Mitt Romney has slammed Barack Obama's administration for its handling of energy since day one of his presidential campaign. On Thursday, the Romney team released its own plan, promising energy independence by the end of this decade. That plan contains important elements that Obama would benefit from adopting as his own. But ultimately, the Romney plan overpromises on results while ignoring many of the biggest energy problems the United States faces.
Republicans have frequently criticized Obama for his admittedly hodgepodge energy strategy, a charge repeated in the new plan. The Romney plan solves that problem by substituting a narrow fossil-fuel production strategy for a genuinely comprehensive plan. Much in that fossil-fuel strategy is reasonable. Romney would shift more power to the states by allowing them to approve drilling on their lands and near their coasts without federal intervention. He would streamline environmental reviews, in part through clear deadlines, and in part by handing more control to the states. If that were accompanied by more federal capacity to process permit applications -- something that Romney has decidedly not promised to do -- the result could be a win-win for business and the environment. Romney also promises to streamline cross-border permitting and expand North American regulatory cooperation, steps that could benefit clean energy and fossil fuels alike.
But the Romney plan promises far too much as a result of these policy shifts. It extensively cites recent Citigroup research to back up its claims its contention that North America could eliminate all imports by 2020 as well as to support its claims about jobs and economic growth. Yet that study is not just about oil supplies -- it assumes that the United States will continue with strict fuel economy standards that lower its oil demand. Romney, though, has argued that such standards are the wrong way to go, and proposes no alternative scheme in his energy plan.
The plan also promises "freedom from dependence on foreign energy supplies." As I explained in a Foreign Policy essay earlier this year, achieving energy independence through expanded supplies is a pipe dream. So long as the United States is part of a global market, domestic crude prices will rise in the face of turmoil overseas, putting the U.S. economy at risk and constraining U.S. freedom of action. The only way to break that link without clashing U.S. oil consumption is to bar energy exports from the United States altogether -- something that Romney, quite correctly, has explicitly opposed. Indeed, one study that the Romney plan cites extensively to back its energy independence claims says the that self-sufficiency "will neither insulate the country from the rest of the global oil market, nor diminish the critical importance of the Middle East to its foreign policy."
Romney also promises cheaper oil as a result of his plan. More oil production would do that, though how much lower remains an open question. The Romney plan pushes this claim further by emphasizing that Canadian and Mexican oil sell at a discount to OPEC crude. Yet the Romney plan would (rightly) permit pipeline infrastructure that would raise the price of Canadian oil by giving Canadian producers full access to the world market. Mexican crude, meanwhile, sells at a small discount because it is of relatively low quality and thus requires more expensive equipment to refine.
What about the 3.6 million jobs the Romney plan promises? Many of those are real: additional oil production would spur job growth at a time when the U.S. economy is hurting. Many others, though, result from oil and gas development that would likely happen during a second Obama term as well. And, according to the Citigroup study that is the source of the Romney figure, 785,000 of the jobs would come from the improved fuel economy that Romney would no longer pursue.
The biggest problem with the plan, though, is not what it does or promises -- it's what it leaves out. The United States remains vulnerable to global oil markets and constrained in its foreign policy because of its massive consumption of oil from all sources. Yet the Romney energy strategy does nothing to address this Achilles heel aside from promising to continue support for basic research.
The plan is also mum on the other grave energy challenge the country faces: climate change. Reasonable people can differ on how much emphasis to place on climate change in U.S. energy policy, but it isn't reasonable to ignore it entirely. The Romney plan does not mention climate at all. To be certain, surging production of natural gas can help curb U.S. emissions, but it will come nowhere close to delivering the reductions the country needs alone. Romney likes to quip that people "do not call [climate change] America warming, they call it global warming," his way of saying that climate change can't be confronted unilaterally. But his plan does not include a multilateral strategy either -- something that other Republicans could easily have helped him craft.
There are many good reasons to embrace rising U.S. oil and gas production and to reform the way government regulates their development. The Romney strategy for fossil-fuel development has some reasonable proposals on both fronts. But when it comes to comprehensively exploiting energy opportunities and confronting energy-related risks, the strategy falls woefully short.