Why a Coherent US Energy Policy is a National Security Issue

Big Red Car here.  SXSW in the ATX, ya’ll.  Big time — 250,000 nerds and hipsters can’t be wrong can they?

That’s a lot of energy.  Speaking of energy, let’s discuss the following hypothesis.

The United States national energy policy is a bedrock element in our national security plan.

The Devil is in the details

The United States is involved militarily in the Middle East in great measure to secure the source of much of the world’s energy coming from this region.

The United States is the insurer of the sanctity of shipping lanes in the world.  When Somalia breeds pirates — pirates, now that’s pretty 18th century, right, John Kerry? — who do they call?  The US Navy and the Navy SEALs.  Good on ya, SEALs.  Like your problem resolution style.

Would we be as concerned about Iran if they were not astride the Straits of Hormuz?  [Big Red Car is going to spot ya'll this one --- correct answer is NO.  Might even be Hell NO.]

The current US energy policy at the Federal level is a shambles but states like Texas — bit of an oil boom in the Lone Star loveliness with directional drilling, shale, fracking resulting in job creation — are showing what can happen when energy is encouraged rather than poked in the eye with a stick.

Russian energy

Russia’s economic resurgence has been fueled by an energy boom of its own.  Russia is a huge producer of energy and in the last five years that number is increasing substantially.

Let me state the obvious:  Russia is able to fund a great measure of its mischievousness with energy income.

Some basic facts:

1.  Russia is the largest oil producer in the world topping 10MM barrels per day.  This is north of 13% of the world’s oil coming daily from Mother Russia.  Did ya’ll know that?

2.  Russia exports almost 6MM barrels per day of crude and 3MM barrels of refined product.  Wow, Big Red Car, that’s a lot of energy income.  I bet if you could reduce energy prices, Russia and Putin would not be able to fund their wickedness.  [Uhhh, Big Red Car, you're getting ahead of yourself a bit.  Down, boy!]

3.  Russia is the largest natural gas exporter in the world and supplies 30% of Europe’s natural gas needs.  Some believe Russia has the world’s largest reserves of natural gas.

4.  Russia has the second largest coal reserves in the world.

5.  Russia sits astride many distribution pipelines including all those coming from filthy oil rich Kazakhstan.  Not only does Russia control huge quantities of oil, it has a choke hold on distribution of other huge sources of energy — oil and natural gas.

6.  Russia has turned off valves on pipelines as a means of applying political pressure.  Often this is blamed on “technical” problems but when your little home is freezing, there isn’t anything remotely technical about it.  Trust the Big Red Car on this one.

Again, Russia supplies approximately 30% of Europe’s natural gas needs.  [Europe gets the "how stupid is that" award for allowing this to happen.  You idiots!]

Russian GDP is approximately 50% energy based.  Read that again — Russia’s GDP is approximately 50% energy based.

Russia has approximately 145MM people.  The United States is more than twice that size.  Europe is much bigger.  For a fairly small country, Russia is swinging a big stick but that big stick is funded by oil.  Let’s get this right — Russia is a fairly small country which has nuclear weapons.  No nukes, we bitch smack these guys and go home.

US energy policy

The US energy policy is a shambles.  No Keystone XL pipeline decision after almost six years.  This is indicative of the Obama administration’s attitude toward energy.  One really doesn’t need to know more.

The US energy policy is anti-coal, anti-nuclear energy and pro alternative fuels.  Alternative fuels — wind, solar — cost 4-10X the cost of base energy costs.  So the whiz kids in DC on the Obama payroll are trying to increase the cost of energy to provide an impetus to using alternative fuels.

Why?

Because they want to pick winners and losers in our economy.  They want to control the economy which is funny because the Russians have historically been the ones who wanted to design outcomes for their economy — that failed “central planning” thing.

The result of all of this is that American energy costs — think gasoline — is artificially higher than it should be thus exerting a blind tax on the entire economy.  High gasoline prices fall into another Obama meme — higher gas mileage for the American fleet driven by confiscatory gasoline prices.  Let’s state the obvious, high gas prices hurt the economy and job creation.

This is all the result of policy, not free market forces.  Oh, you free market forces, I miss ya’ll.

What should we do, Big Red Car?

The solution luckily is very simple:

1.  The US should drill, drill, drill — thank you Saracudda.  Drill, baby, drill.  Now.

2.  The US should shift as much new electric power plant construction to nuclear — low cost solution, ya’ll — as possible.  Think jobs to build, jobs to operate, jobs to maintain in the bargain.

3.  Build the damn Keystone XL pipeline.  Even you idiots have to make a decision after six years.  This is no longer policy, this is just competence.  If you can’t make a friggin’ decision in six years, then self deport yourselves.

4.  Stop the war on coal.

5.  Provide permission to build new refineries.

6.  Allow the export of crude.  Let that free market free.  It won’t hurt us.

Why will this work, Big Red Car?  Because it’s built on reality and we can already see the results in places like Texas.  A market driven energy policy will create jobs and lower costs for everyone.  Well everyone who drives a car or eats or uses water.  Yeah, that’s everyone, Big Red Car.

Why, Big Red Car?

International oil prices — and local gasoline prices — will be immediately lowered.  This will be a huge boost to the economy across the world.

The national security implication is simply this — since Mother Russia’s GDP is 50% dependent on energy when prices plummet, Russia will have less money to screw with the world and to start trouble.  Some folks think it will kick Russia into a depression.  Who deserves a depression more than Putin and those corrupt scumbags running the country and their oil companies?

This could cut oil prices by half and thereby knock a 25% hole in Russia’s energy driven GDP.  Other countries do not have that exposure to energy.  The United States does not.

Putin does not really care that Sec of State John Kerry thinks invading countries is not how G-8ish countries behave.  Hell Putin thinks the 18th century — the Golden Age of Russia and Catherine the Great — was a damn good time.  [Vlad the Great?  I promise you when he goes to sleep that's what this thug is thinking.]  Remember this is a guy who takes his shirt off every time he gets near a tiger, horse, rifle.  He could care less whether he is invited to join the Harvard Club.

Ahh, but Vlad does care whether he has enough money to screw with the world.  Take away Vlad’s money and see how much boorish behavior he can still afford.

Big Red Car will book an assist on this one — not too much.

Break Russia financially at the energy counter.  Make this thug sweat — bare chested brute.  See how wicked Vlad is with a 25% hole in the Russian GDP.

Extra credit:  See how long Vlad survives when the oil oligarchs see their energy prices plummet.  Vlad is a pimp dog but those oil oligarchs are his master.

How?

This will take some cojones and it will require immediate action.

Can our President do it?

Simple answer:  NO.  He’s a pussy and we all know that.  We did not need Putin to tell us that, did we?  [The Big Red Car doesn't really have a problem with President Obama on this.  It's OK to be Mr Sensitive.  What is not OK is to risk the lives of the world's folks because you are also incompetent.  That is a crime.  In the balance lies not some academic debate about policy.   No, Old Sport, what lies in the balance is real lives.  Real blood, sweat and tears.]

But, hey, what the Hell do I really know anyway?  I’m just a Big Red Car.  Be kind to each other today and pray for the Ukraine.