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Bait and Switch

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Having diagnosed America’s worsening energy situation as a short-term political problem for their party rather than a long-term economic concern impacting the health and security of our nation, Democratic leaders this week are expected to bring forth an energy bill that’s long on political posturing, but short on meaningful solutions.


One problem: With winter fast approaching, the millions of Americans who struggled this summer with $4 gas are about to encounter an electric bill that may rival or even surpass what they pay each month on their mortgage. Some have already been told to expect a 30 percent rate hike for the coming year.

Lost in the discussion over the speed and abandon with which Democrats’ have shifted their rhetorical position on developing our nation’s resources, one element of the bill we’re likely to see this week has not been explored as fully. Specifically, it’s the blanket, unfunded mandate taking square aim at the way we get our electricity – a provision that would drive up prices by forcing utilities to generate more electricity through solar and wind, and insist that millions of American families cover the cost of the transition.

But thanks in large part to the zeal with which this Congress has locked away America’s resources, prices for two of our nation’s predominant sources of electricity -- coal and natural gas -- are at historically high levels. That’s why, even without a new mandate, the nation's largest publicly-owned utility informed its customers last month that rates will jump 20 percent beginning in October. Imagine how high they’ll get if we have to start relying on the whims of the weather to determine whether we’ll get electricity that day.

Still, the part of the Democrats’ energy outline that’s been getting all the attention is a section that, at first blush, appears to be a legitimate, supply-oriented energy component. Indeed, in backing away from their previous statements that producing more energy here at home has no ability to bring down the price we pay for it, Democrats took great care to make it look as if they were willing to match word with deed, pairing bold public pronouncement with sound public policy.


Unfortunately, what we know of the bill right now suggests it’s all an illusion. Sure, it would create a scenario in which a state could petition the federal government to allow for new energy production off its coast. But under this bill, the first 50 seaward miles would be locked away forever – and the second 50 could be too if a state doesn’t act in a timely manner to free them. That means nearly 90 percent of our nation’s known offshore energy resources could remain under permanent lock-and-key if this bill were to become law, and potentially even more than that if states make the decision not to allow production.

Regrettably, if not accidentally, this bill removes the financial incentive for coastal states to team up with the federal government to break our dependence on foreign oil and bring down prices at the pump. Missing is any mention of how the revenue generated offshore might be shared with the states along the Atlantic and Pacific coasts, even though Gulf Coast states already share in federal offshore revenues, and interior states across the country already receive an annual check for their share of federal onshore royalties.

By creating two separate classes of coastal states – one with a legitimate claim to a portion of offshore revenues; the other without – Democrats are ensuring that regional rivalries will be the product of their efforts, not access to new energy. That’s particularly troubling when you consider the potential revenue boost from legitimate offshore energy development could top $2.6 trillion. That’s a two, followed by a six, followed by 11 zeros.


Since gaveling open the 110th Congress last year, Democrats have done their level best to distract the American people from the real reasons for record-high energy costs – passing bills to sue OPEC for locking away its oil supply, for example, while simultaneously bringing bills to the House floor to lock away ours. The bill we expect to see next week is just another in that same vein of so-called policy-making, advanced for the sole purpose of giving cover to politically vulnerable Democrats – but failing to provide relief to the millions of Americans in need of real solutions.


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