Legalize freedom: Why the oil export ban?
WASHINGTON -- The House recently passed legislation that prohibits the federal government from restricting crude oil exports. In response, the White House stated that it "strongly opposes" this bill and demanded that Congress instead invest more ...
WASHINGTON -- The House recently passed legislation that prohibits the federal government from restricting crude oil exports. In response, the White House stated that it “strongly opposes” this bill and demanded that Congress instead invest more in “wind, solar, energy efficiency, and other clean technologies.”
Welcome to the religion of global warming where legalizing freedom for anything oil is verboten.
Like so many supporters of oil export restriction, President Obama is more interested in propping up uneconomical renewable energy sources than sensible policies that benefit working Americans.
Citing support for unworkable energy sources to defend the antiquated oil export ban is unacceptable. Congress should ignore the White House and act immediately to lift the ban. In so doing, they can reduce gas prices, spur job growth, and allow Americans alike to enjoy the benefits of an open, consumer-driven energy market.
Since the implementation of the oil ban four decades ago, Congress has invested billions and billions of dollars into renewables.
But, no surprise, the real energy success story emerged from the private sector. Gas prices have plummeted as American producers invest in innovative technology to access underground reserves. We recently overtook Saudi Arabia as the top oil producer on the globe and are on track to produce 9.4 million barrels of oil a day by the end of this year.
Despite this game-changing development, the U.S. remains bound by a misguided policy established four decades ago.
Today’s oil ban proponents are mostly environmental extremists with highly suspect economic arguments.
Activist groups like Oil Change International and Allied Alliance argues that lifting the ban will push energy firms to “find and produce more oil.” This, they claim, in a refutation of supply-and-demand economics, will raise prices.
On the contrary, the Congressional Budget Office and the Energy Information Administration alike have found that lifting the ban would result in cheaper oil.
Moreover, legalizing exports would further help an industry segment where more than 160,000 energy workers have been displaced. Domestic production would grow by 1.2 million barrels a day. Absent government-imposed limitations, the energy sector could continue to expand, and domestic investment would boom.
Unfortunately though, certain independent refiners who are benefitting from the ban are also forcefully lobbying against repeal.
Valero, the nation’s largest independent refiner, supports the ban. Their domestic refineries benefit from artificially low crude oil prices that result from the export ban, with the help of a special license from the Department of Commerce.
Valero and other similarly situated refiners are Obama’s best friends on the issue. They are also practicing cronyism at the expense of basic free trade.
Radicals argue that lawmakers should couple a repeal of the export ban with a list of Left environmental goodies.
But taxpayer giveaways for market-failing energy technologies shouldn’t be a precondition for economically sound reforms like lifting the oil export ban. Nor should the president be able to use renewables as an excuse to keep the ban in place.
Fortunately, it’s unlikely that the self-serving arguments of environmentalists will win over the general public. Gallup and Pew polls have repeatedly found that most Americans are more concerned about the tepid economy than a warped brand of environmentalism.
Corporate responsibility should shift away from calculator cronyism toward principled capitalism where free markets and free trade are supported as a social good. It is high time to legalize freedom when it comes to energy, and there are few better places to start than with the exportation of American oil.
Bradley is the founder and CEO of the Institute for Energy Research.