Winds of Change

Some of the political ads on TV this summer have managed to sink to the level of the swift-boat attacks that torpedoed John Kerry’s presidential campaign in 2004. One, authorized by the McCain campaign, depicted a grinning Barack Obama next to a gas pump as the price-per-gallon meter shot toward $5.

The ad implied that the lone culprit for high gas prices (which averaged $1.20 a gallon in spring 2002 but hung around $4.10 for much of this summer) is the junior senator from Illinois. That’s because he did not initially jump to lift the ban restricting off-shore oil drilling, or support the Arizona senator’s feckless call for a federal gas-tax moratorium. That proposal was a gimmick and eventually disappeared even from McCain’s play book. And none too soon. Americans drove 3.7 percent fewer miles this May than last, and revenues from the 18-cents-a-gallon tax have fallen so precipitously that the transportation department’s Highway Trust Fund is drying up. To pay for highway maintenance and construction, the department may be forced to borrow from its mass-transit account.

As for the off-shore drilling debate, even T. Boone Pickens, the eighty-year-old Texas oil billionaire who financed those swift-boat ads, knows it couldn’t possibly solve the nation’s energy problems. “I’ve been an oilman all my life. But this is one emergency we can’t drill our way out of” (Economist, July 19). Emergency is not too strong a word, yet neither candidate has used it. For his part, Pickens has an alternative plan to meet the country’s energy needs—one that would enrich him and protect the environment. He plans to construct a series of huge wind farms-hundreds of giant wind turbines placed strategically in Texas—that will generate electric power for both cities and electric cars. Some of the natural gas now burned in power plants would become available to fuel vehicles. To date, neither presidential candidate has been as forthright or inventive as Pickens.

Despite the recent drop in U.S. vehicle use, worldwide oil consumption continues to rise (from 76 million barrels a day in 2000 to over 86 million today). In China alone, demand rose 65 percent over this period, and it will rise another 5.6 percent this year. Barring a prolonged worldwide economic downturn, demand will remain at, or near, record levels. According to the federal government’s own estimates, opening off-shore drilling sites would not bring immediate relief or guarantee an increase in future production.

Last month, Rex W. Tillerson, chief executive of Exxon Mobil (whose second-quarter profits were the largest of any company in history), claimed that the only immediate step we can take to address the energy crisis is to emphasize efficiency. In an interview with the New York Times (July 19), he said the United States has never had an energy policy “because an energy policy needs to be left alone for fifteen or twenty years to take effect. But our policymakers want a two-year energy policy to fit with the electoral cycle.” What has been very good for Exxon Mobil has not been as good for the nation—or the environment.

Last winter, the UN’s Intergovernmental Panel on Climate Change (twenty-five hundred eminent scientists under the leadership of Nobel laureate Rajendra Pachauri) warned that the world’s continued reliance on fossil fuels is leading to environmental catastrophe. Pachauri pleaded: “What we do in the next two or three years will define our future.”

In terms of U.S. election cycles, that future is now. Even if the danger of global warming is overstated, moving away from fossil fuels is clearly the prudent thing to do. The question is whether the public—and the media—will settle for a campaign focused on defamatory political advertisements, or will insist the candidates address real issues with concrete solutions. A new energy policy must first aim at conservation and efficiency. Since fossil fuels are the prime culprit in our environmental meltdown, their use must be curtailed. N. Gregory Mankiw, former chairman of George W. Bush’s Council of Economic Advisors, has written that the best way to do this would be to institute a carbon tax: you pay for what you burn. This would not only discourage the use of fossil fuels, it might also allow the government to reduce other taxes. Next, the country must get serious about developing renewable sources of energy (for example, solar, wind, and geothermal power). Finally, through subsidies and public-works projects, the government must help build state-of-the-art electrical grids that will make use of these new energy sources. Oilmen know the winds are shifting. It is up to voters to redirect the politicians.

August 5, 2008

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