With oil prices surging above $100 a barrel yesterday, consumers are realizing they will be paying a heavy price at the pump for the unrest in the Middle East. A perfect storm of foreign and domestic policy choices by the Obama administration has paved the way for European-style energy prices to arrive on these shores. Far from being alarmed, President Obama sees the prospect of $8 a gallon gas as an opportunity.
When it comes to energy, the White House has sought to augment government controls to prevent the “long-term threat of climate change, which if left unchecked could result in violent conflict, terrible storms, shrinking coastlines and irreversible catastrophe,” in Mr. Obama’s words. Making energy more expensive is exactly what the administration’s “cap and trade” scheme is meant to do. The theory is that pricier power will be used more frugally, which in turn will appease Mother Earth into blessing us with cooler weather. Mr. Obama expressed the same outlook in May when - with oil at $61 a barrel - he signed a memorandum dictating to automakers the kinds of cars they will be allowed to sell. At the time, Mr. Obama noted with trepidation, “The impetus for action would fade when gas prices started to go back down.”
It’s not possible for domestic production to relieve the pressure from international uncertainty. Mr. Obama and congressional Democrats have blocked drilling in places like Alaska’s Arctic National Wildlife Refuge, in millions of acres of federal lands and in offshore locations. Mr. Obama even took advantage of the BP oil disaster to shut down operations in the Gulf of Mexico. Mr. Obama points to the small amount of oil currently produced at home to conclude, “We can’t drill our way out of the problem.” That’s only a true statement as long as the current policies place 67 percent of America’s reserves off-limits.
The events unfolding in Egypt, Libya and throughout the Middle East are beyond American control but not outside our influence. Fear and uncertainty drive oil prices higher, and Mr. Obama has done nothing to restore confidence that the United States will act firmly to promote stability in the region. Instead of addressing these concerns openly, pledging support for the remaining U.S. allies or deploying military assets to show that this country will not allow an interruption in the flow of goods through the Suez Canal, Mr. Obama has calibrated his tepid response to ensure no Muslim mob is offended.
We’re now paying the price for weak leadership, but it’s about more than just paying a few bucks more at the local Chevron station. Every product and service depends on the price of oil and the price of electricity. The vast majority of goods hit the shelves after being transported by aircraft, ships and trucks powered by fossil fuels. That’s why, as economists note, there is a direct correlation between the number of miles vehicles travel in a year and the nation’s Gross Domestic Product. Unless there’s an immediate U-turn in the domestic and international agenda, we’re headed for rough economic times.
The ineffective response to problems in the Mideast, economic malaise and sky-high gas prices are all symptoms of administrations that take no interest in promoting economic growth. Like his ideological soul brother Jimmy Carter, Mr. Obama is headed toward one-term status.