President Obama told listeners during his weekly address that American energy is booming under his Administration. The reality is, however, that the private sector delivered the economic benefits America is enjoying from energy production—and the Administration’s policies are stunting that growth.
The President highlighted that domestic oil production surpassed imports for the first time since 1995; that we’re producing more energy from wind, solar, and other renewables; and that government efficiency programs are putting people to work and saving American families money. But much of the growth we’ve seen in oil and natural gas production as a result of horizontal drilling and hydraulic fracturing are occurring on private lands—out of the Administration’s excessive and onerous regulatory reach.
The Bakken, Marcellus, Niobrara, Eagle Ford, Permian, and Haynesville shale formations, which lie primarily on private and state-owned lands, accounted for 90 percent of domestic oil production growth during 2011 and 2012 and almost all of the natural gas production growth. Increased supplies have lowered energy bills and created employment opportunities all over the country.
President Obama’s policies and policy proposals, on the other hand, are going to result in wasted taxpayer dollars and artificially higher energy prices. His wish for a cap-and-trade program, which died in the Senate, would have increased electricity prices 90 percent and gasoline prices by $1.38 per gallon by 2035. As an alternative, the Administration is moving forward with a regulatory scheme that will kill coal and make prices, as he promised under his cap-and-trade plan, “necessarily skyrocket.”
The Administration has failed to open federally controlled lands and waters to drilling. Oil and natural gas production has slowed on federal lands and could only get worse. The Department of Interior proposed regulations of hydraulic fracturing that would further slow production on federal lands.
Representative Bill Flores (R–TX) introduced legislation (H.R. 2728) that would maintain the responsive state regulatory process that has been successful and provided the necessary structure to produce energy, create jobs and economic growth, and protect the environment. And if President Obama had approved the permit for construction of the Keystone XL Pipeline in a timely manner, up to 830,000 barrels of oil per day would already be coming from Canada to the Gulf Coast refineries.
What else has the government done for us? How about waste billions of dollars subsidizing politically preferred energy sources. Taxpayer-funded handouts promote economic inefficiency, create technological stagnation, promote special-interest politicking, and take opportunities away from economically viable projects that would actually help to grow the economy. Efficiency subsidies and mandates restrict choice, drive up sticker prices, and do much more to hurt American families than to help them. If any of these technologies or industries has value in the marketplace, it will succeed without a specific government policy intended to boost its use.
Americans should be happy we’re experiencing an economic boon as a result of domestic energy production, but President Obama’s weekly address serves as another reminder that markets drive growth and efficiency and that the Administration’s regulations, subsidies, and mandates do the opposite.