Historically, one of the biggest impediments to true energy independence has been our country’s collective failure – and that means policy makers, business people and man on the street types alike – to stay focused on the goal through bad times and good.
Many people still associate the last big push to wean ourselves off foreign oil with the last really bad recession, during the Jimmy Carter Administration. When more prosperous times followed, many of those same people and a lot of others who weren’t even alive back then conveniently forgot what was so bad about dependence on foreign oil in the first place.
Fast forward to the current Great Recession, which folks are so eager to put behind them that they are focusing on the thinnest shreds of good news, such as last week’s report that July unemployment actually declined, to 9.4% from 9.5% in June.
But just as the positive ruling that will allow some drilling in the Gulf is no reason to abandon efforts to free up other coastal waters in dispute, a glimmer of an economic recovery — while certainly welcome — is no reason to forget about all the U.S. industries that are still struggling and could be hurt more by volatile oil prices.
A couple of reality checks: Unemployment is still very close to 10%, a level that just one year ago seemed unfathomable. Several industries such as retailing and construction continue to make deep cuts. Even as the unemployment rate fell in July, some 247,000 more jobs were lost, a paradox that reflects large numbers of workers exhausting unemployment benefits and no longer counted among the jobless.
By most accounts, the modest decline in July unemployment was a blip rather than the start of a new trend. Nationwide unemployment is still widely expected to move into the double digits before it improves significantly.
Many states are already there. California’s unemployment is 11.6% and Florida’s is 10.6%. It’s worth noting that these are both oil-rich states that could benefit from a loosening of drilling restrictions.
This story provides a good explanation of how the failure to commit to a strong domestic oil policy is a vicious cycle: Dependence on foreign oil leads to price volatility and uncertain oil industry profits, discouraging oil companies – restrictions notwithstanding – from spending on exploration and ultimately resulting in tight supplies and more need to import oil from abroad. And then the cycle starts over again.
Even as we all look forward to the end of this long and painful recession, we need to see the downturn as an opportunity to commit to doing things differently and breaking this decades-old cycle of oil dependence.