Set America Free Notes&Comments

Max Boot:

“FREE-MARKET purists are getting a lot of mileage out of scoffing at all the hysteria about rising oil prices. From a strictly economic point of view, they’ve got a point. Even with crude selling at more than $71 a barrel and gasoline at about $3 a gallon, the U.S. economy continues to expand [...] Libertarians fret that political meddling will only interfere with the beneficent work of the invisible hand [...]

“If oil were a commodity like any other, the free-marketers would be right. But it’s not. Most oil reserves are controlled by governments, many of which conspire through the OPEC cartel to manipulate the market. These governments aren’t the kind that any sane person would want to see in control of such a vital asset. Their power can only be countered by action from our own government.

“[...almost every] major oil exporter is a dictatorship, and the run-up in oil prices has been a tremendous boon to them. My associate at the Council on Foreign Relations, Ian Cornwall, calculates
that if oil averages $71 a barrel this year, 10 autocracies stand to make about $500 billion more than in 2003, when oil was at $27. This windfall helps to squelch liberal forces and entrench noxious dictators in such oil producers as Russia (which stands to make $115 billion more this year than in 2003) and Venezuela ($36 billion). Vladimir Putin and Hugo Chavez can buy off their publics with generous subsidies and ignore Western pressure while sabotaging democratic developments from Central America to Central Asia.

“The “dictatorship dividend” also subsidizes Sudan’s ethnic cleansing (it stands to earn $4.7 billion more this year than in 2003), Iran’s development of nuclear weapons ($45 billion) and Saudi Arabia’s proselytization for Wahhabi fundamentalism ($149 billion). Even in such close American allies as Kuwait
($35 billion) and the United Arab Emirates ($36 billion), odds are that some of the extra lucre will find its way into the pockets of terrorists [...]

“How do we defund the dictators? That is not an issue that the United States can solve by itself. Although we are No. 1 when it comes to oil demand, our use represents only 25% of the global total, and falling. The U.S. should try to forge a consensus among major consumers, including the second-biggest oil guzzler, China, on how to wean our transportation infrastructure away from gasoline”

Kudos to Rep Everett, Terry [AL-2], Rep McCaul, Michael T. [TX-10], Rep Towns, Edolphus [NY-10], Rep Lowey, Nita M. [NY-18], Rep Price, David E. [NC-4] for becoming cosponsors of HR4409, The Fuel Choices for American Security Act.
Is your Representative on board yet?

An excerpt from Senator Bingaman’s statement on the Senate floor announcing his decision to cosponsor of S.2025, The Vehicle and Fuel Choices for American Security Act:

“In thinking about more efficient use of oil, we need to face up to the fact that most of our oil is consumed in the transportation sector. Growth in transportation demand for oil is the single largest factor in the growth of our dependence on imported oil. So improving the efficiency of our use of oil and natural gas–these were the areas, frankly, in which last year’s Energy bill turned in its weakest performance.

“The Senate adopted a number of reasonable proposals to promote more efficient use of oil and natural gas when we passed our version of the bill, but the most significant of those provisions we passed in the Senate had to be dropped in conference because of the strong opposition from our colleagues in the House of Representatives. These Senate-passed provisions included mandating an economywide oil savings target, increasing tire efficiency standards, and implementing a renewable portfolio standard for electricity.

“Since the passage of last year’s Energy bill, there has been continued interest in these proposals, and last year a bipartisan group of Senators, led my Senators Bayh, Brownback, Lieberman, and Coleman, introduced a comprehensive bill, S. 2025, the Vehicles and Fuel Choices for America Security Act. That bill provides a mix of energy policy and energy tax incentive proposals aimed at moving our economy toward both a more efficient use of oil and a more diverse future mix of transportation fuels, including biofuels. I strongly support many of those proposals. I am joining them as a cosponsor of that bill.

“Because that bill contained both policy and tax provisions, it was referred to the Finance Committee. Yet many of the provisions of this bill are in the jurisdiction of the Energy and Natural Resources Committee, which ought to review and report those provisions to the full Senate. For that reason, I am joining with a number of those sponsors of S. 2025 to introduce a new bipartisan bill this week that will take those energy policy provisions and put them in a bill that will be referred to the Energy Committee. In this way, we will have a starting point for what I hope will be an effective and bipartisan committee process in the tradition of the bipartisan leadership on energy that our committee enjoyed under Senator Domenici’s leadership last year in the passage of the Energy bill.

“Among the most important provisions of S. 2025 and the new bill will be an emphasis on an expanded plan for economywide oil savings. The President would be required to come forward with a plan to cut our oil use from projected levels by 2.5 million barrels of oil per day by 2016, 7 million barrels of oil per day by 2026, and 10 million barrels of oil per day by 2031. ”

Anne Korin talks about oil, national security, and the imperative of reducing our dependence.

Kudos to Senators Bingaman, Inouye and Kerry for becoming co-sponsors of S.2025, The Vehicle and Fuel Choices for American Security Act.
Is your Senator on board yet?

Bolivia’s Morales just nationalized the oil and gas industry. This is part of an epidemic of governmental looting that is spreading across South America, and will serve to discourage energy majors from making the investments necessary to develop the region’s reserves. As Gal Luft was quoted in today’s New York Times article on the issue, “This isn’t like Saudi Arabia, which over the years has developed a know-how to dominate the industry independently [...] When you cause problems for foreign investors, you cause problems for those who know how to create and develop the industry.”

For background, read/watch Anne Korin’s March 2, 2006 testimony before the House Subcommittee on the Western Hemisphere.

Tom Friedman:
“The president can start by pushing the bipartisan Fuel Choices for American Security Act, now wending its way through Congress. This bill would mandate that every car sold in America would not just have seat belts, but would also be flex-fuel capable so it could run on ethanol, methanol or gasoline. It would also pave the way for the rapid commercialization of plug-in hybrid vehicles, which would combine electricity and gasoline to get 100 miles out of every gallon of gasoline consumed.

“Finally, the bill would offer Detroit loan guarantees for transforming its fleets in this direction. “We’re going to have to bail out Detroit anyway, so let’s at least get some public benefit,” the energy expert Anne Korin said.”

Set America Free Coalition members Jim Woolsey & Gal Luft in the Houston Chronicle:
“Large-scale deployment of flexible fuel vehicles running on alcohol, gasoline or any mixture of the two will allow Americans to choose secure domestic fuel over problematic foreign oil. Since the additional per-vehicle cost associated with flexible fuel vehicles is currently under $200, fuel flexibility should become a standard feature in every car ? like seatbelts or airbags.

“Plug-in hybrid vehicles, unlike standard hybrids, can draw charge not only from the engine and captured braking energy, but also from America’s electrical grid [...]

“These technologies exist. There is no need to wait for technological breakthroughs, invest billions in research and development or embark on massive infrastructure changes. What is needed is congressional action to build on the president’s call by enacting the necessary incentives for
producers to make, and consumers to buy, cars that offer fuel choices while encouraging the development of a mass market for alternative fuels, along with the modest necessary changes in the distribution system. Such policies would make the U.S. economy more resilient and put it on a trajectory toward oil security.”

Coalition members Luft and Deron Lovaas:
“With oil trading near $75 a barrel, one can only wonder how much higher prices might get should this year’s hurricane season be as lethal as last year’s, should a full-blown civil war erupt in Nigeria or Iraq, should terrorists attack a Saudi facility or should a standoff with Iran results in a disruption in oil shipments through the Strait of Hormuz. Each of these scenarios could take oil prices to the three-digit domain with profound implications for the U.S. economy and the world economy at large.

“As it is, the U.S. economy is bleeding?three-quarters of a billion dollars leave our country each day in exchange for imported oil. That’s more than $450,000 a minute.

“Worse, a portion of the money ends up in the coffers of undemocratic, unstable and/or hostile regimes, which doesn’t add to our ability to win the war on terrorism. At the same time the U.S. finds itself embroiled in a potentially aggressive competition with emerging Asian powers like China over access to energy resources.”