North America is abundant with energy sources and clean technology — all that’s missing is the political and cultural will to free ourselves from the Middle East.
With an Arab Fall if not Winter dominating the Middle East, the U.S. is under pressure to intervene even more. Unfortunately, reliance on imported oil continues to entangle Washington in the Middle East’s volatile politics. Some analysts advocate more subsidies for alternative energy in response. It would be better to free North America’s abundant natural resources, providing the U.S. with a brighter economic future.
Americans have endured multiple energy “crises” centered on the Mideast over the last four decades. Arab oil producers imposed an embargo during the Nixon administration, which had bizarrely discouraged domestic production with price controls. President Jimmy Carter created the Department of Energy, which paradoxically did more to discourage than promote energy development.
President Ronald Reagan eliminated oil price controls, but had to wait for Congress to remove natural gas restrictions. After the Iran-Iraq war threatened to disrupt oil shipments from the Gulf, Washington “reflagged” Kuwaiti oil tankers and provided American military protection for petroleum shipments. Succeeding administrations promoted subsidies for alternative energies and promised to reduce U.S. dependence on Mideast oil, with little practical result.
Today the Obama administration continues to back the embarrassing Gulf kleptocracies led by Saudi Arabia because they are major oil producers. Unhappy with this dependence, President Obama pushed even bigger subsidies for other energy sources. This corporate welfare wasted hundreds of millions of dollars on federal support for private companies such as bankrupt Solyndra.
Alternative energy production is up, but remains largely irrelevant to meeting Americans’ energy needs. “Their overall contribution to world supply remains de minimus and stays that way (even though it is still growing rapidly) in every credible future scenario,” explained Mark P. Mills, an Adjunct Fellow at the Manhattan Institute, in his recent study, “Unleashing the North American Energy Colossus: Hydrocarbons Can Fuel Growth and Prosperity.”
Coal, natural gas, and oil remain the least expensive and most convenient fuels. That’s why they supply more than 85 percent of energy today. There are technical alternatives to these energy sources, but no economic alternatives. While politicians and environmentalists continue to proclaim alternative fuels as a panacea, Mills explained that “The game-changing technologies that have emerged involve hydrocarbons: natural gas, oil, and coal.”
Nor is enforced conservation any solution. With the rise of China, India, and other emerging markets, the U.S. matters ever less in determining world energy prices. While three decades ago America accounted for roughly one-third of the world’s energy consumption, observed Mills: “Today, however, the U.S. has dropped to below 20 percent of world energy demand; and before three decades pass it will fall to under 15 percent. As a result, going forward, global markets and prices will be increasingly disconnected from domestic U.S. energy consumption behavior, whether virtuously voluntary or punitively policy-driven.”
Obviously, there is a technical limit to the world supply of hydrocarbons. However, contrary to common myth, the world is not running out of energy. Rather, advancing technologies now allow access to supplies once beyond reach. Explained Mills: “Technological progress in hydrocarbon exploration and development has been transformative and is ongoing, enabling the emergence of a new era of hydrocarbon production, which is, in turn, unleashing the capability to efficiently tap into North America’s enormous resources of natural gas, oil, and coal.”
Examples include improved materials and information technology, better ability to find and map supplies and extract resources, directional drilling, and the much discussed hydraulic fracturing. It isn’t just natural gas and oil. Noted Mills, new technologies have “also driven a near doubling in the coal sector’s productivity in the past two decades.”
Energy discoveries overseas have received significant public attention and will prove beneficial. However, there also is much good news closer to home. Mills explained that “Technology has unleashed staggering quantities of commercially exploitable reserves of these fuels, especially in the United States and its neighbors in North America.”
The U.S. once was viewed as a permanently declining energy producer. In 1978 the U.S. Congress even approved the Fuel Use Act, which limited consumption of natural gas, the supplies of which were constrained by federal price controls. This mentality of scarcity drove the Carter administration to launch its disastrous War on Energy, highlighted by pervasive regulations and massive subsidies. Unfortunately, this myopia continues to dominate Washington, as Mills detailed in another Manhattan Institute study, “Liberating the Energy Economy: What Washington Must Do.” He pointed out that today’s federal policies have “evolved unintentionally to become complex, overreaching, and often capricious.”
America no longer is energy poor. “The United States is now the fastest-growing producer of oil and natural gas in the world,” observed Mills in “Unleashing.” America is expected to pass Russia as an oil producer by 2020.
Americans could produce even more energy if the U.S. government freed up access to existing resources. The U.S. alone is estimated to possess 30 billion barrels of oil reserves based on current technology. Total resources are far greater and will yield even more recoverable supplies as technology advances.
Off-shore oil deposits add even more. Mills explained: “The technically easy-to-access — if not politically accessible — oil in Alaska’s off-limits ANWR and the Gulf of Mexico would, in the short term, essentially triple existing U.S. oil reserves.” New technologies have dramatically improved the ability to find and develop these resources.
Even more significant is shale oil. Reported Mills: “The Green River Formation, for example, a shale region largely beneath Colorado, Wyoming, and Utah, contains an estimated 2,000-3,000 billion barrels of oil,” of which between 30 and 60 percent is estimated to be recoverable with existing technology. Alberta, Canada’s oil sands are estimated to contain another 2,000 billion barrels of oil — which could come to the American market with the approval of the Keystone Pipeline project.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
Was the President done in by the economy, or by the politics of the economy?