A short summary on Energy Policy
I’ve been wanting to start blogging about politics recently, but it’s taken more time than I imagined to actually get around to it. So, finally, after beginning to peruse websites of the “presumptive” candidates, I figured energy policy would be a good place to start. I mean, going by the headlines, it’s such a simple thing – we have a finite amount of oil on the planet so we need to switch. And we need to switch away from oil because man-made global warming has reared its ugly head. And we’re angry at the oil companies, Arabs and (now) the evil speculators for driving up the price of gasoline, so controls are needed there as well. See the issue?
Just as way of creating a disclaimer, let me say that:
A) I have no intention of voting for McCain, so that’s that’s not the purpose of this.
B) I’m not a disgruntled Hillary supporter.
C) I’m not terribly worried about man-made global warming. Honestly, I think it’s mostly hype.
That said:
D) I love our environment; I’d hate to have our skies become as smog filled as China’s – that alone is reason enough (for me) to think we should be searching out alternative energy sources.
E) Oil is a tremendously efficient form of stored energy, and its essential to most of ours very existences (think beyond recreation and instead focus on fertilizers, food transportation, electricity for food storage) – until we know we have an alternative solution, we should do all that we can to make sure that what we have lasts us for as long as it can.
And now, most importantly,
F) I find it HIGHLY annoying that (in my own personal experience), the people that are most upset about high gas prices are also the ones that are most likely to jump onto the Al Gore band wagon. On the one hand, we must save the environment, and on the other, we must castrate Exxon Mobil and the Arab countries for gouging us at the fuel pump.
This isn’t actually directed at Barack Obama any more than any other “green” promoter, I just found the following quote on his Senate web page and decided to run with it.
“America must commit to a new national energy policy focused on improvements in technology, investments in renewable fuels such as wind and solar power, and greater efforts in conservation, efficiency, and waste reduction. Shifting from our current investment and consumption practices to this new direction will be one of the great leadership challenges in the coming decade”[i]
The keyword tonight is “conservation”, as a lot of us keep thinking “if only we conserve more, that’ll go a long way towards getting us out of our problems.”
Now, my personal thought on this is that high prices at the pump are the number one way to enact conservation; simply put, if gasoline is $1.00 a gallon, people will drive a lot more than if it was $10.00 per gallon. It doesn’t matter to me whether the premium goes into the pockets of oil companies, Arab countries or the government’s coffers via fuel taxes, all of those are the same end result in my book.
I mean, most of us talk a pretty good talk when we try, but when reality sets in, conservation generally falls on the shoulders of someone else – before it was the Humvee driver and the oil plant operator, now it’s the Chinese and Indian. So, knowing that we are pretty much incapable of conserving cheap, abundant energy, I think price is the one option we can use to moderate consumption. It’s simple supply and demand, the more expensive something is, the less people want it.
And by way of recent experience, there actually seems to be a factual basis to it:
Citing high energy prices, Transportation Secretary Mary Peters reported that up until June, Americans had driven nearly 20 billion fewer miles than they had a year earlier[ii]. Let me emphasize - 20 billion miles. And according to the Department of Energy, we get about 19.6 gallons of gasoline from a barrel of oil[iii]. And, according to the Department of Transportation, in 2004, the average mileage of the entire fleet of vehicles in the United States was 24.7 miles per gallon[iv].
Some math: 20 billion miles (not driven), divided by 24.7 average miles per gallon, divided by 19.6 gallons of gasoline per barrel of oil means that we saved 41,312,071 barrels of oil. We as a country use 20.73 million barrels per day[v], so essentially, high oil prices saved us 2 days worth of our fuel consumption, or we reduced consumption by one and one-third percent.
See the conundrum? When Al Gore touts his energy goals, to me, it’s just talk. I know a LOT of people who spent a LOT of time talking about Al Gore’s movie after it came out, but know very few who actually took concrete action to reduce their “carbon footprint” (I’m just as guilty as any of the rest).
Meanwhile, “evil” oil producing countries and multinational companies who line their pockets with our hard earned money are the ones targeted in so many email campaigns (you know, don’t buy gas from a certain gas station on a certain day in hopes of bringing the price down) were the ones able to reduce our energy usage by 1.3% simply by letting the price of oil rise. If global warming is really “a planetary emergency that now threatens human civilization on multiple fronts” [vi] biggest issue we face, shouldn’t we be applauding them for helping save us from ourselves?
And now, of course, is the downside: the federal government collects 18.4 cents per gallon tax on gasoline (2), which reduced government income by nearly $149 million (coming out to $357.5 million annualized). Which is a drop in the bucket compared to our federal spending ($2.9 trillion according to the 2008 Federal Budget[vii]), but considering we run a budget deficit we come down to having two choices: raise taxes elsewhere to cover the shortfall, meaning we all end up paying more simply because we started to conserve (how’s that for an incentive?), OR we borrow the money from overseas and pay it back in 30 years.
And besides, all those millions add up here and there, and we have to find quite a few of them to finance Obama’s 10 year initiative to spend $150 billion dollars to “to advance the next generation of biofuels and fuel infrastructure, accelerate the commercialization of plug-in hybrids, promote development of commercial-scale renewable energy, invest in low-emissions coal plants, and begin the transition to a new digital electricity grid”[viii].
Let me again swing back to McCain again. He’s a man who professed that he “doesn’t really understand economics” (sources abound, just check Youtube) – and again, that makes him completely unqualified from the get-go to run our country. So presumably Obama does have a cursory understanding of numbers. At least, I’m hoping, he knows more than me (a high school dropout). Because on top of all of his spending initiatives, I’m lead to understand that he hopes to also reduce taxes on people like you and me (the middle class), and ratchet tax rates on the “top 1%” back to 1999 levels, which I just can’t imagine filling that enormous shortfall. Oh, and we all get free health care.
Do I have a fix for all this? No. But that’s not my job. I just wanted to point out that when someone does come forth claiming they have the answers, it’s more than likely they don’t, because the issues extend so much further than most politicians are willing to talk about.
SOURCES:
[i] Senator Barack Obama’s website – http://obama.senate.gov/
[ii] CNN.COM: Americans drive 1.4 billion fewer highway miles - http://www.cnn.com/2008/US/06/18/driving.cutbacks/
[iii] DEPARTMENT OF ENERGY: Gasoline FAQs - http://tonto.eia.doe.gov/ask/gasoline_faqs.asp
[iv] DEPARTMENT OF TRANSPORTATION: Summary of Fuel Economy Performance http://www.nhtsa.dot.gov/Cars/rules/CAFE/docs/Summary-Fuel-Economy-Pref-2004.pdf
[v] NATION MASTER: Oil consumption by country - http://www.nationmaster.com/graph/ene_oil_con-energy-oil-consumption
[vi] THE TIME TO ACT IS NOW by Al Gore - http://www.rollingstone.com/politics/story/8730988/the_time_to_act_is_now/
[vii] FEDERAL BUDGET OF THE UNITED STATES - http://www.whitehouse.gov/omb/budget/fy2009/summarytables.html
[viii] BARACK OBAMA FOR PRESIDENT website - http://www.barackobama.com/issues/energy/