The Fallacy of Energy Independence

There is a wide-prevailing notion, even among many conservatives, that a great national goal should be energy independence.  Somehow, this is understood to mean that we produce all the energy we need right here in the United States of America.  Or, in other words, that there is never a need to import energy-related fuel (like oil, natural gas, etc.).

There are many problems with this idea.  What about steel, or water, or food?  Surely steel and food are nearly as critical for our survival and economic development as fuel.  Why not become “food independent” or “steel independent?”  This, of course, leads to outright protectionism: an unwillingness to trade with others and insisting instead on higher prices and lower quality. 

This type of protectionism never comes about by the market alone.  The government has to step in and either provide a subsidy (taxpayer money re-routed to a company or industry) or penalize someone from outside the country who tries to sell Americans something (i.e. oil, steel, etc.).  Either one results in consumers paying more for a lower-quality product.  Hence, the problem with a protectionist trade policy.

Another problem with this mentality is that the concern is with national wealth and independence, not individual wealth and independence.  It is true that as individuals, we are to be self-reliant.  But as a nation?

A nation that protects private property rights generates no wealth of its own.  People in that nation are free to become wealthy, to exchange, to economize, and thus become wealthy.  The nation itself consumes wealth through taxation and inflation, but apart from the wealth of individuals, a nation posesses no wealth.  A nation with a policy of “energy independence” must somehow tax individuals to keep and maintain those policies.  Considering the huge costs (tens of billions of dollars a year) associated with subsidies and regulation and research money, how much more money will the government need to take from the taxpayers to ensure an “energy independent” nation?

Third is the looming issue of constitutionality.  Nowhere in the Constitution is energy independence viewed as a legitimate function of any part of the federal government.  Movements utilizing federal government powers toward energy independence are unconstitutional.

Fourth is the flip side of the first reason: what of the countries that would benefit from us purchasing their oil?  Few have sympathy for the Saudi government, but what of an average Saudi who benefits from the trade?  Or the middle-class Brazilian?  Or the poor Nigerian?  By not purchasing their oil voluntarily, we make economic growth and development more difficult for them.  For those who support foreign aid, this makes even less sense: why not just give the money voluntarily by purchasing oil rather than having it confiscated by the government and handed over to their government?

Fifth is the idea that it won’t work.  The U.S. government has tried for decades to work towards energy independence.  It has not worked, and will not work unless the government appropriates much larger amounts of cash, amounts the American people would not support in such a difficult economic time as this.

We should strive to be independent and self-sufficient as families and individuals, as prophets have taught for generations, but to force a nation to be self-sufficient in any area poses large problems that would best be avoided.