Romney Energy Plan a Massive Pipeline Dream
Mitt Romney released his energy plan today, and touted it as an ambitious agenda to free the United States completely off of overseas oil by 2020. Like many grand plans that presidential candidates dangle in front of voters, Romney’s energy independence plan will hardly be game changer in the November 2012 election. I personally believe Romney will win in a landslide that will be more reminiscent of 1980 than 2000 or 2004, and that shift will become apparent after Labor Day when most voters finally and begrudgingly tune in. The dream of energy independence has been in every president’s crosshairs since the Nixon administration was rocked by the spike in oil prices during the early 1970s. Romney’s plan, however, really does not offer any new or bold ideas, though strategically it is one more step he needed to take in shoring up the Republican base. The timing of the plan, like many of Romney’s announcements including the selection of Paul Ryan during the final weekend of the Summer Olympics, was another gift to team Obama as he had just mingled with top energy executives in Houston a few days ago. Politics aside, however, Romney’s plan is more of a bone for conventional energy companies than any thoughtful solution that deals with both the specter of peak oil and the long term impact that fossil fuels have on our quality of life. And despite the constant bellyaching that the Obama administration has sabotaged the American energy industry, the fact is that oil and gas extraction are up, the U.S. is producing more of its own energy and the nascent clean energy sector is here to stay and will grow. Here is some of what team Romney is recommending while attacking Obama’s current policies:
- More state control of energy development onshore and more energy development offshore: This is more of the tired mantra that the federal government cannot do anything right, and insists that states, which themselves have had their fair share of budgetary challenges, are better at developing their own energy sectors. Never mind the fact that this is already happening across the U.S.: if you are a natural gas investor, you are making a mint in the Dakotas; if solar floats your boat, New Jersey may be the state for you. The Romney energy plan discusses more offshore energy leases in the Carolinas and Virginia, but is light on specifics elsewhere. This is great red meat for the party faithful; it ignores the fact that these trends are already underway.
- Pursue a North American partnership for energy production: Romney would give a quick green light to the Keystone Pipeline, which plunked Obama in alignment with Dan Heineman, the GOP governor of Nebraska. But the fact is that the United States already is in the midst of its own oil boom. In 2009, as former CEO Herb Kelleher of Southwest Airlines (and an energy expert in his own right) pointed out, the U.S. produced over 700,000 more barrels of oil a day than the previous year. In 2005 America imported over 60 percent of its oil; now that stands at less than 40 percent. Currently 13 percent of U.S. oil is from the Middle East. Bush and Obama policies had less of an effect on oil production than better extraction and recovery technologies. And as for our neighbors, while Canada is in the midst of an energy and natural resources boom, Mexico’s oil exports are in decline because of lower production and increased domestic demand south of the border. And circling back to oil production, all oil is traded on the global market. Increased production here does not shield Americans from geopolitical tinderboxes elsewhere--and with 93 percent of U.S. transport running on petroleum, the U.S. economy will screech to painful halt of the price of oil suddenly spirals out of control. Energy independence based on more drilling for oil is a ruse.
- Facilitate private sector led development of new technologies. A dig at the Solyndra fiasco of course would show up in Romney’s energy plan, and to that end a Romney energy administration promises the end of the current “distorting the playing field.” Never mind the stories about energy executives having easy access to the Bush/Cheney administration or the billions of dollars in subsidies that go to energy companies year after year. But again this plan is more thumping of the “government does nothing right” drum. Meanwhile Germany’s solar industry, despite recent struggles, has made impressive gains; China is building a massive rail system and is pursing its own renewable energy agenda; and Korea will be the leader in smart grid technology. Meanwhile examples of companies that are investing in technologies from fuel cells to solar arrays about--and they are doing it not to save the world, but because it is making good business sense.