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Oil Gone Wild
The price of oil struck an ominous chord for the US economy with yesterday's record trade of $147 per barrel. At these prices we are sending more than $1 million every minute of every day to oil rich countries. As oil hits a new high the dollar has hit a record low against the euro. Our equity is draining away and flowing to foreign hands.
How can we get ourselves out of this mess? This crisis will take nothing short of a restructuring of our core industrial and transport sectors. Just as a turnaround CEO comes in to fix a troubled company, we need a retooling to rid ourselves of oil dependency. We do not need politicians looking for fake fixes such as a summer gas tax holiday.
We do not need the President of the United States of America to beg sheiks for a bit more of the black gold. Keep your dignity, Mr. President.
The problem is clear -- 55% of all the oil we use in the US is guzzled by cars and SUVs. Not planes, not trains, not big trucks. To find the problem look no further than your driveway. Yes, the fleet of 245 million cars and SUVs that we drive in the US -- that is the main problem.
To address this crisis we should partner with automakers, utilities and public transport and create millions of jobs in the process. We need to move immediately to high-mpg cars and the electrification of transportation. We must upgrade to a smarter electric grid and build out public transport to handle the increased ridership from high gas prices.
To deal with the oil crisis, T. Boone Pickens envisions an increase in wind power to offset the use of natural gas and direct that to the transportation sector. While more renewables are absolutely desirable this plan would take years to stabilize the economy and make a dent in oil use.
To decrease the use of oil in our cars we need the kind of retooling we did for World War II. In 1941 we asked Detroit to refit all their factories from pumping out cars to manufacturing planes and tanks.
Now we are in another war. A war against this debilitating addiction. We must ask Detroit and all automakers in America, foreign and domestic, to retool immediately to make cars of more than 30 mpg, hybrids of 40+ mpg and the mass scaling of plug-in hybrids that connect to our electric grid.
We must give the automakers the means to do this. Automakers are in trouble and cannot retool on their own. We should offer them loan guarantees and give incentives to private capital to invest in an immediate restructuring of all car plants.
If there is any tax reduction we should consider it is a capital gains discount for investment funds that pour significant dollars right now into reorganizing automakers around the new order of high oil prices. This could unleash tens of billions of dollars immediately at no cost to the US Treasury.
We can put Detroit back to work and get off oil at the same time. In fact, we can only get off oil by getting auto workers back to work and replacing our addictive fleet of guzzlers.
We must also pull cars off the road at much faster rates. We currently have tens of millions of cars getting less than 18 mpg and stay on the road for more than 14 years. The average mpg of the fleet has stayed at 21 mpg for more than a decade.
We can use the same incentive structures that we successfully deployed to accelerate the retirement of old refrigerators and air conditioners in favor of energy star appliances. Now with the price of scrap auto steel through the roof at $560 per ton, we can afford to junk the worst offenders in low mileage. These tend to be heavier cars that can be worth thousands of dollars in scrap metal and reusable parts.
Second, let's partner with our utilities and create new jobs in this sector. Most utilities are looking for more demand for electricity at night and to cut demand during peak daytime hours. Plug-in hybrids offer utilities that very opportunity to gain new demand at night while we charge up and to shave off the peak by taking back electrons during the day from those same vehicles.
Our national energy labs have concluded that we could replace more than half of all cars in the US with plug-in hybrids and not have to add even one power plant. There is plenty of spare capacity at night.
We should give the utilities the ability to make the same profit off of efficiency gains as generating electrons and give them the capital to upgrade our to a smart network. This will create millions of high and low-tech jobs as we move to a 21st century bit-enabled electricity grid.
Third, let's leverage private capital to build out public transport. While replacing cars is critical, we must move more Americans around using shared systems. High gas prices have already pushed public ridership to new highs. Let us meet this demand by putting at least $100 billion of public and private money into this infrastructure.
This stimulus will create millions of additional jobs at all levels of skill. In particular, the construction workers so hurt right now in the housing crisis will get right back to work on a sustainable asset for this country.
Back in 2005, the Congress passed the Energy Policy Act. Title X of that law calls for the Freedom Prizes - a set of prizes that raise awareness of our enslavement to oil and promote alternative solutions. The White House and Congress should focus more on tools that we have to address this problem than trying to convince OPEC countries to play nice.
We need to get US workers back on the job and retool our economy now for this new reality. We are up to this challenge, but we must act now.
Jack D. Hidary is chairman of SmartTransportation.org and the Freedom Prize Foundation. The Freedom Prizes were co-founded by Hidary and Josh Becker - www.freedomprize.org
Follow Jack Hidary on Twitter: www.twitter.com/jackhidary
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Tax the rich and big business, gotta pay back the BushCo loans anyway.
Use the money from the 158B$ in oil subsides.
Take it all and put it into tax incentive for wind solar and plug in hybrids.
Close the Enron Loophole.
http://www.huffingtonpost.com/users/profile/research
Seriously . . . Did you read the post above or do you just past the same crap on every message board?
The post above offers reasonable alternatives that actually help solve a lot of the problems we face without pointing fingers and trying to penalize certain interest groups. Blaming Bush, rich people, and Big Oil will get us no where fast. Why not create incentives like Jack is suggesting?
Bravo Jack . . . This is by far the best and most reasonable post I've seen on this website to date. Well thought out and with a good eye for a positive future. And this is coming from a Gulf Oil Field Engineer who's Dad works at a Coal plant.
Deja vu. Heard all this same talk 35 years ago. It was the government's responsibility to safeguard the nation, which meant all those years ago insisting on better mpg and public transport, as well as a total hydrogen economy by 2010. What happened? People got money in their pockets, oil got cheap, and the pathetic status symbol consumers demanded SUVs, and the car companies made 'em. And what politician is going to promote rationing in a boomtime? So shut up about who's responsible. You are.
And why don't I hear anything about setting the speed limit back to 55? It is a FACT that driving slower will save gasoline. Again, we just can't alienate the voting consumer. Imagine forcing people to drive slow. I'm still seeing hummers and expeditions fly by me on the highway. It's fourth-turning crisis time, folks - and there's still another 20-odd years to go. "It's the end of the world as we know it, and I feel fine." - R.E.M.
Hi ChrisR
I completely understand your skepticism. The hydrogen argument has been used by the auto makers as a red herring for more than 30 years = and of course it is always decades away. this is to fool congress into thinking that they are actually doing something about clean cars. so you are absolutely right on there.
due to the gross mismanagement, the US automakers are about to stick us - the taxpayers -- with an enourmous bill to bailout their pension and healthcare liabilities if they go bankrupt.
i am hoping we can avoid that by incenting **private** capital to step in and turn these companies around.
as mentioned by one of the commenters on this article, this will require new management in most cases - NOT enriching current management who until last month (!) were still thinking they should build big cars. incredible.
i did not have room in this one piece to lay out all the steps we can take to get off of oil - just a few.
for example - how about the whole OTHER use of oil - plastics and industrial products. how about asphalt, water bottles, pvc, etc. all made with oil as one key ingredient. did you know that Dupont and Dow use about 2% of all the oil every day in this country?
i will address bioplastics and industrial alternatives in another piece. this is more than 20% of oil use in the US.
keep the comments coming...
J
The proven best way to conserve oil, and increase the use of alternative energy - is to make Oil extremely expensive.
Hi Woggles,
For oilmen and leaseholders across the nation . . .we say "Thank you!".
This will be the best boomtime we have ever had!
True but it would best be done with tax's not profits to the Oil companies they should be hit with big profiteering tax's for this war for oil instead of their company Exc's getting huge bonus and salaries.
We need to put more money into research for alternative energy like wind, sun, and algae to oil. We should have done this in the 70's but oh no we can have anything imposing on the big oil companies.
I suppose this is where I lose my cred as a liberal.
But the laziness, stubbornness, and greed of the American auto industry darn near killed it in the 1970s. These same brilliant traits are now helping to deliver another set of disasters.
I'm sorry, but I'm done giving these jackasses any more breaks. Any bit of public financing support MUST include a COMPLETE upper management (i.e. the "deciders") purge. NO auto industry insiders, no family of board members - no more anointing more incompetent, irresponsible heirs to the industry thrones. It's done nothing but cause disaster in this nation.
The other thing that ticks me off is this constant drone of "create millions of new jobs" by converting to non-oil-based industries. Every politician and pundit crows this misleading line. The reality is that we are REPLACING EXISTING jobs with NEW jobs - not ADDING jobs to the economy. The net may be a little higher or a little lower, but it's not going to be some sort of magical BOON to the economy. We need is to change the basics of our energy consumption - not pretend that we're going to add to the economy.
The last thing I can fit here is the concept of plugin cars. We make the electricity by burning stuff - mainly gas, oil, and coal. This is part of the problem, too, and you are not only failing to address it, but amplifying it.
In short, your plan is weak.
In short your lack of insight is weak.. All of the coal and gas based plants can be converted to solar power plants. This is feasible today and cost effective with the latest advances in solar panel efficiencies.
That's hilarious!
First, this guy's plan says nothing about converting plants, so where the hell do you get that from his post?
Second, there is a wide variety of coal and gas-powered plants. You're either over-simplifying consciously to make a point - or you don't have a clue what you're talking about. Cite something - anything legitimate - that discusses how this transformation can take place. Solar plants need large expanses of space which many power plants just don't have - and will never have.
Third, solar panels are used to either intensify heat and apply it to a material that can further transfer and use the heat energy to generate electricity. Or the panels directly convert the sun's energy to direct current and either store it to batteries or run it through an AC inverter to run devices (or flow out to the grid). In cases of the latter type of photovoltaic panels, a plan to cover every roof in the nation with them would be a terrific plan for minimizing our reliance on destructive, extractive generation techniques. However, this doesn't do much for the oil and natural gas consumption in this country and it ignores the fact that fuel-cell will be a more viable transportation solution than those mentioned in the post.
And whereas solar-powered plants in Florida may be pragmatic, I'm not so sure they will be as effective in Maine.
Replacing coal with solar is simply goofy!
Excellent outline . . . reasonable, fair and balanced!
Can you take an existing gas guzzler and convert it to some other engine type? I mean, there are probably plenty of people who can't afford to unload their car because they still owe a lot of money on it and nobody wants to buy it or, if it's already paid for, realize that there won't be anybody to buy it from them now that gas price shock has hit. I have a Town and Country minivan which I love for its comfort, but would be willing to pay some reasonable price to refit it to some other non-gas-burning engine if it were possible. I do feel that the problem is that we want instant results because the pain of high gas prices has hit relatively suddenly, but there doesn't seem to be any readily available cure for our woes.
Depends on how much you drive, how much you can afford, what your expectations are, etc. However, there are people doing gas to electric conversions but right now, the batteries are the most expensive piece. In order to get decent range, you could spend up to $20K on the batteries alone (for LiFePO4). These are the safer alternative to the same batteries in a laptop, cell phone. I've tried to find out why they cost so much considering the chemicals that make them are extremely common but the only thing I can determine is that the manufacturing process is complex and is only being done in relatively small quantities. I believe (in otherwords, no hard evidence to back it up) that if this manufacturing were scaled up to deal with what could be an ENORMOUS demand, the price would come down considerably. Then, there would be no reason why we all shouldn't be driving electric cars.
Hi JaneEyrez,
Compliments . . . a very passionate openminded question!
Yes . . . there was a way . . . The EPA sponsored research into "capturing kinetic energy" . . . Was amazed at the progress they had made. They had converted a fleet of UPS vans, dump trucks, trash trucks, a bus and several SUVs. . . . The short of it . . . you could of replaced the SUV's drivetrain with a fluid drive and a relatively tiny engine (or electric motor). . . . The benefit . . . quiet, efficient travel and power to pull loads. . . . The numbers showed mpgs in the ball park of today's hybrids. . . . There still were some downsides (pressurized reservoir) . . . but the results were promising, particularly when mated to fuel cell technology.
In 2006, when the Democrat congress took power they killed the funding for the EPA research . . . believe the rationale was "why should they fund research to preserve a status symbol associated with lifestyle they were trying to stop" . . . from their point of view, it makes sense . . . leaves the rest of us in a bit of a hole . . .but we will adapt!
Hopefully, Eaton (who made the bulk of these parts) might consider making them available commercially.
Mr. H --
You miss the point entirely.
Oil is not the answer -- it is the problem. Cars and trucks and SUVs are not the problem -- it's the energy needed to operate them. Consumers are not addicted to oil -- we are given no other choice.
When an entire country has its culture dictated to it by entities (like Big Oil & The Big Three) whose raison d'etre is to make money by limiting peoples' choices of energy options, something is bad-wrong. We've been played for suckers -- that's all.
In the 1950s Walt Disney produced a short film segment which showed what the US would look like in 20-25 years. Electrically-powered cars were whisking along radar-guided highways of the future, while the vehicle's occupants were free to gaze out the windows or read the daily newspaper -- hands-free. What ever happened to those predictions -- they weren't that fantastical at the time.
The answer is, of course, that there was much more money to be made off an old idea than a new one, and that's prettymuch where we've been ever since.
"Automakers are in trouble and cannot retool on their own"
These are the same automakers that have fought tooth and nail for many years against higher CAFE standards. If it wasn't for their resistance, we would already have those high mileage cars and hybrids.
Please don't spend my tax dollars on bailouts of these auto companies. Or, if you must, make sure that the board of directors, CEO, CFO, and all the rest of the executive staff are replaced with new people who are dedicated to moving the car companies into a new, more sustainable model.
The guys who lead us into the big SUV craze do not deserve our bailouts, and should not be trusted to lead us in a new direction.
"Americans want big cars and are willing to pay for them."
The economics of utter idiocy.
Because you pay for something--does that mean you *should*? Because you can, you will? What kind of moronic tomfoolery is this, anyway?
Peak Oil is here. We either retool, or ... well, we die. Both economically and physically.
Reality. Deal with it, or it will deal with you.
Time to wake up, idiots.
hi - not sure where your quote about americans and big cars but it is from but it is not from my piece. Americans do NOT want big cars anymore - thankfully $4 a gallon gas has woken them from this delusion.
My point in the piece is that Detroit has to wake up to this new reality and retool right NOW to make hybrids and super efficent cars. private equity can help detroit do this. all we should do is encourage this investment.
i am here visiting Detroit right now - this place has been hit by a BOMB. devastation everywhere. why the management of these companies could not wake up to this reality sooner is another story but all the US suffers for it.
we must move people to public transport now while gas prices are high - now is the time to retrain America to be more efficient. now is the time to create better policy such as we did in NYC - pls see http://www.smarttransportation.org for an example - we are changing out all cabs for hybrids.
the bottom line is that this can be a win - win - we can change the US to a more efficient economy, get off of oil AND create jobs - in fact it is the only way we will create jobs.
I look forward to your comments-
J
I suspect Shawn was intending to reply to lanrameau, whose comment is below and uses that exact phrase in it.
The american auto industry SUED the State of CA to make sure we couldn't have better fuel economy. For the last 20 years they've been blocking every efficiency standard that We the People have demanded. The good old electric car was invented, manufactured, rented and then withdrawn from the market in the '80's by the same people you want us to hand over our hard earned money to in order to encourage them to do the job they should have been doing all along. Paahhhh!!
GIVE them taxpayers' money to bail them out of their own short sightedness and greed???
I thought FREE MARKETS would solve this kind of problem.
We should be mandating better efficiency, and alt fuels, but the best investment we could make would be to build a solar panel factory in every town and city in the US - go solar electric by 2025! This would literally create thousands of jobs. Not only should we have solar on every rooftop, we should have solar along the median of every highway in the US. We should have solar collectors on every parking meter, so that our new electric cars can recharge during the day. I just saw an expert on TV(sorry, no link) that said "If you can see a shadow, you can get energy from a solar panel."
Will we do it? - probably not.
If Germany and Sweden can go alternative, we certainly can.
The auto companies don't need help building fuel efficient cars. All of them sell frugal cars overseas and could easily bring them here. They just don't wanna. Big SUV's are where the profit is. Americans want big cars and are willing to pay for them.
Want big cars? Sales are down 30%. Won't even RENT them anymore.
http://www.latimes.com/business/la-fi-rentalcar14-2008jul14,0,6597295.story
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