There’s a plan out there that will create jobs, collect revenue for state and federal governments and improve the environment. And it won’t come at any cost to the taxpayer but if the administration doesn’t act, it will be a net drain on the economy. 1.) What is it? 2.) Why haven’t Congress and the administration acted? The answers are increased oil and natural gas production in the United States and we have no idea.
The costs of the ban: A new study commissioned by the National Association of Regulatory Utility Commissioners (NARUC) details the social, economic and environmental effects of oil and natural gas exploration on and beneath federal lands. The report estimates that consumer energy costs will increase and cumulative gross domestic product (GDP) will decrease by $2.36 trillion over the next two decades.
The other cost on inaction is an environmental one and specifically relates to offshore drilling. Off the coast of Santa Barbara and elsewhere, oil seeps from the ocean floor release oily bubbles or droplets of oil. The non-profit organization Stop Oil Seeps (SOS) California details that these “Oil slicks of varying thickness form on the sea surface and spread out under the influence of wind and currents. As the oil loses its lighter fractions and undergoes weathering, some of it sinks to the ocean floor, some is dispersed by wave agitation into the water column, and some eventually washes up on shore or sticks to rocks near the high tide line.”
The benefits of action: An enormous amount of energy in a variety of forms exists in the United States that, if developed and commercialized, would create hundreds of thousands of sustainable jobs and largely benefit our overall economy without accumulating massive debt. The Heritage Foundation estimates that increasing domestic oil production by 2 million barrels a day would create 270,000 jobs. Further, increasing supply will either relieve the upward pressure of prices that is likely to worsen as global demand surges when countries come out of their respective recessions. Since states and federal government would collect royalties from the production, it would actually help to lower deficits.
A risk of oil spills, albeit greatly diminished with improved technology, does exist with new drilling activity. But it would also significantly reduce the pressure on offshore seeps and decreases marine oil pollution. Bruce Allen, co-founder of SOS California has argued to lift state and federal moratoriums on offshore oil production. SOS California’s new documentary, A Crude Reality, points out the environmental problems oil seeps present. The Heritage Foundation will be hosting the Washington, DC premiere of A Crude Reality, followed by a discussion with Mr. Allen on February 24, 2010 from 12-1:30. You can RSVP here or watch online at Heritage.org.
With the nation’s unemployment rate creeping ever closer to 10%, it is not surprising that Americans continue to rank the economy as the most important issue facing the country right now. Recognizing the link between a troubled economy and energy prices, last year 1.4 million Americans signed the “Drill Here, Drill Now, Pay Less” petition demanding that the federal government enact policies that will lower our nation’s energy costs. And Congress responded by ending our nation’s quarter-century ban on oil and natural gas drilling off the Atlantic and Pacific coasts.
But this was just the first step Americans needed to take to free our energy from the myriad of bureaucratic restriction the enviro-left has placed between consumers and cheap energy. Before the development of our natural resources can begin, the Department of Interior must approve a five-year leasing plan detailing how federal sale of oil and gas leases in the offshore waters will take place. The case for developing our own natural resources is strong. An estimated 19 billion barrels of oil–nearly 30 years of current imports from Saudi Arabia–as well as substantial natural gas reserves are estimated to lie beneath these restricted areas. According to a 2008 Center for Data Analysis study, increasing domestic oil production by 1 million barrels per day would generate 128,000 jobs. At 2 million barrels per day, that figures jump to 270,000.
Unfortunately the Obama administration is allowing their “Green Job” fantasies to get in the way of cold hard facts and real American jobs. At an Interior Department field hearing this April in Atlantic City, Secretary Ken Salazar claimed ocean winds along the East Coast can generate 1 million megawatts of power, roughly the equivalent of 3,000 medium-sized coal-fired power plants, or nearly five times the number of coal plants now in the United States, according to the Energy Department. This is pure fiction. In 2007 the United States produced 23.48 quadrillion Btus of power from coal. Wind produced .319 quadrillion Btus. Salazar wants the American people to believe we can increase our wind power production by 7,300%. That is unrealistic.
Despite all the rhetoric you hear about the rest of the world abandoning fossil fuels to avoid global warming, their actions show where their real priorities are. Brazil, whose beautiful beaches rival or even surpass anything in California or Florida, recently discovered a huge underwater oil field and it is moving quickly to begin drilling. In Asia, China and Japan were able to put aside centuries of mistrust to come to an agreement on how to drill and share oil in waters in between their countries. Germany plans to build 27 coal-fired plants by 2020. Italy plans to increase its reliance on coal from 14% today to 33% in just five years. In all of Europe, 40 new major coal power plants are set to be built in the next five years. In 2006 alone, China completed enough coal power plants to match all of Britain’s capacity. India plans to boost coal production by 50% by 2012 and quadruple it by 2030.
The rest of the world gets it: in order to compete in today’s global economy countries must maximize the energy potential of all their natural resources. The Obama administration would be forcing American businesses to compete with one hand tied behind our back if they favor costly, inefficient, and unproven renewable energy to the exclusion of all other U.S. resources.
But there is something you can do about it. Any regulatory framework created by the Obama Interior Department can be fought in court. And Federal law requires the Obama Administration to solicit comments from the American people and substantively respond to them before any regulation can attain the force of law. One factor that courts must consider when a regulation is challenged is how the government addressed citizen comments on the proposed regulation. Last year, 30,000 of you submitted a comment through StopEPA.com to the Environmental Protection Agency asking it to not move forward with carbon dioxide regulations. This year, people are voicing their support for offshore drilling by going to FreeOurEnergy.com and submitting a comment. You can too. Now is not the time to turn back.
Let the Obama Administration know that you support domestic oil exploration. Then forward today’s Morning Bell to five of your friends. Visit FreeOurEnergy.com to make your voices heard. The deadline is Monday, September 21st at midnight. So hurry!
Quick Hits:
- President Obama’s mention of Sen. Max Baucus’ health care bill drew boos at Obama’s Organizing For America political campaign rally at the University of Maryland yesterday.
- Polish Prime Minister Donald Tusk confirmed yesterday that he declined to take a call from President Obama informing him of the decision to scrap planned missile-defense bases in his country.
- President Obama will appear on a record five TV networks on Sunday (excluding FOX News, but including Spanish-language network Univision) plus he will sit down with late-night host David Letterman on Monday.
- A visibly shaken Speaker Nancy Pelosi (D-CA) fought back tears yesterday as she compared current protesters against Obamacare to assassin Dan White who killed San Francisco Mayor George Moscone and city supervisor Harvey Milk in 1978.
- Continuing layoffs on Wall Street drove New York City’s unemployment rate to 10.3 percent in August, a 16-year high.