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Four Lies About America's Energy "Crisis"

Posted: 03/ 9/2012 8:52 am

Oil prices are escalating and Americans soon may pay $5 for a gallon of gasoline. This grim fact has not escaped the notice of politicians. America's latest energy crisis has prompted heated rhetoric from Republicans and Democrats. Here are four lies that have been bandied about.

1. The gas crisis is President Obama's fault. In the 2012 presidential campaign, Republicans planned to run on the economy, but it's been improving. They turned to cultural issues such as contraception, but gained no traction. Now some GOP candidates are seeing rising gas prices as their opportunity. Recently, the chair of the Republican National Committee wrote, "Thanks to the president, America is running on empty."

Most Americans don't hold President Obama responsible for rising gas prices. A new Washington Post poll spread the blame around: 18 percent of respondents blamed President Obama, 14 percent the oil companies, 11 percent "Iran/Middle East," a whopping 38 percent cited other reasons, and 24 percent didn't know who to blame for rising prices.

The United States doesn't lack energy, in general, but we don't have enough oil. That's the economic "elephant" in the room, the genesis of our gas woes. The world's largest oil producer, Saudi Arabia, has reserves of 260B barrels and produces 10M each year; 2M barrels go to the US. The world's most desperate energy consumer, China, has oil reserves of 20B barrels, produces 4M each year, and consumes 8M. The United States has oil reserves of 19B barrels [1.4 percent of the world total], produces 9M each year, and consumes 19M barrels.

There are many theories about why gas prices have risen, but the most logical explanation was voiced by Washington Post columnist Ezra Klein: Americans are caught in an economic vise between the world's largest oil producer, Saudi Arabia, which holds exports steady to keep the price up, and the world's most desperate consumer, China, which has no choice but to buy oil at whatever the price is. China's demand is driving world gasoline prices up and the US is suffering.

2. President Obama hasn't done anything to increase America's energy supply. Republicans claim the president has no energy policy and that's the reason for the gas crisis.

On March 7th President Obama spoke about his energy strategy:

" If we are going to control our energy future, then we've got to have an all-of-the-above strategy. We've got to develop every source of American energy -- not just oil and gas, but wind power and solar power, nuclear power, biofuels. We need to invest in the technology that will help us use less oil in our cars and our trucks, in our buildings, in our factories. That's the only solution to the challenge. Because as we start using less, that lowers the demand, prices come down... Since I took office, America's dependence on foreign oil has gone down every single year. In fact, in 2010, it went under 50 percent for the first time in 13 years."

On February 7th, Bloomberg News reported, "The U.S. is the closest it has been in almost 20 years to achieving energy self-sufficiency... Domestic oil output is the highest in eight years..." Republicans refuse to acknowledge the truth: America has energy, in general, but not enough oil.

3. The president hasn't done enough to bring new petroleum resources on line: Republicans chant "Drill, baby, drill." Recently, Mitt Romney said. "Obama should do more to open up domestic sites for drilling, including the Arctic National Wildlife Refuge in Alaska." None of these suggestions would remedy soaring gasoline prices. For example, if the decision was made to drill in ANWR it would take 10 years before this oil reached our pumps and then it would only slightly diminish our need to import oil. Republicans refuse to acknowledge the obvious: America doesn't have enough oil and must turn to alternatives.

Many believe the solution is to increase our use of natural gas. America has humongous natural gas deposits that lie within shale. The largest is the Marcellus shale deposit running from West Virginia to upstate New York; it's thought to hold a one-hundred-year supply of natural gas. The technique used to access the natural gas is hydraulic fracturing ('fracking"): a deep hole is drilled, an explosion is set off, special solvents are injected, and the embedded gas is liberated and floats into holding containers. (While this process has produced large amounts of natural gas, it has disturbing environmental consequences. Fracking has damaged communities, polluting their drinking water and their streams and rivers: "On New Year's Eve a 4.0 magnitude earthquake in Youngstown, Ohio, was blamed on the injection of high-pressure fracking water along a seismic fault.")

4. The president has exaggerated the environmental consequences of an all-of-the-above energy strategy. Republicans claim President Obama doesn't have an effective energy strategy because he's beholden to environmentalists

The reality is that Republicans have no energy strategy because they are beholden to the oil and gas industry. Since 1990 oil and gas companies have contributed $238.7 million to candidates and parties and 75 percent has gone to Republicans -- a higher percentage this year. It's not "drill, baby, drill," it's "money, baby, money."