Democrat And Environmentalist Turns Traitor On Drilling For Oil

I’ve become a Bush Democrat. I’m so convinced, thanks particularly to the Bush years, that the Republican party is on the wrong track fiscally, internationally, environmentally, and socially in terms of judicial appointments that I would vote for a broomstick if it were a Democrat against any Republican for any office. That even includes Charlie Christ and a few other Republicans whom I respect greatly. I just don’t want that party in power any more.

But (you knew there was a “but”) I think the Democrats and the environmentalists are wrong about a key aspect of energy policy, drilling for oil. I think the U.S. needs to drill, drill, drill - everywhere. That is, assuming control by each state of the final decision regarding their respective shores. And in a safe way, to be sure. And only as part of a broader energy policy that includes strong incentives to transition to electric vehicles and produce electricity in clean and renewable ways. And I would add a windfall profits tax on excess oil company profits too, as I discussed a few days ago.

The main reason the Democrats are wrong about drilling is actually the central argument that they themselves make: that it will not produce oil for ten years. But, hey guys and gals, that’s exactly when we are REALLY going to need it. Maybe a little earlier. But believe me in ten years oil will be well over $500 a barrel - maybe $1,000 a barrel - and scarcer than you can imagine. We will have stopped driving not only Hummers but even light pick-up trucks, except when totally necessary. We will no longer be profligate users of oil. We’ll be driving small cars and electric cars, taking public transportation, car-pooling, and adopting all sorts of good habits.

And still the price of oil will be sky high because the Chinese and Indians and Russians and Saudis will all have six times as many cars on their roads as they do now. And the Mexicans will not be exporting any oil - in fact they will need to import it. Only the Russians, the Canadians, and some OPECers (like the Saudis but not the Iranians) will be exporting oil, and not nearly as much as they do now. (And the Brazilians will be a bright spot too).

If oil could be delivered in just a few years from newly authorized U.S. drilling offshore and in ANWR (where only very wealthy people could ever afford to visit- although hardly anyone ever does), I’d be opposed to it. We do not need another “hit” of oil while we are still addicted to it, as Tom Friedman argued in today’s New York Times. But in ten years the addiction will be over. We will have made the transition to an electric economy. And we will never go back because renewable electricity from wind and concentrating solar thermal plants and other sources will be so much safer, cleaner and cheaper than the oil to which we are now addicted.

This suggests that Tom Friedman was wrong today to say that drilling now will feed our oil addiction. But his central point was right, that Congress needs to re-authorize incentives for producing alternatives to oil. His drilling point was wrong only because he apparently does not understand enough about the timing of peak oil, the rapid transition, and the availability of the oil we would get if we began now to authorize more off-shore and ANWR drilling now. But Friedman is no more wrong on drilling than the Democrats who actually know it will be ten years before the oil flows and still oppose it.

What a really smart Democratic party would do at this point is trade off new drilling rights for a windfall tax on the unnecessarily high part of oil profits and then re-distribute the tax revenue to consumers and thereby save our economy from the consumer meltdown that is now in progress. Just like the Berlusconi government is doing in Italy.

I’ve been an Obama fan from the start because I think brains and judgement matter and I think he’s got more of both than anyone else. Of course, you can’t use your brains too much during an election campaign other than to get elected. (Can you imagine if Bill Clinton had campaigned on welfare reform in 1992? He’d have been murdered by his own party!) But I am hoping that if Obama can get elected, he’ll manage to push the Democrats toward more rational energy policies - like increased drilling for oil off the Outer Continental Shelf and ANWR - that might actually help the country. When we need it. Not now, but ten years from now.

Posted in Categories: Canada, Commodities, Contributor, Eurozone, External Research, USA.

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