WALL STREET JOURNAL
No Time to Declare Independence
Gusher of Lies
By Robert Bryce
(Public Affairs, 371 pages, $26.95)
When it comes to "energy independence," American politics has discovered a new spirit of bipartisanship. Hillary Clinton, Barack Obama and John McCain all call for it, in one form or another -- in the name of fighting global terrorism, global warming or merely global price spikes at the pump. And of course the phrase is a cliché outside the world of politics, too, showing up in earnest op-eds and green-shaded pronouncements. Well, Robert Bryce is having none of it.
In "Gusher of Lies," Mr. Bryce declares that "energy independence is hogwash." There is not a chance in the world, he says, that we're going to kick our "oil addiction." Our economy runs on oil and will continue to do so for a long time to come. There are no "Manhattan Projects" on the horizon. Not even the big bad oil companies are "energy independent" anymore. Mr. Bryce notes that oil companies now own only 10% of the world's oil reserves. Everything else is claimed by national governments.
And trends don't favor an American version of energy independence anyway. As U.S. onshore production has slowly played out, the western Gulf of Mexico has been punctured like a pincushion. And yet the eastern Gulf (i.e., Florida) and the East and West coasts won't let drilling rigs anywhere near their waters. And don't even mention the Arctic National Wildlife Refuge, still untouchable.
No, the gushers are elsewhere these days. America's oil production peaked in 1970; non-OPEC oil production peaked about five years ago. Oil power is shifting even more toward the Persian Gulf. Jubail (a port in Saudi Arabia) and Dubai (in the United Arab Emirates) are fast becoming industrial and financial centers on a scale to defy the Western imagination. Halliburton moved its top executives to Dubai in 2007, and little wonder.
What about the imperatives that are so often evoked on behalf of "energy independence"? On global warming, Mr. Bryce is an agnostic, but he notes that, with China adding the equivalent of France to its electrical grid every year -- 90% of it in coal -- talk about reducing global carbon emissions is just prattle. As for the geopolitical aspect of energy independence -- starving bad regimes into reform -- Mr. Bryce believes it to be wishful thinking. We're never going to isolate Iran, he argues. The Iranians are building pipelines to Pakistan and India and signing multibillion-dollar natural-gas deals with China. "The one being isolated on the energy front isn't Iran," he argues; "it's the U.S." If by some miracle oil prices were to plunge dramatically (the result of energy independence and a drop in demand), "there's no evidence -- none -- to support the assertion," Mr. Bryce claims, "that an oil price crash will lead to reform" in troublesome Islamic countries.
Instead we should be thinking of energy "interdependence" in a world where we, quite properly, export what we have in abundance and import what we can't produce for ourselves. The search for "alternative" fuels is, in Mr. Bryce's view, a costly byway. He saves particular scorn for ethanol, "the largest scam in our nation's history," assembling 50 pages of evidence to show that, if anything, the energy-intensive effort to distill ethanol out of the nation's corn crop diminishes our energy supply. Yet ethanol production has become entangled with that other impossible-to-repeal boondoggle, agricultural subsidies.
For all his confidence and expertise, Mr. Bryce can be a little weak in some areas. He rightly notes that both American and Canadian natural-gas production has peaked, but then he talks casually about importing vast quantities from Russia and Iran. Bringing this gas across the oceans, however, will involve liquefying it, adding a huge price premium -- if we ever get the receiving terminals built in the first place. Even with "energy interdependence," natural gas is going to be much more expensive in the future. On nuclear energy, Mr. Bryce is even weaker. At one point he refers to uranium as a "fossil fuel"; and he doesn't seem to grasp nuclear's greater-by-orders-of-magnitude energy potential.
Mr. Bryce's ultimate counsel -- that we should forget about what Arab countries are doing with their petrodollars and learn to get along -- is also hard to accept. It ignores all those stories about the third cousins of oil sheiks showing up in al Qaeda training camps with suitcases full of cash. But it's hard to ignore Mr. Bryce's main point -- that politicians and pundits are woefully uninformed about energy. When you hear a presidential candidate or a TV talking head calling for energy independence, or claiming that we can reduce carbon emissions by 60% or 70%, or pointing to windmills, ethanol and solar panels as the energy future of the American economy, you can be fairly certain that they are wasting their own energy on false promises and futile schemes.
Mr. Tucker's "Terrestrial Energy: How a Nuclear-Solar Alliance Can Rescue the Planet" will be published in August by Bartleby Press.