An Economic Campaign by Really Smart People
The Great Leap Forward (GLF) was the Republic of China’s social and economic campaign intended to catapult China’s economy from backwardness into modernity. Mao Zedong’s Five-Year Plan, launched in 1958, was to modernize the country’s economic agricultural sector using communist economic ideologies. Within a year GLF had to be abandoned.
This was to be not just any old central planning project, but a whole new approach designed by the really smart people to correct the mistakes and failures that the Soviet Union had encountered on the road to communism, explains Francis Menton in Manhattan Contrarian. This time, they were going to get central planning right.
On Tuesday, President Joe Biden announced the launching of a significant new climate initiative with a design that Mr. Menton believes has a striking resemblance to the Great Leap Forward. Biden’s initiative is called “Community-Driven Solutions to Cut Climate Pollution Across America.” (The press release from the EPA is here.) Nick Pope covered the new initiative in this post at the Daily Caller, which was then also re-posted at Watts Up With That here.
Community vs Individual Rights
Q: Mr.Menton, this sounds like a small piece of the multi-trillions dollar puzzle of subsidies for uneconomic projects, like the vast economic waste, as you point out, of the falsely named Inflation Reduction Act. Phrases like “Community driven” to suggest Communist China’s Great Leap Forward. Rather, isn’t our constitution based on “individual rights”?
A: It is and it is concerning. Instead of stimulating the country’s economy, the GLF resulted in mass starvation and famine.
(Biden’s) new initiative is just one small piece of the vast economic waste of the falsely named Inflation Reduction Act, with its multi-trillion dollars of subsidies for uneconomic projects. But the “community-driven” tag line here is what brings to mind the Great Leap Forward.
The basic idea is that the new investments and technologies to transform our energy economy are going to come from federal selection and subsidizing of various projects originating out of state and local governments, otherwise known as “communities.”
For example, A nationwide campaign to exterminate sparrows, which Mao believed incorrectly were a major pest on grain crops, resulted in massive locust swarms in the absence of natural predation by the sparrows. Grain production fell sharply, and hundreds of thousands died from forced labor and exposure to the elements on irrigation construction projects and communal farming.
From the EPA Release (22 July)
. . . the U.S. Environmental Protection Agency announced selected recipients of over $4.3 billion in Climate Pollution Reduction Grants to implement community-driven solutions that tackle the climate crisis. . . . The grants will fund projects supporting the deployment of technologies and programs to reduce greenhouse gases and other harmful pollution across the country. . . . Together, these selected projects will implement ambitious climate pollution reduction measures designed by states, Tribes and local governments that will achieve significant cumulative GHG reductions by 2030 and beyond.
The Misery of Socialism
Traditionally, hasn’t the most efficient and reliable energy system been based on profit-driven businesses competing with each other to find the most cost-effective solutions? In the good ol’ days, didn’t we rely on an efficient and reliable energy system?
Obsolescent, outmoded in today’s progressive thinking, cautions Mr. Menton. The new thinking is that local “governments” aka “communities” run the economy “directed and supported by some lavish funding from the feds.”
From John Podesta, “Climate Czar”
“President Biden’s Climate Pollution Reduction Grants put local governments in the driver’s seat to develop climate solutions that work for their communities.”
Q: What types of projects will receive fed funding?
The projects include electric vehicle (EV) charging station construction, funds to help local governments expedite green energy siting and programs to enhance heat pump adoption.
There is a unifying aspect to these projects. They are uneconomic and would never be adopted by the people of their own choice with their own money, warns Mr. Menton.
Thus, there must be coercion through the federal funding and mandates from the local governments.
Q: How would you compare this to Mao’s Great Leap Forward?
A: A decent short history of the GLF can be found at the Association for Asian Studies here. The basic idea was that communes would be formed, of about 5500 households each, to become the main economic units, then taking direction from above as to what businesses to pursue:
One of the most infamous innovations of the Great Leap involved an industrial revolution in the countryside, where farmers constructed millions of backyard furnaces and then divided their time between tending crops and smelting steel.
30 Million Dead from Starvation
Q: You often point out in the Manhattan Contrarian egregious pitfalls, aka unintended consequences. What’s going on here?
A: In China, GLF took only about one year for the economy to collapse.
Starvation became a widespread problem with the harvest of 1959. . . . As food reserves in the countryside diminished, peasants began dying in droves by the summer of 1960. They collapsed in fields, on roadsides, and even at home where family members watched their corpses rot, lacking the energy for burial or even to shoo away flies and rats. . . . Estimates of deaths directly related to the famine range from a minimum of twenty-three million to as many as fifty-five million, although the figure most often cited is thirty million.
Q: Isn’t $4.3 billion a heck of a lot of money to waste, Mr. Menton?
A: Well, the good news is that this latest Biden program is a lousy $4.3 billion — big, but still not much more than a rounding error in the federal budget.
The Inflation Reduction Act as a whole — touted as $1.5 trillion, but estimated by many to be more like $2-3 trillion — is not a rounding error.
Thank you, Mr. Menton, for pointing out the folly of GLF and central planning. Let’s hope voters understand what’s at stake.
Devoting that kind of money ($1.5 trillion) to uneconomic and wealth-destroying projects can have disastrous consequences. I expect that we will escape the fate of China in the 1950s, but we can’t be sure until the climate crazies are defeated.