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.
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.
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.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
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?
Was the President done in by the economy, or by the politics of the economy?
H/T to National Review Online