n one year, gas prices at the pump have gone from 92 cents a gallon to over $1.50. In California, gas has hit $2. Home heating oil has also reached $2 a gallon, double the price of a year ago.
Now, all of us who commute, or ferry kids to ball games, or heat our homes with oil, are burned by this price explosion. But those hit hardest are those who depend on gas -- to live: The college kid who delivers pizzas in his own car to pay the tuition. The men whose slogan is, "If you bought it, we brought it" -- the truckers who gathered their rigs in outraged protest in D.C., New Jersey and Rhode Island; these folks are going out of business. The independent taxi drivers who put in twelve hours a day. They're facing a collapse in take-home pay that could force their families onto food stamps. These are the Americans who are paying the price -- of their own government's past neglect and present cowardice.
Friends, this price explosion is not the result of free market forces. It is the work of a global price-rigging conspiracy, by oil-exporting nations, to hold oil off the market, to force prices to the sky, to loot America. When the price of a barrel of oil jumps from $10 to $30, that robs America of $77 billion a year -- because we now import 10.5 million barrels of oil a day.
Friends, this is the dark side of globalization. This is the hidden price of "interdependence." The more we rely on foreign nations for the vital necessities of our national life, the greater America's vulnerability to the greed and animosity of regimes that, for whatever reason, resent or despise the United States, or simply act out of their own selfish interests.
Make no mistake: The OPEC cartel of oil-producing nations has used its control of marginal supply to launch a trade war, a war of economic aggression, to enrich themselves at our expense. And the response of the world's last superpower has been pathetic. Congress heroically enacted an "Oil Price Reduction Act" that calls for a "report." They must be quaking in the Gulf. As for Mr. Clinton, he sent Energy Secretary Bill Richardson, whose vice presidential ambitions are sinking as fast as gas prices are soaring -- to beg the price-fixers to, please, pump more oil to help poor old Uncle Sam.
And who are the regimes that have colluded to loot us? They are nations we have bailed out, defended, and rescued.
Call the roll: In 1993 the U.S. signed a NAFTA free trade deal with Mexico. A year later, when Mexico was collapsing in a peso crisis, we rescued that regime with $50 billion. America's reward: President Zedillo and oil minister Luis Tellez colluded with OPEC to rob the Yankees who were dumb enough to bail them out.
Among the major co-conspirators are Kuwait and Saudi Arabia. Kuwait was rescued by our Army of Desert Storm; the Saudis are now defended by U.S. troops, ships, and planes. Without America's defense, Kuwait would be the 19th province of Iraq and the king of Saudi Arabia might be a neighbor of mine at his embassy in McLean.
Other collaborators include Norway, a NATO ally; Indonesia, beneficiary of a $40 billion U.S.-led bailout; Nigeria, recipient of $50 million in new U.S. foreign aid; and Ecuador, whose regime we lately saved from default with a $2 billion IMF loan.
When Andrew Jackson learned long ago that the mighty Bank of the United States was out to crush him, he confided to a friend, "It is trying to kill me; but I will kill it." That is the stance to take toward OPEC. But Bill Clinton is no Andy Jackson. Indeed, he doesn't know a national asset from a national antagonist; so, he wages war on Microsoft for anti-trust violations, while sending poor Richardson to propitiate that den of thieves called OPEC.
As for Al Gore, if he is intellectually consistent, he must be rejoicing. For, in "Earth in the Balance," Gore identifies the internal combustion engine as the greatest single threat to our civilization. Such kookery led Mr. Gore to bring home from Kyoto, Japan, a treaty on global warming under which the U.S. must cut fossil fuel consumption by 30% in ten years, but China cuts nothing. As for Governor Bush, his answer to every suggestion about protecting U.S. national economic interests is a rote recital of the free trade mantra he learned at the knee of his economics guru Lawrence Lindsay.
Let's be clear: There is more at stake here than higher heating bills or enraged SUV drivers. Middle East nations call oil the "blood of the earth." No resource is more critical to our industry, security, and freedom. If America fails to develop a national policy of energy independence, we will one day be at the mercy of this OPEC cartel, which has shown us its lovely face in Vienna.
The situation grows more ominous each decade. In the early 1970s, when we depended on foreign suppliers for 36% of our oil, an Arab boycott crippled our economy. In 1979, another boycott helped to drive us deep into recession. Since then, we've had a generation to develop our resources; yet, we've become even more dependent. Last year, the U.S. imported 54% of its oil consumption. In 15 years, at present trends, we will be 65% dependent on foreign oil. Then, America's boast of being the world's last superpower will ring hollow; and we shall truly be -- a nation at risk.
We must stop this descent into globalist dependency, and let the national interest become paramount in our thinking. How? Let me suggest the beginnings of a national energy policy:
First, let us break down the barriers that wall off our own energy reserves here at home. The Energy Information Administration estimates that 152 billion barrels of "recoverable oil" go untapped in the U.S, plus 61 trillion cubic feet of natural gas. Let's open up the Arctic National Wildlife Refuge to drilling. The Interior Department estimates that new oil from Alaska could replace all the oil we import from Saudi Arabia. Congress voted in 1995 to open the ANWR. Mr. Clinton -- a silent accomplice of OPEC -- vetoed it. I will open the ANWR and clear the way for exploration on the Outer Continental Shelf, where half our available resources have been put off limits.
Second, we must set a floor under the price of oil, so that when OPEC conspires to flood the world to kill competition, an import fee kicks in to support domestic prices, to keep U.S. wells producing and the price of our natural gas competitive.
Over the last 15 years, U.S. oil production has fallen by 2.7 million barrels a day. In 1981 we had 4,500 active rotary drilling rigs; today we have only 760. Domestic producers will not risk huge exploration costs, if OPEC retains the ability to drive prices down to $8 a barrel. Any revenue from such a fee should be used to cut taxes on gas and heating oil, and as tax incentives for new production.
Third, we must focus on alternative fuels. Today, while France generates 76% of its electricity with nuclear power; Sweden, 46%, and South Korea, 41%, the U.S. has not ordered a new nuclear power plant since Three Mile Island. We invented nuclear power. Why let others exploit its potential, while we are too frightened to do so?
And we need to discover new sources abroad. Last fall, Mr. Clinton gloated over an agreement to transport Caspian Sea oil, via a new pipeline, from Azerbaijan through Georgia to Turkey. The White House claimed credit for a diplomatic coup -- because the pipeline bypassed Russia and Iran. This was an act of folly. We have given Russia and Iran reasons to sabotage our project; and that $3 billion pipeline will pass through two countries, Azerbaijan and Georgia, riven by war, whose regimes are vulnerable at any moment to an assassin's bullet. Rather than make U.S. energy supplies hostage to transient politicians, we should support a multiplicity of pipelines from the Gulf, the Caspian Sea, and Central Asia, and negotiate long-term contracts with the regional gatekeepers.
Finally, we should play hardball with those who play hardball with us: Tell Saudi Arabia, Kuwait, and the sheikdoms of the Gulf that if they do not begin to pump enough oil to cut the price to $20 a barrel by fall, they can look elsewhere the next time war clouds descend over the Gulf.
To show we mean business, the U.S. should negotiate an end to sanctions on Iran and Iraq, sell both all the oil-drilling equipment they wish to buy, and let them sell all the oil they want on the world market. None of these Gulf regimes is worth another war. Let their avarice and greed work for America. If our erstwhile friends can collude with the regimes against whom we defend them, perhaps it is time to treat them all alike. Lifting sanctions on Iraq would also end an economic war, the primary casualties of which have been that country's innocent, elderly, sick, and young.
As for Mexico, which refuses to ship us the oil we need, we should put a $1000 tariff on all cars assembled there; and suspend all foreign aid, World Bank and IMF loans to any regime that supports the OPEC cartel's looting of America.
Finally, to bring about a quick drop in prices, we should begin to pump out of the Strategic Petroleum Reserve, and suspend for six months the 18 cents a gallon federal gas tax. We can restock the reserve with cheaper oil as the price falls. These policies can not only bring down gas prices; in the long term, they can end America's vulnerability to OPEC greed.
Among the reasons Washington, Madison, and Hamilton went to Philadelphia was to create an economic system to end America's dependence on foreign regimes for the necessities of life. They were economic nationalists who put America's economic security first. In our fool's embrace of globalism, we betray that heritage and imperil our future. Let us rather renew the commitment of John Adam's deathbed toast: "Independence, forever!"
