Germany moves to pay women to stay at home taking care of kids

Germany moves to pay women to stay at home taking care of kids

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If you are going to have the government pay people to take care of people's kids, why not give that money to the mom's themselves?  Who is going to do a better job taking care of kids?  From The Economist:

CRITICS call it a “hearth bonus” or “keep-your-kids-out-of-school money”. The government prefersBetreuungsgeld (“child-care benefit”). Few of its ideas are as contentious as a planned €150 ($199) monthly payment to parents who do not put their children into crèches. Angela Merkel, the Christian Democrat chancellor, defends this as “an essential part of our policy of freedom of choice.” But it seems to contradict much of what she stands for.
Germany’s long-term worries include a shrinking and ageing population, immigrants who are not fully integrated into the workforce and women who are both underemployed and underpaid. German women work fewer hours than women in most other OECD countries (see chart). The gap in median pay is the third-widest in the club, after South Korea’s and Japan’s. That is partly because mothers stay at home. In 2008 just 18% of children under the age of three were in formal child care, against an OECD average of 30%.
. . . . By 2013 parents will have a legal right to a day-care place after a child’s first birthday.
Good crèches are thought by some to be a cure-all. By helping women to combine motherhood and career, they relieve skills shortages, boost growth and reduce inequality between the sexes. They might even lift Germany’s miserably low fertility rate. . . . .

GM Volt sales very slow even before safety issue with fires

GM Volt sales very slow even before safety issue with fires

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Someone really needs to add up all the subsidies that have gone into these cars. The average income of Volt buyers is $175,000 a year. Whether it is 8,000 cars this year or a chance of 45,000 next year, where would these sales be without these huge subsidies? So much for initial predictions of up to 60,000 sold in 2011. From the WSJ:

Before General Motors Co.'s Chevrolet Volt became the subject of a U.S. safety investigation, the auto maker's moon shot was falling well short of its stratospheric expectations.

GM's year-old, battery-powered Volt, cast by the company as a revolution in automotive technology, will miss the sales target of 10,000 vehicles that Chief Executive Dan Akerson set for this year, hampered by production delays, distribution problems and questions about whether Americans really want electric cars. The company is on track to sell around 8,000 Volts this year.

GM aims to sell 45,000 Volts in the U.S. next year, and the auto maker faces questions about whether it can deliver.

"We're getting a lot of interest, we're just not getting a lot of buyers," says William Willis, a Chevy dealer in Smyrna, Del. Mr. Willis says he has sold two Volts since the fall and has two on his lot. "Customers come in, they are wowed by the display, the quick acceleration. It's just going to take a while for the American public to accept the price."

The $41,000 Volt solved the biggest hurdle with electric cars: range. But that came with compromises on price and space. Now questions have arisen about safety in the wake of fires caused by government crash tests. . . .

Subsidies

tax credit of up to $7,500

federal tax credit equal to 50% of the cost to buy and install a home-based charging station with a maximum credit of US$2,000 for each station. Businesses qualify for tax credits up to $50,000 for larger installations.

There have been other huge subsidies in terms of the development of the cars and even the equipment used to manufacture the cars.

Who can forget all the big subsidies to General Motors?

"Overflowing" Government Subsidies

"Overflowing" Government Subsidies

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It is bad enough that projects that don't pay for themselves are getting subsidies. The problem is that they are getting almost all their money from the government and (surprise) that the subsidies are haphazard. From the New York Times:

. . . Obama administration officials said the subsidies were intended to help renewable-energy plants that were jumbo-sized or used innovative technology, both potential obstacles to getting private financing. But even proponents of the subsidies say the administration may have gone overboard.

Concerns that the government was being too generous reached all the way to President Obama. In an October 2010 memo prepared for the president, Lawrence H. Summers, then his top economic adviser; Carol M. Browner, then his adviser on energy matters; and Ronald A. Klain, then the vice president’s chief of staff, expressed discomfort with the “double dipping” that was starting to take place. They said investors had little “skin in the game.”

Officials involved in reviewing the loan applications said that Treasury Department officials pressed the Energy Department to respond to these concerns.

Officials at both agencies declined to discuss the anticipated financial returns of the clean-energy projects the federal government has agreed to guarantee, saying the information was confidential. . . .

In at least one instance — NRG’s Agua Caliente solar project in Yuma County, Ariz. — the Energy Department demanded that the company agree not to apply for a Treasury grant it was legally entitled to receive. The government was concerned the extra subsidy would result in excessive profit, NRG executives confirmed.

In other cases, the agency required that companies use most of the Treasury grants that they would get when construction was complete to pay down part of the government-guaranteed construction loans instead of cashing out the equity investors.

“The private sector really has more skin in the game than the public realizes,” said Andy Katell, a spokesman for GE Energy Financial Services, which like Goldman Sachs, Morgan Stanley and other financial firms has large investments in several of these projects.

But there is no doubt that the deals are lucrative for the companies involved.

G.E., for example, lobbied Congress in 2009 to help expand the subsidy programs, and it now profits from every aspect of the boom in renewable-power plant construction.

It is also an investor in one solar and one wind project that have secured about $2 billion in federal loan guarantees and expects to collect nearly $1 billion in Treasury grants. The company has also won hundreds of millions of dollars in contracts to sell its turbines to wind plants built with public subsidies. . . .

US goes after China for subsidizing Wind Power?

US goes after China for subsidizing Wind Power?

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The complaints against the Chinese seems to focus on protectionism more than subsidies per se, but still it is pretty ironic that the Obama administration, which has given huge subsidies to wind power in the US, would complain about China's subsidies.

The U.S. said Wednesday it is requesting consultations with China at the World Trade Organization to end hundreds of millions of dollars of subsidies to boost wind-power production. . . .

China's Ministry of Commerce said Thursday that China is "highly concerned" about the U.S. invoking dispute settlement procedures at the WTO. China will study the U.S. request for talks and handle it in accordance with WTO rules on dispute settlement, while reserving China's "relevant rights," the ministry said without elaborating.

In the past, Chinese officials have called the union's complaints "groundless and irresponsible."

The U.S. says wind energy is the fastest-growing sector in China's renewable-energy market, which overall is expected to reach $100 billion by 2020. Chinese wind-turbine makers now rank among the top 10 producers globally, and foreign companies' share of the Chinese market has been slashed to 13% from 79% in the past five years, according to Goldman Sachs. . . .

Just one recent note on the subsidies to wind-power in the US.

Alas, market forces ruined the Pickens Plan. Mr. Pickens should have shorted wind. Instead, he went long and now he's stuck holding a slew of turbines he can't use because low natural gas prices have made wind energy uneconomic in the U.S., despite federal subsidies that amount to $6.44 for every 1 million British thermal units (BTUs) produced by wind turbines. . . .

. . . "The place where it works best is with natural gas at $7."

That may be true. But on the spot market natural gas now sells for about $4 per million BTUs. In other words, the free-market price for natural gas is about two-thirds of the subsidy given to wind. Yet wind energy still isn't competitive in the open market.

Despite wind's lousy economics, the lame duck Congress recently passed a one-year extension of the investment tax credit for renewable energy projects. That might save a few "green" jobs.

But at the same time that Congress was voting to continue the wind subsidies, Texas Comptroller Susan Combs reported that property tax breaks for wind projects in the Lone Star State cost nearly $1.6 million per job. That green job ripoff is happening in Texas, America's biggest natural gas producer. . . .