"There are only two ways of telling the complete truth—anonymously and posthumously."Thomas Sowell

Monday, February 07, 2005

Geo-Green Garbage

New York Times columnist Thomas L. Friedman offered “The Geo-Green Alternative” on January 30:

“I am a geo-green. The geo-greens believe that, going forward, if we put all our focus on reducing the price of oil — by conservation, by developing renewable and alternative energies and by expanding nuclear power — we will force more reform than by any other strategy. You give me $18-a-barrel oil and I will give you political and economic reform from Algeria to Iran. . . . Shrink their oil revenue and they will have to open up their economies and their schools and liberate their women so that their people can compete. It’s that simple. By refusing to rein in US energy consumption, the Bush team is . . . depriving itself of the most effective lever for promoting internally driven reform in the Middle East.”

“Geo-Green” relies on economic illiteracy. If oil fell to $18, there would obviously be much less incentive to conserve oil or to develop expensive alternative energy sources, including nuclear. It is sheer fantasy to imagine the Bush team could somehow “rein in US energy consumption” enough to make a dent in the global oil price. Even if oil prices did fall by a buck or two as a result of some sort of mandatory US austerity scheme, the benefit would go to China and other countries who would gladly buy any cheaper oil we unloaded on the world market.

Mr. Friedman’s geo-whiz political forecast fares no better than his economics. The price of West Texas Intermediate crude was below $18 most of the time from February 1986 to June 1999 -- falling as low as $11.28 at the end of 1998 and remaining below $20 at the end of 2001. So, why did we not see “political and economic reform from Algeria to Iran”? It’s that simple.

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