The Right and Wrong Side of the Energy Divide

Mark Green
Posted April 25, 2012

Interior Secretary Ken Salazar talked about a divide in America between the “real energy world and the imagined energy world” during a speech Tuesday in Washington. He’s got that right – but it’s not like the administration is on the right side of that divide. Consider:

• It dismisses calls for increased access, saying it takes years to develop oil and natural gas resources, and then takes credit for increased production.
• It says it wants more oil and natural gas when in reality its policies set back production in the all-important Gulf of Mexico and on federal western lands.
• It says 75 percent of America’s offshore resources are open for development when in reality 87 percent of areas are off-limits.
• It says oil and natural gas are the energy of the past even though they currently supply 62 percent of the energy we use and in 2035 will still supply about 60 percent.
• It repeatedly suggests that America is an energy pauper, when in reality the country has tremendous energy wealth, with ample supplies onshore and offshore.
• It claims the oil and natural gas industry doesn’t pay its fair share in taxes when in reality it sends $86 million a day to the U.S. Treasury in rents, royalties and income tax payments, and its companies rank 1-2-3 on Forbes’ recent list of those paying the most in income taxes. 

Now, the Interior secretary’ s speech was on-target in some ways. Salazar said that “overwhelmingly, Americans agree on energy.” They do indeed:

• 84 percent believe increasing domestic oil and natural gas production could enhance the country’s energy security, according to a Harris Interactive poll last month.
• 64 percent in that same poll said they believe some in Washington are intentionally delaying domestic oil and natural gas development, potentially hurting the economy and leading to higher consumer energy costs.
• Anywhere from 56 percent to nearly 70 percent in other polls say they support construction of the Keystone XL pipeline that would bring upwards of 830,000 barrels of crude oil per day from Canada to U.S. refiners – which the administration continues to obstruct while pretending others are at fault for the delay. Here’s video of the secretary doing just that after Tuesday’s speech (courtesy The Daily Caller):

More Salazar: 

“Americans want to cut our reliance on imported oil. They know that a lot of factors affect gas prices – including world markets and international events – and that, unfortunately, there’s no silver bullet in the near term.”

No question, world crude oil markets play the biggest role in prices at the pump – 76 percent of the cost right now – and affecting near-term change is problematic. But market signals do matter. And it’s time to take charge of our energy future by choosing the right policies to affect the long-term energy equation. For too long opponents of accessing available U.S. resources have used the “no silver bullet” line to block sound energy decisions – like drilling in remote Alaska, which by now would be an important part of the energy mix if it had been undertaken when it first began to be debated more than a decade ago. 

Salazar once more:

“The energy world is changing … Whether it’s our oil and gas technology, our solar power plants, or our auto manufacturers, the pace of American innovation is staggering. The U.S. is determined to lead in the new energy world. So it’s no longer a question of whether you support renewable energy or conventional energy, or whether you favor the environment or the economy. The American people have decided to take an all-of-the above approach.”

The United States needs all of its energy resources, but a real all-of-the-above approach must do more than pay lip service to oil and natural gas production – today’s energy and tomorrow’s. The challenges are daunting, but historically Americans have risen to meet challenges with the help of strong leadership – in contrast to the rhetoric of resignation and powerlessness that frequently comes from the current administration. API President and CEO Jack Gerard, speaking last month at a congressional hearing on energy:

“With sound policy and bold leadership, we can put this country’s vast resources to work to change the current energy equation. … A strategy that confidently deploys resources here at home will send a clear message to global markets that the United States is serious about affecting supply. To the American people it will say help’s on the way. … With the right policies and strong leadership, we can secure our energy future instead of surrendering it to outside forces.”