The $140-per-barrel, partial epiphany beats none at all

Charles Krauthammer marvels today at the irony that the energy crisis has produced in the presidential election.  The candidate of change now excoriates his opponent for adapting public policy to over a quarter-century of changing conditions, and the marvel according to Krauthammer is that John McCain hasn’t adopted even more change.  If drilling in the heretofore pristine oceans works for McCain, why not the tiny portion of ANWR set aside for just that task?

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At a time when U.S. crude oil production has fallen 40 percent in the past 25 years, 75 billion barrels of oil have been declared off-limits, according to the U.S. Energy Information Administration. That would be enough to replace every barrel of non-North American imports (oil trade with Canada and Mexico is a net economic and national security plus) for 22 years.

That’s nearly a quarter-century of energy independence. The situation is absurd. To which John McCain is responding with a partial fix: Lift the federal ban on Outer Continental Shelf drilling, where a fifth of the off-limits stuff lies. …

The oil crisis handed McCain an unexpected and singularly effective campaign issue. A majority of Americans now favor drilling in the Arctic and offshore. Democrats stand in the way of increased production, just as they did 13 years ago when President Bill Clinton vetoed drilling in ANWR. Domestic oil production would be about 20 percent higher today if the Republican Congress had been allowed to prevail.

As expected and right on cue, Barack Obama reflexively attacked McCain. “His decision to completely change his position” to one that would please the oil industry is “the same Washington politics that has prevented us from achieving energy independence for decades.” One can only marvel at Obama’s audacity in characterizing McCain’s proposal to change our policy as “old politics,” while the candidate of “change” adheres rigidly to the no-drilling status quo.

McCain is a lot of things, but the man who opposed ethanol in Iowa — as Obama shamelessly endorsed the most abysmally stupid of our energy policies — is no patsy of the energy producers. Americans know that increased production is needed to complement reduced consumption as the only way to get us out from oil shocks, high prices and national security blackmail.

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Unlike Krauthammer, I’d accept an incremental approach to the problem.  It would at least be an improvement over the last quarter-century of stubborn refusal to access our own resources rather than keep us at the mercy of murderous regimes in volatile regions.  If we start with the OCS and move towards shale and interior oil deposits in Montana and the Dakotas, we can keep ANWR as an open issue for later efforts.  Unlocking those assets will bring plenty of supply back to the market, and that will curtail the shortage issues that fuel speculators.

In a rational policy, ANWR would be opened as well.  The entire intent of creating that portion of the refuge was to get oil from it.  We didn’t need it in the early 1980s, and the lack of effort then to pursue ANWR allowed it to become a tradition, of sorts, for the self-sacrificing need to pay homage to bleak tundra in the name of environmentalism.  And perhaps that didn’t work out badly, as the advances in drilling technology made during that period means that we can drill more safely with less potential damage now than we could have hoped thirty years ago — the same argument that McCain makes for drilling in the OCS, as a matter of fact.

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Boosting domestic oil and energy production would start a series of effects for our economy that reach much farther than the gas pump.  We would purchase less of our oil from abroad, which would cut into the trade deficit.  That would strengthen the dollar, which would then cut the price of oil even further.  Food prices would stabilize.  The boom in the energy industry would add good-paying jobs to the economy, which would boost retail sales as well.  It could help take the edge off the credit crunch in the long run as people would have less need of credit.

We should be thankful that at least one of the two presidential candidates has shown the willingness to demand change to meet changing conditions.  For Americans who wonder why we continue to hold our economy hostage to the vagaries of foreign potentates and a region full of conflict, that candidate could offer real solutions in real time, rather than a desperate cling to outdated policies of the past.  It may turn out that John McCain is the real candidate of hope and change, even if Krauthammer feels he hasn’t changed enough yet.

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David Strom 5:20 PM | May 01, 2024
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