BTW, I am still waiting for my lesson on supply and demand.
WTB, your opinions about Europe, Krugman, FDR, etc are noted. Only time will tell how things play out, but I think Europe will adjust and adapt. As you can read from the reports I linked to, European renewable energy is very likely to continue to grow at an impressive pace, faster than any other energy source. And you're right about things shifting to other countries, as much as renewable energy is expanding in Europe, the rest of the world is catching up and future growth of solar is projected to be even faster in Asia and the Americas.
So I'll speculate a little as well. I'm optimistic that air and water pollution will eventually contribute to a revolt in China when the effects start to really sink in. They've embraced our capitalism and eventually I think they will embrace our environmental ethics to some degree. The US and Europe will be looked at for leadership when they finally realize they can't just keep burning coal, dumping hazardous waste, and doing everything on the cheap.
As for supply and demand, subsidies have fueled demand, which has allowed mass production to lower prices of solar cells and wind turbines. Lots of jobs have been created in the process. So you need to subtract the income taxes that all these solar workers are contributing to the treasury from the cost of the subsidies, and consider all the spinoff jobs that are created along the way. This is how government policy and investment can jump start an industry struggling to get a foothold in the market. We're in agreement that at some point subsidies should be be phased out. It's all about timing and minimizing uncertainty. You just seem to be on a much shorter timeline, that's all (like phase them out yesterday).
