Tuesday, March 8, 2011

Really bad ideas on energy

One thing that you can always count on about the US political process is that it will generate a few good ideas and a great many bad ones. Energy policy is a perennial source of the bad ones, and right now is no exception. Let's pick one from both the Democrats and the Republicans.

First, some of the Dems seem to think that the US should tap the Strategic Petroleum Reserve (SPR) because the current troubles in the Middle East are driving up gasoline prices here in the US. This is a ridiculously dumb idea.

The whole point of having an emergency reserve like the SPR is for ... uh, emergencies. An extra thirty-five cents per gallon at the pump is emphatically not an emergency. In fact, for anyone who cares about providing economic incentives for the development of renewable energy sources and new cars, high oil prices are actually a very important market signal. The US government absolutely should not blunt that signal by tapping the SPR.

Just as importantly, the SPR should be preserved for a true emergency, such as the kind of major oil disruption that could occur if Saudi Arabia experienced something like the conflict we're seeing in Libya. Given that there is a reasonable probability that we haven't seen the last of the revolutions in the Middle East, now is precisely the time when we should be extra careful with oil reserves.

Ok, what about the Republicans? Well, some of them seem to be seriously considering Newt Gingrich as a presidential candidate. Even if we were to look past the raging hypocrisy that Mr. Gingrich displayed when he tried to impeach Clinton for having an affair even as he was having one himself -- and I can't imagine why we would look past it -- I'd still have a dim view of Gingrich's candidacy because of his ideas for energy policy.

Gingrich is the author of a 2008 book entitled, "Drill Here, Drill Now, Pay Less." He is, in short, the "intellectual" force behind the chants of 'drill, baby, drill' that we heard in the 2008 campaign. The idea of America obtaining "energy independence" by replacing foreign oil imports with US oil production is profoundly unrealistic. At least within the foreseeable future, the US is completely incapable of self-sufficiency in oil.

Moreover, policies that try to rapidly expand US oil production are much more likely to do harm than good. Too much haste in developing offshore resources, for instance, could lead to another spill akin to the BP disaster in 2010. Even if we get lucky and avoid an accident, what exactly would the US gain by depleting its own geological reserves at a rate far faster than the rest of the world?

So here's my recommendation: let's bundle up Gingrich and the geniuses who want to tap the SPR, and see if we can trade them to Qadhafi for a little peace in the Middle East.

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