-
Restrain the Abusive Administative State
May 22, 2013 | 24 comments
-
Delivering Serbs to the Wolves
May 21, 2013 | 29 comments
-
The Perils of Intervention in Syria
May 7, 2013 | 37 comments
-
America on Welfare
April 25, 2013 | 46 comments
-
Thursday Is Tax Freedom Day
April 17, 2013 | 5 comments
The Energy Spectator
Energy to Spare
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.
(Page 2 of 2)
Indeed, count Canada and Mexico and the continent becomes an energy colossus. Mills observed: “North America has total hydrocarbon resources that are some four times greater than those found in the Middle East. The geology of North America is profoundly hydro-carbon rich.”
Allowing firms to develop these resources would offer several important benefits. The first is economic. Mills pointed to significant current gains for North Dakota from oil and Texas from natural gas production. Estimated benefits for Utah and Wyoming from oil and natural gas production are expected to run some $400 billion over the next 15 years. Extracting oil from ANWR and the outer-continental shelf could generate $1 trillion in benefits. Freeing the energy industry would mean jobs, wages, sales, and tax revenues. All of those would be useful for a nation suffering from anemic economic growth, persistently high unemployment, and massive government deficits.
Moreover, America’s energy industry spreads its rewards broadly. Noted Mills: “Economic benefits from expanding hydrocarbon production will be felt widely given the structural and geographic diversity of hydrocarbon resources and the associated industries. In contrast to other parts of the world, benefits here won’t flow to a handful of oligarchs but will involve thousands of businesses and ripple broadly throughout the economy.”
Given America’s falling share of international energy demand, reducing imports wouldn’t have much impact on global energy prices. Rising demand in China, India, and other emerging markets could easily overwhelm any downward pressure on prices.
However, there would be a political benefit from reducing hydrocarbon imports (America is unlikely to ever entirely end oil imports). Even though the energy marketplace is international, presidents from Richard Nixon to Barack Obama have mistakenly treated the Middle East as a vital security interest because of U.S. dependence on oil. That has led to support for thuggish monarchies and frequent wars. An expanding and diversifying international energy marketplace would make it easier to convince Washington to lay down the sword. If the Europeans, Chinese, or other significant oil consumers want to take over Gulf guard duties, let them. The U.S. should reduce the size and cost of its military and, more importantly, the risk of conflict.
To obtain this bright future government merely need reduce barriers to existing energy production. Mills posits an even more abundant energy future, however. He asked: “what would happen if policies were enacted to accelerate and encourage even greater expansion of North American hydrocarbon production and to expand access to the vast tracts of federal lands that sit atop staggeringly large resources? Why not push beyond self-sufficiency to energy influence, even dominance?”
The benefits of doing so are obvious. Allowing an already important industry to greatly expand and turn into a significant export market would offer significant economic rewards. Moreover, higher energy production could moderate global energy prices and reduce the reliance of other nations on the Middle East and other unstable and/or undemocratic energy states.
Concluded Mills: “Economic research noted earlier finds about $75 billion in broad economic benefits for every billion barrel of oil produced (or oil-equivalent in hydrocarbons). This would imply that the aggregate 100 billion barrels of additional hydrocarbons extracted and sold over the next two decades in the accelerate scenario would yield over $7 trillion of value to the North American economy, with $5 trillion of that accruing to the U.S.”
There are no obvious technological or economic barriers to this future. Nor are any government subsidies required. Rather, the problem is political, especially access to federal land. “Vast tracts of hydrocarbon-rich resources are either entirely or effectively off-limits to development,” with a steady decline in new natural gas and oil leases on federal land since 2006, explained Mills. In “Liberating the Energy Economy” he cited problems of regulatory “complexity,” “creep,” and “capriciousness.” In response he offered a deregulatory agenda, emphasizing agency accountability, access to federal lands for exploration and development, and rationalizing legal challenges to development. Among his suggested policy changes were removing barriers to exports and creating “a single federal portal for approval of all major energy projects,” similar to that employed by Canada.
Nevertheless, opposition to an abundant energy future remains strong. Environmental concerns rank high, but just as new technologies make energy extraction more economical, they also make energy extraction more ecological. The argument that development should proceed responsibly is no reason for not letting it proceed.
Americans can see the potential of an energy-rich future. In “Unleashing” Mills concluded that “The world will need enormous quantities of hydrocarbons in the future, regardless of and despite substantial gains in energy efficiency and alternative energy deployment. No single region of the world could make as significant a difference to the supply dynamic as could North America.”
Uncle Sam should get out of the way and allow the rest of us to get to work.
About the Author
Doug Bandow is a senior fellow at the Cato Institute. A former Special Assistant to President Ronald Reagan, he is the author and editor of several books, including The Politics of Plunder: Misgovernment in Washington (Transaction).
Letter to the Editor View all comments (32) | Leave a comment
More Articles by Doug Bandow
More Articles From The Energy Spectator
http://spectator.org/archives/2012/12/14/energy-to-spare
Follow us:
ADVERTISEMENT
SPONSORED LINKS
FLASHBACK TO: 1995
-
Pope Culture
A man of faith in a godless age is hitting Americans where it hurts.
-
Why the GOP Does Not, Like, Totally Suck
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
-
Dames at Sea
-
In the Absence of Guns
In Britain, defending your property can get you life.
-
The Metaphysical Martini
-
Counting the Costs of Clintonism
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
-
Chuck McHagel
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
-
The Legacy of Old John and Mother Fresh-Roasted
-
It’s the Best Time of the Year
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
-
The Bush Crack-Up
Was the President done in by the economy, or by the politics of the economy?
Clip of the Day
H/T to National Review Online
ADVERTISEMENT
Pecos Pete| 12.14.12 @ 8:05AM
"Freeing the energy industry would mean jobs, wages, sales, and tax revenues." Exactly what King O and the environmentalists do NOT want, except for tax revenues.
In due course the feds will formally nationalize the energy and mineral companies. The environmentalists would love to be the owners of these resources thus enabling their desire to eliminate them from the USA. Cave dwelling is a swell life.
Jack in Wi| 12.14.12 @ 8:31AM
This country is awash in energy. There is enough here for hundreds of years. It means the USA can get the hell out of the Middle East once and for all. Even now most of our energy comes from North America. The whole world is discovering new sources of hydrocarbons. Let the Saudi's eat sand. Gas should be no more then a dollar a gal. America was built on cheap enery and now it can be rebuit on the same thing. Energy produced here means jobs and money here.
TLP| 12.14.12 @ 2:16PM
When Jack is right? He's right.
Queery, Jack?
Could you be so kind as to elucidate WHY the Democrats fight, Tooth and Nail, to prevent us from being Energy Independent, all the while, bemoaning that we are Hostages to Middle East Oil?
FBX1999| 12.14.12 @ 3:11PM
This might be a bit tricky for our friend Jack, so I'll spell it out.
Its pretty hard to build a one-world oligarchy with a prosperous economy in existance. Energy independence would prevent Soros, Buffet, Gates and the rest from ruling us all, and they simply won't allow us access to cheap energy for that reason.
The Useful Green Idiots (UGI's) think they're Saving the Planet.
Occam's Tool| 12.18.12 @ 3:21PM
Finally, Jack shows some hostilty to Islamist Terror supporting scum. Yes, we should drill, baby, drill. North Dakotans deserve to get rich. Very nice people.
mike 3/505| 12.14.12 @ 8:49AM
"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."
Correction: all that's missing, is the political and cultural will to free ourselves from servitude of a feral government that has no business dictating how we use those resources in the first place. It's well past time that the several states boldly non-comply with Federal BS...especially BS that deigns CO2 and rainwater as pollutants.
Von Mises Jr| 12.14.12 @ 9:22AM
The "political will" to drill will occur when Obama's "kleptocracy" is complete. If you recall, Obama gave somewhere between $2B and perhaps $15B to PBR that Soros had invested in. He was willing to champion drilling when it was a money laundering operation. So if he can nationalize oil, we will drill like China does with CNOOC, Russia does with Gazprom, Lukoil, Rosneft and Transnet, and PBR does in Brazil. The stocks are listed as NaN or "Not a Number" when identifying stock holders.
The author is incorrect about the environmental reasoning and cause of crony capitalism such as Solyndra. If you take Hillsdale's "Constitution 201," the Professors explain how the new Progressivism is fascism. The paradigm shift occurred in 1965. The old Progressives moved leftward to Stalinist/Maoist tactics focusing with LBJ's "Great Society" on the three pillars of Civil Rights, Environmentalism and Education. Look where we have come to so far. Crony capitalism is a major feature of this socialist movement.
I would summarize the shift as the GOP becoming like the better intentioned Wilson and FDR style statist, and the Democrats adopting the platform of the totalitarian socialist.
Russel| 12.14.12 @ 10:45AM
Well put , Von . I may have some of that in my head , but sure can't put it on paper like you . What anyone is yet to nail down tho is : what is the ultimate goal of these socialist , liberal whacko's ?. They live in the greatest country ever made and enjoy its riches and rewards . Are they so stoopid as not to see what they're doing will take all that away ?. This isn't a hard question , but I've yet to hear an answer. Why do Reid and Pelosi take the tack they do ?. Reid is a crook and Pelosi half nuts , but they're both rich and live like royalty . Sign me dumbfounded .
Moe Blotz| 12.14.12 @ 11:29AM
Same reason Barry "choom me" Sotero/Obama wanted to be president: POWER.
Al Adab| 12.14.12 @ 11:33AM
Because Pelosi and Reid, while rich, are not the income producers who are subject to the Obama success penalty tax increase. That $250K tax rate only hurts those running businesses and making such income.
Of course the rates on capital gains and dividends goes up too along with all the other imposts that anyone working for wages will pay.
BTW, taxation without representation might be a cause when we realize that among others there is that $63 health care impost put in place by HHS regulators; never voted into place by our Congress.
Von Mises Jr| 12.14.12 @ 12:02PM
It is because they prefer serfdom where they have power in perpetuity while creating zero wealth. This is the driver that created the "Age of Democratic Revolutions" across Europe in 1760 to 1800. Tallies, quitrents, road taxes, oven taxes were imposed after the Industrial Revolution made serfdom obsolete and the Nobles worthless.
Just listen to Obama, Reid or Pelosi and it is abundantly clear that if they had to compete in the free market to earn a living, they would probably be homeless people. If you tried to present their arguments to a private sector boss of any value, you would be fired on the spot. So you co-opt the government and use the police power to steal what you could not earn.
TLP| 12.14.12 @ 2:20PM
And we all know how this inevitably turns out.
Somewhere, Santayanna is smiling.
Of course, he might be Crying, too.
JD| 12.15.12 @ 3:30PM
If you don't understand why they do what they do, then you're no better than them.
Their flaw is lack of understanding. They don't understand what makes America great. They don't know what their policies actually do. They think the rich used to pay a lot more taxes. They think the poor are worse off than before. They think unprecedented greed is causing the problems that their policies cause.
You must understand the truth, and you must understand what they have wrong. If you don't understand both of these things, then you are like they who base their positions on misunderstanding.
Louis Jenkins| 12.14.12 @ 9:01AM
Except, Except, wait for it, OBAMA , the Democrat party, and Tree Huggers. The only way for America to have more abundant energy is for the government to nationalize the industry. There seems to be a dis-interest for cheaper hydrocarbons. Taxing it is a different story. We all know that it is in the best interest of our economy, but let's be honest, it is all in politics. Get the politics out of it, and America would soar.
TLP| 12.14.12 @ 2:47PM
Contest at Tuesday's Story: More Pants Than Fire.
Look for Pinnochio.
MikeW| 12.14.12 @ 9:21AM
There are lots of good reasons to encourage use of home-grown hydrocarbons, but invoking the Middle East turmoil perpetuates the Gulf Myth; i.e. that the U.S. is totally dependent on Arab oil.
The U.S. imports 45% of its oil, and 22% of that comes from the Middle East. Do the math: less than 10% of our oil comes from that part of the world. Even if we reduce the percentage to zero, the problems of Arab infighting and anti-Israel hostility won't go away.
c. j. acworth| 12.14.12 @ 10:37AM
But we would have far more leeway in dealing with the problems of Arab infighting. As in, why do we care what they do to each other? They have shown themselves to be a bunch of savages who pine for the 7th century. Fine, let them have it. Just stand ready to jump on their necks with both feet if they try to export it. If any decide that they would like to join the League of Grown-Ups, let them ask politely and we'll talk.
Al Adab| 12.14.12 @ 11:37AM
The US is about to become ance again the worlds leading producer of oil Why then do we export, say to use round numbers, 100 tankers every day while we import 100 tankers everyday? Should not American oil remain in America and drive down the energy costs here before we export the surplus? Our military should not be dependent on imported oil (ask Japan how that worked) when action is required.
TLP| 12.14.12 @ 2:48PM
Exactly.
Sturmudgeon| 12.14.12 @ 4:58PM
Great post, c.j.
Thanks!
Vance P. Frickey| 12.14.12 @ 10:29AM
It's no longer a matter of political alignment whether you believe in global warming. I personally doubted the case for global warming based mostly on IPCC's history of academic fraud and naked political gamesmanship, but Princeton's Freeman Dyson has adopted the case for global warming after having been a skeptic for years (partly for the same reasons I mentioned).
Since the case for global warming being good enough finally to stand without help from academic fraud and political log-rolling, hydrocarbons can't be the sole foundation for an American economic recovery, nor can they be used without substantial repair of the damage they cause to the environment. Dyson proposes massive planting of rapidly-growing trees to trap the carbon dioxide which is the problem with hydrocarbons. That can also be used to help with soil erosion throughout the world and to create jobs and repair the damage that exploitation of federal lands for oil, gas and shale will inevitably cause.
We need to work on other forms of energy. Solyndra and other less well-publicized solar flops paid for by Federal loan guarantees demonstrated that solar doesn't have the power we need for our industry. Nor does wind. Nuclear is the only real power source potent enough to run our country that won't add to global warming. Great to know we have plenty of hydrocarbons, but we'll need them as industrial feedstocks, not power.
BShep| 12.14.12 @ 12:22PM
Let's see, how can I reply to this in a simple but clear manner?? Oh yeah, BULLSQUAT!
I may be able to accept global warming (hard to do when the average temperature has been going DOWN during the last decade) but I can never, ever accept man made global warming. That, my dear sir is BULLSQUAT, plain and simple.
Besides, global warming does not mean summers will be so hot that we are all going to die. It means that our winters will just be a little milder. Being a Michigan resident in December (go RTW) makes me wish for milder winters. After all, even the rabid MMGW believers are only predicting a 1 degree C average increase in the next hundred years (or whatever their current nonsense is).
Al Adab| 12.14.12 @ 2:56PM
Temperatures of today are roughly equivilent to those around the year 1000AD when the vikings were farming Greenland; during the time of King John when wine grapes grew in England and to about 1350 when the "little ice age" set in. That lasted to about 1815 when temps began to rise again.
Nuclear for electric production is essential. The Navy has been running those things for over fifty years now without incident. Hydro works and does not pollute. Leaves lots of oil to make gasoline cheap if we quit importing and use our own supplies. A few new refineries would make a lot of difference and create jobs both during and after construction.
Sturmudgeon| 12.14.12 @ 5:09PM
Good points and thoughts, Al... Thanks for the Common Sense.
Petronius| 12.14.12 @ 10:43AM
Banish the EcoCommies and drill.
Moe Blotz| 12.14.12 @ 11:41AM
Perhaps I will suggest to my elected representative to Congress and my Senators that we utilise the energy lying dormant in all the welfare recipients the administration has created. Before doling out millions of dollars in food stamps and welfare benefits, make the able bodied walk or run five hours per week on treadmills set up all around the country. Hook the treadmills to a generator and feed the juice to a central location ,then feed it to the electric grid. Think of the power 20 to 40 million bodies could generate every week. That might also reduce obesity among the government dependents as well. Now if we could just get our president to rescind his executive order that lifted the work requirement...................
Sturmudgeon| 12.14.12 @ 5:03PM
good one, Moe... but there would have to be TV monitors in front of the treadmills to act as the "carrot".
Who Knows?| 12.14.12 @ 1:12PM
If you want the full story, read “The Bottomless Well---The twilight of fuel, and why we will never run out of energy”, by Peter W. Huber & Mark P. Mills, 2005.
Yes, the same Mr. Mills.
Ah, the damage done by the pubic school systems in America are oh so far reaching!
There have always been “gaps” between X and Y.
The missile gap, the CEO gap (men verses women), the wage gap, the computer use gap, etc, but the knowledge gap is killing us. That, and the gap between people with closed minds, deeply programmed by the leftist schools, and those with at least the possibility to hear and process new information---deadly.
While we are presently going through the War of the takers verses the makers, led by Obama’s gang, I expect the gap to even widen---that is, the absolute number of real makers will likely stay about the same, while the takers grow; after all, pubic schools (including post high school education) continue to spit out programmed babies.
So, if now, in 2012, in America there are X makers and Y takers, in a generation there should still be X makers, but maybe 2Y takers.
Power to the elite makers!
JP| 12.14.12 @ 2:41PM
The political will to drill for shale and to frack on public lands will come as soon as enough Americans suffer through daily or weekly blackouts. Nothing like $1000/month electricity payments to get the voters to actually pay attention.
Coming in 5 weeks: the EPA will present the findings of its 3 year study of regulating fracting on private lands. This study will become law once the President approves it and signs the Executive Order.
JD| 12.15.12 @ 3:36PM
Many a conservative has made predictions like this one, and all have been wrong for one simple reason: they underestimate the Leftists' ability to lie about the causes of and solutions to problems.
The Leftists and their media will never let people believe that the solutions to resource issues are conservative ideas. That means people will never clamor for an end to Leftism.
sdfhlk | 12.14.12 @ 9:09PM
merry christmas to u,thank you so much.
jbspry| 12.16.12 @ 12:51AM
I would certainly support full-on development of American energy resources but with this caveat: that domestic resources be reserved for domestic markets alone. To allow our oil, gas and coal to be sold on the world market would enrich the oil companies but be counter-productive to the goal of national energy independence; we would simply be another Venezuela or Saudi Arabia.