It Takes an Oil Crisis
Are you ready for a quiz? Here’s a quote. Guess who said it and when.
“Our growing dependence upon foreign oil sources has been adding to our vulnerability for years and years, and we did nothing to prepare ourselves for such an event as the embargo of 1973.”
Answer: Gerald Ford in 1975.
Frank G. Zarb, who served as the assistant to president for energy affairs in the Ford administration, offers this quote in today’s New York Time Op-Ed section. He reminds us that Ford proposed a number of steps to reduce our vulnerability, including more nuclear power plants, coal mines, refineries, drilling, and the sale of millions of new cars that use much less fuel. Congress debated the plan—but the crisis eased, oil supplies returned, prices came down, and we fell back into complacency. A few measures were passed, like the establishment of a strategic petroleum reserve, but it was “far short of what was necessary,” according to Zarb.
30 years later, with gas prices matching all-time highs in both nominal and real dollars, government officials and the driving public are busy pointing their fingers at oil companies. Zarb has a few more practical ideas. For example:
We could levy a truly substantial gasoline tax, something like 50 cents per gallon to start, followed by 50 cent increases in each of the following three years, with rebates for lower-income taxpayers. The revenue from this levy could be used to pay for tax credits for fuel-efficient autos.
He also supports an increase in corporate average fuel economy of at least 4 percent per year. But judging from history, you can forget about any of these measures coming to pass unless the current run on gas prices takes an even more drastic turn.
Referring to our national response to energy policy two short years after the 1973 oil embargo, Zarb writes, “Without a crisis, a real national energy program could not get past normal political paralysis.” Today, we are even more aware of the dangers of oil dependence, as well as climate change. And the viability of fuel-saving technologies like hybrids is evident. Unfortunately, we haven’t learned our lesson. It will take another energy crisis before we even begin to change our direction.