I have been trying for several years to explain why I believe that our current nuclear regulatory environment has been influenced by a “strange bedfellows” marriage of interests that joins frightened “environmentalists” with rent-seeking fossil fuel interests who want to slow down or even eliminate competition from nuclear energy suppliers. I have documented evidence of this alignment of interests through the “smoking gun” series of posts here on Atomic Insights and engaged in numerous discussions with both nuclear supporters and anti-nuclear activists. Normally, my theory is met with a strong dose of skepticism and disbelief.
Today, while enjoying a visit to the Seeker Blog I noticed a link to an article titled Bootleggers, Baptists, and Global Warming that attracted my attention. My Dad was raised as a Southern Baptist but he left that denomination as soon as he could. His sister married a Southern Baptist preacher, who turned into one of my least favorite uncles. I was intrigued by a title that linked Baptists and Bootleggers; my preacher uncle had once stormed out of our house when my parents served wine with dinner.
That article led me to search for the original theorist, who apparently first published a piece titled “Bootleggers and Baptists: The Education of a Regulatory Economist” in the journal Regulation in 1983. I have not yet discovered the original, but I did find an article titled Bootleggers and Baptists in Retrospect that Bruce Yandle, the original author, wrote for a 1999 issue of Regulation. It makes for extremely interesting reading. Here is a quote from that article:
Here is the essence of the theory: Durable social regulation evolves when it is demanded by both of two distinctly different groups. “Baptists” point to the moral high ground and give vital and vocal endorsement of laudable public benefits promised by a desired regulation. Baptists flourish when their moral message forms a visible foundation for political action. “Bootleggers” are much less visible but no less vital. Bootleggers, who expect to profit from the very regulatory restrictions desired by Baptists, grease the political machinery with some of their expected proceeds. They are simply in it for the money.
The theory’s name draws on the colorful tales of states’ efforts to regulate alcoholic beverages by banning Sunday sales at legal outlets. Baptists fervently endorsed such actions on moral grounds. Bootleggers tolerated the actions gleefully because their effect was to limit competition.
In the case of nuclear energy regulation, the role of the “Baptists” was played by luminaries like Ralph Nader and Helen Caldicott who preached about the evils of using nuclear energy, especially because of its material relationship with nuclear weapons. The “bootlegger” role in this instance is played by a very large group of energy suppliers who often compete against each other for market share, but who have a common interest in keeping nuclear energy off of the list of options.
Nuclear energy is like Shaquille O’Neal on a playground basketball court. No one who is already playing the Great Game as an energy supplier can win if they let atomic energy compete without heavy restrictions. The most effective way for established energy interests to keep control of the energy game is to tie nuclear down. That effort works best if there is a group of vocal moralists that paint nuclear materials as inherently evil, when the real answer is to avoid using nuclear materials for evil purposes.
Here is another poignant quote from Yandle’s 1999 article that helps to explain why the “strange bedfellows” alliance of “environmentalists” and fossil energy producers has been joined by “nuclear” energy producers to slow down the often discussed, but yet to be realized Nuclear Renaissance:
The “devil is in the details” aspect of B&B theory is seen vividly in the federal environmental regulations that replaced common law with command and control enforcement of technology or specification standards, rather than call for performance standards or use emissions taxes and other economic incentives to reduce environmental harm. Specification standards generally set stricter limits for new and expanding plants than for existing ones, giving a cartel-like advantage to existing producers. Bootleggers who already use a particular technology – or better yet, hold a patent on it – are not likely to support performance standards, which are advantageous to diligent, innovative, and competitive firms seeking the most profitable (lowest cost) route to environmental control. As for emissions taxes and similar economic incentives, can anyone think of a firm or individual that has lobbied for more taxes? Only economists do that and they do it only if someone else will pay the taxes.
Think about that quote as you go and read the Wall Street Journal’s summary of Exelon’s most recent quarterly earnings call titled Exelon 4Q Net Falls On Weak Demand, Unfavorable Weather. Here is a quote from that article:
As the nation’s largest nuclear generator, Exelon is expected to benefit from new climate change regulations because of the emissions profile of reactors. But analysts from Goldman Sachs Group, Oppenheimer & Co and Macquarie Group in recent weeks have downgraded Exelon shares as global climate talks last month produced no binding agreement and U.S. legislation remains stalled in the Senate.
Rowe acknowledged that the Senate climate bill is in serious trouble, but he still expects limits to eventually be put on carbon dioxide emissions. In the meantime, increasingly stringent regulation of traditional power plant pollutants such as sulfur dioxide, mercury, and coal ash will be a major challenge for Exelon’s peers that operate coal-fired power plants, he added.
See any resemblance in the two photos below?