The Point Of A Limbo Stick Is That Eventually Everyone Falls Down And Looks Dumb

October 23rd, 2008 by owenam

At the end of a nice NYT Magazine article on the causes and effects of oil pricing, Roger Lowenstein wisely points out that what should worry us is not how high oil can go, but how low. The higher the price, the more urgent it becomes to develop workable alternative energy technologies. If the price continues to drop, we’ll lose the momentum we’ve gained over the past year.

What the country doesn’t want is to remain dependent only on oil — to lose the urgency to develop alternatives. It happened once before. After the gas lines of the ’70s, Jimmy Carter declared that solving our energy problems was the moral equivalent of war. Then, in the 1980s, Americans forgot.

…because oil prices plummeted and Joe “The Plumber” Sixpack went back to worrying about the Russians. There’s no way Congress is going to stay interested in solving the problem if voters aren’t yelling about it. And anyway, even if they do try to play the hero by identifying and subsidizing development of the next big thing, they are not going to get it right:

… even if politicians act with the purest of motives, there are simply too many possibilities … (fuel cells, nickel-hydride or lithium-ion batteries, natural gas, biofuel from wood chips and oil itself) to know which will prove the most feasible.

Sure, they could (and, I suspect I would find, are) just try to fund all the possibilities, but part of the game is that we need to be able to quickly jettison the ideas that aren’t panning out, and expand our investment in those that are. Good luck getting that to happen without having to wait a few election cycles. No, this sounds like a job for the private sector. The trick is to make alternative energy technologies a good investment — and keep them that way — so that America’s captains of industry will naturally join the hunt and Congress can get back to filming the next season of CSPAN. To do this, Lowenstein suggests

… [dusting] off an idea that Gerald Ford once proposed: a tax on oil. Ideally, it would kick in only if the price fell back to, say, $70 a barrel. The beauty of this tax is that, very likely, no one would have to pay it. The tax would merely serve as a floor — a new lower bound.

I met an RV-driving Texan campground host in Glacier National Park who proposed the same thing two months ago, when gas was still $4/gallon. I should have asked her to run for Congress. She probably knows how to field-dress a moose.