Much has been written the past couple of days about the 4 minutes or so that President Obama allocated to discussing his energy “policy” initiatives in his State of the Union address to Congress on Tuesday evening. Seems to me, after reading what was said and much of the commentary that has followed that the best thing about the speech was that at least it left no one completely happy.
Wait, what? Yeah, seriously – one of the best indicators that any public policy proposal is probably headed in the right direction comes when no one with a dog in the hunt (that’s how Texans refer to “stakeholders”) is happy with it.
This is especially true when it comes to federal energy policy, given that the best policy for the federal government to implement where energy is concerned is to simply have no policy at all. So when all of the affected industries are grumbling after the speech, along with all of the President's supporters who oppose those industries for a living, it's a pretty good indication that a) the President didn't make any large, broad-reaching new policy proposals, and b) the proposals he did make are either old hat, minimalistic, or unlikey to come to fruition, i.e., the best energy policy is the least energy policy.
Don’t believe me? Think about this in terms of the Obama Administration: what energy-related policy has received the most media attention during this President’s five years in office? If you answered “What is Solyndra” and failed renewable subsidy policies in general, you are today’s Energy Policy Jeopardy champion.
The truth is that this Administration’s focal points in the realm of “Energy Policy” have been the following:
- Tossing billions of taxpayer subsidy dollars at energy sources that are non-competitive in the marketplace, and several of which couldn't survive even with the subsidies;
- Ramping up emissions regulations in a concerted effort to kill the nation’s coal industry;
- Blatantly slow-playing the permitting approval for the northern leg of the Keystone XL pipeline project in an obvious effort to placate a part of the President’s loyal voter base;
- Constant, unending efforts to massively increase taxes on the oil and natural gas industry; and
- Steadily diminishing the amounts of public lands and offshore waters that are available for oil and natural gas exploration.
Given this set of policy priorities, it is more than a little amusing for the President to have spent time in his speech bragging about the “success” of his “all-of-the-above” energy policy, since that in no way accurately describes the policies his Administration has pursued. Nowhere is the claim more chuckle-inducing than in the contention that his administration has played any productive role in creating or sustaining the ongoing boom in U.S. oil and natural gas production.
The main reason why this boom has been allowed to take place is that the vast majority of shale oil and gas resources lie beneath private or state lands, over which state agencies – not the federal government – have operational permitting and regulatory authority. This accident of geology and geography is an incredibly fortunate circumstance for the nation, given that if these resources were instead beneath federal lands, the ability to access and develop them would without question have been severely restricted by this Administration.
Indeed, even though the Administration doesn’t control operational permitting authority over resources beneath private and state lands, it has made every effort to hamper development via increased regulations under the Clean Air Act, and by cooperative action with radical groups like Wild Earth Guardians and the Center for Biological Diversity in their efforts to distort and abuse the Endangered Species Act as a means of restricting human progress. So the nation is extremely fortunate that the Obama Administration has had little ability to exert federal "energy policy" over the ongoing shale oil and gas revolution, i.e., the best energy policy is the least energy policy.
Equally amusing was the President’s claim that he would “keep working with the (oil and gas) industry to sustain production and job growth”, given that it is painfully difficult to identify any real examples of such cooperative efforts from this White House, and correspondingly easy to point out many examples of a polar opposite approach. In the very next sentence of the speech, the President then promotes his policy of taking more and more federal lands and waters out of availability for oil and gas development, saying “while we’re at it, I’ll use my authority to protect more of our pristine federal lands for future generations”. One can only wonder what he expects those “future generations” to do with lands that have been placed off-limits to human use. A few sentences after that, the President segued into promoting his tax policies, which would “eliminate $4 billion (per year) in tax subsidies for the fossil fuel industries that don’t need it”.
Nevermind the simple fact that the oil and gas industry simply does not receive “subsidies” from the federal government, or that some of the tax treatments that apply to the industry have been in the tax code for more than a century; the sheer contradiction in terms of the President’s own rhetoric should give any thinking person great pause before seeking any proactive efforts on “energy policy” from this federal government, other than to just get out of the way and let the market function, i.e., the best energy policy is the least energy policy.
The reality about federal energy policy is that the less we have of it, the better off the nation will be. The federal government does have a legitimate role to play in setting standards – such as minimum mileage standards for automobiles – and in reducing pollution. But other than those things, if Americans really do want continued access to the abundant and inexpensive energy that has historically made this country’s economy the envy of the world, the best federal “energy policy” is the least policy possible.
That has always been the case, regardless of which party controls congress or which president is currently occupying the White House, but it has never been more obviously true than during this current Administration.
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