Iain, Robert Zubrin’s proposal should lead to Americans paying less to fill up their cars and transferring less wealth to the Islamists — because there would be competition among a variety of automotive fuels.
Consider: In 1998, Saudi Arabia’s oil export revenues were $32 billion. After the 9/11/01 attacks, that almost doubled: $63 billion. By last year, the figure was $203 billion. In other words, for the Saudi economy, terrorism is the best investment anyone is likely to devise.
Similarly, everything Iran does to de-stabilize the Middle East fattens its wallet. They can count on it. They can buy oil futures – and then send out the terrorists and watch their investments soar.
Oil will always be valuable but its value – both monetary and strategic – is excessive now simply because we have no viable alternative fuels. To change that situation, all that is necessary is to build a sufficient number of Flexible Fuel Vehicles. We have the technology and it only costs about $100 per car. Create these vehicles and entrepreneurs will figure out the best fuels (probably a variety of alcohol fuels based on agricultural products, coal and bio-waste) to power them.
Tropical countries of the third world could be encouraged to grow the crops – Africa and South America have lots of land — turn them into fuel and sell the fuel to us.
American coal also can be used. And who knows what else may work? Algae grown in the ocean? Again, I’m not going to figure this out. But I have confidence that the market will.
I’ll have more to say on this later (as will Robert Zubrin, I suspect) but I wanted to get a few thoughts down now in response to your item.