Few days of energy-related news clearly show the sharp contrast between the crony capitalism-based energy policy of the Biden administration and the US energy domination policy introduced during the second Trump administration as past news. do not have. week.
On November 26, the Biden Department of Energy, led by Secretary Jennifer Granholm, announced the award It provided $6.6 billion in low-interest loans to struggling electric car maker Rivian. The capital injection is intended to help the company finance a new Georgia-based factory with an annual production capacity of 400,000 vehicles. Rivian already operates a factory in Illinois that can produce 150,000 cars a year. (Related: David Blackmon: ‘Landman’ Broadcasts Rare and Provocative Defense of U.S. Oil & Gas Industry)
So what’s the problem? you might ask. First, Rivian, like other U.S. EV manufacturers other than Tesla, has consistently struggled financially. The company was unable to significantly achieve its sales targets for 2023, so it was unavoidable. discount price and laid off workers This is to maintain the ability to repay existing debt.
Second, Rivian has only sold just over 37,000 units this year due to stagnant demand for EVs from U.S. consumers. loss of over $107,000 whole car. This explains why a car company struggling to sell 50,000 cars a year would take $6.6 billion from taxpayers to increase its production capacity to 550,000 cars a year, or roughly 13 times its current annual sales. The question arises whether it is necessary to invest.
Third is the fact that Amazon is majority owned by billionaire Jeff Bezos. one of Rivian’s largest investor. Mr. Bezos currently listed He was named the second richest individual in the world by Forbes magazine, with a net worth of over $226 billion. If pouring another $6.6 billion into Rivian was a great financial idea, as the DOE claims, why weren’t Amazon or Bezos enthusiastic about it?
The answer is pretty obvious. This is not a good idea economically at all. What’s really happening here is a desperate last gasp of crony capitalism in the Biden era, with billions of IRA dollars in the works before President-elect Donald Trump takes office and begins to rein in the madness. Push it out the door.
The day before the DOE announced the award to Rivian. President Trump announces plans to impose 25% tariffs It would apply to all imports from both Canada and Mexico, unless the governments of Canada and Mexico immediately act to stop illegal immigration and drugs from crossing the border with the United States. It is important to note that when we talk about all goods coming in from Canada and Mexico, we are referring to: America’s two largest crude oil trading partners.
Canada is by far the largest oil exporter to the United States, and Mexico ranks second on the list, well ahead of OPEC countries.
The strategic purpose behind announcing these tariff plans two months before being sworn into office was to ensure that both governments acted quickly to slow cross-border flows so that there was no need to actually impose tariffs. The aim was to give time for major reforms to take place. Trump wields leverage in negotiations, a skill that made him a billionaire in his business life.
This is a strategy Biden has never attempted to use in connection with open borders. deadly fentanyl Currently, more than 100,000 Americans die each year.
President Trump within 48 hours held the first meeting Together with Socialist Mexican President Claudia Sheinbaum, he reported on important developments. Mr. Trump reported that much more progress had been made than Mr. Sheinbaum acknowledged, but this was also an obvious negotiating tactic.
By Friday, November 29th, the Prime Minister of Canada Justin Trudeau was jetting down He heads to Mar-a-Lago to talk with President Trump about the government’s ambitious border reforms to avoid tariffs. Again, there are still seven weeks until Trump is sworn into office.
Joe Biden remains president, at least nominally, but the days of his crony capitalist approach to energy policy are quickly passing and will soon be replaced by President Trump’s return to US energy dominance .
It is a change that cannot come soon.
David Blackmon is a Texas-based energy writer and consultant. He spent 40 years in the oil and gas business, specializing in public policy and communications.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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