This commentary orginally appeared on RealMoney on Feb. 28.
NEW YORK (
) -- President Obama has the best chance of any president before him to secure our economic and strategic military power by eliminating our importation of energy and at the same time making us an exporter of energy.
This would reduce the entire world's energy costs and reduce the power that undemocratic, unfriendly governments have over Western democracies. It would be a win for the U.S. and the rest of the world. Obama has to change from acting like a hapless victim of circumstances and embrace natural gas as a bridge fuel until automakers can produce the mythological hydrogen automobile.
I am talking about converting all surface transportation in the U.S., including trains and tugboats on our rivers, to natural gas, or at least make them able to run on either oil-based fuels and natural gas. The technology to do this is here. In addition, I would convert all building heating systems to propane or natural gas. I would also include off-road vehicles and construction equipment. Our air would be much cleaner and we would not be a net importer of oil or oil products. Instead, we would be exporting. This would drive down the price of gasoline worldwide and help the global economy. It would destroy OPEC finally, or perhaps as a net producer of oil we would join OPEC since Washington is capable of anything.
I do not think Obama will embrace natural gas. The president, when pressed, has given lip service to using our huge natural gas reserves but has not come out for it in any meaningful way. His supporter Warren Buffett will not even embrace it to save a multibillion dollar investment in a natural gas company. It will take long lines at the pump and $10 gasoline or more to get the American people to demand that we use our natural gas.
One point to all the environmentalists who care only about reducing greenhouse gas emissions: What you have been doing is clapping with one hand. Europe and the U.S. have exported jobs and greenhouse gases to the emerging markets for years. The result is that we close relatively clean operations to the emerging markets that have almost no pollution controls.
There are more greenhouse gases now then in 1997 when Kyoto came into being. There are also 1.3 billion more people in the world today. Canada has dropped out of Kyoto because it wants to keep its jobs. Australia is going forward with a carbon tax, and its government does not care if its aluminum industry goes to China where the electric grid is mostly coal based. India is the same way with using coal.
Here are a few problems that could affect our energy supplies and are already influencing the price of our gasoline at the pump:
- Libya, while getting better, is still not up to prewar levels of production and there is no real central government in place.
- Nigeria may blow up at any time. Venezuela is very close to Iran and has a leader who regularly confiscates private property.
- After it takes power, the Islamist government in Egypt may close the Suez Canal during a crisis and support war with Israel.
- Iran is already a seething problem that could blow up into a major crisis. High oil prices now may cut world growth.
- Mexico could have unrest that could curtail oil production. A large portion of Saudi Arabian and Kuwaiti oil could be locked in if the Iranians go to war in the Gulf.
- What would Muslim oil exporters do if another Muslim country such as Iran were attacked by Israel or the U.S.?
- Bahrain is having its problems too with Shiites as well as disturbances by Shiites in the eastern provinces of Saudi Arabia, who are sympathetic to Iran. A lot of Saudi Arabia's oil is in its eastern provinces.
- Syria is destabilized and could bring in Turkey and Iran and Iraq to name a few. Iraq is trying to increase its oil production, but it is unstable, too.
If we do not voluntarily switch to natural gas now with all of the above problems facing us, then we will most likely switch when we have no other choice.
Matt Horween is a certified public accountant and served as a commissioned U.S. foreign service officer for the U.S. Agency for International Development from March 1981 to March 1998. He served in Burkina Faso, Senegal, Egypt, Honduras and Barbados, spending about 15 years overseas. He ended his career stationed in Washington, D.C. as the financial controller for the bureau that controlled the foreign aid program for Europe, including all of Eastern Europe and the former Soviet Union and its former satellite countries. Horween also worked as an auditor for Price Waterhouse & Company in New York City and held various financial management positions for several publically listed corporations. Early in his career, he served as a radio intercept analyst for the U.S. Air Force Security Service and was stationed in Greece.