Energy and Oil

Oil imports at almost $400 Billion a year account for over half of our trade deficit. That is $1200 for every man, woman, and child we are spending on imported oil and sending out of our country. Our economy is at the mercy of foreign oil suppliers and oil trading hedge funds on Wall Street. We are addicted to oil----black heroin.

Oil Importer in 1948

The US became a net fuel importer in 1948 and by 1970 US oil production peaked. We lost our ability to increase or surge production in the case of supply disruptions in 1971. This led to the stunning oil shock in 1973 when OPEC embargoed oil exports to the US. I still remember the gas lines. During the Nixon-Ford-Carter years we cut imports by half through conservation and alternative fuel development. A small part of this reduction was new Alaskan oil production. The tide of progress turned in 1980 when Ronald Reagan came into office. With his conservative republican anti-government zeal he slashed the funding for conservation and research by over two-thirds. The emphasis was an early version of “drill baby drill”, and trust free markets to take care of the problem. Actually, conservative republicans didn’t see there was a problem and still don’t.

Addiction to Oil Imports

But our addiction to oil has hidden costs that conservation republicans don’t add to the free market equation. At huge cost the US 5th Fleet is based in Bahrain to protect oil supplies. The oil industry receives tax breaks and protections from lawsuits that distort the free market equation. Over a trillion dollars were spent on both wars in Iraq and the war in Afghanistan that have their roots in our addiction to oil. Oil also is a threat to our environment as evidenced by the spill in the Gulf and possibly global warming. Our current lack of an energy is not only bad economic policy, it’s bad national security policy and bad environmental policy. Other nations realize that with the rise of China world oil consumption is growing rapidly, and “drill, baby, drill” will not produce enough new oil to keep the price of oil down in the future. Europe’s energy consumption per dollar of GDP is about two-thirds of ours. Japan has the lowest energy consumption per dollar of GDP of any major nation. France is the world leader in nuclear technology. Germany and China are the leaders in solar technology. We have to compete.

Reduce Dependence of Oil Imports

While we have to continue to drill, there are two routes we must take to reduce our dependence on foreign oil: conservation plus alternative energy. We can see immediate results through conservation. Two-thirds of our oil consumption is for transportation and over 40% of our consumption is for gasoline alone. Overall fuel economy for vehicles in the US peaked in 1987. We need to require the new fuel economy (CAFÉ) standards that George Bush signed into law to go into effect in the year 2015, not 2020. We can provide grants to retrofit commercial and residential buildings to reduce energy waste. We can modernize our electric power grid by applying “smart grid” technology. There are numerous initiatives we can implement but we need a conservation policy.

Innovative Energy Research

We need an innovative research initiative on the scale of the Apollo project to develop alternate sources of energy. We need research in the area of fusion nuclear reactors and start building nuclear power stations once again in this country. We can invest in clean coal technology and carbon capture. We can invest in composite technology to make cars lighter and stronger.

Effective Energy Policy

We need to recognize we have an energy problem that affects our economy, defense and environmental health. Then we need to have a policy to deal with the problem. The republicans “small government” versus “big government” argument is a false argument. I don’t want a “big” government” I want an effective government. Only an effective government can tackle this problem as private enterprise is primarily interested in quick profits and won’t invest in strategic conservation without incentives and they won’t take the risk to invest in new energy technologies.

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