Oil greed
The United States is the world's third biggest oil producing nation behind Saudi Arabia and Russia, but you wouldn't know it given its whining about high prices and its huge oil import tab. The Saudis produce 10.72 million barrels daily, Russia, 9.67 and the U.S. 8.37 million. But consumption is 20.59 million barrels a day, making net imports 12.2 million a day. This is more than Germany, Japan, France and Italy import.
This year, at $130 a barrel, oil imports will probably total $578 billion, equivalent to 81.5% of 2007's trade deficit of $708.5 billion for imports of every kind.
We Americans spill or waste more oil than any 20 undeveloped countries. Despite the whining about $4-a-gallon, we pay dramatically less for gasoline than do Canadians at $6 a gallon or Europeans at up to $11 a gallon.
Instead of seeing our wasteful ways as the problem, Americans and their politicians are externalizing blame and looking for scapegoats. But the culprit is Washington and the Bush regime whose intelligence has been about as smart when it comes to comprehending the global supply-demand issue for oil as it was in concluding there were weapons of mass destruction in Iraq.
I'm no genius but all commodities have taken off since 2003. I first forecasted $100 a barrel oil two years ago, $150 a year ago and believe that unless the Americans stop using the stuff prices will hit $200 in a few years before we are plunged into a worldwide recession.
A Simple Solution
So America needs an energy intervention right now which will have added benefits such as helping to clean up the environment, slash trade deficits, reduce dependency on nasty foreign
regimes and finance research into new technologies.
Here is a simple, sensible 21st Century energy policy:
1.Mandate increased fuel efficiencies of at least 10 miles per gallon for every vehicle and within two years require all new cars sold in the U.S. to be hybrids. Measures should be considered, such as subsidies, to help retire the nation's gas guzzlers more quickly. Why? If all vehicles in the U.S. were 10-miles-per-gallon more efficient, the country would cut oil consumption by four million barrels daily, eliminating $189.8 billion, or 27%, from the total trade deficit.
2.But another measure is essential in tandem with fuel efficiencies: an increase in gasoline taxes. This is because studies show that fuel efficiencies don't necessarily decrease consumption but increase it because the same money can buy more tankfuls. So the combination of fuel efficient cars, and more expensive gasoline, would lower consumption rates even faster.
3.The next step would be to earmark higher gasoline taxes for research into alternatives.
In other words, all Americans have to do to vastly improve their economic prospects is to live like Europeans by using smaller, lighter and more efficient vehicles less often.
The Bush/McCain, Big Oil Gimmick
John McCain's remedy is to chop gasoline taxes which will make matters worse. Oil companies will scoop up the savings unless prohibited or, alternatively, sell more oil and make more profits.
What can McCain be thinking? Plentiful and relatively cheap gasoline has led the United States into this predicament in the first place by allowing Detroit to hook the nation on SUVs, pick-up trucks and heavy luxury vehicles.
Fortunately, Obama has a grasp of what's needed. He's rejected the tax cut gimmick, recognizes the need for revenue to do research and connects cheap oil with pollution and the dangerous dependency on hostile and rogue regimes around the world.