The president is running on empty
Skyrocketing gasoline prices have sent President Obama’s public-approval ratings plummeting. The White House is searching for someone to blame, but the problem rests not with the pumps but with the president.
Mr. Obama maintains that lack of supply is not driving up prices. However, domestic demand is not the issue either, since U.S. energy use per capita has been on the decline. So the White House has formed an interagency working group to root out the “traders and speculators” whom he says are responsible for America’s gasoline woes. This type of populist blame-game is typical of the Obama administration’s approach to policy challenges, and diverts attention from the true proximate causes of the oil spike, such as the crises in the Middle East.
If prices are being manipulated, perhaps Mr. Obama should take it up with the OPEC potentates who are the most direct beneficiaries. Mr. Obama also said he wants to end what he says is a $4 billion annual taxpayer subsidy to oil and gas companies, though how removing a subsidy will lower gasoline prices has yet to be explained.
Mr. Obama’s scapegoat safari notwithstanding, the current energy crisis underscores the general failure of administration energy policies. The promised brave new world of green technologies is slow in coming, and the government is quickly putting reliable domestic fossil fuels further out of reach. Even as vast new energy reserves are being discovered, such as the Saudi-topping Bakken formation in North Dakota, domestic production is declining. Mr. Obama has banned new domestic offshore drilling while subsidizing it in Brazil. Last week, Shell Oil Company announced that it is abandoning Arctic Ocean drilling plans because the Environmental Protection Agency is blocking key permits, sacrificing 27 billion barrels of oil. In March, the U.S. Energy Information Administration (EIA) projected a reduction in total U.S. crude oil production of 110,000 barrels per day in 2011 and a further 130,000 barrels per day in 2012. Given the current profitability of oil production, the blame can only rest with the White House.
Mr. Obama talked a good game regarding reducing dependency on foreign oil before he was president. In 2006, then-Sen. Barack Obama said the United States should cut oil imports by 7.5 million barrels a day by 2025, which at the time would have amounted to a 50 percent cut.
He was highly critical of President George W. Bush’s energy policies, but according to the EIA, oil imports declined from a daily average of 13.7 million barrels in 2005 to 11.7 million by 2009. At that rate, a 50 percent reduction would have been reached by 2016.
Since Mr. Obama took office, foreign oil imports have increased. In 2010, oil imports rose by 62,000 barrels per day, and in January 2011, the latest month for which government data are available, the average was up an additional 200,000 barrels daily. Mr. Obama has now reduced his 2025 target to a onethird cut. Ignoring for a moment the disingenuousness of presidents who promise miraculous results arriving years after they leave office, so far Mr. Obama’s policies have only dug a deeper hole.
In 2006, Sen. Obama declared, “When it comes to finding a way to end our dependence on fossil fuels, the greatest vacuum in leadership, the biggest failure in imagination and the most stubborn refusal to admit the need for change is coming from the very people who are running the country.” In 2011, we could not agree more.