The recent back and forth on Planet Gore over whether to mandate flex-fuel vehicles in the interest of oil independence confirms two truths, I think:
1) That free markets remain our best means of deciding product superiority, and
2) “Oil independence” is a mirage.
On the first point, the national security crowd has lots of opinions on what might be a viable fuel. Robert Zubrin likes cellulosic ethanol, Ann Korin thinks “coal to methanol has a huge role to play,” many Detroit pundits see electric cars as the answer and so on. But none of them are omniscient. Indeed, even Zubrin conceded at a lecture before The Ethics and Public Policy Center last weekend that it is “impossible to know” how quickly ethanol might become market competitive even with a federal mandate for flex-fuel cars.
I would add that it is impossible to know if it will ever be competitive — which is precisely why the ethanol lobby, in addition to new flex-fuel mandates, also wants to increase existing federal production mandates and federal subsidies. Coskata, a leading cellulosic researcher, also wants a mandate that all gas stations carry E85 pumps. Korin also wants a whole new fuel sales tax structure (based on BTUs rather than gallons) to favor ethanol. Zubrin further conceded at the Center that “if the (E85-fueled) cars don’t come up fast enough, you may have to have more mandates,” and so on.
Better to let the market sort it out.
Such has been the case in telecom: With no federal mandates or intervention, a vast new wireless alternative took shape in just twenty years, infrastructure and all.
As to the second truth: Does anyone really believe that — even if we manage to wean ourselves with alternatives to a highly optimistic 60-percent dependence on oil (as Brazil has done with the optimal crop, climate, and massive government bureaucracy) — the Middle East will cease to be relevant to U.S. foreign policy? To quote my colleague Ken Green: “Let’s be realistic. Nothing anyone can do short of bombing their production facilities can deny them the revenue from oil sales.”
We would still be importing 4 billion barrels of oil a year with China and India demanding ever more as well. That’s still plenty of money to invest in Wahhabi schools, jihadists will still hate us, and Israel won’t be any less of an issue.
To conclude, I would suggest the national security crowd — rather than thinking of ways to make America less efficient and our federal government more powerful — perhaps instead concentrate their energies on ending imports from suspect countries just as we fought the Soviets by not importing their goods. We already ban the import of Iranian oil. Why not add the Saudis to the list? The Venezuelans?
And speaking of concentrating energies, we could better assist our auto and oil companies by opening America’s vast oil resources rather than forcing new, expensive mandates down their throats.






Comments