Drill Baby Drill

Member Group : Lincoln Institute

I like my sport utility vehicle. It works well for me because it seems I am always toting something around; printed materials for work or campaigns, plants for the yard, luggage for family vacations. My SUV gets a lot of use. What I don’t like is paying $70 to fill up the gas tank. And, with gasoline prices projects to approach $5.00 per gallon by Memorial Day I can expect that cost to go even higher.

Fortunately for me my office is a five minute drive from my house, so I keep mileage low. But, for those with long commutes to work; and especially for businesses that depend on shipping and deliveries the skyrocketing cost of gasoline spells economic disaster. And, with the economy experiencing a sputtering recovery from the recession, the increasing cost of gasoline threatens to delay further the nation’s return to economic prosperity.

Blame for the current run-up in gasoline prices is being placed on instability in the mid-east and on speculators who bid up oil futures. It is easy to blame faceless speculators. And although the flow of Libyan oil has been slowed, there is more than enough oil being produced elsewhere to keep the supply lines full.

The real culprit here is neither speculators nor mid-east tensions; the real culprit is the policies of the Obama Administration. Since taking office the administration has done everything possible to slow domestic drilling and to prevent America from taking advantage of Canadian oil reserves which rival those in the mid-east.

Driving up the price of gasoline is part of the Obama master plan. Carbon-based fuels are anathema to the administration which has placed an emphasis on so-called "green" power. The problem is no current technology exists to economically deploy such power sources on a mass scale. Obama’s goal is to create a crisis that triggers the flow of billions of federal dollars into his preferred sources of energy.

But those sources are unproven and millions of Americans are suffering economic hardship as a result of this policy. It should be the goal of Republicans in congress, and a major issue for GOP Presidential candidates, to make developing domestic oil resources a top national priority.

David Kreutzer, a research fellow in energy economics at the Heritage Foundation points out that the Obama Energy Department has made it virtually impossible to drill for oil off the Atlantic coast, the Pacific coast and the eastern Gulf of Mexico. In the wake of the BP oil disaster in the gulf last summer rigs were shut down and permits suspended. Contrary to administration rhetoric, production in the gulf has not returned to normal, in fact companies have pulled some rigs from the region literally setting sail for better opportunities.

Of course drilling in the Alaskan National Wildlife Reserve (ANWR) has been off limits under multiple presidential administrations. But, with 10 billion barrels of known oil deposits in that region the time has come to develop that resource. There is no way America can lessen its dependence on mid-eastern and South American oil sold by unstable, often hostile, regimes without producing oil from ANWR.

Another factor preventing increased domestic oil production is the lack of refinery capacity. The last new oil refinery built in the United States was in 1976 in Louisiana. Clearly it would do no good to increase drilling without also building the refineries necessary to transform that oil into gasoline.

And then there is Canada. Our neighbors to the north are capable of producing more than one million barrels per day. There are two problems. First, the Obama Administration opposes the tapping of Canadian oil because it is of a type that requires the expenditure of energy in the extraction process. The procedure is more costly, but at current prices more than profitable. Second, the administration opposes building the Keystone XL pipeline which is necessary to transport Canadian oil to the United States.

The bottom line is our country could lessen our dependence on undependable foreign oil, dramatically reduce the cost of gasoline at the pump, and generate economic growth all by changing federal policy. Our current problems have not been caused by a lack of resources, or by a lack of companies willing to invest in oil production. Rather they have been caused by radical left-wing energy policies that, while surrounded by nice sounding rhetoric, simply don’t work in the real world.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal. His e-mail address is [email protected].)

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