The USA: TOWARDS A NEW ENERGY POLICY
No doubt we are all sick of escalating fuel prices and the disruptions to our economy, our jobs, and our lives. I have seen this and lived with this my whole life. Of course, there were the tranquil days when I was a kid back in the 60s and 70s (and gas prices of ca. 30-50 cents per gallon, believe it or not - the lowest I remember was around 30 cents!), but the whole global picture changed in 1973 with the economic "shot (or "shock"!) heard round the world" - the Arab oil embargo due to the 1973 Arab/Israeli war. Nothing has been the same since.
We now have oil availability pretty much dictated to us by the OPEC oil cartel, formed as a response to all of this in the early 70s. Funny - everybody (especially on the left) yaps on and on about "international law" (whatever that is - try and define it) when they have some grievance against George Bush and/or the US political right, but nobody ever wants to reprimand OPEC for being a cartel and illegally price fixing a barrel of oil ( why do we do business with criminals?).
We have lived through oil shocks and "crises" before; this time around, it's truly playing out on the world stage. We must consider the demand factor as well: 1 billion new capitalists in India thirsting for oil; 1.3 billion in China. The actual demand for crude from emerging market nations (think the "BRICs," among others) just surpassed that of the US for the first time in history. If you've been reading any of my posts, you realize this is one of my big "themes" - the emergence on the world stage of all these countries as global, powerful, and monied "players." I've been to many of these countries, and I have seen firsthand their emerging prosperity.
The US does not dictate the price of commodities any more; and, when our economy is weak (as now), it is not necessarily a guarantee that the rest of the world will be obliged to suffer along with us. This is something I've never seen until now in my lifetime. And the ramifications are huge for us here in the US; the effects to our wallets and portfolios will not be so desirable.
It's past time for a new direction in domestic energy policy, and while government is, most of the time, best left out of the process, the stakes for this situation are just too high and there are certainly, at the very least, tax incentives that the Govt. can put in place to encourage domestic development of the right resources. Moreover, Govt. can assist in putting in place the right laws (and get away with bad ones) to encourage a "Manhattan Project" for domestic energy development, and hopefully down the line, energy independence. Finally, the current energy situation impacts our national security and national financial well being, and this is definitely the domain of correct government.
We need to face the facts, though - most all of the things we use in our everyday lives have some relationship, at least tangentially, with the price of crude oil. Think plastics, most all fuels, household items, transportation, among many other products and services. Moreover, we have a couple more billion capitalists on the globe competing for the same resources. Supply and demand dictate that prices will continue to rise, so long as the current situation holds. We wanted everyone to be capitalists, so look at what we've now got!
Some things we need to do to HELP OURSELVES for a change and stick it to OPEC (with "friends" like OPEC - who needs enemies?):
1.) encourage more nuclear power - in every state and city - to power our electricity needs. It would provide more good, local jobs, and come from an inexhaustible source - nature (though we do need the uranium). The nuclear power industry is far advanced and more safe from where it was in the 1970s; we here in the US are in a time warp of Three Mile Island-induced fear, and this need not be the case. Countries like France and China are far ahead of us in this regard. We have no choice but to encourage more nukes...
I would be happy to buy a hybrid car; get twice the gas mileage I now get, and have the whole thing powered electrically by a local power plant providing my household electricity. Take that, OPEC!
2.) More solar and wind incentives; tax breaks, etc. Sure, the argument has been made innumerable times, correctly, that we cannot expect to get all of our needs this way, but we could, if we really tried, get a significant fraction. Over Christmas, I worked on a Habitat for Humanity project locally, and all the new homes we were helping to build were given complimentary solar panels to put on the new homes' roofs - donated by the local power company - SRP. Unbelievable... I only wish I could've been on the receiving end of some new solar panels for my own home!! We have plenty of sun here in the Phoenix valley, so it's an inexhaustible, free resource and could make a significant dent in any home's monthly power consumption. (Electricity bills during the Phoenix summer are atrocious!) Also, the power that you do not use can be sold back to the power company; sweet deal.
We are also way behind here as compared to other countries: I saw ubiquitous solar panels on homes in the sunny Caribbean 10-20 years ago as I worked and traveled this area. One sees solar panels all over the place in just about any area of the world these days. I even saw them powering street signs and lights in Spain fairly recently. It should be standard on new homes in this country...
3.) More domestic oil and gas drilling and extraction - we have located massive finds in places such as the Bakken oil field (North Dakota) and others (Utah, Montana, Colorado, Nevada). If we could get the antiquated environmental regulations out of the way, we could cash in on what appear to be fields larger than even Saudi Arabia's or Canada's oil sands (Alberta). Stay tuned - these are new developments and brand new companies have sprung up to cash in on this new American gold mine.
4.) Domestic coal: we are the "Saudi Arabia of coal," and there are new technologies that enable the environmentally cleaner extraction and use of coal (some of it liquefied, for instance) for power needs. Why aren't we developing this resource more?
5.) Finally - ethanol. There's plenty of evidence that ethanol is not really any kind of answer, since it inevitably runs up the price of corn, and hence, food costs. Although Brazil seems to do great things for themselves with their superlative ethanol initiatives, it doesn't seem to be a helpful part of the equation in the US, especially since we are already rich in coal, and untapped oil, gas, and nuclear power solutions.
I don't know about you, but I am REALLY tired of my country's economy being held hostage by the OPEC cartel, dated thinking from environmentalists and out of the loop politicians, and automobile manufacturers who still, after all these years (and I've heard the same "song" for many years), just don't get it. There are some notable exceptions, though, and the picture is brightening up somewhat, thanks to increased consumer demand; people coming to their senses, economic expediency, etc. Thank you, Toyota, for the Prius - you were the first. Decent looking car and gets 50 miles per gallon. If you and I are going to pay twice as much for gas, why not get twice the mileage?
Of course, ultimately, prices will find some kind of ceiling (as they always do in a market economy) where consumers will finally give it up and adjust their behavior, wasteful or otherwise. "The cure for high prices is high prices," in other words. When cauliflower is too expensive at my local store, I switch to broccoli. When green peppers are more expensive than the equally nutritious orange peppers, I switch to orange. Obviously, we don't have all that much "choice" when it comes to our gas at the pump. However, we have some choice - we can individually choose to not drive as much as we have; take public transportation whenever feasible, walk, ride a bike; whatever. I don't know about you, but I refuse to overpay. And if I have a choice, I move on. And so it goes...
Europeans are paying the equivalent of $9 + per U.S. gallon of gas, and their squeals of pain are just now starting to be heard on cable news. We here in the US are paying $ 4+ now ($5 + in Hawaii, Alaska, and CA), and I'm really starting to hear folks squeal. Perhaps we'll finally get politicians and private business in action now to do what we should've been doing all along. At the very least, this will slow the economy, and lessen demand for crude - at least from our country.
During the political campaigns and debates, one thing struck my ear coming from John McCain: he spoke of a "Manhattan Project" for domestic energy. Let's hope, should he be elected, that he will actually, sincerely follow up on it. It is desperately needed, and I wish him (or whomever) all the best in moving towards this goal.
As unpleasant as are higher costs at the pump (and considering the damage it does to our macro economy, the stock markets, etc.), this latest crisis will hopefully get us off our duffs here in the US and on towards new frontiers in domestic energy and more towards at least a significant measure of "independence." Couldn't come too soon...
TTC
We now have oil availability pretty much dictated to us by the OPEC oil cartel, formed as a response to all of this in the early 70s. Funny - everybody (especially on the left) yaps on and on about "international law" (whatever that is - try and define it) when they have some grievance against George Bush and/or the US political right, but nobody ever wants to reprimand OPEC for being a cartel and illegally price fixing a barrel of oil ( why do we do business with criminals?).
We have lived through oil shocks and "crises" before; this time around, it's truly playing out on the world stage. We must consider the demand factor as well: 1 billion new capitalists in India thirsting for oil; 1.3 billion in China. The actual demand for crude from emerging market nations (think the "BRICs," among others) just surpassed that of the US for the first time in history. If you've been reading any of my posts, you realize this is one of my big "themes" - the emergence on the world stage of all these countries as global, powerful, and monied "players." I've been to many of these countries, and I have seen firsthand their emerging prosperity.
The US does not dictate the price of commodities any more; and, when our economy is weak (as now), it is not necessarily a guarantee that the rest of the world will be obliged to suffer along with us. This is something I've never seen until now in my lifetime. And the ramifications are huge for us here in the US; the effects to our wallets and portfolios will not be so desirable.
It's past time for a new direction in domestic energy policy, and while government is, most of the time, best left out of the process, the stakes for this situation are just too high and there are certainly, at the very least, tax incentives that the Govt. can put in place to encourage domestic development of the right resources. Moreover, Govt. can assist in putting in place the right laws (and get away with bad ones) to encourage a "Manhattan Project" for domestic energy development, and hopefully down the line, energy independence. Finally, the current energy situation impacts our national security and national financial well being, and this is definitely the domain of correct government.
We need to face the facts, though - most all of the things we use in our everyday lives have some relationship, at least tangentially, with the price of crude oil. Think plastics, most all fuels, household items, transportation, among many other products and services. Moreover, we have a couple more billion capitalists on the globe competing for the same resources. Supply and demand dictate that prices will continue to rise, so long as the current situation holds. We wanted everyone to be capitalists, so look at what we've now got!
Some things we need to do to HELP OURSELVES for a change and stick it to OPEC (with "friends" like OPEC - who needs enemies?):
1.) encourage more nuclear power - in every state and city - to power our electricity needs. It would provide more good, local jobs, and come from an inexhaustible source - nature (though we do need the uranium). The nuclear power industry is far advanced and more safe from where it was in the 1970s; we here in the US are in a time warp of Three Mile Island-induced fear, and this need not be the case. Countries like France and China are far ahead of us in this regard. We have no choice but to encourage more nukes...
I would be happy to buy a hybrid car; get twice the gas mileage I now get, and have the whole thing powered electrically by a local power plant providing my household electricity. Take that, OPEC!
2.) More solar and wind incentives; tax breaks, etc. Sure, the argument has been made innumerable times, correctly, that we cannot expect to get all of our needs this way, but we could, if we really tried, get a significant fraction. Over Christmas, I worked on a Habitat for Humanity project locally, and all the new homes we were helping to build were given complimentary solar panels to put on the new homes' roofs - donated by the local power company - SRP. Unbelievable... I only wish I could've been on the receiving end of some new solar panels for my own home!! We have plenty of sun here in the Phoenix valley, so it's an inexhaustible, free resource and could make a significant dent in any home's monthly power consumption. (Electricity bills during the Phoenix summer are atrocious!) Also, the power that you do not use can be sold back to the power company; sweet deal.
We are also way behind here as compared to other countries: I saw ubiquitous solar panels on homes in the sunny Caribbean 10-20 years ago as I worked and traveled this area. One sees solar panels all over the place in just about any area of the world these days. I even saw them powering street signs and lights in Spain fairly recently. It should be standard on new homes in this country...
3.) More domestic oil and gas drilling and extraction - we have located massive finds in places such as the Bakken oil field (North Dakota) and others (Utah, Montana, Colorado, Nevada). If we could get the antiquated environmental regulations out of the way, we could cash in on what appear to be fields larger than even Saudi Arabia's or Canada's oil sands (Alberta). Stay tuned - these are new developments and brand new companies have sprung up to cash in on this new American gold mine.
4.) Domestic coal: we are the "Saudi Arabia of coal," and there are new technologies that enable the environmentally cleaner extraction and use of coal (some of it liquefied, for instance) for power needs. Why aren't we developing this resource more?
5.) Finally - ethanol. There's plenty of evidence that ethanol is not really any kind of answer, since it inevitably runs up the price of corn, and hence, food costs. Although Brazil seems to do great things for themselves with their superlative ethanol initiatives, it doesn't seem to be a helpful part of the equation in the US, especially since we are already rich in coal, and untapped oil, gas, and nuclear power solutions.
I don't know about you, but I am REALLY tired of my country's economy being held hostage by the OPEC cartel, dated thinking from environmentalists and out of the loop politicians, and automobile manufacturers who still, after all these years (and I've heard the same "song" for many years), just don't get it. There are some notable exceptions, though, and the picture is brightening up somewhat, thanks to increased consumer demand; people coming to their senses, economic expediency, etc. Thank you, Toyota, for the Prius - you were the first. Decent looking car and gets 50 miles per gallon. If you and I are going to pay twice as much for gas, why not get twice the mileage?
Of course, ultimately, prices will find some kind of ceiling (as they always do in a market economy) where consumers will finally give it up and adjust their behavior, wasteful or otherwise. "The cure for high prices is high prices," in other words. When cauliflower is too expensive at my local store, I switch to broccoli. When green peppers are more expensive than the equally nutritious orange peppers, I switch to orange. Obviously, we don't have all that much "choice" when it comes to our gas at the pump. However, we have some choice - we can individually choose to not drive as much as we have; take public transportation whenever feasible, walk, ride a bike; whatever. I don't know about you, but I refuse to overpay. And if I have a choice, I move on. And so it goes...
Europeans are paying the equivalent of $9 + per U.S. gallon of gas, and their squeals of pain are just now starting to be heard on cable news. We here in the US are paying $ 4+ now ($5 + in Hawaii, Alaska, and CA), and I'm really starting to hear folks squeal. Perhaps we'll finally get politicians and private business in action now to do what we should've been doing all along. At the very least, this will slow the economy, and lessen demand for crude - at least from our country.
During the political campaigns and debates, one thing struck my ear coming from John McCain: he spoke of a "Manhattan Project" for domestic energy. Let's hope, should he be elected, that he will actually, sincerely follow up on it. It is desperately needed, and I wish him (or whomever) all the best in moving towards this goal.
As unpleasant as are higher costs at the pump (and considering the damage it does to our macro economy, the stock markets, etc.), this latest crisis will hopefully get us off our duffs here in the US and on towards new frontiers in domestic energy and more towards at least a significant measure of "independence." Couldn't come too soon...
TTC
posted by thoughtful conservative at 7:18 PM
1 Comments:
You are right on the mark.
Another item to consider: Because the US has nearly depleted its reserve of uranium from cold-war weapons stockpiles, we are now import dependent for uranium. Modern uranium mining (in-situ) is environmentally benign and new projects should be fast-tracked so that we can keep up with current demand AND supply clean fuel for the expansion of our domestic nuclear power production.
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