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By Robert Rapier on Aug 7, 2008 with no responses

Pinning Pelosi

I received an interesting e-mail yesterday:

Nancy Pelosi, Speaker of the House and Author of “Know Your Power: A Message to America’s Daughters” will answer questions in a live discussion on washingtonpost.com today (Wednesday, Aug. 6 at 3 pm ET).

Pelosi will discuss the current political scene heading into the conventions, the message of her new book and other questions submitted by readers.

To submit questions and participate in the live discussion click here: http://www.washingtonpost.com/wp-dyn/content/discussion/2008/08/01/DI2008080102174.html

This seemed to me to be an ideal opportunity to pin her down on two issues that she is clearly passionate about, but seem to me to be diametrically opposed: Tapping the Strategic Petroleum Reserve (SPR) and reducing carbon emissions. So, I submitted the following question, several hours prior to the chat:

Dear Speaker Pelosi,

Perhaps you could clarify an issue that is baffling to me. On the one hand, you have spoken passionately for the need to combat global warming by reducing our carbon emissions. This is clearly a priority for you, as well as for large segments of the Democratic Party. On the other hand, you have also come out strongly in favor of tapping oil from our Strategic Petroleum Reserve in order to bring oil prices down. Given that high prices are causing the public to abandon SUVs and to embrace fuel efficiency and mass transit – exactly the sorts of things that need to happen if we are to reduce carbon emissions – how is your position on the SPR not completely inconsistent with your position on global warming? If in fact you push through your proposal on the SPR, won’t that lead to increased consumption and therefore increased carbon emissions?

Had I been a bit more long-winded, I would have pointed to reports that gasoline demand is in fact down this year, breaking a multi-year trend of increasing demand. Or I could have shown the many news stories showing record demand for Priuses while SUVs are not moving. The reason demand is down is clearly price-driven. Price is the clearest handle we have on moderating demand.

Unfortunately, Pelosi (or the person screening the questions) decided not to answer my question. Instead, they answered a question in which she could once more push for tapping the SPR!

Marietta, Georgia: Dear Madam Speaker,

Although this forum is primarily focused on your book, I cannot help but bring up an issue that is affecting each and every American. Why have the American people not seen energy legislation that lowers the price of gas?

Thank you

Nancy Pelosi: Now let’s pivot from book questions to a topic many of you have raised: the high price of gasoline at the pump and what we can do about it.

Every American family is affected by the high price of oil and gas. It is our responsibility in Congress to protect the consumer and increase the domestic supply of energy. For the past 18 months, the Democrats in Congress have set forth an energy agenda. Some has been passed into law – and some has been blocked by the Republicans.

House Democrats have put forward 13 major proposals that would increase supply, reduce prices, protect consumers and transition America to a clean, renewable energy-independent future. Each time a majority of House Republicans have voted against these proposals.

Let me be very clear: drilling for oil in protected areas offshore will not bring down the price at the pump for 10 years – and then only 2 cents. To say otherwise is a hoax on the American people.

Here’s what we can do:

1. Free Our Oil

We can have immediate price relief at the pump. Freeing our oil from the Strategic Petroleum Reserve will bring down the price of oil in 10 days. President Bush refuses to take this step for immediate relief.

10 years or 10 days – the choice is clear.

2. Use It or Lose It

Democrats passed the Drill Bill which says to Big Oil “Use it or lose it!” – drill in the 68 million acres in the lower 48 states or let someone else drill there. Also, “use it or lose it in Alaska. All of these areas have permits for drilling – and will produce oil sooner than drilling in protected areas offshore.

3. End Excessive Speculation Which Raises the Price of Oil

Democrats were part of a strong bipartisan vote was taken in the House but GOP leaders twisted arms to block passage.

4. Repeal the subsidies for Big Oil

With Big Oil making record profits, they do not need American taxpayers funding their drilling.

Instead we can invest in research, renewable energy, and tax credits for wind, solar and other renewables. This passed the House but failed in the Senate by one vote – John McCain was absent that day but said he would have voted no.

5. Increase Our Energy Supply With Increased Use of Natural Gas – a cleaner energy source.

There is immediate relief for the consumer – if only President Bush would free our oil.

I must say that Number 5 is a surprise, and something I have long advocated. Instead of recycling our natural gas into ethanol, it would be much more efficient to use it directly as fuel. As I have pointed out before, Brazil – the poster child for ethanol production – also has 8 times the number of natural gas vehicles on the road as we do in the U.S. They don’t waste their natural gas separating ethanol from water. Besides Brazil – Argentina, Pakistan, Italy, and India all have larger natural gas fleets than does the U.S. So for those who suggest that we don’t have the infrastructure in place to manage this, maybe we can learn from India and Pakistan. So I agree with Pelosi on this point: As our supply of oil depletes, we can moderate the decline with natural gas.

Number 1 on Pelosi’s list is the very contradiction I asked about, Number 2 promotes a myth (there already is a ‘use it or lose it’ provision in the law) and is nothing more than pandering, Number 3 may have some merit, but is again in contrast to her position on global warming (higher prices equal lower carbon emissions), and Number 4 says that oil companies should not be entitled to the same sorts of tax deductions afforded every other industry. I will let you all in on a dirty little secret: Big Oil also deducts the salaries of their employees from their gross receipts, just like every other business. Maybe that ‘subsidy’ should be eliminated. Maybe their deductions for capital spending should be disallowed. More subsidies. But I digress.

Can anyone explain to me why championing action on global warming while also championing tapping the SPR is not blatantly contradictory? Anyone? Or why nobody in the Democratic Party seems to have the guts to speak out on this contradiction? Instead, Barack Obama – long opposed to tapping the SPR – has now fallen into line and is calling for the same.

Actually, I think I know the answer to the contradiction. Proponents of tapping the SPR think that alternative fuels are going to rapidly scale up, displace petroleum with cheap ethanol, and the consumer won’t have to suffer in order to bring fossil fuel consumption down. To that, I would point out that the Energy Information Administration – the source of Pelosi’s claim that drilling in the OCS would only bring prices down by 2 cents a gallon – testified last year that they don’t foresee that cellulosic ethanol is going to scale up to even a billion gallons by 2030.

The EIA also predicts that fossil fuels will continue to be the dominant source of our energy supply for decades to come. So, the very agency Pelosi references in her argument for tapping the SPR is telling us in no uncertain terms that alternative fuels aren’t going to ride to the rescue. With that in mind, I believe it is impossible to reconcile a position of tapping the SPR with a position that reducing our carbon emissions is a high priority. It’s like saying “I propose that the nation needs to go on a diet. And by the way, I also propose that we increase the supply of donuts to make them more affordable.”

I just wish a politician would have the guts to step forward and address this contradiction.