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What Affect Will High Oil Prices Have on the 2012 Election

If current trends continue, gasoline prices and U.S. energy policy seem destined to play a larger role in the political debate prior to the November elections than ever before. Gasoline on the East Coast is already within striking distance of all-time highs and most prognosticators are talking about the likelihood of $4+ gasoline before summer. Although the U.S. consumer is more inured to $4 gasoline than four years ago, the crossing of the $4 barrier is bound to set off another round of recriminations and finger pointing as to just who or what is causing this phenomenon. If what happened in 2008 is any indication we are in for another round of bizarre proposals from our politicians - remember the "sue OPEC" legislation.

The fundamental energy policies of the two U.S. political parties have been pretty well set for the last four or five years although there has been some give in response to transient political pressures. Most Democratic politicians continue to express concerns about the potential threat to the planet caused by increasing CO2 emissions and therefore reflexively tend toward policies that favor reduced consumption of fossil fuels either through increased efficiency or replacement with renewables or even nuclear power.

For the most part, Republican politicians, whether they believe it or not, have embraced the position that increased burning of fossil fuels either is not responsible for climate change or is such a slow moving phenomenon that it need not be dealt with in the foreseeable future - "if it is real, the grandchildren can worry about it." Increasing domestic energy consumption at all costs which incidentally is relatively painless to the voter is the proper course. This position, of opposing efforts to control emissions is of relatively recent vintage and came about when it became apparent that controlling carbon emissions would likely result in heavy costs to fossil fuel producers and consumers alike.

What does peak oil have to say to us about the coming election? In general, those who understand the nuances of the phenomenon of the peaking of global oil are saying that world oil production is either at or is very close to reaching its all-time peak. In recent years leveling out of conventional oil production has resulted in a fivefold increase in oil prices. This increase in oil prices is believed by many to be a key reason, if not the key reason, for the economic troubles currently besetting much of the world. The undeniable conclusion is that, given the current situation and the prospects for oil prices, it is unlikely that there will be an economic rebound or a meaningful increase in employment until such time that new and affordable sources of energy come into general use.

Now this is clearly a conclusion that no voter wants to hear, which is exactly why no government or politician running for office is saying much if anything about it. While the real issue of this election is how we can reorganize our civilization to get through the decades ahead when motor fuel becomes unaffordable, our economy continues to contract, and we are likely to be devastated by repeated natural disasters stemming from climate change. Incidentally, it is interesting to note that federal disaster declarations, related to extreme weather events, totaled 15 in 1981, 43 in 1991, and 99 in 2011.

The Republican candidate in the coming election has the luxury of ignoring reality and telling the voters that he can do exactly what they want, create jobs, grow the economy, and ensure plentiful supplies of cheap energy. All this can be achieved without subjecting voters to any more pain than the incumbent administration has already caused them. Thus the Republican platform for the coming election likely will be one of lifting all possible restrictions on the domestic production of energy. Tax breaks for fossil fuel producers will be continued on the grounds that reducing them would amount to a tax increase, and support for renewable sources will be reduced on the grounds that they will not be needed after the bonanza of new oil, coal, and natural gas comes forth from eliminating regulations.

Democratic candidates will have to sell a more nuanced platform. As most Democratic politicians not representing fossil fuel producing districts profess some concern for the threat posed by carbon emissions, they have a more difficult case to make. While the responsible case in an era of depleting fossil fuels is to advocate energy conservation and efficiency first, and then to seek out policies to avoid or prepare for lower standards of living, these courses would require sacrifice on the part of voters who as yet do not see where they will be necessary.

Despite the increasing incidence of extreme weather around the world, for the time being a majority of Americans are rejecting the connection between burning fossil fuels and aberrant weather events. This rejection is not so much because they do not believe the science, which most do not understand anyway, but because climate change is not perceived to be such an immediate threat as that posed by a lack of jobs.

President Obama is attempting to steer a course through this thicket by embracing policies which make long-term sense from an environmental point of view and yet do limited damage and leave him hope of reelection. In recent days the President has unveiled the energy plan he will take into the election campaign. The centerpiece is to embrace natural gas as a transportation fuel as it can be produced domestically, is currently much cheaper than oil, and while not carbon-free, emits less CO2 and other pollutants than do oil products. He has also opened more public land and offshore areas for drilling - although nowhere near what the industry and many Republicans politicians are calling for.

Although it is likely that the President and his Secretary of Energy understand that a decline in world oil production is not far away, it is simply not a topic to be raised prior to an election as the political risk is simply too great. Someday, likely within the next decade, the US and the rest of world's governments will have to acknowledge there is a problem here, and unless alternative sources of energy can be developed and brought into general use quickly, major changes in economic activities and lifestyles are going to take place.

By. Tom Whipple

Source: Post Carbon

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