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SCANLON: Obama’s radical energy transformation reversal
Revival of fossil fuels could alter trajectory
President Obama has his second term and will never face voters again. On one of his highest priorities -- energy and the environment -- he's free to be the "transformational" figure he always wanted to be.
Since the beginning, Mr. Obama's main goal on energy and the environment has been clear to anyone listening to him and his advisers: to make energy -- at least, the carbon-based energy on which contemporary civilization was built -- more expensive, forcing us to use other forms of energy or do without.
During the 2008 campaign, Mr. Obama told the San Francisco Chronicle that under his "cap-and-trade" plan, "If somebody wants to build a coal-fired power plant, they can. It's just that it will bankrupt them." He added, "Under my plan electricity rates would necessarily skyrocket."
After being elected, he brought in allies to support his misguided schemes. In September 2008, Steven Chu talked about the dilemma of finding out "how to boost the price of gasoline to the levels in Europe." The European price of gas was roughly $8 a gallon. Soon afterward, Mr. Chu became U.S. secretary of energy.
Van Jones, the administration's first "green jobs czar," saw the energy agenda as a means for radical societal transformation. He declared in February 2009, "We want to move from suicidal gray capitalism to something eco-capitalism [sic] where at least we're not fast-tracking the destruction of the whole planet. Will that be enough? No, it won't be enough. We want to go beyond the systems of exploitation and oppression altogether . [T]he green economy will start off as a small subset, and we are going to push it and push it and push it until it becomes the engine for transforming the whole society."
The administration can drag us into an energy utopia using creative means. It can continue to funnel grant money to questionable enterprises in the name of "green" energy, to subsidize those projects with special-interest tax breaks and to guarantee business for those companies with "renewable energy" mandates. A president has a thousand tools, from national-monument designations (which can be used to block oil drilling), to building-efficiency standards (which can put "global warming" rules into effect), to fuel-economy standards for cars (which, incidentally, make cars less safe, causing people to die).
A president and a compliant bureaucracy can seize control of the energy economy one decree at a time, without congressional support. Consider cap-and-trade, which couldn't make it through a Democrat-controlled Congress in 2009 and 2010. The administration can direct the Environmental Protection Agency (EPA) to limit carbon emissions directly and indirectly by issuing new regulations, blocking permits and erecting other barriers. "They can't pass [cap-and-trade] legislatively, but they're trying to do it through the EPA, through regulation, which is even worse," said Sen. James M. Inhofe of Oklahoma, ranking Republican on the Environment and Public Works Committee. "Legislation would cost in the range of between $300 [billion] and $400 billion a year, but if you do it through regulation, it'd be much more than that."
Another possibility for the second term is a carbon tax that automatically increases each year. The administration denies it's considering such a tax, but the chatter -- academic papers, newspaper op-ed columns and Washington conferences that lay the groundwork for new policy -- suggests otherwise. Corporations such as ExxonMobil and Shell, think tanks such as the Brookings Institution and the American Enterprise Institute, and prominent economists, including some who advised GOP presidential candidate Mitt Romney, are pushing a carbon tax.
The administration's power is not unlimited. Republicans control the House and can cause problems. As Mr. Inhofe noted, a lot of Democrats coming up for re-election won't want "to fall on the sword of Obama on this overregulation, once the people at home find out what it's costing."
A twist of history may interfere with the president's transformation of America. New technologies related to hydraulic fracturing (fracking) and horizontal drilling offer the promise of huge supplies of natural gas -- perhaps as much as a 100-year supply. Natural gas from fracking produces about half as much in carbon emissions per unit of electricity as coal.
Unless politicians, bureaucrats, environmental activists and their media allies can stop fracking, the price of natural gas in the United States will be half, perhaps one-third, of the price in Europe and Japan. This means, ironically, that Mr. Obama, who promised to wean Americans away from standard forms of energy, may involuntarily preside over a renaissance in fossil fuels.
Terrence Scanlon is president of the Capital Research Center.
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