Free market energy policies can end economic malaise

By and |2013-05-03T06:00:11+00:00May 2nd, 2013|CFACT Insights|6 Comments

“We can’t have an energy strategy that traps us in the past,” President Obama proclaimed in March 2012. “We need an energy strategy for the future – an all-of-the-above strategy for the Twenty-First Century that develops every source of American-made energy.”

At first blush, this sounds like common sense. The US economy and lifestyle “depend on inexpensive and plentiful energy,” the Congressional Research Service noted in a 2005 report, but people tend to forget this until world events cause gasoline prices to spike. Then Washington reacts, CRS continued – passing the Energy Policy Acts of 1992, 2005 and 2007. However, the US still does not have a “comprehensive long-term energy policy” that balances increasing supply with conservation and defines the proper interplay between government and market forces.

Forty years ago, President Nixon announced “Project Independence,” in response to the 1973 oil cutoff by Middle East and other OPEC nations, with the goal of ensuring that “Americans will not have to rely on any source of energy beyond our own.”  His broad-based strategy begat the trans-Alaska pipeline (to get North Slope oil to Lower 48 markets), expanded onshore and offshore oil drilling, an all-of-the-above strategy for electric power generation that brought lignite mining and natural gas into prominence, and a host of conservation measures, including 55-mph speed limits.

Rosie-the-RiveterPresident Carter brought very different thinking to Washington – policies that many believe led to declining US oil and gas production and economic “malaise.” President Reagan reversed Carter, but his successors, Congress, courts, environmental activists, regulatory agencies and disparate corporate interests launched American energy policies on a roller coaster ride. This history helps explain why comprehensive long-term energy policies and strategies are less logical and desirable than at first blush.

The term itself suggests policies devised and dictated by Washington, DC politicians, bureaucrats, lobbyists and pressure groups – many of whom have no real knowledge of or hands-on experience with energy, economics, science, technology, business or job creation.

In too many cases, the policies, strategies, laws, programs and regulations are crafted to promote specific ideologies, benefit companies and organizations with the best lobbyists, and secure tax breaks, subsidies and preferential treatment for political cronies, campaign contributors and politically correct ideas.

“All of the above” too often means all of the above ground and little or nothing below the Earth’s surface: wind, solar, biofuels and wood, for example – but little or no oil, gas, coal or uranium. In fact, more than any other in history, the Obama administration is using its executive powers to delay, obstruct, hyper-regulate, penalize and bankrupt the proven energy that is the foundation of modern living standards.

Similarly, the notion that proven energy strategies “trap us in the past” fails to recognize that “past” energy technologies (oil, gas, coal, nuclear and hydroelectric) actually provide 94% of the energy that powers America today; are abundant, reliable and affordable; and represent a monumental improvement over the wind, solar, wood, dung and water wheel power that feebly energized mankind for millennia.

Suggesting that we can abandon these vital 94% energy sources – in favor of new variations on antique technologies that Mr. Obama promotes as energy of “the future” – ignores the fact that these politically correct sources are expensive, intermittent, heavily subsidized and wholly dependent on fossil fuels. Moreover, any honest and meaningful cradle-to-grave analysis of wind, solar and biofuel energy reveals that these PC sources are land- and resource-intensive, environmentally damaging, and unsustainable.

Pipeline constructionThe “comprehensive long-term energy policies and strategies” slogan also ignores where the real progress of recent years has been made: in the private sector, especially the petroleum industry, where revolutionary horizontal drilling and hydraulic fracturing technologies have unlocked centuries of oil and natural gas worldwide. In fact, “fracking” on state and private lands has sent US petroleum production to new heights – even as Washington politics and policies have ensured that production from federally owned and controlled onshore and offshore lands continues to decline.

Hydrocarbon, hydroelectric and nuclear have undeniable problems: oil spills, air and water pollution, radiation and accidents. But laws, regulations, technologies and greater corporate responsibility have greatly reduced their frequency and severity – and errors are quickly and severely punished.

By contrast, human health and environmental impacts associated with wind, solar and biofuel energy are routinely and systematically ignored, and almost never punished. The slaughter of millions of birds and bats annually by US wind turbines is a case in point, and when the impacts are considered in the context of the minimal energy produced via these “renewable” technologies, the damage is especially egregious.

These “alternative” technologies ALSO require perpetual subsidies, taken from hardworking taxpayers and productive sectors of our economy, and given to crony corporatists whose schemes slide repeatedly into bankruptcy. They employ rare earth metals and other raw materials that require vast amounts of fossil fuels, monumental earth removal and widespread land degradation – to build and operate facilities whose energy is so expensive it kills 2-4 jobs for every “green” job created, drives families deeper into poverty, and impairs human health and welfare.

Forty years ago, President Nixon actually sought to develop and utilize “all of the above” energy – every practical source on every list. Today, amid an anemic economy and joblessness far worse than official government figures admit, President Obama balks at approving the Keystone XL pipeline, cancels leasing and drilling on federal lands, tells our budget-sequestered military to buy $26 to $67-per-gallon ship and jet fuel, punishes refineries for not buying cellulosic ethanol that doesn’t exist, and happily lets EPA shut down coal-fired power plants and kill countless thousands of mining, utility and other jobs.

Thoughtful Americans find little comfort in these policies. Twelve million still cannot find work in this moribund, DC-dictated economy. Red-state Democrats like Joe Manchin (D-WV), Mark Begich (D-AK) and Mary Landrieu (D-LA) tremble at the prospect of facing voters in 2014. And outrage is properly growing over the massive failures of wind, solar and biofuel startups whose executives (mostly Obama and Democrat campaign angels) skimmed millions of tax dollars for themselves but let their companies go bankrupt and their employees go on unemployment and welfare rolls.

And still President Obama and his minions push for punitive carbon dioxide regulations and carbon taxes, while the European carbon market collapses, EU jobs head to China and India, and thousands die of hypothermia in England. The European emissions trading system is “below junk status,” according to The Economist, and the collapse has been felt as far away as Australia, whose political leaders prepare to reap the whirlwind of carbon taxes that are now 5.5 times higher than in Europe. Is this America’s “future”?

Will ideology continue to trump sanity in the Obama energy and climate policy arenas? The President is putting all his eggs in the basket of “hope” that Democrats will “change” the House leadership and extend their Senate majority in 2014. He has shown little desire to compromise on energy and climate change.

America does not need “comprehensive” energy policies devised and dictated by Washington. It needs policies that unlock our creative genius and allow free enterprise and private sector innovators to operate on a level playing field – one that applies the same reasonable, responsible environmental, endangered species, tax, subsidy and other laws and standards to all companies, investors and energy technologies.

We need simple laws and policies that let our ultimate energy resource (our creative intellect) work – without ideologues, pressure groups and regulators promoting failed, subsidized energy schemes, while continuing to block affordable, dependable energy that actually creates jobs and generates revenues.


  1. J.P. Katigbak May 2, 2013 at 11:21 PM

    Wait, wait, wait, can “free-market” energy policies end economic malaise without understanding the whole truth regarding the rather dubious philosophical and ideological doctrine of environmentalism?

    Mr. David Rothbard, are you really listening to what I say about that doctrine?

    Thank you very much. – J.P.K.

    And just for the record: I am neither belonging to the Left nor the Right. I am just respecting for traditional values and customs, including respect for monarchy. Why? Because it is a different governmental system I know of. Thanks again.

  2. jameshrust May 3, 2013 at 8:23 PM

    A good summary of government failures over the forty -year period from the 1973 oil embargo from OPEC to the 2013 energy embargo of the Obama Administration. Some day the public will wake up and demand better performance.
    The United States is the most blessed nation on the planet. We have hundreds of years supply of coal, oil, and natural gas; thousands of years supply of uranium; and a thinking population that can exploit these gifts of nature if given the chance. Prosperity should be our future for many years and we can help the rest of the world to have better lives.
    James Rust

    • J.P. Katigbak May 4, 2013 at 9:24 PM

      I just like to note that the US is not the only country that is ‘most blessed’.

      I can hope people from the rest of the world will have better lives, as long as they can challenge the dubiously ideological and philosophical doctrine of environmentalism which is, I believe, an attack on various cultures and customs of societies and economies across the globe. – J.P.K.

  3. Eckenhuijsen Smit May 4, 2013 at 6:40 AM

    I couldn`t agree more with you, as I did already in my comments during years on end.

    Dear Americans, to get out of the slump your country has been plunged into, you have to get rid of the bunch of ignorant idiots who are intentionally destroying your country [as Barry Hussein Obama announced he would do, already before his first election!] with all kind of absurd and totally worthless and shamefully malignant regulations.
    You have to eradicate them like vermin through impeachment, voting them out of office or any other acceptable means, which stand at the disposal of your Congress and Senate.
    The problem with this brainless vermin is that it still thrives on the food given by
    shameless AGW CO2 alarmist swindlers [Anthropogenic (= human) Global Warming] during more than thirty years, lying to the peoples of the world that human made CO2
    is the supposed cause of global Climate Change and all disasters thereof.
    By axiom is CO2 indispensable for all life on earth, which means that without CO2 no life would be existent!
    So why then are educated people still talking about diminishing the CO2 content in the atmosphere while this benevolent, inert, innocuous gas is so useful?
    Apart from the foregoing is manmade CO2 only 0,001152% (≈ nil) of the atmosphere!
    So CO2 ‒although it is called by “alarmists” a dangerous greenhouse gas‒ has no effect at all on global warming nor on global Climate Change.
    Global Climate Change is a very slow process of thousands of years, which is caused for at least 95% by the sun’s state of agitation i.e. the varying amount of solar spots, changing the earth magnetic field and by that the quantity of cosmic rays [particles] entering the atmosphere forming more or less clouds, which change global cooling [through more clouds] or warming [through less clouds].
    Man can not influence the sun’s behaviour nor Global Warming; end of the discussion!

    As long as Barry Hussein Obama is not impeached for not being a NATURAL BORN AMERICAN (which means both his parents should be American citizens, which they were NOT when Barry was born), drilling, fracking and exports won`t reverse the horrendous, intolerable, unnecessary statistics.

    • J.P. Katigbak May 4, 2013 at 10:08 PM

      Yes indeed – and I hope that the ideological and philosophical doctrine of environmentalism will be challenged to the best extent possible.

      And that is not all: there still needs to be done to put the humans’ master resource into good uses appropriately well suited to various societies and economies around the world.

      But first of all, people like me must challenge the twin ideological and philosophical doctrines of environmentalism and so-called “democracy”, because such can be a bane to various cultures and customs among various societies. Always BE WARNED of the consequences brought about by the politically correct motivations of activist ideologues. They are anywhere!

      As for claims about AGW (Anthropogenic Global Warming), it is a different story to tell about how politically correct beliefs are as depressing as ideological politics in the current reality on the ground.

      Protecting the environment while ensuring social and economic improvements is important, but do not let activist ideologues go unpunished for aggravating depressive politics around the globe.

      Remember that, get it? Thank you very much. – J.P.K.

      • J.P. Katigbak May 4, 2013 at 10:09 PM

        And can you know more regarding sound science, please?

        Thanks again. – J.P.K.

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