Category — Carter, Jimmy

As a Democract, I have asked myself how it is that the current administration could be so consistently wrong on energy policy. There was a time in the days of Bob Kerr, Lyndon Johnson, Sam Rayburn, and Bennett Johnson that energy policy was bipartisan. In fact, those Democratic wheel horses from the great Southwest made sure that the policy–particularly as regarded oil and gas– was somewhat rational.

Carter Was Pro-Drilling Compared to Obama

The last Democratic President to acknowledge the need for exploration was Jimmy Carter, under whom I served as Deputy Assistant Secretary for Oil and Gas. Carter pushed both an offshore 5-year leasing plan and production from the Naval Petroleum Reserves. I know–I was in charge of both.

So despite the Windfall Profits Tax and much hyperbolic rhetoric, President Carter had a foot, or at least a few toes, in the pro-production camp. And it was none other than Carter who set up the Arctic National Wildlife Refuge (ANWR) for drilling (after adequate study) as one of his last acts in office.

The 39^th President also initiated both the decontrol of gas dating from the 1950’s and the (phased) decontrol of crude oil and oil products that began with Richard Nixon in 1971 which Reagan simply accelerated with his famous decontrol executive order of January 1981.

Democrats vs. Drilling

But no more! Democrats today seem to want to fly in the face of reality by espousing phantom sources of energy and working at cross purposes with American interests:

Democrats today tend to:

• Believe in Peak Oil and the imminent end of the hydrocarbon age
• Accept Global Warming Alarmism unquestioningly
• Exaggerate the decline in the state of the environment when it is actually improving
• View hydrocarbons as a threat to modern civilization rather than its creator and preserver and to viscerally oppose oil and gas exploration
• Exaggerate the environmental impact of oil drilling both on and offshore

All this leads Democrats to support and subsidize trendy new sources of power (e.g. switchgrass!) without acknowledging how limited or how environmentally damaging they are when implemented on a large scale.

This has only a little to do with “free market” ideology. I assert that a centrist–or if you like a moderate liberal–who believes in moderate government intervention (securities regulation, social security, Medicare, single payer health, etc.) can: [Read more →]

Thirty years after President Carter declared that our energy crisis was the “moral equivalent of war,” forever known as “meow,” we are faced with another federal potentate who is sure that he knows what is best for us. At a Smart Grid conference in Washington, D.C., Energy Secretary Stephen Chu opined that “The American public … just like your teenage kids, aren’t acting in a way that they should act.”

Just as President Carter declared that our country’s failure to conserve natural gas and oil was a symptom of a “malaise,” not heaven forefend, the low prices for fuels sold at (federally) regulated prices, so does the current Energy Secretary believe that our citizenry is incapable of making rational decisions about energy use.

Why would the smartest guy in the room (read: central planner) say such a thing–a mistake his press office now says?

Incentives Matter

We consumers respond to economic incentives all the time. If the government offers an incentive to get rid of a car that was already paid for, then we will take the $4,500 and walk away with a new one; when the price of oil and gas rise people put on sweaters and turn down the thermostat, install new windows and think about shorter commutes to work; if the government encourages banks to lend money at very low rates to anyone with a pulse, then people will borrow money to purchase houses they cannot afford; if the government pays companies to generate electricity using wind then they will try to do so regardless of its specific utility in the energy mix. Incentives run the world of personal choices. People can only make rational decisions about the real alternatives that face them, not about some theoretical concerns far in the future.

Obviously, the Secretary thinks he was the only person to grow up in a household where dad told us to turn off lights, shut the refrigerator door, close windows in the winter and other staples of energy-conscious behavior. Only it was not really energy-conscious behavior that motivated dad, it was the gas and electric bills at the end of the month.

I’ve got news for you, Mr. Secretary, a lot of us grew up with this dad, made fun of him at the time for his “light bulb fetish,” and now tell our children exactly the same things (and don’t track mud on the floor, while you’re at it!). [Read more →]

In hearings recently held by the House Science and Technology Committee, new Secretary of Energy Dr. Steven Chu remarked that energy- intensive companies were seeking to save energy because it could result in large savings (so what’s new?). But then the DOE head said, “the more forward looking companies … see in the long term energy costs just increasing because in the long term, as noted before, oil, natural gas production will eventually peak and decline, plateau and decline” (emphasis added). [Note: this is a paraphrase from the recording, at about 1:32.]

Apparently, Secretary Chu has taken to heart the arguments of the Hirsch report, which was essentially a survey of expectations by various forecasters, primarily peak-oil advocates, [Read more →]

Many in the energy business, whether or not they support President Obama’s positions on energy and the environment, are likely to think, “Look, the US is a big ship. It cannot be turned around in a couple of years, and even if they tried, you can right the course at the ballot box.”

Actually, you can’t. The United States is still a nation of laws, and without strong political support, the acts of one administration cannot be easily reversed or undone by the next.

But there is more to the story than simple inertia and political head-counts. Each new administration enters with an agenda of positive goals. Spending time and political capital on your predecessor’s agenda can often find its way to the bottom of the to-do list. Moreover, a new president has only a limited circle of advisers. They cannot know everything about what the last guys did (Hayek’s revenge). [Read more →]

Government policies that arrest economic recovery and diminish economic growth reduce our carbon footprint. Indeed, human misery and carbon reduction are positively correlated in a growing world where consumers demand red-meat energy–oil, gas, and coal. The Malthusian wing of the Obama Administration knows this, and they might just be hoping that the recession will last long enough so that folks question their long-standing belief of economic growth. Rising expectations among the masses is the bane of interventionists and Malthusians everywhere.

So get ready for the end-of-growth mantra from the Left as time marches on and Obama’s economic recovery plan keeps the economy from recovering. [Read more →]