"We can’t just drill our way to lower gas prices.” As recently as two years ago, that’s what the president was saying—with his usual self-assurance—about the nation’s dependence on foreign oil and on oil in general. And he wasn’t the only one. The line was widely echoed on the political left, where the instinctive feeling is that petroleum is poison. It helped that the opposition, led by archvillainess Sarah Palin, was meanwhile chanting, “Drill, baby, drill.”
What more proof was needed?
The conventional wisdom among those who like to believe they never think conventionally was that drilling was futile. It would never produce sufficient quantities of oil to keep up with demand and, anyway, no such amount of oil even existed. The supply of oil was finite, and we had arrived at a point of diminishing returns, called “peak oil.” Henceforth, it would require more and more effort and expense to bring up less and less oil.
No drilling our way out of this impasse! It was time to move on to the next thing and to leave oil and its attend-ant sins, wickedness, and dirtiness behind. It was the dawning of the age of clean energy. And not a minute too soon, either, if we were to avoid planetary catastrophe.
There turned out to be two problems with this vision of oil and its place in the world. First, it was wrong. We could, and did, drill our way to lower gas prices. There was more oil than we thought, and new technology provided ways to get at it. And second, big events like the peaking of oil production take a long time to develop and impose their effects. Politicians, even the big thinkers among them, operate on shorter time spans. These are known as “election cycles.”
We all know, by now, that in the United States there has been a tremendous boom in oil production and, hence, its supply. It has come about as the result of techniques known colloquially as “fracking,” which were not developed through any long-term federal initiative. And the oil was pumped out of ground that was mostly in private hands. It was all a market phenomenon.
This boom resulted in, among other things, direct employment. Much of the job growth in the long and exceedingly slow recovery following the great recession has occurred in oil drilling states like Texas and North Dakota. This increased U.S. oil production has also fed a worldwide increase in supply that has driven the price of gasoline down dramatically—from the neighborhood of $4 a gallon to just over $2. And this, in turn, has led consumers (many, if not most, of whom are also voters) to feel more optimistic about the economy. Gasoline, after all, is the only price that they can follow every single day merely by looking at the signs along the road as they drive. Cheaper gas means more money for other things. And there are those ancillary effects, like the reduced cost of getting goods to market.
Hard to find anything not to like about increased oil production and cheaper gasoline, especially if you are a working man or woman trying to get by in an era of high unemployment and nonexistent wage growth. For you, the American oil boom is something to celebrate.
Not so much, though, if you belong to that segment of the political class that was, not so long ago, confidently saying that we couldn’t “drill our way . . .” You don’t necessarily have to say you were wrong. Nobody expects that. President Obama has, in fact, finessed things rhetorically so that he sounds like he is taking credit for the lower price at the pump and all those new jobs. In politics, there is no shame in being shameless.
But the problems don’t stop there.
The challenge now will be to square a hatred of oil and all its works with the blessings it brings to the average American. The hatred is real and almost embedded in the DNA of the true believers, and it is nothing new. The Texas oilman has been the stock villain in so many bad movies and books that you can see him coming in the opening scene or the first chapter. He will drive a car that is too big and have a wife/mistress who is too blonde, and he will keep her around mostly as an adornment since his real love is guns. Check out Chris Cooper in Syriana, a movie that starred Matt Damon, who went on to top billing in an antifracking number called Promised Land. That movie was partially funded with OPEC money, so it is double good news that it bombed. But the loathsome oilman isn’t going away as a Hollywood stereotype.