Friday, September 29, 2006

Let's hear it for energy dependence...

I have blogged before about how we can't "replace Mideast oil with ethanol". We can replace oil with ethanol, to be sure, but there is no way to tell which supplier will be reduced. In fact, the most likely provider would be our own expensive domestic production.

But it could be that energy independence is not all what it's cracked up to be anyway.
Thus whatever other arguments there might be for boosting domestic oil production, national security is not one of them. While this might seem counter-intuitive, it is really part of the overall logic of trade: The mutual dependence that trade breeds fosters peace because it gives hostile trading partners an incentive to refrain from acting on their hostility. Energy independence would weaken that incentive. [More]
I am reminded of American agriculture's relationship with China as one of our largest export markets. Given the angst of that partnership, who is really the controller? We want to sell beans to China, and when we don't bad things happen to our soybean industry. Do we want other nations working to become grain or meat independent?

Free trade is good for both sides - even oil. Characterizing trade as dependency doesn't help us appreciate the benefits.

1 comment:

1029barn said...

John:

Energy independence will cause major changes in our energy mix. In many countries in Europe and Asia, electricity is the major source of energy, much of it produced by nuclear power. Their lifestyle is quite different from ours, with electric trains being a major means of transportation for goods as well as passengers.

One of the major cargos carried by these trains is oil. China is a major importer of oil, but they also import raw materials such as iron ore and metals. China is short on electricity, even with the massive infrastructure investments and hydroelectric dams they have built.

I agree that food production should be used for people and animals, not for fuel, but how will you get the starving people of the world to pay for it?