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WILLIAM TUCKER: Sequestration Follies – Will Nuclear Reactors Start Melting Down Next Week?

By William Tucker

If Congress insists on sequestering 2.3 percent of the federal budget, we will be forced to shut down the Nuclear Regulatory Commission and reactors will start melting down next week.

Now how did have government enthusiasts missed that one in their efforts to scare people into thinking the world is going to end if we try to rein in federal spending?

To read the papers this week, you’d wonder how this country ever survived before we had a federal government spending 24 percent of GNP and borrowing a trillion dollars a year to do it.  Departing Energy Secretary Steven Chu tells us the effort to convert to renewable energy will be stopped in its tracks if the Sequester is imposed.  The Superfund will end, air pollution monitoring will fall by the wayside and oil spills will gush forth if Congress imposes the “severe budget cuts,” according to Environmental Leader.  The American Association for the Advancement of Science predicts energy research and development will “fall off a cliff” if the cuts go through.  And just think, all this represents only 2.3 percent of federal outlays!  Just think of all the things the government must be doing with the other 97.7 percent!

Of course what we’re seeing here is the old “Washington Monument Syndrome” that sunk Newt Gingrich when he tried to rein in federal spending in the 1990s.  Want to cut spending?  That’s easy.  We’ll close down the Capital Mall, shutter all the National Parks and take away your Social Security check.  See how you like that!  The press plays into this, the public remains gullible and before you know it we’re back on track for national bankruptcy.

What’s really going on here, however, is a question of whether we’re going to have a private economy or an economy run by the government.  To see what that means, there’s no better place to look than energy.  And there’s no better place to start in energy than nuclear power.

Go back to the end of World War II when the energy that had been unlocked from the atom was still a dazzling mystery and there was tremendous public enthusiasm for its potential.  The technology had been developed by the government, of course – specifically the Army Corps of Engineers.  And once the Army had control of it, of course, it didn’t want to give it up.  It took a tremendous effort by Los Alamos scientists and others to pry it loose from the military and set up the civilian “Atomic Energy Commission” to oversee its introduction into general use.

But the AEC became very possessive and was reluctant to let it go as well.  The AEC became a claustrophobic bureaucracy that convinced itself that it was the only agency in the world that could understand the technology.  Utility companies were chafing at the chance of using the new technology but the AEC parceled it out very abstemiously.  By the early 1950s, Democrats who controlled Congress were arguing that the government itself should build any new reactors.  President Eisenhower was enough of a free-enterpriser to choke on this so he threw the technology open with the Atoms for Peace program. 

It wasn’t until the late 1960s when concerns began to grow about air pollution, however, that nuclear got its big push.  At one point the Sierra Club was proposing reactors as an alternative to damming Glen Canyon.  (The technology was still new and they hadn’t found enough things to object to about it yet.)   When the environmental movement got going, however, it turned on nuclear and soon the AEC was under fire as a “schizophrenic” organization that was supposed to promote nuclear and regulate it at the same time.

In fact, nuclear didn’t need that much promoting.  The myth circulated today is that the wave of reactor construction from 1970 to 1990 was somehow subsidized by the federal government.  It did no such thing.  Solar and wind energy today receive more tax credits and Department of Energy subsidies in one year than nuclear ever received during its entire golden age.  What supported nuclear is that the utilities were still operating under the old franchise system where they were guaranteed a profit on their investment.  That made utilities feel fairly confident in committing themselves to a long-term project that in those days might reach the extraordinary level of $1 billion.

Then came the creation of the Nuclear Regulatory Commission, Three Mile Island and the current regime where a decision on whether employees will be able to ride a bicycle inside the reactor compound requires an eight-month review from Rockville

The NRC has finally approved two new reactor projects – the first licenses issued since the 1970s.  But don’t expect any more.  The process is too uncertain, too expensive, too time-consuming for any sensible utility executive to undertake.  Everybody in the utility industry knows we’re taking a huge gamble by converting out electricity to natural gas.  Look what’s happening in New England right now where cold weather has set utility companies bumping up against home heating and prices are soaring.  The administrators of the New England grid last week that their territory would be in huge difficulty right now if not for Indian Point.  But natural gas still functions largely outside the reach of the federal government while nuclear is a wholly administered government enterprise and that makes all the difference.

So what is the federal government doing with all that money it spends on energy?  Well, departing Secretary of the Interior Ken Salazar was in Boston this week warning of all the horrible things that are going to happen if the government is required to tighten its belt and preaching about the wonders of offshore wind and how New England will soon be reaping the benefits of all the permits that Interior is going to grant.    

This is insane.  Any comparison of electricity costs tells you that offshore wind is the most expensive technology there is, even more expensive than solar in some instances.  So who’s going to pay for all this?  If these windmills are ever built – and environmental groups are already lining up to oppose them – the electricity will be so expensive it will have to be subsidized by the government.  Then government officials will be able to argue that if anyone tries to reduce federal spending, everybody’s electric bills will soar  – and they will be right.  As the late economist Arthur Nelson posed in his Third Law, “The more a subsidy distorts the market, the harder it is to get rid of it.”  Sooner or later, people adjust to the distortions.

Is there any way out of this?  None of the options are very pretty.  As long as we live with the illusion that there’s some renewable energy utopia waiting for us and all we need is a “bridge fuel” to get us there, we will continue to squander time and money on unproductive technologies.  But someday someone is going to take a look at thorium or small modular reactors and realize that if we’d just let people invest in these things, they would soon be paying off.  Then we’d finally be on the road to solving our energy problems.           

3 Responses to “WILLIAM TUCKER: Sequestration Follies – Will Nuclear Reactors Start Melting Down Next Week?”

  1. jagdish dhall Says:

    Windmills, as currently used are a single technology with several defects. If at all used, it should be an entirely different technology.

    1. It should be used locally, saving on transmission and investing in more important storage of energy.

    2. Conversion to and de-conversion from electric is costly. The wind power is best stored as compressed air and used for ventilation/climate control with heat pumps or with pneumatic motors to mechanical power.

    3. Huge bird-killers are an eye-sore. We should best have funnels to increase the wind speed and use more compact turbines saving on materials.

    F0r electric/electronic use we should use sun via photo electric/thermo-electric panels, stored in batteries as a 12Volt system. The vehicles already use the system and no R&D is required, only scaling up.
    Utilities should stick to coal/gas/nuclear/hydro energy.

  2. Rod Adams Says:

    Bill – though you and I both agree that nuclear is far superior and that the current regulatory regime is partly to blame for its current tiny market share, we have a different philosophy about government in a representative republic governed by a constitution framed by people who fundamentally believed in the notion that the power of government comes from the consent and cooperation of the governed.

    Big government programs can do amazing things to make the country a better place. The free market supporting Eisenhower that you mentioned recognized that; he was the one who realized that the US was choking on its poor roads and bridge network and that continued dependence on monopoly railroads for transportation was constraining free enterprise. His Interstate Highway system broke the hold of the railroads and freed automobiles and trucks to become the transportation means that unified the country. By the time I was in college, I could make it from Annapolis to Miami in 16 hours with a car load of friends for about the cost of a single restaurant meal’s worth of gasoline.

    Land grant colleges, free K-12 education, the REA, the CDS, the FAA, and the GI Bill are some other favorites of mine from the big government. Disclosure: The big government sent me to college and graduate school, paid my salary for 33 years and now provides me with a generous pension. All I had to do in return was to be willing to lay down my life, work as many as 53 hours in a row, and spend months at a time submerged on a submarine with no way to contact my wife and children.

    The regulations that constrain nuclear energy, however, did not come from good government advocates like me. They came from political pressure supported by lots of private money; mostly from people with some kind of tie to the hydrocarbon industry. People forget that the “environmental movement” is funded by such hydrocarbon linked foundations as Rockefeller (Standard Oil) and Pew (Sunoco). The current position of natural gas in the national conversation is fueled by an enormous ad budget – ads are the lifeblood of “the media”; no wonder talking heads on 24 hour news networks feel empowered to bash nuclear energy.

    I’ve had plenty of run ins with “free market” advocates like Jerry Taylor of Cato, who claim that nuclear has failed in the market and should not receive any support – even free support like cutting out some of the constricting regulations that you mention. If you scratch the surface of those free marketers very hard, you will find that they are enabled by the same fossil fuel money that paid for the “environmental” attacks on nuclear energy.

    Rod Adams
    Publisher, Atomic Insights

  3. Atomik Rabbit Says:

    Off-topic, but I just want to thank Bill and his staff for starting and maintaining NT.

    It is one of my first go-to places when I am looking for energy news, especially relating to nuclear. You deserve the Matt Drudge Golden Fedora, with Neutron Cluster.