McCain: Let’s eliminate our dependence on oil so that we don’t have to fight any more Middle Eastern wars

If McCain is still losing sleep over the issue of torture, he should stop talking about the MidEast beyond the need for resolution in pursuing our interests – the bumbling (albeit conventional Beltway wisdom) otherwise is incredibly painful. But even more importantly, most commenters here – and posters – and just about everybody else also need to get a clue WRT oil “dependency”.

We – and the fabulously dynamic, growing world economy with which we are quite integrated – are dependent on oil for energy and other needs for a good reason – it’s the best commodity for its use at prevailing prices. Period. Just as is gypsum for wall-board, and sand for cement, and softwoods for framing houses. There’s nothing special about oil, other than it having the most efficient global market of any commodity.

All talk of “energy independence” – all – is stupid and misleading, in the most fundamental ways:

1) Petroleum is, by far, the best commodity for its current uses, at current prices. We are dependent on it to the extent we want to maintain current standards and modes of living. Any changes to reduce oil consumption, other things being equal, will entail significant reductions in living standards and economic activity with current infrastructure and technology.

2) Petroleum is a global commodity, produced, refined, marketed, distributed, and priced as efficiently as any item in human history. Short of surely ruinous and chaotic attempts to separate the US from world markets WRT this commodity through export controls and price regulation, there IS no separating ourselves from the world oil market. We don’t import much actual oil from the MidEast, but it doesn’t matter – it’s a GLOBAL market, and adjusting for things like different sulfur/parafin levels and configuration of specific refineries for specific feedstocks, it doesn’t matter where the oil comes from, and the price will be the same for everyone (save for producers who stupidly sell at subsidized prices – Mexico, OAPEC, etc).

3) Petroleum prices were almost unchanged in real terms for nearly 3 generations. Current and recent price increases reflect global supply/demand. Feasible increases in supply – within the US and world-wide – will be unlikely to return average prices to levels to which people are accustomed. Oil is not “running out,” and there is no “crisis”, but the balance of demand vs. supply has shifted due primarily to the great success of the US and free markets in mobilizing increasing percentages of the human race into economic growth and opportunity (China and India, for short).

4) Global jihadism does not rely in any way on a given level of oil wealth or cash flows. It is an ideologically driven menace whose most damaging attacks are inexpensive to mount. The only relevance of oil money is in state sponsorship and possible WMD proliferation. Unfortunately, mass-casualty terrorist operations and even WMD technologies do not require that much in the way of financial resources either (any more). Iraq under the old regime was easily able to pursue an extremely ambitious, broad, and sophisticated WMD program embracing nuclear, chemical, and biological weapons as well as delivery systems, as well as substantial economic development, all on real price levels of oil we can only dream of today.

5) Therefore our strategic or security interests in the MidEast are not and will not be affected by whether oil is a bit more or a bit less expensive. The jihadi enemy will not be affected by the oil situation, and our strategic interests, both economic and security, drive our interests in the MidEast.

Translated: there’s no such thing as “energy independence”, and even if there were it wouldn’t get you anything strategically anyway, if you’re the US, with unique capabilities and exceedingly compelling interests in the geopolitical and security situation in the MidEast. Additional points: drilling off FL and CA and in ANWR all make sense, but let’s not pretend that even the dream scenario of increased production would return us to even the later chapters of the 70-yr marvel of cheap oil. It WON’T.

The torture of hearing everyone on all points of the political spectrum mangle these issues has become unbearable. The “conservatives” are correct that increased production is desirable (domestic or foreign is irrelevant), the “liberals” are pretty ridiculous (even by their standards) in their opposition to increased production, NIMBY-types in FL, CA, and elsewhere are the same – but everyone without exception displays a complete lack of understanding of economics, the oil markets, and US foreign policy when they discuss the chimerical issue of “energy independence”.

IceCold on May 2, 2008 at 6:51 PM