Jay Reding.com

The Washington Post has an article on how high oil prices are “stumping” the experts. The massive rise in oil prices to $130+/barrel does represent an unprecedented rise in oil costs. However, it shouldn’t be a surprise. The world is facing a “perfect storm” of factors: China and the rest of Asia are still growing, OPEC is either unwilling or unable to pump more (and the good money is on the latter—the Saudis may have been overstating their own reserved for some time), and countries are subsidizing gas prices—and subsidies invariably distort markets and raise prices.

Of course, the Democrats have their own culprits. Of course, the Democrats are wrong. They blame the oil companies for raising prices. They do look suspicious, given their skyrocketing profits. The problems with that theory is that those profits are not out of line for the amount of oil they sell. The other problem is that they can’t invest in new projects. Normally they would reinvest those profits into expanding their new capacity. But bad public policy prevents them from doing that: most of America’s coastal waters are off-limits to new oil development, and domestic development in places like ANWR are also forbidden.

Congress is once again asking for the impossible, and behaving petulantly when they don’t hear what they want. On one hand, they want the U.S. to limit carbon emissions—but then they demand cheap gas.

The world doesn’t work that way. We’re running out of cheap gas, and it’s a question of whether we hit the peak in 2030, 2050, or some other point. If we want cheap gas, we have to drill in places like ANWR and off-shore, and we’d better accept that we’ll produce more carbon emissions. If we want to keep ANWR into the untouched pestilential wasteland that it is and keep carbon emissions down, then consumers better get ready to have an arm and a leg ready the next time they buy gas for their cars or pay their heating bills.

As always, Congress’ economic illiteracy is hurting American interests. The laws of supply and demand are just that—laws. There is a relatively stagnant supply of oil and more people are using it. That means the costs will go up, and they’ll go up not only to cover the current costs of oil, but also the future costs.

If the goal really is to reduce the price of oil, we can’t sit on our own reserves. A smart public policy would be to open ANWR and offshore sites to development instead of relying on dangerous and unstable places like the Middle East or Venezuela for our oil while simultaneously creating tax credits and awards for developing clean fuel technologies—because sooner or later we will enter a post-oil economy and the longer we can cushion the shocks the better positioned we’ll be.

Our current strategy, however, won’t work. We can’t keep messing around with the market through oil taxes, byzantine requirements for the blending of fuels, and a stubborn insistence on not allowing more infrastructure like refineries.

As they say, you can’t have your cake and eat it too. The problem is that lesson most of us learned in first grade seems to be forgotten the second a politician walks into the halls of Congress.

Jerry Pournelle has a suggestion for how we can make this country energy independent:

As to whether American ingenuity can use that technology to help win us energy independence, I have to say it again: cheap energy will cause a boom. The only cheap energy I know of is nuclear. Three Hundred Billion bucks in nuclear power will do wonders for the economy. We build 100 1000 MegaWatt nuclear power plants — they will cost no more than 2 billion each and my guess is that the average cost will be closer to 1 billion each (that is the first one costs about 20 billion and the 100th costs about 800 million). The rest of the money goes to prizes and X projects to convert electricity into mobility.

But he ends on a more somber note:

Of course we won’t do that.

Even though some in the environmental movement have embraced nuclear energy as a way of reducing CO2, the kneejerk reactionaries are still numerous enough to prevent any real progress. The fact that the government horrendously mishandled the regulation of nuclear plants and stifled the chance at making the industry viable didn’t help either. We could have been energy independent right now had we done things right in the 60s and 70s.

Meanwhile, France gets 70% of their energy from nuclear sources, reprocesses their waste, and is far less dependent on Saudi shieks or Venezuelan strongmen for their fuel. Their nuclear plants were build around common plans so that there was little duplication of effort, and spare parts could be made in batches rather than having every reactor be a largely unique design.

A smart politician would be pushing for a new Manhattan Project—the United States getting 25% of our electricity from clean nuclear reactors by 2020. A program that offsets the strain on the electrical grid from electric vehicles by building more capacity from nuclear power. A program to speed the development of safe pebble-bed reactors that won’t be capable of spreading radiation and doesn’t pose a threat from the proliferation of nuclear materials.

We can do those things, but all it takes is the political will to push them through. Sadly, it seems like our political leadership is decidedly lacking in will. Glenn Reynolds is right, we do have a lack of faith in our political leadership, and that comes because politicians are too willing to push for burning more of our food stocks than leading us into the 21st Century. We can do better, but we can’t do that if our political class is more interested in jockeying for power than pushing this country forward.

Mike Huckabee says that he wants us to stop consuming energy within a decade. Damn straight it’s time we had a candidate willing to stand up against the laws of thermodynamics!

In all seriousness, even if Huckabee meant that we should switch to all renewable sources within a decade, it’s still a silly argument. Even if you try to make sense of the statement, there’s just no way it doesn’t come off as being silly. We need a President who actually understands basic issues of policy. Mike Huckabee constantly comes off as someone who is clueless about the world around him.

Gaffes like this, and his statements which either sly anti-Mormon innuendos or signs he slept through his comparative theology classes demonstrate why Huckabee isn’t ready for prime time. He will probably win Iowa, but the reality is that Mike Huckabee is not a strong candidate, he’s not a conservative, and if he gets the nomination Hillary Clinton might as well start picking out drapes for the Oval Office. The Democrats have been holding their fire against him for months now because they know damned well that Mike Huckabee is a carbon copy of George W. Bush with all the same faults. He’s the sort of guy you want to have a beer with, but he would be a lousy President and his instincts are dead wrong on key issues.

Huckabee is a rising star, but his star will fall just as fast when Republican voters realize that he’s simply unready for the job. His appeal is understandable, but it’s all skin deep. Sooner or later Huckabee will crash, and when he does it will be a hard crash—in this race, Huckabee is playing the role of Howard Dean, and while he has some strong support, at the end of the day he is not electable and Republican primary voters need a candidate who can stand up to Hillary Clinton. Mike Huckabee is not that candidate.

Jim Geraghty of NRO’s Campaign Spot blog notes a survey that show that global warming is a major political issue in New Hampshire. While much of the global warming issue is alarmist hype, that hype has sunk in. However, even for global warming skeptics the necessity for a smarter energy policy is clear. We can’t live off of fossil fuels forever, and whether the days of “peak oil” will arrive in one year or 100, it will happen some day.

The usual conservative answer is that the market will decide what technology becomes the fuel of tomorrow. Which is all fine and true, but people want some kind of plan now. We have the problem of needing fuel, yet having key fuel sources being in hands of places that are unstable or hostile. The reality is that our dependence on Middle Eastern, African, and Venezuelan oil is a problem of national security, and the Republicans are not sufficiently serious on how we will deal with this problem.

The next answer is to boost domestic production. That’s all fine and good, but that still isn’t enough. We can expand our percentage of domestic oil, but we can’t insulate ourselves from the world oil market. We can’t produce enough domestic oil to meet our needs, and countries like China and India expand, the demand for oil will keep pushing prices up regardless.

Geraghty suggests a couple of policy stances that will help the GOP on this issue:

I’m a big believer that the Republican candidate ought to have something to say on global warming and carbon emissions beyond “the science isn’t clear” and “the market will take care of this.” Find some deserving target of environmental scorn and pledge to crack down on polluters; turn environmental protection into a law-and-order issue. Mock the Democrats’ hypocrisy on this issue. Promise to build wind turbines off the coast of Ted Kennedy’s Nantucket estate. Point out that the GOP wants to finance innovation while the Democrats want to tax energy.

That last sentence is key. What the GOP needs to do is back a 21st Century energy policy. The best analogy is the stock market: you’d be an idiot to hold all your money in one stock. Right now our portfolio is almost entirely based on oil, with a few alternative holdings. What we need is a diversified energy portfolio. Ethanol is one solution (although it’s economically inefficient, it’s politically popular). Biodiesel is one. Wind power is one. Hydroelectric power is another.

But there’s one issue that could significantly impact America’s energy independence, and that’s nuclear energy. The GOP needs to get behind the policy of removing the governmental roadblocks to safe, clean nuclear energy. It’s fundamentally conservative in that it involves removing governmental barriers to private enterprise. It’s also environmentally conscious in that modern nuclear technologies produce minimal waste and product significant amounts of power. As this excellent book points out, there is a strong case that nuclear energy needs to be a key part of America’s 21st Century energy agenda.

There isn’t a “magic bullet” to fix all of our energy woes. Instead, the GOP needs to be aggressively pushing a package of reforms that includes expanding domestic sources of energy, pushing for more efficiency through tax credits and other incentives, and bolstering several different alternative energy sources and letting the market determine which ones work and which ones don’t.

There’s no reason why one can’t have solid conservative principles and still be environmentally conscious, and there is a real need for a more aggressive stance on environmental and energy issues by Republican candidates. Energy is a national security issue, and while the GOP doesn’t have to charge headlong into the politics of fear surrounding global warming, they do need to have a coherent and competitive energy and environmental agenda.

The “progressives” aren’t progressive on energy—they want more big-government solutions that will slow down the development of real alternatives. But in order to win on this issue, conservatives can’t be afraid to take a stand. Again, the GOP candidate who can get conservatives for conservation on their side will have an edge against those others who no real plan to preserve America’s energy independence and the environment at the same time.