• The Heritage Network
    • Resize:
    • A
    • A
    • A
  • Donate
  • The American Energy Act: Supply Side Solutions

    Congressman John Boehner of Ohio is set to introduce The American Energy Act, which will most importantly increase America’s energy supplies. The bill calls for leasing regulations for offshore natural gas by 2010, removing restrictions for outer continental shelf drilling, and opening up sections of ANWR for drilling.

    As The Heritage Foundation’s Senior Policy Analyst Ben Lieberman has been arguing this even when gas prices were around $1 a gallon. More energy supplies, not more taxes and regulations, are what this country needs. It’s economics 101: expanding supply is the surest way to lower energy prices, and the quicker Congress moves to open up restricted areas, the quicker more resources will be available.

    As my colleague Michael Franc writes, it is the first time in awhile House Republicans are leading the charge on producing more in America here at home. Now that gas prices are surpassing $5 a gallon in some states, consumer pressure is causing a number of Members to switch their stance on drilling. Franc notes,

    Recently, freshman Rep. Steve Kagen (D., Wisc.), who previously voted the environmental line, got religion. “Drill for new oil across America,” he wrote in the Milwaukee Journal-Sentinel. On the Republican side, Maryland conservative Rep. Roscoe Bartlett, who has also opposed drilling, recently co-sponsored a plan to open up the vast oil and gas resources under the Alaskan Coastal Plain for exploration and development.”

    These supply side ideas are considerably better than those that were tried and failed in the past. For instance, the Consumer-First Energy Act of 2008 (S. 3044), introduced by Senate Majority Leader Harry Reid (D-NV) would raise taxes on the price of oil, impose price gouging legislation that, in effect, led to supply shortages and long lines at the pump in the late 1970s.

    Where Boehner’s bill falters is the support for renewable fuels such as biodiesel and ethanol. Ethanol has been a prime culprit for rising food prices not only in America but also globally. The federal government has been trying since the 1970s to pick winners and losers by subsidizing unsuccessful alternative sources of energy and these sources still only comprise a small fraction of America’s energy profile.

    Overall, Congressman Boehner’s legislation is the right move to relieve American consumers from high gas prices. Lieberman summarizes it accurately: Good energy policy is easy to distinguish from bad energy policy: Good policy leads to more supplies of affordable energy, and bad policy leads to less.

    Posted in Energy [slideshow_deploy]

    13 Responses to The American Energy Act: Supply Side Solutions

    1. Bill says:

      Another part of Economics 101 is "competition" to control prices

      Another thought is that California regulators believe that energy efficiency is the most cost effective way to resolve our energy crisis.

      IMHO the energy crisis is much more complicated that any situation taught in Econ 101.

      • Independent says:

        Yes, oil prices are determined on the global market, and efforts to increase supply in the United States will be dwarfed by the output of major oil sources abroad. Drilling more here will do nothing to decrease energy prices. It is merely a symbolic act. What we can do is decrease demand, because we have far more of that than we have supply. Increasing efficiency will do more to decrease prices than drilling away on our fragile American lands, which we should take pride in protecting.

    2. Tom Wingett.....Newn says:

      I feel strongly that the Congress should give this "All the above bill" an up or down vote..Something has to change for the better or we can kiss ole America goodbye…The Democrats are choking this country to death with thier politics…Obama,Obama,Obama..What a farce..DO SOMETHING NOW OR GET OUT OF THE WAY..I feel almost the same about our beloved McCain..WE COULD HAVE DONE BETTER!!!!

      • Independent says:

        Look at who's holding up congress to see that democrats aren't the ones stalling our democracy.

    3. Darvin Dowdy, Houst says:

      Unfortunately all of these excellent and "true" arguments regarding the need for drastically increased domestic oil production aren't garnering the level of support we need from the average U.S. voter. In other words we are continuing to do a lousy selling job. We're giving facts, figures, statistics, etc. Yaaawwwwn. Boooring. Causes folks eyes to glaze over.

      What is needed? I've gone over this before. Place the emphasis on the number of high paying oil field related jobs that will be available with expanded domestic drilling. Possibly available before Christmas '08. Middle Americans have suffered the loss of millions of high paying manufacturing jobs over the past decade or so. Many are working as burger flippers or mall retail, etc. Door greeters at Walmart.

      What would get them enthusiastic [like they did over McCain/Kennedy back in 6/07-burning up the communication lines to their elected reps] would be the prospect of doubling their annual paychecks. Its not an unrealistic expectation. The oil industry is one of the last bastions of high paying jobs in the U.S.

      Come on HF! Be the point man here. Break new ground. Have some of your "brains" focus on this very attractive prospect for U.S. workers. Pose the question, "why are democrats denying U.S. workers high paying oil field related jobs"? And watch the walls come down.

      What should we NOT do?? Lets not look to the tree hugging moonbats in California for guidance. Ha! Darvin Dowdy

    4. Pingback: Today’s Science Policy News for July, 24th 2008 - Scientists & Engineers for America Action Fund

    5. Donna, Murfreesboro, says:

      the democratic congress has not done anything to help the people of the united states unless they thought their party would benefit from it. If it is not something the democratic congress has put into place then they will not pass it. I will make sure that I will NOT vote for any congressional democrait in the future.

    6. JHarley, San Antonio says:

      Amen to Donna, Murfreesboro, TN

      I agree with Donna. What she says about Democrats in Congress is absolutely true.

      I will do anything in my power to remove them all.

      If Bill Clinton had not vetoed the energy bill we would have the oil situation under control by now and if we don't start drilling in ANWAR and offshore we will just keep sending our good money to the Middle East. 700 billion dollars a year plus is a lot of money and it comes right out of all of our pockets!

    7. Carol, Pa. says:

      I recently read an article that reported how Nancy Pelosi praised herself and all of her accomplishments. This is a joke, right?

    8. Bill Higgins=Staten says:

      It doesn't matter who was the cause on the oil crisis. The CRISIS is fact and is killing the AMERICAN ECONOMY. The CONGRESS has a responsibility ( both Republican & Democrat ) to do what is good for the country. DRILl,DRILL, DRILL. Those that can't understand this should be listed and thrown out by the people.

    9. Bonnie Fink, Louisvi says:

      This country is going to hell in a hand basket. First, we are removing God from everything because we are afraid of hurting the feelings of Illegal aliens, etc. What a load of crap! This country was founded on Christian principles…remember the Constitution of the United States? Now, we are in the energy crisis of the century, and the Democrats are LARGELY at fault for it! Congress had better do something….and fast…or we will soon become the United States of China!

    10. Judy, Colorado says:

      WAKE UP AMERICA . . . !!! We only have 99 days to save our beloved country from complete liberal ruination. We have always been a strong independent nation, world leader in every sense of the word and now . . .our Founding Fathers must be spinning in their graves. Our Constitution is being raviged, In God We Trust removed from our money, Under God deleted from the Pledge. I am truly saddened by the lack of national backbone at this point in time. Have we been so brainwashed by the liberals in Congress and the drive-by media that we actually believe we can continue to prosper and be the strongest leader in the free world? We are blessed with numerous natural resources (oil, gas, coal, shale oil), but are not allowed to develop them because it is not economically feasible to do so with the restrictions the environmentalists/tree huggers and liberals in government impose on the industry. A lease can expire before a permit to drill will be authorized . . .cite the sage grouse strutting ground, bald eagle nesting, tit mouse habitat. . . it's always something, and the nation is suffering dearly because of it. The caribou in ANWR calve under and next to the pipeline because it is warm. Bald eagles nest on holding tanks because it is warm and off the ground away from predators . . .the tit mouse can fend for himself and the sage grouse will strutt no matter what. I'm scared of the direction in which our country is headed. Barack Obama and his clueless, hateful wife have to be stopped from destroying The Home of the Free and The Land of the Brave. God Bless America!!!!!

    11. Greg, Michigan says:

      I am a former petroleum geologist.

      You people are ALL wrong. The guy from Houston ought to know better.

      1.There is no such thing as "proven" reserves.

      2.Oil companies already have many wells that they have explored for, drilled, completed and tapped that are sitting capped while they set back and regulate world prices.

      3. Over 38,000 acres of leases are unexplored and undrilled by these companys.

      4. They just want to get their hands on ANWR and offshore areas. Repubs are just doing their master's bidding.

      5. Oil takes a lag time of 12-16 years before getting to the pump. Exploration, acquiring seismic, acquiring lease, rent or lease and transport drill rig, "Spudding" a well, drilling, well completion, production, transportation, brokering, refining, transport to retail all take a huuuuuge amount of time.

      6. Oil companies are holding the leashes of the Republican Party. Don't take a brain surgeon to see it.

      The Repubs are blowing smoke if you think drilling ANWR will drop the price at the pump to 75 cents per gallon tomorrow. All the ANWR oil on the planet will drop the price at the pump 6 cents,………in about 16 years!!

      Want more planes flown into our buildings? Vote Republican!

      I'm Greg in Detroit and I approved this message.

    Comments are subject to approval and moderation. We remind everyone that The Heritage Foundation promotes a civil society where ideas and debate flourish. Please be respectful of each other and the subjects of any criticism. While we may not always agree on policy, we should all agree that being appropriately informed is everyone's intention visiting this site. Profanity, lewdness, personal attacks, and other forms of incivility will not be tolerated. Please keep your thoughts brief and avoid ALL CAPS. While we respect your first amendment rights, we are obligated to our readers to maintain these standards. Thanks for joining the conversation.

    Big Government Is NOT the Answer

    Your tax dollars are being spent on programs that we really don't need.

    I Agree I Disagree ×

    Get Heritage In Your Inbox — FREE!

    Heritage Foundation e-mails keep you updated on the ongoing policy battles in Washington and around the country.