Getting Squeezed at the Pump

Last week was quite a week. OPEC voted to cut oil production by 4 percent as refinery fires raged in Texas and Minnesota, all but certainly increasing the spike in gas prices. This bad news for consumers unfolded against an even grimmer backdrop. The country saw the one millionth worker lose unemployment insurance, and though there was a bump in hiring, manufacturing failed to gain jobs for the 45th straight month while the economy as a whole had 2.6 million fewer private sector jobs than three years ago. Overseas, our troops in Iraq faced some of their deadliest days since the end of official hostilities.

It was business as usual for the Bush administration, however, whose policies have delivered the American people turmoil abroad, a dirty environment at home, millions of lost jobs ... and now a predicted $3 per gallon gas for the summer months.

The debate in Washington swirls around the appropriate response to rising gas prices: Should we "jawbone" OPEC to release supply; freeze the re-supply of our strategic petroleum reserves; harmonize regional regulations that result in boutique fuels; or simply attack political opponents for past support of conservation taxes? One point, however, remains clear: The U.S. economy is more vulnerable to supply shocks from OPEC today, because of our growing demand for imported crude oil.

Record high gas prices are just the latest example of the Bush-Cheney failed energy policy that views conservation as a lifestyle choice and rewards corporate friends at the expense of innovation and the public interest. Families have to make tough budget choices and businesses are struggling. News stories are sprouting up across the country about the negative effects of high gas prices. Schools and cities already facing budget shortfalls have to make up for the high cost of gas; small businesses are having a hard time adjusting to the increases in price and delivery costs; the cost of production is rising for most goods; and working Americans who were already having trouble making ends meet are finding it even harder.

With gas prices rising in an election year, the Bush campaign and the Republican majority in Congress are scrambling to pass the blame off to someone else. The Republican leadership is blaming OPEC, environmental regulations and the failure of Congress to pass the President's energy package.

OPEC has indeed voted to cut production and such a cut will strain supply, but it is the Bush administration's lack of vision that has kept America reliant on foreign oil, by failing to move forward on reasonable alternatives like conservation and new technology investment. As oil companies are recording record high profits and reaping new windfalls from the latest price surge, the administration blames environmental regulations for the absence of new refining capacity. At a time of historic profits for the oil industry, we can afford to invest in new capacity that meets high standards of public protection.

The Bush team also wants to blame Congress for not passing the president's energy package. The Bush energy bill, filled with corporate give-aways and breaks for big oil, however, will not answer the gas price crunch. In fact, the energy package puts little to nothing toward new clean energy technologies, and does nothing to reduce our nation's reliance on oil. With 25 percent of global demand for oil, and only 3 percent of reserves, the only strategy that is viable over the long term, is to reduce demand by diversifying our energy supply.

But don't expect a visionary program from this administration. Remember the Freedom CAR initiative? The president promised to "make America less reliant on foreign oil" and Energy Secretary Spencer Abraham said that "gas guzzlers will be a thing of the past." But the Freedom CAR project turned out to be another empty promise, with little new funding, and a response that was wholly inadequate to the magnitude of the task before us.

Sen. Kerry and some in Congress are calling for important short-term measures to ease oil supplies and lessen the burden for working families. Such measures, which include ceasing to fill the Strategic Petroleum Reserve until this crisis is over, are fine policy for the short-term; however, it's time to think beyond this spring and summer's oil crunch.

While workers here at home are facing job insecurity and unemployment, workers in Europe and Japan are busy capturing new markets for hybrid vehicles, solar cells and wind turbines, cleaner fuels and more advanced power plants, and they are building a new generation of manufacturing capacity in the process.

It's time once and for all to curb American dependence on oil. No longer should consumers have their economic well being determined by an oil cartel half a world away. America needs a forward-looking energy strategy that puts people to work rebuilding our domestic economy, makes America less dependent on oil and cleans up the environment.

Bracken Hendricks is executive director of the Apollo Alliance. Skye Perryman is a policy fellow at the Institute for America's Future in Washington, DC. Find out about Apollo Alliance's public campaign to demand leadership for alternatives at the pump.

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