Tuesday, August 23, 2005

Fareed Zakaria's Energy Policy Column.

HT: To Jonah Goldberg in The Corner.

Fareed Zakaria takes on the question of how to lessen our dependence on oil for energy. This is a good question. Most conservatives say let the marketplace take care of it. Now, being an economic conservative I am sympathetic to the argument. However, I am coming more and more around to point of view there are sufficient externalities in our current energy paradigm (sorry for using that word, but it fits my needs very well) to justify societal to justify coordinated societal (i.e. governmental) intervention.

Now, Fareed goes on and brings up some of the usual solutions.

That is because of strong growth, but also because American cars-which guzzle the bulk of oil imports-are much less efficient than they used to be. This is the only area of the American economy in which we have become less energy-efficient than we were 20 years ago, and we are the only industrialized country to have slid backward in this way. There's one reason: SUVs. They made up 5 percent of the American fleet in 1990. They make up almost 54 percent today.
Source: MSNBC's Fareed Zakaria - How to Escape the Oil Trap

This point most people arguing for government intervention do so in their sleep. The funny thing is I am hearing more and more reports the values for used SUVs is declining and people are not getting declining value on SUV trades. It seems the number of Yukons and Suburbans in the GMC lot next to my house is rising. Even earlier this summers SUVs would hit the lot and be gone quickly, not so anymore.

In any event, the more efficient one's car is, the more driving one will do. Any gains in efficiency will be lost to increased driving. If not more driving by the same people then by an increase in the number of cars (with an increasing population).


We don't need a Manhattan Project to find our way out of our current energy trap. The technologies already exist. But what we're searching for is perhaps even harder-political leadership and vision.
Source: MSNBC's Fareed Zakaria - How to Escape the Oil Trap

The solutions Fareed argues for are nothing but stop-gap measures. Increased automotive efficiency is important but not a solution.

Are we in need of a Manhattan Project? I say we are. Or do we finally start to harvest the fruits of the original Manhattan Project?