 alone. In 2014, China actually managed to decrease its CO2 emissions by 1 percent, with further reductions expected in the coming years.

China also powers more homes with wind energy than every nuclear power plant in the U.S. put together. China’s wind output provided electricity to 110 million homes in 2014, as its wind farms generated 16 percent more power than in 2013, and 77 gigawatts of additional wind power are currently under construction. China’s energy grid is currently powered by 100 gigawatts of green energy, and aims to double green energy output to 200 gigawatts by 2020.

Bill Gates wants the U.S. to be an additional green energy leader, and expresses hope that there may still be enough time for the U.S. to take green energy investment seriously, and that the public sector can be instrumental in preventing a 2-degree increase in global temperatures.

“I don’t think it’s hopeless, because it’s about American innovation, American jobs, American leadership, and there are examples where this has gone very, very well,” Gates said.

 

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