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Should Congress invest $50 billion in T. Boone Pickens' Plan to expand wind power?

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If you're an economist, like David H. Wang, you wake up some days muttering, "What has happened to the industrial base in the U.S. economy?"

The auto companies are practically on life support, and other sectors are paring-back operations, even as international competition mounts. Hundreds of thousands of jobs have been lost. How did this happen? Eight more years of industrial base decline without a viable plan to counteract it? And now, as a result of the financial crisis and de-leveraging, the prospect of a period of less-available credit threatens to delay economic recovery.

Well one remedy for the above, Wang argues, is to invest in the industrial sector via investing in the United States' infrastructure. And what's one project worthy of consideration? Investor T. Boone Pickens' plan to substantially increase domestic wind power via his Pickens Plan, Wang argued.

Pickens' investment fund has fallen on tough times, as of late. His BP Capital investment fund has shrunk by 60%, due to energy sector losses, and will drop to about $500 million after redemptions, by week's end, Pickens told CNBC Thursday. Pickens, who sees oil sector consolidation, expects the price of oil to recover to $100 per barrel in 2009. Oil Thursday closed down $1.81 to $65.69 per barrel.

Pickens Plan: a better investment than AIG?

Wang is less certain about a $100 oil price in 2009, but he is certain about the merit and benefits from investing in Pickens' project, and his argument is compelling. (Wang added that he does not have an investment stake in any power/energy company.)


"On the one hand, we, as U.S. taxpayers have invested more than $122 billion in American International Group (NYSE: AIG), a necessary investment to stabilize the global financial system," Wang said. "However, it remains to be seen if we taxpayers will receive most of our money back from AIG, let alone earn a return." (Our own BloggingStocks Peter Cohan concurs with Wang regarding AIG.)

"On the other hand, the Pickens' Plan would create tens of thousands of good-paying jobs based in the United States, which will boost the economies of local communities and towns, not the bank accounts of oil producing nations, even as it increases our electric power generating capacity," Wang said. "That sounds like a bigger bang for the U.S. Government's buck than AIG."

Further, Wang says Pickens' wind technology could then be leased / sold to other countries, creating another revenue stream and source of export growth.

Energy Policy / Economic Analysis: An investment in Pickens' Plan has merit for a multitude of reasons. The plan would not only increase U.S. energy independence, it would serve as a growth engine for a U.S. economy that sorely needs all of the domestic growth engines, and good-paying domestic jobs, it can get.

In your view, should the U.S. Government invest $50 billion in the Pickens' Plan to expand wind power?

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Last updated: November 25, 2009: 03:11 PM

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