October 27, 2011
We all know that the Arabs control $16
billion in this country. They own a chunk of Fifth Avenue, 20 downtown pieces of Boston, a part of the Port
of New Orleans, an industrial park in Salt Lake City. They own
big hunks of the Atlanta Hilton, the Arizona
Land and Cattle Company, the Security National Bank in California,
the Bank of the Commonwealth in Detroit.
They control Aramco, so that puts them into Exxon, Texaco, and Mobil Oil. They’re
all over -- New Jersey, Louisville,
St. Louis, Missouri. … Right now, the Arabs have
screwed us out of enough American dollars to come right back and with our own
money, buy General Motors, IBM, ITT, AT&T, Dupont, U.S.
Steel, and 20 other American companies. Hell, they already own half of England!
So listen to me. Listen to me, goddammit! The Arabs are simply buying us.
There’s only one thing that can stop them. You! You!
- Howard Beale
(Peter Finch), “Network”
It’s been 35 years since “the mad prophet of the airwaves”
warned his countrymen about Arabs’ plot to seize the Republic with their petrobillions.
Howard Beale’s admonition hasn’t held up well.
OPEC’s bearded villains don’t
own General Motors. Nor do they hold
anything close to a majority of the national debt. And although energy-security
hysterics choose to remain clueless, in 2010, OPEC’s Middle East members supplied
than 40 percent of America’s crude imports.
Foreigners still ship plenty of petroleum to the U.S.,
but increasingly, they aren’t Arabs. Since 2000, Canada’s exports have risen by 40
percent. The first decade of the 21st century saw the combined contribution from
Russia, Kazakhstan, and Azerbaijan grow by 62 percent. Brazil
was the period’s star -- its sales soared fivefold. Imports from Cameroon and Colombia are growing. India and Indonesia, too.
Dozens of non-OPEC nations now supply crude to the American
market. Meanwhile, the cartel faces a bleak future. Its production is slipping,
a phenomenon driven by xenophobic nationalization. By excluding nondomestic
investment, technology, and know-how, OPEC’s government-run oil “companies” -- e.g.,
Saudi Aramco, National Iranian Oil Company, Kuwait Petroleum Corporation, Abu
Dhabi National Oil Company -- are pushing themselves toward irrelevance.
Reliance on petroleum tapped abroad hit its zenith in 2005, when
a hefty 60 percent came from beyond our borders. But in a May
bulletin, the U.S. Energy Information Administration (EIA) wrote that
“dependence on imported oil has dramatically declined … . By the broadest
measure, [it] fell below the 50 percent mark last year for the first time since
An improved method to calculate imports and exports explained
part of the dependency decline. Boosted production and lower consumption were additional
factors. Awash in cash, environmental extremists employ legislation and
lawsuits to erect obstacles, but American drillers are pressing ahead, and
enjoying success. The EIA reported that output “increased by an estimated
334,000 [barrels per day] between 2005 and 2010, further eroding the need for
imported crude oil.” It gets most of its press when used to extract natural
gas, but hydraulic
fracturing also accesses petroleum. Better imaging techniques make finding
profitable deposits easier. Enhanced oil recovery,
a process that often makes use of carbon dioxide, boosts wells’ yields.
With the price of gasoline soaring in recent years, Americans, constantly slandered
by elites as “addicted to oil,” have cut back. Consumption
has fallen every year since 2007’s record demand. Telecommuting, hybrids, and
natural-gas vehicles are growing in popularity. Companies’ preference for
building workplaces in the suburbs, where most of their employees live, leads
to fuel savings. Households that switch from expensive heating oil to cheap
natural gas also help. Measured by either population or economic output, the
trend is toward greater petroleum efficiency.
So while Howard Beale had some
interesting things to say about television’s twisted depiction of reality,
he wasn’t much of an energy seer. It’s an error worth keeping in mind as other
prognosticators peddle the next “inevitable” apocalypse. A decade after Beale, The
Land of the Rising Sun was destined to “overtake” (whatever that means) America.
But not much is written about that meme anymore -- probably because Japan’s
economy is pathetically stagnant and its trade surplus
with the United States plummeted by an inflation-adjusted 45 percent between
1986 and 2010.
have to do anything to stop the Arabs from “buying us.” The failures of nationalized
oil firms, the profit motive, a well-functioning global market for crude, impressive
new technology, and changing consumer habits did the trick.
The world is
far more complex than energy alarmists understand.
D. Dowd Muska (www.dowdmuska.com) writes about government, economics, and technology. Follow him on Twitter @dowdmuska.
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