Drilling Ban Left Us Over a Barrel
By Stan Katten
(First of two parts)
Recognizing the serious deleterious effects of a 27-year-old policy, President Bush canceled the balance of an executive order prohibiting oil drilling in federal offshore waters. Congress initiated the drilling ban in 1981 – a policy formalized by President George H.W. Bush’s executive order covering 1990 to 2000 and extended by President Clinton to 2012.
“Post-partisanship” Speaker of the House Nancy Pelosi immediately responded with her usual vitriol: “Once again the oilman in the White House is echoing the demands of Big Oil. The Bush plan is a hoax. It will neither reduce gas prices or increase energy independence.” California Sen. Barbara Boxer said, “The proposal is something you’d expect from an oil company CEO, not the president of the United States.”
Sen. Dianne Feinstein subsequently joined in with a Los Angeles Times column quoting all the liberal false arguments used for more than 20 years: “It would put our nation’s precious coastlines in jeopardy; wouldn’t begin to fix the underlying energy supply problem; surely wouldn’t ease gas prices any time in the near future.”
In contrast with the senators’ liberal prejudices and disdain for their constituents, the president responded to the ban’s obsolescence, the demands of the people, and the impact on the economy and national security. It took exactly three days for the price of oil to drop 11 percent.
While there was good reason for the ban initially – the 1989 Exxon Valdez incident in Alaska – technological advancement obviated its need by the mid-1990s. There had not been a serious U.S. mainland oil spill in 25 years since the Santa Barbara disaster in January 1969, and to date none in nearly 40 years.
In addition to unnecessarily extending the ban to 2012, Clinton vetoed a bill to open drilling in a minuscule part of the Arctic National Wildlife Reserve (ANWR) in 1996. Since then, there have been numerous attempts by Republicans to revoke the ban and provide funds to open additional federal land and offshore areas to leasing – all of which, including two in recent weeks, have been voted down or killed in committee by the Democrats.
Pelosi has refused to allow a bill to come to the House floor because she is afraid it will pass, with moderate Democrats joining with Republicans.
Presumptive Republican presidential nominee John McCain, who originally opposed drilling in the coastal continental shelves and ANWR, recently changed his position and now favors environmentally safe offshore oil and gas recovery. He explained that the difference between $1.50 per gallon and $4.50 per gallon of gasoline drastically changes the situation.
McCain noted that high oil prices and resulting increased prices for virtually everything are not only hurting people throughout the nation, but they are also a serious national security threat, with the United States transferring nearly half a trillion dollars annually to foreign suppliers, several of which are politically unstable or hostile to the West. Even worse, some of those oil dollars fund terrorists.
In contrast, in keeping with the long-held liberal position, the Democrats’ choice for president, Barack Obama, still opposes any expanded drilling offshore or onshore. He has no problem with $4- plus gas prices, only that they increased too rapidly. He wants to put a windfall profits tax on oil companies, which will add not one gallon of gas but will further increase prices. He says conservation will solve the problem, but despite a 3 percent to 4 percent decrease in gasoline demand announced a couple of weeks ago, gas prices were slow to decrease.
Democrats point out that oil companies already hold leases on some 68 million acres, including some in the Alaska National Petroleum Reserve, where, they complained, only 26 wells have been drilled. So why do they need more? They don’t seem to know that oil companies buy leases in hopes there will be oil, and if none is found with initial wells, they stop drilling.
Should the estimated 10.6 billion barrels actually be there, a new pipeline would require several years and many billions of dollars to build, making that oil more expensive and less readily available than oil in the lower 48 states. Anyway, the Democrats say it will take seven to 10 years until continental shelf oil could become available – which is the same old lame excuse. The oil companies contradict this, saying that on a crash basis, additional domestic oil could become available in two to three years, provided the congressional and bureaucratic obstacles are eliminated.
A saner oil drilling policy over the last two decades could have yielded an additional 1million to 3 million barrels of domestic oil per day and avoided the current economic debacle. But, as the old saw says, “Better late than never” to correct the situation – and do so on a crash basis.
Stan Katten is a former RAND Corp. analyst and a San Pedro resident.
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