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America, China take radically different paths on energy
By: Thomas Pyle, OpEd Contributor
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March 12, 2009
KEY DATA: Expanded off-shore energy production would create 1.2 million new jobs, generate $2.2 trillion in new government revenues and $8 trillion I economic output.
TAKE HOME: China and other foreign nations are investing billions in new energy resources, while the U.S. keeps its vast, untapped off-shore energy resources off-limits.
President Barack Obama has taken some heat recently for the expensive and unproven energy policies he has promoted. But whether his trillion-dollar government giveaways prove effective or not, Obama deserves credit for one thing - he promised us change and he delivered.
In a mere four weeks, he’s changed the face of the entire relationship between government and the private sector. With the possible exception of the financial services industry, nowhere is this more evident than in our energy policy, especially in the form of restrictions to our ability to secure affordable and reliable energy to meet our future needs and fuel America’s economic growth.
A series of recent energy events signal that Obama will apply his big-spending approach to any problems America faces. The Department of Interior, for instance, wasted no time delaying action on offshore energy production and closing oil and gas exploration leases in Utah, both of which would have employed thousands of American workers and provided homegrown energy.
In spite of the fact that gasoline prices are nearly halved from last summer’s highs, the American people still overwhelmingly support offshore energy exploration and production.
This long overdue policy change would create 1.2 million jobs, $2.2 trillion in government revenue, $70 billion in additional annual wages, $8 trillion in economic output, and affordable energy right here at home. Instead, Obama instead offers us taxpayer subsidized “green jobs” that will increase the cost of energy.
It is interesting to think about the alternative to Obama’s approach. In the same week he traveled to Denver to investigate subsidized solar panels and signed the budget-busting economic recovery spending package, China’s leaders - who own the interest on most of our national debt - took a noticeably different path.
In one month alone, China spent $41 billion on new oil investments. First, China loaned $25 billion to Russia to develop their oil fields to secure more energy for China’s growing economy.
China’s Vice Premier followed that deal with a visit to Hugo Chavez’s oil rich Venezuela. On the way home, he stopped in Brazil - a nation that is quickly becoming an energy superpower as it develops its offshore energy resources - to cut a $10 billion deal in exchange for long-term oil supply.
Over the past 28 years, the U.S. government has kept off limits the vast taxpayer-owned energy resources that lie underneath our shores. This failed policy has led to increased oil imports, exported trillions of dollars and hundreds of thousands of jobs, and has left America a hollowed-out nation when it comes to domestic energy production.
Instead of following the will of the American people and securing long-term affordable energy for America, Obama’s primary concern has been to throw more money on an already heavily subsidized industry that currently generates less than 4 percent of our electricity.
Over the last month, it has been interesting to witness this tale of two leaders. China’s leaders demonstrated the importance of investing in the energy it needs to fuel its ambitious plans for economic growth.
Our leaders, on the other hand, have placed obstacles in the path of accessing our own energy, doubled down on the subsidies for inefficient, expensive, and unreliable forms of energy, and have guaranteed that we won’t see changes in this arena for quite some time.
Thomas Pyle is president for the Institute for Energy Research, a not-for-profit foundation that conducts intensive research and analysis on the functions, operations and government regulation of global energy markets.
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