Washington’s Unpopular War on Energy

June 18, 2008

Washington’s Unpopular War on Energy

Most Americans have little faith in the federal government to represent their interests. Who can blame them, when their fears are constantly affirmed by Washington’s shenanigans? According to polls, presidential and congressional approval ratings are hovering around an all time low. Just 17 percent of American voters believe the federal government represents the will of the people.

That this skepticism is well placed is bad news for citizens who are looking to Washington to solve the problem of rising fuel and energy prices. It’s even more dire news for Americans on fixed and limited incomes.

With energy prices already skyrocketing, federal lawmakers wreaked more havoc by trying to pass heavy-handed regulatory legislation known simply as “cap and trade.” The legislation would impose stringent emission limits on energy and manufacturing industries. At the same time, many environmentalists admit that the legislation would have little to no impact on climate change. However, the bill would greatly increase hidden taxes and costs on consumers. The poor and middle class would be hardest hit.

The religious left and even some evangelicals are supportive of the legislation, rallying around a supposed “green” policy at the expense of the economically marginalized. With their support come odd statements like this one from the Rev. Jim Ball of the Evangelical Climate Initiative, “We agree that a cap-and-trade policy will spur innovation and will create new markets.” But even many expert economists who support cap and trade admit that it will have a negative effect on the economy.

Similar cap and trade measures are already law in Europe. Even the more socialist-minded citizens on that continent are trying to reform current law because carbon emission output has only increased, along with already high prices.

Under the proposed legislation, emissions would have to be slashed by 70 percent by 2050. It calls for an elaborate system of carbon welfare credits auctioned off by, you guessed it, bureaucrats and lawmakers. “This is easily the largest income redistribution scheme since the income tax,” declared the Wall Street Journal editorial page. Simply put, the bill’s aim is to radically decrease energy supply, while ignoring demand.

Fortunately, the bill did not pass the U.S. Senate, but you can be assured that lawmakers will redouble their efforts next year. There won’t be an obstructive president in their way, as both presidential candidates Barack Obama and John McCain support the bill’s intent, if not the current version. Many lawmakers for the time being have shifted to another unpopular policy of levying additional taxes on oil profits. But a majority of Americans understand this too will only reduce supply and raise prices.

Genuine efforts to increase the supply of energy have been summarily rejected by Congress on many occasions, even when the local populace and local elected officials of both parties supported taking action. The most famed example is the blocking of attempts to increase domestic oil production in places like ANWR, Alaska. Unsurprisingly, support for domestic drilling nationally is about to reach a super majority level. While the introduction of more domestic drilling won’t solve the nation’s short term or long term energy needs, it would provide much better results than congressional leaders have produced so far.

Concerned citizens and consumers waiting for action on deregulation, or even a consistent or coherent energy policy, will not find answers in Washington. Lawmakers seem intent on raising more revenue at the expense of private industry and lower wage earners, all the while buttressing themselves against future voter backlash with handouts and earmarks targeted to friends and supporters. A free market, which offers more solutions than an out of control tax and spend bureaucracy, will be further constrained in its ability to address our energy needs.

In a famed address in the 1970s, Jimmy Carter spoke to the nation about energy, and said the American people faced a crisis of confidence. Voters soon replaced their confidence crisis with new leadership that insisted more government was not the answer. While circumstances and challenges may be different, voters may not have the same option this time. Citizens might have to sit through a repeat of policies that hastened the energy crisis of the 1970s, coupled with brand new policies that exacerbate a problem already out of control. Very soon gasoline at $4 a gallon may seem like a bargain. And while the free market is ready to act and provide some relief, citizens can be assured that federal legislators are redoubling their own efforts to circumvent popular and common sense solutions.

Comments

Chris Manesq: lokicsm@aol.com

Mr. Grimes. There's a concept. It's called democracy. Sorry you don't share its values. They are the essense of American values.

But I've found that most market evangelists at heart despise democracy, and what it represents -- mature informed people making decisions about their lives, rather than having corporations decide.

Byron Grimes: obadiah4@hotmail.com

Mr. Manes, for all of your dislike of the oil companies, what do you drive? I don't have a car, which gets a bit frustrating when mass transit is only decent, but it is there. Do I trust the corporations? NO, but I can't trust government either, and maybe we can get companies to listen; government doesn't.

brad: brad@gillespiepaddles.com

"Of course Mr. Gissy is right. The only way to competently manage God's creation, besides Our Lord, Himself, is by government. Only politicians and government employees have the dispassionate objectivity and utter lack of self interest (well, at least as much as it is possible for us sinners to lack it) that make such management possible and necessary. They must act as stern monitors over the child-like CEOs who cannot curb their appetites. And, unlike the free market, which operates purely randomly and arbitrarily to advance those who are most motivated by greed, politicians are picked by the people. The administrators and managers they chose to carry out the government's wise policies are very brains of society, carefully selected by means of competitive examinations and cultivated in America's universities. They are better in their areas of oversight than the people making a living in those areas and would dispense with them altogether if it weren't for the accident of history--something which enlightened people are right now trying to get back on a righteous course. All Christians should renounce the dollar, reject the free market and accept Christ's social programs brought to you by His True Vicar--the Federal Government. (With all due respects to the Holy Father in Rome, of course.) "

Ha ha!! What delicious mockery! But what sane person would disagree? Carefully selected government employees do represent the very best in their profession -- and should be appointed to the regulation and governance of all those nasty, untidy, and disorganized details that are so random in the free market -- the free market being the natural interaction of free people; these are the sort of things that upset what should be controlled by efficient government employees, selected by our very finest elected officials -- you know, like our congressmen who are doing such a remarkable job of coming up with winning energy strategies!!

Brad: brad@gillespiepaddles.com

Market evangelism? Strange comment -- I guess that is a perversion of what is otherwise known as the free market. To listen to anyone on the left comment on the energy situation, the mantra is the same: nothing will happen for too many years into the future, and price will be affect marginally (on oil) -- ha ha. I guess wind, solar and biofuels are on the cusp of rescuing us from energy dependency? Without the gov'ts massive assistance, and total pervsion of energy markets, neither wind nor solar will ever be even miniscule players in providing this country with energy. Clean coal, nuclear, and offshore oil drilling are the only really rational answers to our problem. But with an obstinate, socialist oriented congress, the direction will always be towards whatever makes them more powerful and influential -- not towards any sort of market solution, or rational solution! Meanwhile, everyone is destined to suffer under the oppressive gov't mandate to do nothing but attack oil companies -- perhaps the villians to some degree, but also potential saviors! And here's another thought for you government lovers: the left whackocrats, with their admonitions of the oil execs, offer only punitive solutions -- such as taking away the continental land leases, unless they are used. Ok, so what if that happens -- what if our leftie congress takes them away? Will congress then drill on those sites? Will congress save us? I mean I just don't get the direction here. What is congress doing for anyone, other than puffing their flabby chests?

Chris Manes: lokicsm@aol.com

Mr. Grimes, rightwing talking points and anti-gum'mint rhetoric won't change the fact that drilling for more oil (while despoiling the planet) is no solution to our reliance on a vanishing, dirty energy source mostly in control of rather despicable dictators around the world.

Why you would trust Exxon to get us out of the mess they put us in, is beyond me, but then market evangelists are anything but rational.

Byron Grimes: obadiah4@hotmail.com

Mr. Manes, if you don't like what Acton has to say, you don't have to listen. That's a BASIC free market principle. Your tirade against possible new drilling here avoids addressing the problem pointed out in the paper; government does not fix things. You create an agency to deal with a problem, they will make sure the problem not only survives but exacerbates.
As far as Skinner goes, for you other readers, if you check his language carefully, he's being sarcastic and satirical. Note the enthusiasm for clearly impractical goals that are ridiculously expensive. I salute you, sir.

Tom:

OK, Chris Manes and Douglas Skinner are plants to get discussion going, right?

Chuck: cpalm11@yahoo.com

I am responding to Douglas Skinner: skinner_douglas@hotmail.com comments above. We have a great desire for easy answers to difficult questions. (which is why politicians like to talk in sound bites) It makes it easy to believe that some right wing (or left wing) conspiracy is blocking the development of efficient transportation systems. Unfortunately, the truth is, cheap gas for many years blocked development of better systems. Most people choose to drive down the road, alone, in a 6000 lb vehicle, that gets 12 miles per gallon. During the 90s gas was so cheap that driving inefficient vehicles became the norm. Surveys showed that gas mileage was 18th on the list of attributes that people were looking for in a vehicle. Now that energy has become more expensive, people are suddenly paying attention. Sorry to burst your bubble, but electing Obama will not suddenly produce breakthroughs in technology. (If he is anything like Clinton, 6 months after inaugeration he will still be trying to fill his cabinet.) The best thing that congress (who by the way, makes the laws) can do is keep gas at $4.00 per gallon. This will encourage companies to develop and people to buy fuel efficient vehicles. But that has almost no chance of happening, since that would take courage. An leadership trait in short supply these days.

J P HONSE: JPHONSE@NETZERO.COM

IT LOOKS LIKE, "JAM YESTERDAY AND JAM TOMORROW BUT NO JAM TODAY". WHY IS THE DISCUSSION AN EITHER/OR PROPOSITION? WHY CAN IT NOT BE A BOTH/AND PROPOSITION. WHY IS THE OIL INDUSTRY THE VILLAIN AND THE ENVIRONMENTALISTS SAINTS? IS THERE NO MIDDLE GROUND? WHY TELL THE OIL INDUSTRY IF YOU DRILL AND FIND OIL THE GOVERNMENT WILL TAKE AWAY YOUR PROFITS? WHY IS IT OK FOR CHINA AND MEXICO TO DRILL IN THE GULF 50 MILES AWAY FROM KEY WEST AND NOT US? LET'S GET REAL, FOLKS. IF KATRINA DID NOT CAUSE OIL SPILLS IN THE GULF, AND IF THESE OTHER COUNTRIES PURCHASE THEIR DRILLING EQUIPMENT FROM US MANUFACTURERS, THEN FREE OUR PEOPLE TO FIND AND BRING THE OIL HOME. I THINK THAT WOULD CERTAINLY LOWER THE COST OF OIL FUTURES.

Douglas Skinner: skinnerd_douglas@hotmail.com

Of course Mr. Gissy is right. The only way to competently manage God's creation, besides Our Lord, Himself, is by government. Only politicians and government employees have the dispassionate objectivity and utter lack of self interest (well, at least as much as it is possible for us sinners to lack it) that make such management possible and necessary. They must act as stern monitors over the child-like CEOs who cannot curb their appetites. And, unlike the free market, which operates purely randomly and arbitrarily to advance those who are most motivated by greed, politicians are picked by the people. The administrators and managers they chose to carry out the government's wise policies are very brains of society, carefully selected by means of competitive examinations and cultivated in America's universities. They are better in their areas of oversight than the people making a living in those areas and would dispense with them altogether if it weren't for the accident of history--something which enlightened people are right now trying to get back on a righteous course. All Christians should renounce the dollar, reject the free market and accept Christ's social programs brought to you by His True Vicar--the Federal Government. (With all due respects to the Holy Father in Rome, of course.)

William Gissy: wgissy@kennesaw.edu

There are those who believe in the Easter Bunny and those who believe in Santa Claus. They can be forgiven, for the most part, because their beliefs do not threaten others with knee-jerk policy proposals. The sad souls are those who believe in the perfect efficiency of the market process. These people would rather serve the dollar than Christ and lead others astray with their false gospel of free markets solving all problems. F.A. Hayek once wrote that the key is competition not lassiez-faire. Where markets fail to be sufficiently competitive then all bets are off and only a fool would wait for the market to "correct" the problem. Of course there are still Misean fools lurking, corrupting the world with their silly views, all designed to fatten themselves and to Hell with the rest of God's children. Oil is part of God's creation, to be managed wisely for the betterment of his creation not to fatten the pockets of a few corrupt souls./

Douglas Skinner: skinner_douglas@hotmail.com

I took a gander at the www.ourfuture.org blog, mentioned by a previous commenter. It surely offers some real, real solutions. Why, one of it's respondents reports that the Japanese are working on a car that gets 500 (yes five hundred) MPG! I'm sure it's coming out soon, or would be if the capitalists weren't trying to suppress it. Others are absolutely convinced that papering the nation with solar panels will provide a ready solution--much more practical than the over-idealized drilling! There was much speculation about the El Dorado of energy sources: hydrogen. Again, hydrogen cars (and appliances, presumably?) provide a much more concrete solution than drilling oil out of the ground. The problem is that the oil companies are too greedy to realize that they must stop chasing the chimera of light, sweet crude and give the people the hydrogen it deserves. I confidently predict that six months after the inauguration of Mr. Obama, we will not only have a car that gets 500 MPG but it will use hydrogen instead of gasoline.

Werner Speer:

Dear Ray
Your article is on the mark. I believe the democrat leadership will hold off any action until after the elections in order to blame the republicans for the high fuel cost. What an opportunity for the republicans to show where the problem exists, if they will only get the message out.

Phil Lundmanp: phil@lundman.com

Where there is a lack of competent leadership people parish. I fear this is the problem with church and state. But Acton is doing its part to create competency. Good paper.

Chris Manes: lokicsm@aol.com

This article shows just how meritless the author's claims are. Enjoy reality over faith-based mystical assertions about "markets".

http://www.ourfuture.org/blog-entry/offshore-drilling-comes-empty

Chris Manes: lokicsm@aol.com

More market evangelism from Acton. Does it ever cease?

The fact is oil and auto interests have warped the market for years, even to the point of destroying public transportion alternatives and electric cars. More to the point, they have ilnfluence our disastrous energy policy and tied it to a depleting resource held by some of the world's most vicious dictators (which has completely distorted our foreign policy).

Finally, even it we drill as ludicrously irresponsibly as the author proposes, not one drop of oil will be pumped out of the ground for 5 years, and the effect on prices will be a measley 50 cents a barrrel -- ACCORDING TO BUSH'S OWN DEPARTMENT OF ENERGY.

So, please, stop your market evangelism and anti-gum'mint rhetoric and deal with the facts: we need a national energy policy that replaced the moribund fossil fuels with new clean renewable energy sources (starting with solar). We should do this by having a Manhattan project to make the US energy independent in 5 years, starting with solarizing the federal government, creating economies of scale for solar power. We should fund the changeover with a tax on the oil industry and the top 1%, so that money that is now going to hedge funds instead goes to production of useful products -- new energy sources.

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