Advice from the Czar

In a counterpoint to yesterday's posting, it seems that although many 1970s energy notions are well past their sell-by dates, there are still some figures from that period who have useful advice to impart. While I was focused on "energy theater" in D.C., I missed seeing an eminently sensible op-ed in the NY Times on the requirements of effective energy policy. It was written by President Ford's energy advisor, Frank Zarb. Describing our problems with a level of objectivity that evokes nostalgia, he observed, "The basic elements of a responsible energy policy are not complicated, but the politics are horrendous." While the first portion of that sentence is bit of an over-simplification, its punchline is spot on.

I'm just old enough to remember news reports during the first energy crisis that began something like this: "In Washington today, Energy Czar Frank Zarb said..." I was always amused by the coincidence of an official with such an alliterative name and title. After President Ford died last year, Americans were able to reconsider his brief but challenging term of office from the vantage point of three decades. The pragmatism and frankness of his administration looked wise, rather than naive, after so many years of arguing about ideology. Mr. Zarb's comments on energy policy reflect that same kind of pragmatism, criticizing the mistakes of others in the mildest terms, and looking back to look ahead, rather than score points.

A glance at yesterday's weekly report from the Department of Energy reminds us how much the problem has evolved since Mr. Zarb ran one of its predecessor agencies. Not only does the US now import twice as much crude oil as we produce--that ratio was 1:3 back then--but we rely on foreign refiners to satisfy 12% of our gasoline demand (2006 average). If a new poll is right about the level of gasoline prices necessary to induce consumers to change their driving habits--$4.38/gallon--it will be extremely difficult to reverse these trends. Nor can our energy problems be solved in isolation from the local environmental concerns that were mostly evident in the 1970s and a global challenge that certainly wasn't. Ultimately, energy security is a much more appropriate target and mindset now than energy independence, which might have looked achievable in 1975.

Mr. Zarb is entirely correct that any effective US energy policy must employ coordinated efforts to increase supply and reduce demand, and that we cannot ignore some of our best options. That would mean simultaneously tackling the politics of fuel taxation, fuel economy, energy infrastructure, offshore drilling, nuclear power and nuclear waste--on a practical, rather than ideological basis. Are we really ready for that, or are we happier looking for scapegoats? The poll referenced above offers an answer: a third of Americans blame high gas prices on oil company greed, compared to only 15% who attribute them to supply and demand.