Last month, the front page of The Wall Street Journal featured 25-yearold Saeed Khouri, who paid at auction the equivalent of $14 million of our increasingly worthless American dollars for a license plate bearing “1.” His cousin, Talal Khouri, threw in $9 million in pocket change for tag “5” to tool around Abu Dhabi in his Rolls Royce. Get this, the Khouris declined to be interviewed because they didn’t want to be the center of attention.
I am not particularly fascinated with the excesses of the super rich, but I do resent the monstrous wealth transfer that has taken place as a result of the lack of a cogent American energy policy in the last few decades and its effect on our standard of living. While the youth of Abu Dhabi spend millions in license plate money for their Ferraris and Rolls Royces, Americans contemplate purchasing a Smart Car so we can pay the rent after we fill our tanks.
The looming presidential election presents us with two competent candidates with real differences to evaluate. There are many issues before the American public in this election, including wars in Iraq and Afghanistan, education, Supreme Court nominations, corporate bailouts and inflation. Pick your issue if you will, but none is more important to the continuing viability of the United States of America than energy self-sufficiency. Let’s hope our next president sees it that way, too.
The price of energy has disrupted our economy. It is the culprit behind much of our losses and layoffs and the root of hilarity for those who joyously feed our addiction. It’s not just economics. Our oil dependence has pumped up dangerous and often hostile regimes throughout the world, including Saudi Arabia, Venezuela and Iran. It is a widely accepted premise that we are financing both sides of the war on terrorism.
In an effort to lower the price at the pump, President Bush has pleaded with Saudi Arabia for more of its expensive oil. He has also lifted executive orders banning drilling near many environmentally sensitive areas. More barrels of expensive foreign oil prolong and exacerbate our problems and, according to oil baron T. Boone Pickens, we do not have sufficient domestic oil resources to make a difference. Efforts to lower the price at the pump are misguided. The high price of gasoline has provided a strong impetus for consumers to conserve. The solution lies elsewhere.
Al Gore has gumption, but he is not running for office. He proposes that we produce 100 percent of our electricity in 10 years from renewable and carbon-free sources. The idea is a little dreamy, but the effort would be laudable.
Candidates John McCain and Barack Obama recognize the vulnerability of the economy to manipulated oil prices and both have expressed concern for the environmental insults delivered every day by dirty fuels. Obama favors hybrid cars, an increased fuel economy standard, and a gradual substitution of home-grown biofuels for gasoline. McCain talks of lower gasoline taxes, batterypowered vehicles and nuclear energy. Both candidates favor increases in domestic drilling and other efforts to lower gasoline prices in the short run.
Private enterprise can clean up this mess with the aid of federal tax incentives. There are countless examples of government’s using the tax code to encourage the flow of capital to particular industries. In this case, the goal should be to strengthen and connect the national electrical grids that are necessary to provide sufficient electricity to efficiently power automobiles. Incentives should also subsidize the production of clean coal through gasification and the development of alternative energy sources, including wind, water, solar, biofuels and nuclear.
The next president must commit our nation to fasttrack solutions and to the painful and significant conservation that is necessary to free us of this energy crisis forever. What I propose is a good recipe for a one-term president who will be thanked for generations.
Maurer is a shareholder in IBJ Media Corp., which owns the Indianapolis Business Journal. His column appears every other week. To comment on this column, send e-mail to [email protected]