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Husband, father, grandfather, friend...a few of the roles acquired in 62 years of living.  I keep an upbeat attitude, loving humor and the singular freedom of a perfect laugh.  I don't let curmudgeons ruin my day; that only gives them power over me.  Having experienced death once, I no longer fear it, although I am still frightened by the process of dying.  I love to write because it allows me the freedom to vent those complex feelings that bounce restlessly off the walls of my mind; and express the beauty that can only be found within the human heart.

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Tuesday, May 27, 2008

The Oil Emergency: Hard Times, Hard Choices

Copyright © 2008 by Ralph Couey

Over the years, I’ve come to understand a fundamental truth. People’s political attitudes are formed in the events and experiences that make up the chronology of their lives. These days, the foundations of those attitudes are, more often than not, based on deeply held emotions rather than critically evaluated information. Thus, there is no longer a widely held consensus of right and wrong. Everything is filtered through the prism of each individual's personal experiences. What seems incontrovertible truth to one is complete nonsense to another. This reality is a big part of the reason why politics is a subject considered verboten in polite conversation.

Our political attitudes have become tightly interwoven with our sense of self-identity and esteem. Consequently, when someone disagrees with us, we feel defensive, which then triggers emotional responses. And when emotion, by its nature an irrational state, enters into a debate, all hope of a calm, rational discussion is lost. My high school debate teacher once said, “You can debate conclusions; you can debate positions; you can debate policy. But you cannot debate emotion. Emotion listens only to its own version of truth, and refuses to entertain anything else.”

For that reason, I’ve mostly avoided hot-button issues in my columns, knowing that no matter what the indisputable facts are, they will make no headway with those who are emotionally wedded to opposing views. But the debate on energy in general and gasoline in particular has become so fraught with irrationality, I decided, at no small risk, to wade in.

The world has changed drastically and rapidly over the last two decades, of that there can be no debate. From the geopolitical bipolar stability of the Cold War, we have morphed into an age where for the first time in human history, conflict does not require a state sponsor. Zealots distort religion in order to justify hate, murder, and the acquisition of power. The economy is becoming globalized; Europe has, at least on the surface, begun to discard centuries of conflict in favor of continental unity. Those and many other changes have rippled across the lives of everyone in this country, indeed, the world.

India and China have become the two largest economies on the planet. As a result, their consumption of energy has drastically increased. The glut of oil on world markets that helped depress prices in the 90’s exists no longer. This is a fundamental change which has introduced the law of scarcity into the oil market. The laws of supply and demand are immutable and unchangeable, so with the supply pinched, the price goes up. At present, the only immediate mitigating factor available to consumers is to cut back on demand, a difficult thing to do when driving is critical to our ability to earn a living. Small business is the largest single element of the U.S. economy and the ability of those small businesses to use their vehicles is crucial to their success, and even their survival. For the rest of us, our vehicles represent a fundamental freedom to go where we want, when we want without fear of consequence. Given our history and traditions, that's the hardest thing to surrender.

The response of government to this current crisis has been exasperatingly political and largely useless. The effort to switch to alternative fuels, mainly E85 ethanol, has seen the price of corn, as well as other grains, skyrocket. Hunger, some starvation, and violent food riots have erupted in the developing world.

Hydrogen fuel cells are a good answer, but critics moan that technology required upon which to base our economy is 50 years in the future. Personally, I doubt that time frame, since it’s spouted by those who oppose hydrogen. Besides, I never put anything beyond the reach of a truly motivated scientist. But that journey is just like any other. If you’re not actually traveling towards the destination, the distance never changes. If we don’t expend a major effort on hydrogen now, that goal will forever remain out of reach.

In the shorter term, we will have to face some unpleasant facts. When you tally up untapped reserves under the outer continental shelf, under North Dakota, Montana, and Colorado, and yes, under the one-tenth of one percent of the two million acres that make up the Arctic National Wildlife Reserve, the U.S. has more oil reserves then the entire Middle East. Enviromental policy, driven mostly by the political stranglehold the radical environmentalists have over Democrats, has restricted our ability to drill for that oil. But, because that oil belongs to us, we would no longer be chained to the arrogant pricing policies of OPEC.

We also lack refining capacity. We haven’t built a new refinery in at least 30 years and those we do have are running at 95% to 98% capacity. One of the scarier scenarios is what could happen if Hizb’allah, HAMAS, or al-Qa’ida glommed onto that little fact and decided to drive truck bombs into a few of those refineries. If they could do enough damage to take three facilities off-line for three to six months, the resulting squeeze could cripple our economy, damage that might take a decade to repair.

Now, the Democrats in congress say they will sue Saudi Arabia for, in their words, “conspiring to limit the production of oil.” As the prescient talker Quinn pointed out, isn’t that precisely what the Democrats have done themselves?

It’s easy to point political fingers in these situations, and in this situation, most of those fingers are directed to the right. But, let’s look at some numbers.

In the first 6 years of the Bush administration, with the Republicans holding a nominal majority in congress, the average price of gas, according to the Department of Energy, rose from $1.51 per gallon to $2.21 per gallon. That’s an increase of 70 cents over 72 months, or less than one penny per gallon per month of increase. In 2006, Democrats campaigned for control of congress, promising among other things, to reduce the price of gasoline at the pumps. We took them at their word, giving them control. On their first day in office, January 21, 2007, the average price of gas was $2.21 per gallon. As of the day I write this, that price is $3.90 per gallon. That’s an increase of $1.69 per gallon over a period of 16 months, or an increase of more than 10 cents per gallon per month. And that’s after their solemn campaign promise to reduce those prices.

The Republicans have taken the lion’s share of the blame, but based on these numbers, which party has been better at controlling gas prices? The Democrats, at more than ten cents per month, or the Republicans at less than one penny per month?

There's another, far more sinister possibility. Politicians make their careers on problems. As long as one exists, then the politicians relevance is maintained. I wonder sometimes if anyone in Washington, both parties, are more interested in perpetuating problems, rather than crafting solutions. After all, if they solve these problems, wouldn't they then become irrelevant? What if there are people who are bent on inflicting critical damage to the economy for the sole purpose of winning an election?

I know I’m going to get a lot of flack for this. But, these are hard numbers, and hard facts. And these are hard times. If we’re going to survive, we have to make the hard choices. Now.
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