SECURITY AND ECONOMIC PROSPERITY

By Joseph P. Francini

A country needs a strong and intelligent defense strategy to guarantee the security of its citizens, and a prosperous economy to reward them with social programs that substantially improve their standard of living. Unfortunately, today our defense strategy and our economy are both dependent on a commodity that is under the control of others and is rapidly going toward empty: Oil.

It is my firm belief that the so-called clash of civilizations is in reality a fundamental struggle for the control of the fuel that runs the world. Yet, despite all the rhetoric, political calculations, needs of the macho right or dreams of the peacenik left, no one seems to be addressing the realities of our current economic and security panorama.
For decades now we have been in bed with Saudi Arabia, we have put up with tin dictators a la Venezuela's Chavez, rearranged the geography of the southern republics of the old Soviet Union, bought Saddam Hussein's oil and done anything to satisfy our thirst for this commodity. To some, our invasion of Iraq had more to do with this essential need than WMDs, democracy in never-never land or the brutality of a dictator. While high-flying strategists of both parties may disagree on whether this is right or wrong, they do agree that oil runs our lives. It just happens that Arabs also know this and either because of misguided pride, frustration with their own governments, or pure hate for the "ugly American" they make it as difficult as possible for us to get the stuff in a normal commercial environment, and some take our lives and give theirs to keep it away from us. For this absolute necessity we seem to be willing to go to hell and back without ever looking at what's driving us there. Yet, regardless of the price we pay at the pumps we are consuming much more than the world reserves will sustain, and the new energy hunger in China is accelerating the process.

It seems clear that if we are to survive as a super power, and differentiate ourselves from the emerging giant of the far East, sooner or later we will have to create the world's new energy source, whether we like it or not. To be sure, one would not expect a Republican administration to undertake a major program that would put the oil industry out of business since the latter has obviously been a key part of its leadership background. On the other hand, while Senator Kerry has made some noise in the direction of renewable energy, he has so far not advocated a major, super-intense program for achieving energy independence for this country.
It is most interesting to look at the oil industry's own strategies to understand what's going on. At a recent business conference a retired top oil executive reviewed the industry's position as follows: Of the four major concerns, the Dutch Shell Oil Company decided to outrageously inflate their oil reserves to prop up their stock. The British giant BP's (British Petroleum's) assets are already close to 50% in renewable energy areas (their new slogan is "BP; Beyond Petroleum"), and the American Exon/Mobil and Chevron keep socking profits out of the business with no indication of a future direction.

They all seem to know that the oil age is over, but they are certainly not going to stand up and say so. It is time for the people to wake up and to realize that not only is our security tied to energy independence, but that breaking the doomed oil binge will produce a great bonanza of richly paying jobs for our country and return us to the position of world leadership we want and can achieve. Does anyone doubt that if our government decided to spend as much on a "Manhattan Project" for energy independence as we have spent so far in Iraq (around $100 Billion and counting), we would not come up with the next energy source for the world? And don't we understand that in so doing we would be forced to rebuild our entire infrastructure, from the engines that run our cars, trucks, tractors and lawnmowers to the super monsters that run our power generators, egg beaters, shavers and CD players? One heck of an investment and giant gamble to be sure, but one that would create the high paying jobs and the opportunity for exports that will replace those for which our obsolete oil based technology has found much less expensive homes abroad. We are the only industrialized country without a national health insurance system and we are now panicking about the soundness of our Social Security program because the funds that could pay for these programs, as well as hundreds of lives of our soldiers, are being spent to keep oil flowing for just a little longer!

It just might be that no President can be elected or stay in office championing an idea as big as this because the oil industry is powerful enough to thwart any meaningful attempt. Let us hope this is not so, but just in case, is there a Representative or a Senator gutsy enough to start the ball rolling? The basic technology is here and so is the willingness of thousands of Americans to make it a success. The squeezing of the last cent of profit from the last drop of oil will be over very soon… and we will no longer need to fight wars over it.

Joseph Francini is a retired senior executive from the Computer and Payment Systems industries and now a premium wine grape grower in Sonoma County.

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