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Jewish World Review
January 20, 2010 / 5 Shevat 5770
Who Needs Energy Independence?
When you gas up your car, do you think that you're doing something evil?
After all, I'm told that burning gasoline helps "murder the Earth," not
to mention fills the coffers of terrorists and despots.
So we must move away from oil. Al Gore says, "The future of human
civilization is at stake."
But I need the gas. I need to drive. I need electricity to light my
home. What can I do? Is there an alternative? There is, I'm told.
"What if we could use fuels that are not expensive, don't cause
pollution and are abundantly available right here at home? We have such
fuels," Gore says.
"In fact, we can start right now using solar power, wind power and
geothermal power to make electricity for our homes and businesses."
In 10 years, he says, we can get all our
electricity from these carbon-free sources.
Global warming hysteria is just one reason Gore and others push for
alternative fuels. We're also told that America's goal should be energy
independence. Today, we do buy oil from some very nasty people:
dictators in Venezuela and the Middle East. What if they cut us off?
That fear is one reason almost every president and presidential
candidate from Richard Nixon to Barack Obama promised to end our
"intolerable" reliance on oil imports.
When Nixon was president, we imported 25 percent of our oil. Since then,
our "leaders" have wasted billions on subsidies for alternative energy.
The result? Today we import nearly 70 percent of our oil.
Terrible as that sounds, I say, "So what?" Interdependence is just fine!
Bryce points out that while Saudi Arabia and Iran are oil exporters,
they are gasoline importers. "If even Saudi Arabia and Iran are energy
interdependent, why wouldn't we be?" he says. "Energy interdependence" is just a way of
saying "division of labor" and "comparative advantage."
Our biggest foreign oil suppliers are Canada and Mexico. Do they threaten us? Venezuela or Iran might,
but they need the oil money. They would hurt themselves if they tried to
cut us off.
Even if they did try, we'd still get their oil. All the world's oil ends
up in the same bathtub. The dictator sells to someone who sells to
someone who will then sell to us. Chasing energy "independence" is
pointless. Free trade is better. It makes us richer and more secure.
Yet among those pushing for subsidies, along with Gore, is someone
smart: oil billionaire T. Boone Pickens. He'll be a guest on my TV show,
You've probably seen Pickens in his television ads, saying: "I have a
plan! We can unleash wind power to free up America's natural gas to
power our big trucks and bus fleets. And save billions of American
But if we can save billions by using wind and natural gas, why do he,
Vice President Gore and today's Congress need our tax dollars? If there
is a good alternative to oil, it won't need subsidies. The free market
will simply make it appear. Let the entrepreneurs compete.
Pickens' commercials say: "Over $700 billion are leaving this country
for foreign nations every year. That's four times the cost of the Iraqi
war. We need action."
But that's misleading. The $700 billion leave America for a reason. We
get useful oil for the money. Trade is a win-win
situation. There's no comparison with destructive war spending.
Pickens' website carries videos about how good government-subsidized
windmills are for towns like Sweetwater, Texas.
Windmills may be great for Sweetwater, but that only looks at what's
seen. What's unseen are all the people who are
hurt because they are taxed to pay for Sweetwater's windmills. That
money could have gone elsewhere. It's the broken-window fallacy
identified by 19th-century French free-market economist Frederic Bastiat. Maybe Fox will let me break a window to
make the point.
Pickens is wrong. We don't need government to choose which fuels to
subsidize. The free market is the way to go.
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