President Reagan liked to say, "There are no easy answers, but there are simple ones." This principle applies to America's energy woes. Since the Democrats took control of Congress in January 2007, the price of a gallon of gas has soared from $2.33 per gallon to over $4. Furthermore, over the next two decades, global demand for oil is expected to rise by 50%, meaning that further price escalation is almost inevitable. When confronted by these facts, the energy solution - as President Reagan would say - is simple. We need more energy! We should be increasing our production of oil, natural gas, clean coal, and nuclear power – and those resources should come from America, instead of foreign dictatorships. Unfortunately, enacting this agenda won't be easy. The Democratic Leadership in Congress is determined to "punish" energy companies with new taxes, even if the greatest victim of those taxes is the American consumer.
The Democratic nominee for President, Senator Barack Obama, is eager to burden oil producers with a "windfall profits tax" - a euphemistic phrase that implies an undue or undeserved "profit." As Alan Greenspan once said, "Whatever you tax, you get less of." By raising taxes, and thereby, reducing the incentives to produce energy, the consequences of this policy are obvious: we will end up with a smaller supply of domestic energy. But don't just take my word for it; take a look at history. In 1980, Congress passed a "windfall profits tax" and the consequences were devastating. In the six years following that levy, domestic oil production dropped by 1.26 billion barrels and imports of foreign oil rose 13%. The "windfall profits tax" was an unmitigated disaster, which is precisely why it was repealed. We shouldn't make that same mistake again.
Instead of searching for scapegoats, we should be striving to create a bold, comprehensive plan for America's energy security in the 21st century. Specifically, this will require overturning literally decades of Big-Government regulations that have prevented energy companies from tapping America's bountiful natural resources. So many people in Washington have grown accustomed to the idea that we must either import oil from the Middle East or make an expensive transition toward homegrown fuels like corn-based ethanol. This is a false choice. One of the best kept secrets in politics today is that our country is one of the richest energy nations in the world, and is extremely capable of achieving energy independence - but only if we have the willpower to do it.
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