Our Energy Crisis
Our country is on an unsustainable path of energy use and resource availability. The fossil fuel- dominated energy resource portfolioto which we are accustomed is becoming increasingly costly. Higher prices come in the form of personal expenditures on gas at the pump and for home heating and cooin ling, and the realization of more hidden costs associated with the environment or those related to protecting our oil interests abroad.
Our Economy is threatened because all aspects of it are intricately dependent on a steady supply of affordable energy on which we can no longer depend. From transporting workers to the workplace, to the transport of goods, to the production of petro-chemically based products like plastic, it is impossible to overestimate the degree to which our economy is driven by energy. Some reasons for concern:
- Three times in the last 30 years (1973, 1978, 1990) energy price spikes have caused recessions in the US (WTRG Economics);
- The recent "energy takeoff" of developing economies such as China and India is placing unprecedented pressure on a global oil supply already struggling to meet demand;
- We are not only paying billions annually to foreign governments (many of them hostile to U.S. interests) for our economy's energy supply, but we are investing in their energy production sectors instead of our own, which weakens our long-term economic viability and our short-term economic security;
- Persistent high oil prices are likely to cause: increased costs for goods and services, inflation, unemployment, lower capital investment, decreased tax revenues, increased budget deficits, and higher interest rates (Energy Information Administration).
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The Environment has only recently come to the forefront as a reason for concern about our rate and style of energy consumption. While it is difficult to quantify the effects of energy use on the environment, the follow facts are known:
- Since the industrial revolution, energy use -- and therefore carbon emissions -- have increased greatly;
- Climate change is occurring, and scientists are 90% certain humans are the cause (IPPC Report);
- From flooding and famine to increased natural disasters like hurricanes and tornadoes, climate change has serious economic implications;
- Regional effects of climate change may be greater, for example in the Mountain West region, where tourism plays a key role economically and water is in short supply.
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Our Foreign Policy and National Security are compromised by our dependence on foreign sources of energy, particularly oil and natural gas.
- In 1970 we imported 28% of the transportation fuels we consumed. Today we import over 65% (Energy Information Administration);
- About 62% of remaining oil reserves are located in the Middle East (EIA Proved Reserves Data);
- $6 billion is spent monthly to maintain our presence in Iraq, and over 50% of U.S. troops deployed are in the Middle East (National Priorities Project);
- While publicly traded oil companies once had access to a majority of oil reserves, nationalized, government run oil companies now control some 90% of available reserves, subjecting future oil supply quantities to geopolitics, not technical constraints (PFC Energy Advisors).
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The bottom line: Clearly we are entering a new energy era -- one in which we will have to make energy consumption behavior changes and therefore tough energy policy choices. The only question is whether these changes will come painfully through serious economic dislocations (like a recession, inflation, and even a depression) or unfold more gradually. The answer depends on how we direct our efforts today, while we still have a limited window of opportunity within which to act.
Dig Deeper
Want a more in-depth explanation of how economy, environment, and national security relate to energy? Explore the following ELA authored essays:
