President's speech resorts to fantasy on oil and prices

The state-of-the-union speech Feb. 12 smothered whispers of hope on energy policy with shrieks of delusional ambition.

US President Barack Obama hinted at tapping federal oil and gas royalties to fund research on alternative energy. So would policy on new energy forms swing toward research and away from subsidization? Would funding from royalties replace the oil and gas tax increases Obama proposes every year?

These would be constructive changes. But the president didn’t claim to be altering course. And what he did say was discouraging.

The aim of new energy research, Obama said, would be “to shift our cars and trucks off oil for good.”

To accomplish that, he’d need more research than royalties can buy. Oil and gas dominate transportation energy for reasons not easily overcome—and not likely to be overcome soon. History—recent and less so, in the US and elsewhere—shows how costly it is to try to replace oil with other forms of energy, especially in mobile uses.

Why do that, anyway?

To “free our families and businesses from the painful spikes in gas prices we’ve put up with for far too long,” Obama suggested.

The argument here seems to be that oil’s undesirable because gasoline prices fluctuate.

Yet prices of other energy forms change, too. Have any of Obama’s speech writers checked ethanol’s price history?

In fact, the utterances about price spikes and shifting off oil seem designed to appeal to visceral wishes ungrounded in physical or economic reality. They’re rah-rah lines. Who wouldn’t want energy as convenient and cheap as oil that didn’t have oil’s disadvantages? Who wouldn’t want energy prices never to change—unless they start out as high as, say, transport fuels that aren’t oil?

The real world can’t satisfy those desires, and no amount of research will make it do so.

Obama leads by gushing grand ambition. On energy, this approach leans too heavily on popular fantasy, making his agenda, even the possibly practical elements of it, consistently incoherent.

(Online Feb. 15, 2013; author’s e-mail: bobt@ogjonline.com)

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