Why John McCain's offshore oil plan makes no sense

I've been probing the recesses of my brain for some 24 hours now, and I still can't work out quite what John McCain hopes to achieve with his plan to lift the United States' 27-year ban on offshore oil drilling. It's certainly a brave move - not when it comes to his relationship with the big oil companies, which have donated over $1 million to his campaign, but in electoral terms, it seems like a bit of a dice roll.

First of all, it harms his attempts to distance himself from the Bush administration, key to his support among moderates. Only yesterday, as he announced his plan, did he insist that "the next president must be willing to break with the energy policies ... of the current Administration." Yet today, President Bush announced he would be asking Congress to do exactly the same thing.

To be fair, McCain has always had a near impossible task in balancing the need to win over conservative Republicans with maintaining the support among moderates and independents that he has long enjoyed. This latest move could be read as an act of redemption with the Republican leadership, but one has to wonder how they will take his renewed commitment not to open up the Arctic National Wildlife Refuge in Alaska, which with between 4.3 billion and 11.8 billion barrels of oil is one of the US' largest offshore oil reserves. While he might be hoping this will placate environmentalists, the danger is that he will end up pleasing no one.

How the plan will play with voters is uncertain. As Politico notes, McCain is wagering that soaring gas prices have led voters to rethink their long-held opposition to offshore oil exploration. A Rasmussen survey released on Monday supports this view, finding that 67 per cent of US voters are now in favour of offshore drilling. But nationwide polling does not reveal the extent of opposition in the states most affected, such as Florida and California. There, the signs are that the policy remains distinctly unpopular, not only with voters but with Republican politicians.

Says Politico: "The stakes couldn’t be higher: If he is wrong, McCain will have seriously damaged his chances in two key states with thousands of miles of coastline — California and Florida — and where opposition to offshore oil drilling has been unwavering. And he will have undermined some of his closest political allies in those states and others, including potential fall battlegrounds such as Virginia and North Carolina."

The announcement also leaves McCain open to accusations of flip-flopping, coming as it does after years of support for the offshore moratorium. He has been keen to present himself both as a green Republican and a straight-talker who adheres to his principles regardless of pressure from lobbyists or donors - such an about turn risks both reputations.

Says the Huffington Post: "This is a very sad moment. The oil industry has demonstrated that their reach and power enable them, with just the slightest flick of a finger, to take a Presidential candidate whose reason for being was independent, and turn him into a lapdog."

Fred Barnes, executive editor of the Weekly Standard, a conservative opinion magazine, notes a further flaw. McCain's newfound position is essentially a federalist one, claiming that it is up to individual states to decide whether or not to allow offshore drilling. But as Barnes writes, the core of his reasoning in lifting the ban is that dependence on foreign oil is a serious threat to national security.

"A federalist on what he regards as a grave national security threat? That's an odd stance. It seems more like a dodge -- a very un-McCain-like tactic -- than a logical position.... There's an intellectual and political hole in McCain's position, a lack of coherence that hurts both his presidential campaign and that of Republican congressional candidates."

Finally, it leaves his commitment to weaning America off fossil fuels in serious doubt. McCain presented the proposal as a pragmatic, immediate solution which would alleviate the pain of ordinary Americans, while not harming work on alternative sources of energy. On neither part is he right. Lack of infrastructure means that oil production would not start until 2017, and in any case, according to the Bush administration's own advisers, would have negligible effect on fuel prices. The policy would divert attention and funds from alternative energy sources and technologies (some of which, such as cars with greater fuel efficiency, could be ready far sooner) while failing to eradicate US dependence on foreign oil. As McCain himself says, untapped oil reserves are thought to contain 21 billion barrels of oil - including in ANWR - while America imports 13.5 million barrels a day. At that rate, offshore oil drilling would fill the energy gap for just four years.

This is a plan to prolong the US addiction to oil, not end it.

Comments

[Dave]

Why does it not make sense? We need to tap our own resources not only to lower the cost of oil and gas but to lessen our dependence on foreign oil from unstable countries. It's about our economy and national security. Europe and Asia can have the mideast and russian oil. We have plenty of our own plus Canada and S America. This will also bide us time until we develope new technology

[Michael Taylor]

We Americans are tired of you liberials here and abroad telling us what we can and cannot do with our own country. We're done with you enviromentalist wacko's and we're going to drill. We're going to have freedom from states like iran so if we want to go to war with them we can do it. We'll just go and take over the whole middle east if we want. Screw what the rest of the world thinks about us. We no longer care.

[Bob Evans]

Alas, The Times' love affair with the man whose campaign projects him as the New Messiah, makes it impossible for it or their writers to look at McCain with any objectivity.

[Steven Seagal]

Drilling for oil in Alaska is a short term move. It will hinder the rise of gas prices by fulfulling some of our need for oil, and not requiring us to purchase it from foreign countries. In the mean time, Americans will continue to switch to more economical means of transportation, and hopefully our power system can be weaned off of fossil fuels and onto something much cheaper and cleaner, such as nuclear power. Further down the road, someday we will simply rely on the main power grid to power our vehicles; we will only have to focus on cleaning up our electrical generation technology.

[Joseph P. Smith]

Hannah Strange's claims that John McCain's plan to allow states to decide whether or not to allow offshore drilling "makes no sense" is both factually and politically incorrect.

American public opinion has swayed greatly over the cost benefits of allowing offshore drilling as the price of gas has skyrocketed. A Reuters/Zogby poll released today indicates that 60% of Americans support more drilling and oil infrastructure construction.

Ms. Strange's claim that it would take years to bring new oil into production, while factually true, belies the fact that if we do not start drilling now -- that the crises will be far more severe than necessary in the future.

Ms. Strange claims that this policy would "divert attention and funds from alternative energy sources" is factually incorrect. Senator McCain's plan does not call for tax subsidies for new off shore drilling; it calls merely for lifting the federal ban. Actually, substantial government revenues from taxes from the new production could provide much needed funding for support of alternative energy research and production.

Alternative energy research and production is vital and a significant part of Senator McCain's plan. Senator Obama's oft repeated platitude that we "can't drill our way out of our energy crises," while making a great sound bite, is only partially true. Even with a massive effort we can not switch in time to alternative energy sources to avoid even more severe shortages in the years ahead. Drilling offshore will help ease the very painful transition years ahead of us.

[Jim]

As an American voter, I can assure that my ire is not raised by someone suggesting we should do everything possible within our control to mitigate the damage that is being done by $4/gallon gasoline. The argument that it will take time to exploit these resources is vapid. It will also take time to implement alternative energy strategies. We need to do both!
Additionally, with political fortitude, we would be able to exploit the resources much more quickly-laws and regulations can be changed.
What truly makes no economic sense is this article. We have an abundance of carbon based fuels including oil, gas, coal, and oil shale. Our economy is currently dependent on oil. We need a transition plan that uses all available resource not one that precludes alternatives and does the maximum amount of damage.

[coolrepublica]

You lost me at says the Huffington Post.

[El Lepero]

Something must be done to overcome the oil crisis. Offshore drilling has worked well for the UK and other countries. It could be extremely beneficial for the USA to begin before it is too late. While I agree with your analysis regarding the two key states (Florida and California), I believe that the latest increases in fuel costs have now surpassed the prejudice over offshore drilling.

[Eric]

What a ridiculous article. The author, liberal hack that she is, completely ignores the fact that our economy will be oil dependent far into the future as NONE of these new technologies are ready for primetime and won't be for many years. The fact is, had previous administrations done what they should have and promoted domestic drilling, we wouldn't be in this predicament now. Case in point: Bill Clinton and his refusal to allow domestic drilling.

And from the Obamatard, we get more of the same "It won't make a difference/it will take too long" rhetoric that lead us to this point. Had liberals like him done what they should've years ago and stopped answering to their environut communist buddies, we'd still be paying under $2.00 per gallon.

Fact: Liberals and their unholy alliance with environmentalists (aka communists) are what lead us to $4.00/gallon gas. McCain's plan is sound and many Americans agree (Drill here, Drill now, Save money).

[daniel]

of course it makes sense, we drill our own oil and we keep the money here and out of the hands of terrorist. at the same time possibly bringing down the price of gas alittle.

[daniel]

honestly, we just have to have government officials there to monitor the oil companies so they dont make a mess, but over all it will help the economy and price of gas.

[James]

This is a very insightful and accurate article, however it leaves out one major point. The US Government has allready issued drilling permits on 86 million acres. However the oil companies have not utilized these permits. There is no logical reason to allow offshore drilling or in the Artic. considering the potential to destroy very delicate ecological habitats or destroy a $60 billion anual income and millions of jobs. McCain's energy policy is nothing more than pandering for votes . He often calls Obama inexpierienced, naive and ill prepared for POTUS,in fact these are the political attributes of McSame. I believe when the voters take a good look at McCain on the issues and his political flip flopping of his stances, will insure a landslide Democrat win in Nov 08!

Obama 08

[samwardell]

My only thought is that the oil companies have leaned on McCain to say this in order to get some negotiating space with OPEC

[Skwurl Nutz]

Hannah, I cannot believe that you have not figured this out. Offshore drilling is going to happen off the coasts of Florida and California whether you or anyone else likes it or not, The real question is, who is going to do the drilling? Will it be companies regulated by the US government, or will it be the Red Chinese, Cubans, Mexicans, Venezuelans, or whomever?

McCain makes a lot of sense on this. If it is going to happen regardless, it makes sense to ensure that it is done in a way that (a) protects the environment, and (b) reduces costs to American consumers.

[gavin mcintyre]

Hannah deserves many plaudits for this extremely insightful article about the folly of repealing the offshore drilling moratorium. Succinct, accurate, well-researched and well-written, I only wish all the journalism on the Timesonline site could live up to this very high standard. I look forward to reading many more of your articles.

[gavin mcintyre]

having read some of the other comments, I feel I should point out that anyone who thinks drilling offshore or even in ANWR will produce freedom from Middle Eastern oil is completely out of touch with the scale of America's oil (and energy) consumption. It is literally a drop in the ocean.

[Katherine, London]

Eric, what lead you to $4 a gallon was the Iraq war, not the "communist environmentalists". Haven't you noticed the 300 percent increase has been since you invaded Iraq? Yet I'm sure you still agree with that move.

The fact is you can't eradicate your dependence on foreign oil by drilling offshore, as McCain himself said the US has an estimated 21bn barrels in untapped reserves (a third of which is in ANWR, where McCain still opposes drilling). Consumption is 21 million barrels a day in the US and at present 13.5 million barrels a day are imported. So even if you opened up ANWR, and got that 13.5 millon a day from your offshore reserves, it would last 1500 days - just over four years. What will you do then, crawl back to the Saudis?

[Bob]

The US needs to drill now, while we look for alternatives.

I'm tired of relying more and more on Arab nations.

[Katherine, London]

And another thing - some of you leaving comments here have obviously swallowed Cheney's lie about Chinese drilling off the coast of Florida with the help of the Cubans. Cheney took this claim from a columnist whose office has since said that as a columnist he doesn't have to check his facts. Cheney's office has since put out a statement acknowledging that he "misspoke".

[Rick]

Hey, has anyone considered what doing NOTHING will do? Duh. China and India have economies booming at 10%+ GDP EVERY YEAR! That equates to more and more stress on the oil supply chain. If the USA begins drilling and extracting NOW we can head off the economic collapse these oil prices will bring. Does anyone have a brain in liberalville? Have you been to a grocery store in the past month? Well wait until November when $5 diesel, $4 gasoline, ethanol insanity and 1/3 of America's corn crop (flooding in Iowa) doesn't come in. The prices int he grocery stores will cause a backlash that all these idiots in Congress will have a hard time deflecting. Drill here, drill now, pay less! Duh^2

[JOHN CHUCKMAN, TORONTO]

You are exactly right on this, Hannah, it is hard to understand just what McCain hopes to achieve here.

First, today, environmentalism is anything but a left-wing philosophy. There are definitely people in his own party he will alienate.

The oil industry has never enjoyed great public sympathy either, and today as we enter a new era in the cost of petroleum products, I would expect that sympathy is going nowhere but down.

I think too this should be sufficient for any fence-sitters left from Hillary's campaign. Environmental recklessness is hardly a viable alternative to Obama.

As far as your calculation of filling the oil gap, it is even worse than it suggests. Depending on the nature of an oil-bearing structure, oil can only be produced at certain rates, rates far, far slower than the calculation suggests.

I do think this proposal shows us something about McCain's character. He is taking a big crap-shoot, rather than a thoughtful analysis, and this is in keeping with what we know of many of his past behaviors.

This was how George Bush went into Iraq, and the results have been disastrous (including, along with his constant threats against Iran, a significant impact on oil markets).

You may be familiar with Ian Kershaw's analysis of Hitler's personality in his large two-volume biography. Kershaw came down to the view that Hitler was a bet-the-farm gambler who had a winning streak for a while.

Bush's personality is very much like that, and so is John McCain. It is a dangerous personality type to lead a nation which spends more on its military than the rest of the planet combined.

McCain shares another personality trait, a truly frightening temper.

Of course, McCain does not actually have the nomination yet. As you may know, there are rumors on the Internet that he will not be made the candidate at the Republican Convention.

I do not regard these as totally implausible because there has always been a faction in the Republicans which feels about McCain the way most Republicans feel about Hillary Clinton - that is, visceral hatred.

[ian]

Wow. The Times getting attacked for it liberal bais. Don't they know that the Times is owned by Mr Murdoch owner of Fox News that bastion of left leaning media!
What no one seems to realise is that the federal goverment cant force any state to drill for oil off the coast and no state with a coast line will allow it! the polls that say 60% of Americans want drilling is irelevant. Show me the polls that ask only people in states with a coast line. I bet the results are far different.

[f c]

drilling for oil in alaska was considered dangerous as it hastened the rising temperatures in the arctic and the melting of the polar ice leading to global warming and rising sea levels - which translates as more devastating storms like hurricane katrina over usa soil, more floods, worse winters and the possible loss of the gulf stream - but hey some people just wont be told and the greed of the usa in general and the bush family in particular for oil without strings will result in the destruction of the very land that feeds you all . denial will not prevent this and the 21st century history books if there are any will rue the short sightedness of the republican oil barons. Sadly this is also being echoed in south america as swathes of globally vital forest are being cut down to feed the bio fuel market. ironically the money made from fuel will be erased by the natural disasters befalling land and crops. the usa is like a greedy kid in a sweet shop (thats candy store to you guys) and my worry is how bad will it have to get before they realise this ?

[JOHN CHUCKMAN, TORONTO]

Eric,

Your comments are incredibly uninformed, but what would one expect from someone who uses a childish epithet like "Obamatards"?

As a retired chief economist for a large oil company, I can assure you that Obama's characterization of the prospects for offshore drilling is accurate.

There is a lot of money to be made with $140/barrel oil even with a small field, so of course companies want to do it, but there is no chance that offshore drilling in America is going to turn around the developing situation. None.

And things are only likely to become worse. Apart from Bush's ignorant shooting up of some of the world's great centers of production, the rise of China and India and their competition for resources mean the United States is entering a new era altogether.
Lumbering SUVs and grotesque, over-sized pick-up trucks - two and three to a family - each with one passenger are a thing of the past, unless you are rich enough to burn money.

So is the seemingly endless suburban sprawl that has made America an ever-uglier place since WWII. Endless new cheap tracts in the cornfields and deserts are going the way of the Dodo. The costs of transportation and heating and public services are going to end this phenomenon.

So you might stop being senselessly angry and calling names and start thinking about the future new realities.

[Fred]

As soon as the "media" stops giving front page copy to small wacko groups and let some level headed pro-American voices the chance to be heard, childish opinions like these will continue their attempt to dictate policy.

How is the offshore drilling working out in Norway?

How many countries are currently drilling in the Gulf?

I will accept having the oil industry make decisions vs. George Soros and Al Gore any day of the week.