Obama's energy abyss
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Somehow we have to figure out how to boost the price of gasoline to the levels in Europe," Steven Chu, now the energy secretary, said in a 2008 interview with the Wall Street Journal.
A gallon of regular costs more than $8 there. The Oil Price Information Service thinks the average price here will rise to $4.25 a gallon by the end of April. That would exceed the record of $4.11, set in July 2008.
A gallon of regular cost just $1.85 the day before President Barack Obama was inaugurated. If the price were to double again during a second Obama term, Mr. Chu's goal could be achieved.
Sen. Obama expressed little concern when the price of gas was approaching the current record high.
"I would have preferred a more gradual adjustment," he told CNBC in a June 2008 interview. "But if we take some steps right now to help people make the adjustment ... then I think we can come out of this stronger and have a more efficient energy policy."
Earlier, Mr. Obama told the editorial board of the San Francisco Chronicle that "under my plan of a cap and trade system, electricity rates would necessarily skyrocket."
Secretary Chu has backed away from his infamous quote. But that was political expediency. Democrats want high energy prices, but not the blame for them.
"If you are a politician who wants to raise the price of gas, you have two choices," said Prof. Walter Russell Mead. "You can persuade the military leadership to install you in office through a coup d'etat, or you can lie to the voters and pursue your agenda on the sly."
Democrats want higher energy prices mostly to make alternative sources of energy seem economical. That's a tall order. The Energy Information Administration estimates the cost of generating a megawatt hour of electricity from a new plant would be 66 cents from plants powered by natural gas; 86 cents from hydro; 95 cents from coal; 97 cents from wind; $1.13 from biomass; $1.14 from nuclear, and $3.12 from solar thermal.
Only wind appears competitive. But industrial wind turbines are eyesores, they kill a lot of birds and bats, and -- as sweltering Texans and shivering Britons have learned -- tend not to work when it is very hot or very cold.
The Obama administration's massive subsidies to "green" firms have produced more embarrassment than energy. Solar panel manufacturer Solyndra, which went bankrupt last September after receiving $535 million, has left behind an environmental mess. Eleven other subsidized firms are having financial problems and five have filed for bankruptcy, CBS News reported in January.
In his state of the union address this year, President Barack Obama cited battery manufacturer Ener1 as a government investment success. Ener1 filed for bankruptcy two days later.
A few days after Mr. Obama said he planned to buy a Chevy Volt, General Motors announced it will suspend production of the electric car. About 1,300 workers will lose their jobs, at least temporarily.
The $38.6 billion in loan guarantees it provided to "green" firms created just 3,545 permanent new jobs, according to a Department of Energy estimate. That's an average cost of $5 million per job.
Mr. Obama's "investments" haven't been bad for all of us. Eighty percent of the firms that got DOE loans are run or owned by the president's financial backers, according to the Hoover Institution's Peter Schweizer. "Green Firms Get Fed Cash, Give Execs Bonuses, Fail," headlined an ABC News investigative report broadcast Tuesday.
In what was billed as a "major speech" on energy policy Feb. 23, the president pledged to make more such "investments."
The speech was remarkable for its mendacity. During the Obama administration, the time it takes to get a permit to drill in the Gulf of Mexico has nearly doubled. Leases to drill on federal lands in the West are down 40 percent. But Mr. Obama claimed credit for the recent rise in domestic production of oil and natural gas. This "couldn't be farther from the truth," said the president of the American Petroleum Institute.
We can't drill our way to lower gas prices, Mr. Obama said. The Institute for Energy Research says there are 1.4 trillion barrels of recoverable oil in the United States and offshore, "enough to last at least 200 years." But most are on public lands. Government policy keeps them locked up.
"The administration has done everything but support drilling," said retired Shell oil company executive John Hofmeister. "We are on the verge of slipping into an energy abyss."
First Published March 11, 2012 12:00 am