NATIONAL LEADERSHIP:  THE PRICE OF GAS AND OUR PRIORITIES

• First some thoughts about oil.  It is most interesting to hear all the speeches coming from the US Senate on the price of oil.  Many are blasting the oil companies and some are blaming the Saudis for not increasing their own production of oil.  The US Senate also voted to suspend the flow of  oil into the Strategic Petroleum Reserve, presumably because this will increase the amount of oil available for consumer consumption.  But as George Will has observed, seventy-one of the 97 senators who voted to stop filling the reserve also oppose drilling in the Arctic National Wildlife Refuge (ANWR).  For just a moment, contemplate what might have been:  In 1995, then President Bill Clinton vetoed legislation to permit drilling in ANWR.  If he had not vetoed that bill, 1 million barrels of oil would now be flowing into the American economy.  That would produce 27 million gallons of gasoline and diesel fuel.  Amazingly, 72 members of the Senate, including Barack Obama and John McCain, have voted to keep ANWR’s 10.4 million barrels of oil off the market.  Not only have they voted to keep ANWR’s oil in the ground, but these same Senators and members of the House as well, have voted to put 85% of America’s offshore territory off-limits to drilling.  Will cites the US Minerals Management Service, which contends that these restricted areas contain perhaps 86 million barrels of oil and 420 trillion cubic fee of natural gas—“10 times as much oil and 20 times as much natural gas as Americans use in a year.”  Nonetheless, drilling in this area is going on.  In fact, 60 miles off the coast of Florida, China, in cooperation with Cuba, is drilling for oil and natural gas.  As Will observes, “[China] is drilling closer to South Florida than US companies are.”  Listen again to Will:  “ANWR is larger than the combined areas of five states (Massachusetts, Connecticut, Rhode Island, New Jersey, Delaware), and drilling along its coastal plain would be confined to a space one-sixth the size of Washington’s Dulles airport.  Offshore?  Hurricanes Katrina and Rita destroyed or damaged hundreds of drilling rigs without causing a single spill.  There has not been a significant spill from an offshore US well since 1969.  Of the more than 7 billion barrels of oil pumped offshore in the past 25 years, 0.001 percent—that is one-thousandth of 1 percent—has been spilled.  Louisiana has more than 3,200 rigs offshore—and a thriving commercial fishing industry.”  Why is Brazil’s energy production growing?  It is not because of ethanol or other biofuels.  It is because of increased offshore oil production.  Further, in September 2006, two US companies announced that, in the Gulf 270 miles southwest of New Orleans, they had tapped a field of perhaps 15 million barrels of oil, which will increase America’s proven reserves by 50%.  This is terribly costly, costing perhaps $100 million to probe 4 miles below the surface of the Gulf.  But what does Congress do?  It wants to increase the tax burden on the oil companies, as a key element of its energy policy.  Will that tax produce more oil?  Hardly!  Finally, George Will concludes:  “America says to foreign producers—We prefer not to pump our oil, so please pump more of yours, thereby lowering its value, for our benefit.”  It is almost beyond belief how narrow-minded and shameful our present US Congress really is.  There is an enormous vacuum of leadership when it comes to developing an energy policy in the US.  Quite frankly, the US has no energy policy.  We are the captives of a group of environmental lobbyists who fear something—an oil spill—that keeps the US from tapping into oil reserves greater or equal to some of those in the Middle East.  The US, do not forget, is the world’s third largest producer of oil and natural gas.  We have the potential to produce much more.  But Congress is preventing that from occurring.  Combined with sensible strategies on alternative energy sources—wind, solar, nuclear, etc.—opening up oil and natural gas production in ANWR and the coastal regions is an energy policy.  But there is no leadership in Congress to do this.  And, looking to the next president, both Obama and McCain will not support such drilling.  In other words, we are getting the price of gasoline we deserve as a nation.  Our leaders have no policy—and we are paying for that!  See George Will‘s most helpful essay in the Washington Post (5 June 2008).

• Second, a few thoughts on our priorities.  Bjorn Lomborg has recently written:  “A reduction in carbon emissions has become an end in itself.  The fortune spent on this exercise could achieve an astounding amount of good in areas that we hear a lot less about.”  What does he mean?  He goes on, “. . . just $60 million spent on providing Vitamin A capsules and therapeutic Zinc supplements for under-2-year-olds would reach 80% of the infants in Sub-Saharan Africa and South Asia, with annual economic benefits (from lower mortality and improved health) of more than $1 billion.  That means doing $17 worth of good for each dollar spent.  Spending $1 billion on tuberculosis would avert an astonishing one million deaths, with annual benefits adding up to $30 billion.  This gives $30 back on the dollar.”  Listen to some of the other priorities the world could focus on for relatively small amounts of money:

1. Heart disease represents more than a quarter of the death toll in poor countries.  Spending $200 million getting cheaper heart drugs to these poor countries would avert 300,000 deaths per year.  Spending $1 will achieve $25 worth of good.  Compare that investment return with the 90 cents return spent for every dollar on carbon mitigation policies.  “Focusing on costs and benefits means that we can reconsider the merits of policies that have gone out of fashion.”
2. Poor water and sanitation affects more than 2 billion people and will claim millions of lives each year.  One realistic solution is to build large, multipurpose dams in Africa.  Building dams for many is politically incorrect.  But in a nation like Ethiopia, which has no water storage facilities, great variability in rainfall and where dams could be built with relatively few side effects, building dams is wise policy.  Lomborg contends that “A single reservoir located in the scarcely inhabited Blue Nile gorge in Ethiopia would cost a breathtaking $3.3 billion.  But it would produce large amounts of desperately needed power for Ethiopia, Sudan and Egypt, combat the regional water shortage in times of drought, and expand irrigation.  All these benefits would be at least two-and-a-half-times as high as the costs.”

What Bjorn Lomborg and his Copenhagen Consensus group have done is demonstrate how the world community can do the most good with our limited resources.  When you read what he has written and meditate on some of his conclusions, you come away with this conviction:  global warming should really not be at the top of anyone’s priority list.  With proper research and strategic thinking that carefully analyzes costs and benefits, the world community can begin to solve many of the worlds’s problems or at least make some traction toward solving them.  It is a matter of the wise use of the resources we already have.  It also means abandoning some of the politically correct prejudices we have.  God expects us to be good stewards of His world.  Managing His resources—oil, natural gas, making medicine available, building dams to control water—are all examples of good stewardship.  But, as I argued above, such policy priorities demand strong leadership—something that is disgustingly absent in our nation and in the world.  Raw, self-serving politics has replaced sound leadership.  And remember, we voted these people into office.  It is time to hold them accountable and demand a sound, sensible energy policy and a sound, sensible set of priorities to deal with the world’s problems in a measured way.  See Lomborg’s essay in the Wall Street Journal (22 May 2008).

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