Look who has just been put in charge of energy policy! It's the same D.C. politicians who have defeated all attempts to increase domestic supplies of every form of energy for decades. How can they be persuaded that 'alternative' sources cannot possibly be grown quickly enough to replace foreign oil?
Also, look who has just been put in charge of resolving the financial mess we are now in! The same politicians, including Rep. Barney Frank, Sen. Chris Dodd and Sen. Chuck Schumer who built and protected the financial sink-holes at Freddie Mac and Sallie Mae. Incredibly these mess-ups will be given charge of the $700 billion bail-out kitty to spend as they please! Well, recent history has been a brutal economics teacher. We can hope some lessons have been learned well in Washington.
Mr. Obama has promised a huge effort to develop 'alternative' energy sources, including clean coal. Well, liquefied coal has been doable since the 1930s. Hitler's Germany had little oil, but they had an abundant supply of coal. They made gasoline, synthetic rubber, pharmaceuticals, munitions and myriad other things from coal to support their huge war machine. They nearly prevailed in world conquest before the U.S. could ramp up major opposition. The liquefaction technology is well known. This time CO2 sequestration will be a necessary addition to satisfy our environmental activists. So far we have lacked the political will to encourage the necessary investments. It hasn't been confident investors who have dropped the Dow nearly 12 percent since the election.
T. Boone Pickens wants to build huge wind farms in west Texas. Why not? He is a big enough man to do it, except for two things. First, he needs a recovery in the price of natural gas. He has that in abundance and will use it to finance the wind farms. Second, he will need many hundreds of miles of new electrical grid to move the juice to his nearest customers in Texas and Oklahoma. Environmental activists will have to be satisfied before that can happen. Austin, San Antonio, Dallas-Ft.Worth, Houston and Oklahoma City will likely use all that he can produce.
Nuclear power and offshore oil drilling are now politically off the table. Forget significant new domestic oil and natural gas production. These fossil fuels produce CO2. Even the big expansion of production desired by the ethanol industry could have trouble. Use of ethanol also produces CO2!
There really is no way to reconstruct a prosperous economy without domestic energy supplies. Not only is the economy suffering. Our national security is at great risk. Enemies are watching our developing weaknesses for opportunities.
So, here we are hunkered down like rabbits awaiting our fate. Mr. Obama and his fellow Democrats are in an ideal position to exploit the situation with draconian measures. Their power over us is virtually unlimited.
Recently we have heard:
• Rep. George Miller, Calif., advocating sweeping $2 trillion in before-crash 401(k) private accounts into the Social Security bin where they will earn 3 percent, maybe.
• Sen. Chuck Schumer, N.Y., advocating restoration of the fairness doctrine to squelch talk radio. Congress would likely pass it.
• Advocacy of 'Freedom of Choice' rules for all medical personnel that will require them to participate in abortions or lose their licenses to practice. Whose 'freedom?'
All of the foregoing are just preliminaries. Two main events are to follow:
1. The proposed bailout of the Detroit car makers is really for preservation of the obsolete UAW union structure. Toyota, Honda and Mercedes will continue to eat Detroit's lunch.
Both Ford and GM are making cars and making money in foreign countries. Fords are popular in Europe. Buick is the most popular car in China. Why are they failing here?
2. Cap-and-trade of CO2 is a whole separate ticket that will drive up energy costs and boost creation of vast new bureaucracies. Al Gore must be smiling with anticipation.
George E. Edens is a resident of Lake Oswego.