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Joe Biden is in Michigan today, reportedly to announce the first round of $2B in battery grants.  (Source: The Weekly Standard)
Grants bring good news to state's troubled economy

Michigan is among the states that has been hit hardest by the recession.  The government went to extreme measures to keep the state's economy from collapsing, including assuming majority ownership of GM and propping up Chrysler through bankruptcy.  Now the federal government is preparing to reach deeper into its pockets to help the state out even more.

Vice President Joe Biden is in Michigan today at the NextEnergy Center in Detroit.  He is reportedly going to announce the first round of $2B USD in Department of Energy battery grants.  The grants should boost the state's economy and help develop better electric vehicles, currently favored as the future of the car industry by the domestic automakers.

The federal government is also separately loaning money to battery manufacturers under the $25 billion Advanced Technology Vehicle Manufacturing Incentive Program (ATVM).  Among the battery manufacturers that applied for that loan are A123 Systems, EnerDel, and Compact Power.  Thus far Ford, Nissan, and Tesla Motors received ATVM loans.  It is unknown who the grants will go to, but A123 Systems, EnerDel, and Compact Power seem like leading candidates.

Ed DeSeve, the president's special advisor on the stimulus program, had stated about on July 21, "I think you'll see over the next week or so ... some industrialization focus, for example, on the battery grants that are coming.  It makes sense to put those in places where there is productive working capacity -- people who can do the jobs. There are plants where the jobs can exist, and I think you are going to start to see more and more of that over time."

The ATVM loans must be repaid eventually by automakers and battery makers.  However, the DoE grants do not have to be repaid.  Michigan has also offered battery makers some big tax cuts in hopes of luring business into the state.

A limited amount of tickets to Mr. Biden's appearance have been offered to the public on a first-come-first-serve basis.



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RE: Good
By mdogs444 on 8/5/2009 12:05:57 PM , Rating: 2
quote:
Grants are NOT bailouts

Giving money to companies, who don't have the money and cannot get enough private investment, to make batteries and hire employees is NOT a bailout?

You'll have to explain that to me someday. I always thought artificially propping up any industry (in this case a grant, subsidy, "rebate", "stimulus", etc) for a company/person who does not have the money, cannot get the money, or the product is not worth the money...is nothing less than a bailout.


RE: Good
By Mr772 on 8/5/09, Rating: 0
RE: Good
By mdogs444 on 8/5/2009 12:40:50 PM , Rating: 2
quote:
liberal church and started shooting people blaming them because you could not get a job??

I think you're confused. I'm a republican - therefore I work for a living so liberals can sit at home and live off my taxes.


RE: Good
By sgw2n5 on 8/5/09, Rating: 0
RE: Good
By MrPeabody on 8/5/2009 2:03:47 PM , Rating: 2
That report seems misleading. The link to the original report is broken, or I'd figure this out myself, but the page you provided doesn't really give a breakdown on the type of spending in each state.

Doesn't North Dakota have all sorts of government installations, like missile silos? I bet those are pricy. Especially compared to all four taxpayers that actually live in the state.

As another example, Alaska is lousy with federal parks, wildlife refuges, and more missile silos, among countless other Federal shennanigans. Also, everything is more expensive there anyway.

I guess my point is that just because the federal government spends more money per taxpayer in North Dakota, it doesn't mean that those North Dakota taxpayers personally see more money than they pay.

Whereas I'd be willing to bet that most Welfare recipients get more from the government than they put into it.


RE: Good
By Mr772 on 8/5/2009 3:06:28 PM , Rating: 1
Great link.

Be careful these angry, propaganda spreaders will not be able to take it if they find out they have been sheep repeating a lie.

These hard liners are so confused and mislead by their idiot talk radio brethren who constantly construe and fabricate reality.


RE: Good
By mdogs444 on 8/5/2009 3:08:33 PM , Rating: 2
quote:
These hard liners are so confused and mislead by their idiot talk radio brethren who constantly construe and fabricate reality.

Anyone who talks like you spends way too much time on liberal websites...Media Matters, Huffington Post, am I close?

Do you also like the smell of your own farts?


RE: Good
By FITCamaro on 8/5/2009 1:25:45 PM , Rating: 2
And all you do is call people dumb and attack them personally.


RE: Good
By Mr772 on 8/5/2009 2:18:15 PM , Rating: 1
I'm sure you can over it.

Maybe it would be better if I attacked a large group of people and lumped them all together with misleading and baseless attacks.


RE: Good
By sgw2n5 on 8/5/2009 2:33:19 PM , Rating: 2
Very well put.


RE: Good
By Xavier434 on 8/5/2009 12:56:26 PM , Rating: 2
Money is money, but the purpose and conditions behind which the money is being spent makes all the difference in the world. Case in point, no one is completely against all forms of government spending. Everyone takes their sides based on how much is spent, why it is spent, and how it was acquired.

Therefore, the difference between a bailout and a grant lies within each of their purposes. Grants are not designed to prop up a company although they do have the potential to create that effect. The purpose is to target a specific service, product, or an idea. Unlike bailouts, they are not intended to target a specific company or small set of companies although due to the nature of some markets that result is sometimes inevitable. Grants are also available to anyone provided that they meet the requirements which are designed to ensure that the money will be spent to fulfill its purpose and nothing else. Bailouts are designed to do the same, but careless design lacking regulation such as the bank bailouts designed by the Bush Admin will result in the money being spent in ways that are not intended.

Often times, grant money is permitted because even though the demand is there for a particular product or service such as this battery technology, no business is capable or willing to step up to bat and take the necessary risks to get the job done in a timely fashion. That doesn't mean that the demand does not exist though. For example, there is plenty of demand for a cure for cancer but we provide grants all of the time to hasten the progress now don't we? It also doesn't mean that it is money which isn't well spent. Many wonderful things have come to us which were supported in part by grant money....and yes, there are other things which didn't work out so great.

On the other hand, a corporate bailout's single purpose is to prop up a company which is not capable of sustaining itself in order to keep it from going out of business. Such things are supposed to happen under the pretense that the people will be a lot worse off overall if the bailout doesn't occur.

Now, whether or not you support either of them is up to you. All I ask is that you do not label something as anything other than what it actually is just because you don't like it and you want others to view it negatively as well by using a word that happens to be very unpopular at the time. If you don't like bailouts then say that you don't like bailouts. If you don't like grants then say that you don't like grants. If you don't like both then say you don't like both.


RE: Good
By FITCamaro on 8/5/2009 1:27:26 PM , Rating: 2
To be fair, I am not against government research grants in order to further development on something.

But if the only reason for this grant is to make it so that these batteries are more affordable now, because otherwise they'd be too expensive, then yes, this is wrong.


RE: Good
By Xavier434 on 8/5/2009 2:05:05 PM , Rating: 2
For me, that depends on why the batteries become more affordable should it happen. If the battery technology becomes a lot more affordable then it will most likely become a lot more successful. Therefore, if the grants play a part in advancing the development of the technology further so that they are cheaper to produce and cheaper to sell then I'd say that is a very good thing.

If the grants do nothing more than allow the manufacturer to sell the exact same product at a lower price and result in the same amount of profit then that's not very useful to the people. That's just playing musical chairs with the money. Doing it could create some jobs so it is not a complete loss, but I would prefer the jobs be created through further means of development. That is one of those details which should be outlined in both the prereqs and regulation imo.


RE: Good
By ats on 8/5/2009 2:06:06 PM , Rating: 2
Well there go all the defense contractors...


RE: Good
By FITCamaro on 8/5/2009 3:25:29 PM , Rating: 2
So are you advocating private companies develop tanks and jet fighters for anyone with the money to buy be able to purchase?

Defense contractors exist to design, develop, and support the weapons our military needs.


RE: Good
By Xavier434 on 8/5/2009 4:15:24 PM , Rating: 2
I think you took that the wrong way. He was using an example which supports defense contractors and also shows how mdogs444, assuming he supports defense contracts to private companies, is being very hypocritical with his statements. When applying his logic to that of defense contracts he is basically saying that all defense contracts are also bailouts. Obviously, that isn't true. Thus, it is a logical fallacy on his part.

On a side note, I can speak from direct experience that a lot of these defense contracts are far more expensive than what they need to be while others contain ideas which are utter failures. We just rarely hear about them. It's a shame.


RE: Good
By FITCamaro on 8/5/2009 5:06:55 PM , Rating: 2
There is a big difference between government contractors who do work for the government and get paid for it and a private company who supplies nothing to the government for the money it receives.

I won't deny there is waste in defense contracts. I work for a defense contractor. Part of the waste though is government imposed though.


RE: Good
By Keeir on 8/5/2009 8:57:03 PM , Rating: 2
quote:
Part of the waste though is government imposed though.


Actually, large amounts of government waste are self-imposed. Essentially, to prevent the possibility of large fraud, the government ensures each and every transaction is a little bit wasteful. Requirements of procurement must be meant and typically a government contract will come with all sorts of requirements that are not typically needed in a private setting.

For instance we have all heard of the 500 dollar Wrench or some such? The government can't just buy a wrench. Someone might (gasp!) say they spent 50 dollars on a 25 dollar wrench and pocket the difference. (Do this a few million times and its large waste) Instead, the government puts in place procedures to
A. Make sure the wrench is needed
B. Define what wrench is needed
C. Request for Bids to Supply Wrench
D. Decide Which Wrench to Purchase (Defend Purchase)
E. Purchase the Wrench
F. Ensure the Wrench is made correctly (not if the end product is acceptable but a host of other requirements)
F. Distrabute the Wrench or Store the Wrench
G. Create a system to track the wrench
H. Ensure Steps A-G are Auditable and Defendable

For small procurement efforts, the overhead or fixed cost of this ensures the end price will be much much higher than a private company buying from private company.


RE: Good
By Xavier434 on 8/6/2009 8:31:11 AM , Rating: 2
Correct. It's kind of ironic actually. The reason why they have to go through all of that trouble is because they are constantly being regulated by the people which I think is a great thing, but such regulation does come with a price. The ironic part is that a primary means of incentive for a lot of people to regulate is to try and keep wasteful spending down. Some might argue that we are cutting the nose to spite the face. I guess it all boils down to moderation as most things do. I really don't know for certain...


RE: Good
By Xavier434 on 8/6/2009 8:38:08 AM , Rating: 2
Never forget who the government really is.

The government is the people. It is NOT the politicians as much as they may think it is sometimes. Therefore, when you say that that government contractors are doing work for the government and getting paid for it what you are really saying is that these contractors are doing work for "the people" and getting paid for it by us.

This is very similar to that of grants. Grants are a form of tax dollars just like these defense contracts. It is money being paid by "the people" with the intention of doing something for "the people".

The biggest difference when it comes to the end result between grants and defense contracts is what we are actually buying. The rest is primarily logistics.


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