|
| Click to Go Back |
Commentary
Drill Now, For the Children
By E. Frank Stephenson
In 1995, Robert M. Goldberg penned a Wall Street Journal article called, “When in trouble, unleash the urchins.” In the article, Goldberg documents how “War on Poverty holdovers are now using children to shield every social program from any spending controls” and he calls the rhetorical exploitation of children a “cause for genuine embarrassment.”
More than a decade later, children play a prominent role in this year’s presidential campaign rhetoric. Democratic candidate Barack Obama calls for having “our children … inherit a planet that’s a little cleaner and safer” and bemoans “crumbling schools that are stealing the future of black children and white children and Asian children and Hispanic children and Native American children.” Talk about no child left behind.
Not to be outdone, Republican candidate John McCain makes children a bipartisan cause. He asks, in the wake of a Baghdad bombing, “What are they [terrorists] willing to do to our children?” Indeed, he raises the ante with some grandchildren straight talk: “We and the other nations of the world must get serious about substantially reducing greenhouse gas emissions in the coming years or we will hand off a much-diminished world to our grandchildren.”
Of course, it’s true that education, national security, and the environment are all issues that will affect our children, my young son included. Another issue affecting our children’s future is the availability of energy at affordable prices. And this issue, specifically motivating Congress to join President Bush in lifting the moratorium on offshore oil exploration, is ripe for some “for the children” advocacy.
Many in Congress oppose drilling. Says one senator, ''Even if new offshore drilling were allowed … along the outer continental shelf, which I wholly and resolutely oppose, it won't produce oil in time to solve the gas price emergency American consumers are facing right now.''
Maybe the senator is right that drilling would have little immediate effect on prices; after all, oil exploration is an expensive and time consuming process. Then again, futures markets – exchanges inhabited by scapegoats called speculators – react not only to current conditions but also to expectations about the future.
Regardless of any effect increased drilling may have on current prices, it is still worthwhile policy. Even if it takes five or 10 years for new drilling to expand the flow of available oil, the increased supply of oil will make future prices lower than they would otherwise be. How much lower is, of course, impossible to forecast with any reasonable degree of certainty. But a reduction of, say, 50 cents per gallon of gas below the price that would otherwise prevail would translate into savings of $250 per year for a consumer who logs 15,000 miles per year in a car getting 30 miles per gallon.
Moreover, there would also be reductions – again, difficult to quantify but certainly not trivial – in the cost of producing and transporting goods. Everything from airfares to supermarket produce to plastics would be a bit cheaper than if we continue with the moratorium on drilling offshore and in Arctic National Wildlife Refuge. (As an aside: The ANWR drilling footprint would require less than 10 percent of the acreage of my college’s campus.) These savings would not move someone from poverty to opulence, but they are substantial nonetheless.
Advocating drilling is not claiming we can “drill our way out” of higher energy market prices; future generations may still face higher prices arising from increased demand for oil in China, India, and other developing countries. Nor does advocating drilling mean that future generations should not adopt more fuel efficient lifestyles. Higher gas prices have led people – almost as if they are guided by an invisible hand – to drive less, to buy more fuel efficient vehicles and make myriad other changes. Even if drilling is permitted, the strong possibility of higher prices is likely to provide an incentive for continued fuel conservation and for the development of new technologies.
It’s also worth noting that domestic drilling, to the extent it replaces imported oil, would offset carbon emissions from tankers and may well produce less spillage than tankers. Hence, it’s far from a foregone conclusion that increased drilling would leave future generations a dirtier environment.
Besides advocating policies for the children, another political nostrum is “targeted tax cuts.” By promising to lower the future price of products derived from oil, lifting the ban on drilling amounts to a targeted tax cut: targeted at future generations, aka children. Congress should drill now – for the children, of course.
E. Frank Stephenson, Chairman of the Department of Economics at Berry College in Mount Berry, Georgia, wrote this commentary for the Georgia Public Policy Foundation. The Foundation is an independent think tank that proposes practical, market-oriented approaches to public policy to improve the lives of Georgians. Nothing written here is to be construed as necessarily reflecting the views of the Georgia Public Policy Foundation or as an attempt to aid or hinder the passage of any bill before the U.S. Congress or the Georgia Legislature.
© Georgia Public Policy Foundation (September 5, 2008). Permission to reprint in whole or in part is hereby granted, provided the author and his affiliations are cited.