(By Mark McCutchan)
President Obama gave a speech Wednesday at Georgetown University, describing his administration’s “Blueprint for a Secure Energy Future”. In the speech, he hit a number of strong notes in favor of reducing our dependence on foreign oil, recognizing that we cannot drill our way out of the problem, and calling for efficiency in addition to development of cleaner energy resources. Unfortunately, the President left out the real key to reducing our foreign oil addition – a cap-and-trade program that would reduce our nation’s emissions of greenhouse gases that cause climate change.
Our President’s speech started with a summary of the world’s recent stories of Japan’s tragedy, and our decision to join our allies in enforcing a no-fly zone in Libya. President Obama then quickly got to the point of our recent run-up in energy prices:
So here’s the bottom line – there are no quick fixes. And we will keep on being a victim to shifts in the oil market until we get serious about a long-term policy for secure, affordable energy.
He gets kudos for not sloganeering or waffling on the need to fix the problem. President Obama continued:
I’m setting a new goal: one that is reasonable, achievable, and necessary. When I was elected to this office, America imported 11million barrels of oil a day. By a little more than a decade from now, we will have cut that by one-third.
I set this goal knowing that imported oil will remain an important part of our energy portfolio for quite some time. And when it comes to the oil we import from other nations, we can partner with neighbors like Canada, Mexico, and Brazil, which recently discovered significant new oil reserves, and with whom we can share American technology and know-how.
That’s a great (if modest) goal – reducing imported oil usage by 1/3 from 2009 to around 2022 breaks down to a reduction of 3% per year.
America uses 20.7 million barrels of oil every day. We produce only 8.5 million barrels of oil per day, and must import about 10.4 million barrels per day. This foreign oil creates a trade deficit of about $380 billion per year (at $100/barrel), equal to 76% of our 2010 trade deficit of $498 billion. Clearly, imported oil has a huge effect on our trade balance, and needs to be reduced for America to become economically healthy.
Why did President Obama mention Canada, Mexico, and Brazil as sources of imported oil? He is implying that the U.S. should reduce its dependence on oil from the Arab states, and prefer sources closer to home. This would be good for the U.S. for two reasons: the Middle East is currently in political turmoil, where control and maintenance of the flow of oil is uncertain, and secondly, some foreign oil profits end up in the hands of groups that would do us harm. For example, Saudi Arabia pays for schools internally and in other Arab countries that use the radical Wahhabi curriculum, which teaches hatred of non-Muslims, and that democracy “is responsible for all the horrible wars of the 20th century”.
President Obama says cutting our dependence on imported oil depends on two goals: finding and producing more oil at home, and reducing our dependence on oil with cleaner alternative fuels and greater efficiency. But after disproving the GOP’s attempt to blame his administration for higher gas pump prices, he then correctly discounts the value of the first stated goal:
But let’s be honest – it’s not the long-term solution to our energy challenge. America holds only about two percent of the world’s proven oil reserves. And even if we drilled every drop of oil out of every one of those reserves, it still wouldn’t be enough to meet our long-term needs.
As stated here in a previous Winning Progressive column, oil produced on U.S. soil does not go solely to the U.S. needs. Like all oil produced, it goes to the highest bidder on the world market, and if China outbids American customers, China gets it. The “Drill here, drill now” mantra is purely political fodder, and no solution to our energy needs.
The president next makes the case for two alternative fuels, natural gas and ethanol. He emphasizes that the safety of natural gas needs to be improved before its use is pursued whole-heartedly, to which we agree – hydrofracturing, or “fracking” usually employs chemical solvents to loosen the gas from the shale in which it is held. As documentaries such as “Gasland” have shown, fracking releases these solvents and natural gas into the water table, endangering the safety of the drinking water and the citizens who depend on it.
Ethanol is no godsend either; when corn is used as the fuel source, food prices inevitably increase. While cellulosic sources like wood chips or switchgrass holds significant promise, the cost doubles to about $2.20 per gallon. Valuable cropland is used for a non-food source, with the potential to drive up food prices.
As we replace oil with fuels like natural gas and biofuels, we can also reduce our dependence by making cars and trucks that use less oil in the first place.
And the president is off and running about fuel standards. He also promotes mass transit, electric cars, energy efficiency, and more public funding for advanced energy research – all laudable and progressive programs.
There is still an “elephant” in the room that President Obama did not address, nor is it mentioned in the 44-page Blueprint even once – addressing greenhouse gas emissions through a carbon tax or cap-and-trade. Requiring fossil fuels to reflect their full cost to society is a powerful tool for weaning America off fossil fuel, but the President seems to have taken it off the table for discussion. Such action is a bit baffling, as it would be a good idea from a policy stand point to play up the fact that the power of America’s free market system can be harnessed for the good of all Americans (and not just the wealthy and powerful) if we were to phase in a simple carbon tax, or allow a cap-and-trade system to reduce carbon emissions in the most cost-effective way possible.
The Center for American Progress (CAP) put out a publication in 2007 entitled “Progressive Growth – Transforming America’s Economy through Clean Energy, Innovation, and Opportunity”. The report was written by John Podesta (among others), current CAP President and former White House Chief of Staff under Bill Clinton, and in it he describes how a sustainable economy and job growth would be helped, not hurt, by a low-carbon policy such as cap-and-trade.
President Obama needs to find the courage to face down the GOP naysayers, Big Oil and Big Coal, revive either of the carbon tax or cap-and-trade “elephants”, dress them in the patriotic clothing of American energy independence, and explain to the American people that this is how we will win the future.
Please contact the President and your Senators and Congressperson, and write a letter to your local newspaper editor and explain how putting a price on carbon emissions, in the form of a carbon tax or cap-and-trade system, will help America achieve energy independence
Here are links for submitting letters to the editor for national papers, and to newspapers in Colorado, Connecticut, Delaware, Illinois, Iowa, Maine, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, Ohio, Pennsylvania, Rhode Island, Vermont, and Wisconsin.
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