The Bush gang's answer to high energy prices
May 25, 2001 | Page 7
FOR MONTHS, U.S. consumers have been feeling the energy pinch.
Californians are facing sharply higher electricity bills--even as rolling blackouts become more common. During the winter, the price of natural gas skyrocketed, hitting Midwestern residents with doubled heating bills. And gasoline prices have shot up everywhere--with some analysts predicting a summer of $3 gallons.
So when the Bush administration finally announced its plan to address high energy prices, you might think that it would be cause for relief.
But as ERIC RUDER explains, you'd be wrong.
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IT'S HARD to imagine what more the oil and gas industry could want. The Bush administration's energy "solution," announced in May, scraps environmental protections right and left to clear the way for more drilling, more mining and, incredibly enough, new nuclear energy reactors.
At the same time, Dick Cheney was ready to recycle old arguments about the futility of conservation. "Conservation may be a sign of personal virtue, but it is not a sufficient basis for a sound comprehensive energy policy," snorted Cheney.
As Washington Post columnist Mary McGrory summarized the thrust of the Bush plan: "Conservation is for sissies and self-righteous fatheads who think they're better than real people. "Real men drill. Real men dig coal. Real men go nuclear."
Even the pro-business Financial Times newspaper was surprised by the aggressiveness of Bush's proposal. "All the environmentally friendly stuff Mr. Cheney derides--more conservation, investment in wind and solar power and fuel cells--came top in voters' preferences in a Gallup poll [in mid-May]," it wrote. "All the digging, drilling and fission Mr. Bush favors--opening up the Alaska National Wildlife Refuge for oil exploration, reviving nuclear power plants, help for coal mining--sat firmly at the bottom."
But it doesn't take a genius to figure out why the Bush team is slavishly devoted to the proposals. Bush and Cheney are oil industry insiders from way back. Plus they received $12.6 million in campaign contributions last year from the oil and energy sectors.
Their "energy plan" is nothing more than payback on a grand scale. "Rather than protecting consumers and promoting clean energy, the Bush administration is blatantly pandering to the coal, oil and nuclear industries by lavishing them with billions in taxpayer subsidies," said Public Citizen President Joan Claybrook.
After a few P.R. miscues, Bush and Cheney figured out that they shouldn't heap scorn on people who care about the environment. By mid-May, they were claiming that their plan promoted conservation and energy efficiency.
For example, the White House highlighted its proposal to give tax incentives to increase research into ways of refining organic waste, like manure and corn fiber, into new forms of fuel.
But their claim is bullshit--no pun intended. Bush's energy budget proposal cuts funding for so-called "biomass" research by the least amount. But funds for research into solar and geothermal energy and hydrogen technology are slashed by about 50 percent.
Meanwhile, the Bush gang plans to spend $150 million on so-called "clean-coal" technology. But honest energy experts say "clean coal" is a fantasy. "Clean-coal technology is an oxymoron," said Lois Corbett, executive director of the Toronto Energy Alliance, which has long fought the devastation of acid rain caused by U.S. coal-burning power plants.
In fact, Bush and Cheney's whole energy plan is riddled with nonsolutions to nonproblems. For example, Bush wants to "solve" the problem of high gas prices by allowing drilling in the Arctic National Wildlife Refuge (ANWR).
First of all, drilling would wreck the enviornment of a pristine area. But second, even if construction began tomorrow, it would take years to extract the oil and get it to market. In other words, ANWR drilling would have no effect on gas prices.
On the other hand, requiring an increase in the average fuel efficiency of cars to 35 miles per gallon would save 1.5 million barrels of oil a day by 2010--and help reduce the emission of greenhouse gases that cause global warming. By contrast, ANWR drilling would produce, at most, 580,000 barrels a day by 2010.
It's easy to see which option makes more sense. But Bush doesn't want to offend the big car companies, which think that spending $700 a vehicle to make their SUVs more fuel efficient is $700 that they won't make in profit.
The same pattern of nonsolutions to nonproblems applies to the Bush plan for dealing with spiking electricity prices in California and elsewhere. Bush claims that we can't "conserve our way to energy independence" and therefore need to build 1,300 to 1,900 new power plants--more than one a week--for the next 20 years.
But this flatly contradicts an Energy Department report released in November that concluded that simple energy efficiency measures could provide enough energy to substitute for 610 new plants.
Expanding alternate power sources, such as wind, solar or geothermal energy, could make up for another 180 plants. In fact, wind power is far more affordable--not to mention clean--than Cheney's absurd "clean-coal" proposal. At 2.5 cents per kilowatt hour, wind is now the cheapest and fastest-to-build form of power generation.
But Cheney's corporate pals are into drilling and mining, concludes the Seattle Post-Intelligencer. "All that logically can be concluded from this profound folly is that the administration believes the wrong people stand to profit if the nation moves to increased reliance on renewable energy and more efficient use of energy," the paper wrote in an editorial.
Administration ready to risk nuclear nightmare
THE MOST alarming part of Bush's plan is its enthusiasm for nuclear power. After nearly three decades in which not a single nuke plant was built, the Bush administration wants to start constructing dozens of new ones.
"If we're serious about environmental protection, then we must seriously question the wisdom of backing away from what is, as a matter of record, a safe, clean and very plentiful energy source," said Cheney.
But this is absurd. A single accident could kill millions--and leave a large part of the U.S. uninhabitable for thousands of years.
"[H]ow environmentally attractive and cost-effective is an energy source whose deadly byproduct must be isolated from humans for 10,000 years?" asked the Seattle Post-Intelligencer.
Even leaving aside the safety issue, nuclear energy is expensive. A 1998 OECD report estimated the cost of nuclear power in the U.S. at $2,079 per megawatt hour, compared to $500 per megawatt hour for gas-fired plants.
As Harvey Wasserman, an expert on nuclear energy and deregulation, put it: "Anyone who advocates nuclear power as a solution to our energy problems should be shut up in a padded cell."
Big Oil profits from gouging at the pumps
IF BUSH wanted to look for the real cause of high gas prices, he'd be in an uncomfortable position--of biting the oil industry hand that feeds his campaign coffers.
In the first three months of 2001, the top 10 oil companies posted $16.8 billion in profits--a 27 percent increase from a year earlier.
How'd they do it? The answer has nothing to do with OPEC production or any of the other excuses floated by the Bush gang.
Due to the recent wave of oil industry mergers, the top 10 oil giants control 70 percent of domestic oil refinery capacity. In March, many refineries went offline for "routine maintenance"--though you could be excused for wondering why they all decided to do maintenance in the same month!
Prices for crude oil have remained roughly the same throughout the year. But the artificial supply crunch pushed up prices at the pump--and filled up the bosses' bank accounts.
Market madness in California
BENEATH THE details of the Bush energy plan is a fanatic devotion to the economic principles of the free market. The administration's justification for gutting environmental regulations is that the market needs to be freed to work properly.
But we already know what a disaster free-market reforms have been--from the experience of California, where the electricity crisis can be traced back to a deregulation law passed by state lawmakers in 1996.
"The new law ends the monopoly California utilities have on providing energy with restructuring of the industry to begin in 1998," the San Francisco Chronicle wrote on the eve of the bill's passage. "By 2003 residential, commercial and industrial customers will be able to buy their electricity from whomever they want. Pacific Gas & Electric Co. projects residential and small business customers will see their rates fall from an average of $65 a month to $58.50 in 1998 and then to approximately $50 a month in 2003."
Of course, the exact opposite took place. The idea that the free market coordinates supply and demand has nothing to do with reality.
The only real solution to surging energy prices is public ownership of utilities--and organizing a fight against the greedy corporations that make obscene profits off consumers while wreaking destruction on the environment.