Does anybody out there remember the reason given for the establishment of the DEPARTMENT OF ENERGY during the Carter Administration?
The ‘Department of Energy’ was instituted on
Department Of Energy Was To Lessen U.S. Dependence On Foreign Oil.
The department, which has become a huge federal bureaucracy over the last 33 years, came into being largely as a result of the 1973 oil “shortage” that occurred when Arab nations in OPEC, the Organization of Petroleum Exporting Countries, staged an oil “embargo” against the United States.
President Carter underscored his goal of reducing dependence on foreign oil on Aug. 4, 1977, when he signed into law the bill creating the Energy Department.
However, more than three decades latter, a look at the statistics, validates the colossal failure of the Department of Energy.
Imports have risen, not declined. In 1977, the U.S. imported 8,565,000 barrels of oil (net) per day, according to the DOE’s Energy Information Administration (EIA). By 2009, net imports were 9,667,000 barrels per day – over a million more barrels per day. In fact, by 1980, two years after the Energy Department was up and running, 37.3 percent of oil consumedin the U.S. came from foreign sources. By 2009, however, about 51 percent of the petroleum consumed by the United States was importedfrom foreign countries.
Domestic production has declined. The U.S. produced 3 billion barrels of oil in 1977, but by 2009, that was reduced to 1.95 billion, according to the EIA.
Oil consumption in the U.S. is up, not down. In 1977, the U.S.consumed 18.4 million barrels of oil per day. In 2009, we consumed 18.77 million barrels per day, making the U.S. the world’s largest petroleum consumer.
Gasoline usage has grown significantly. In 1977, the U.S. utilized 7.1 million barrels/day of gasoline. In 2009, Americans used 8,997,000 barrels/day, or 378 million gallons/day.
Gasoline prices have continued to rise. In 1979, the average price of gasoline in the U.S. was $0.58 per gallon, according to the federal Bureau of Labor Statistics. Adjusted for inflation, that is the equivalent of $1.85 in 2010 dollars. In 2009, the average price of gasoline in the United States was $2.88 per gallon. During 2008, oil prices reached a record high of $145 a barrel, with gasoline prices of more than $4 per gallon throughout much of the nation.
A huge federal bureaucracy was created. The Department of Energy brought together under one Cabinet secretary more than 50 agencies that dealt with energy, including the Atomic Energy Commission. Upon its creation in 1977, according to official estimates, the new DOE employed a total of 20,000 people. Today, the Department of Energy has 16,000 permanent employees and 100,000 contract employees around the nation.
The agency’s budget, meanwhile, has ballooned from $8.4 billion in Fiscal Year 1980 to $26.5 billion in FY2010.
In an embarrassing moment for the department, the DOE’s inspector general revealed in a 2009 report that the agency spent nearly $300 million per year in energy costs for its 9,000 building around the country. Of that, $76 million was spent on lighting. The IG audit discovered that most DOE buildings were still using “bulb technologies” that were introduced over 40 years ago.
33 YEARS LATER, AND THE BUDGET FOR THIS ALLEGED NECESSARY DEPARTMENT IS AT $24.2 BILLION A YEAR, THEY HAVE 16,000 FEDERAL EMPLOYEES, AND APPROXIMATELY 100,000 CONTRACT EMPLOYEES. This continues to validate the utter incompetence of the (general) government at work/waste.
More Fu$kups By The General Government
Facing new polling showing that 52% of the American people believe that he does not deserve a second term in office, President Barack Obama attempted to reach out to conservatives yesterday by promising $8.33 billion in federal loan guarantees for a pair of nuclear reactors in Georgia. The President told an enthusiastic audience of union officials in Lanham, MD: “Those who have long advocated for nuclear power — including many Republicans — have to recognize that we will not achieve a big boost in nuclear capacity unless we also create a system of incentives to make clean energy profitable.”
In other words, as newspapers across the country have noted this morning, President Obama’s nuclear loan guarantee announcement is really nothing more than a transparently cynical attempt to revive his moribund cap-and-trade/energy tax proposals currently languishing in the Senate. In reality, the $8.3 billion announced yesterday is actually just a first down payment on the $18.5 billion in loan guarantees that were authorized under the Energy Policy Act of 2005. While the administration should be applauded for following the law, loan guarantees are not enough to recreate a robust nuclear industry in the United States. Indeed, an expansion of the program could do much more to stifle the industry’s growth than to help it.
And expanding the nuclear loan guarantee program is exactly the approach the Obama administration plans to pursue. Their 2011 budget provides an additional $36 billion in loan guarantee authority to nuclear energy projects. When added to the $18.5 billion previously authorized under the Energy Policy Act of 2005, the American taxpayer will now be subsidizing $54.5 billion in loans to the nuclear industry. But just as conservatives do not support subsidies for wind, solar or biomass energies, conservatives should not support subsidies for nuclear power, either. Heritage Research Fellow Jack Spencer explains:
Expansive loan guarantee programs, however, are wrought with problems. At a minimum, they create taxpayer liabilities, give recipients preferential treatment and distort capital markets. Further, depending on how they are structured, they can remove incentives to decrease costs, stifle innovation, suppress private-sector financing solutions, perpetuate regulatory inefficiency and encourage government dependence.
President Obama’s bureaucratic/special interest/Washington approach to energy policy is clear: tax and regulate those energies unpopular with his political base while subsidizing and mandating the use of those energies that his supporters favor. This is the same approach the United States tried in the 1970s under President Jimmy Carter, and it was a colossal failure.
What America really needs is a true free market approach to the energy sector, and the nuclear industry is a great place to start. Specifically, the federal government should: limit the loan subsidies of Energy Policy Act of 2005 to existing law; avoid creating a government-dependent nuclear industry; remain committed to scientific conclusion on Yucca Mountain; introduce market principles into nuclear waste management reform; and focus the government on key responsibilities like establishing predictable and effective regulation that will ensure safety and security.
Just as with the health care debate, the White House seems to believe they can win conservative support for their big government policies by buying off selected industries. What the White House continues to fail to realize is that true conservatives are pro-market, not pro-business. Subsidies and mandates are never the answer to an ill-functioning market. A predictable and reliable regulatory framework where firms and consumers can find the best solutions through undistorted price signals is the better approach for energy, health care … and really just about everything.