Was it a time warp, or did George Bush actually morph into Jimmy Carter last week? How did wood chips and switch grass ever make it into a final State of the Union speech?
On April 18, 1977, in a televised speech to the nation, President Carter announced that by the end of the 1980s the world would us up all the proven resources "of the entire world." Carter predicted that by the end of the 1980s we would "not be able to import enough oil — from any country, at any acceptable price." Simply put, he was wrong.
Conservation was Carter’s solution to the perceived crisis that we were running out of oil. A classic liberal, Carter decided to blame Americans for their profligate ways. "Conservation is the quickest, cheapest, most practical source of energy," Carter proclaimed. "It is no program simply to say ‘use less energy,’" Ronald Reagan wisely pointed out in 1979.
Today, R&D is President Bush’s solution. Having failed to manage profitably a string of Texas oil companies, President Bush now wants us to "move beyond a petroleum-based economy." Is it possible that George Bush has really bought the political Left’s position on oil, or was last week’s SOTU simply his "energy malaise" speech?
Economist Julian Simon liked to point out that "peak production" hoaxes associate with energy conventional wisdom just as Malthusian doom-and-gloom are inherent to Ehrlich-like population predictions. Recasting one of Julian Simon’s most famous questions, we might ask this: "Why does President Bush believe so much false bad news about energy?"
Since 1970 the world oil marketplace has grown from producing 49 million barrels of oil a day to somewhere around 86 million today. In response to claims that Saudi Arabia was "running out of oil," Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi contended that the Kingdom’s proven oil reserves are under-estimated. "Saudi Arabia now has 1.2 trillion barrels of estimated reserve," Al-Naimi told an international conference in April 2004, four times what is usually estimated. "We are continuing to discover new resources, and we are using new technologies to extract even more oil from existing reserves," Al-Naimi continued, proving the Saudis also like R&D, but they use it to produce more oil.
Last month, Clive Mather, chief of Shell Oil Canada told the CBS 60 Minutes television show that there might be as much as 2 trillion barrels of oil recoverable in the oil tar of Alberta with advances in technology. Again, the Canadians know that the real point of oil R&D is to find more economically recoverable oil. With the oil tar resources stretching down into the oil shale of the Rocky Mountains, we probably have more oil right on this continent than is in all of Saudi Arabia, even with the Saudis upping their reserve estimates. Maybe while we’re waiting for nuclear batteries to power our cars, we should just use more oil and natural gas.
R&D is a great solution for the future, but a realistic energy policy needs to address the here and now. Yes, scientists probably can make fuel out of peanut oil, but is President Bush really getting ready to invite Jimmy Carter back to the White House for a chat? America still has abundant hydrocarbon energy resources that we already know about — in Alaska, in the Gulf, offshore on both coasts, and in the Rocky Mountains. Let’s stop dealing with make-believe. Dependence on foreign oil is a problem we can solve without the help of Jules Verne.