We Need Energy Policy to Defang Russia
Whether it's Russia or the Gulf States, being less reliant on energy from basket-cases gives western countries a freer hand
I won’t pretend to know the right course of action toward Ukraine.
I think the post-Iraq shift toward greater foreign policy modesty in both political parties has generally been a good thing, and I’m glad almost nobody in proximity to power is proposing direct military involvement such as through the imposition of a no-fly zone, which would really mean agreeing to get into an air war with Russia. And I have been impressed by President Biden’s ability to bring big economic pressure to bear on Russia through international coalition-building.
I do have some specific thoughts on what Biden needs to say and do about Ukraine for domestic audiences, though, and they have to do with the economy.
For all the focus on luxury goods carveouts and the initial sense that western sanctions against Russia might be fairly toothless, it’s become clear that they are having real and large effects. So in tonight’s State of the Union Address, I’d like to see the president talk about how we will continue bringing this pressure to bear while minimizing blowback on our own economy, particularly through the energy sector.
To some extent, this builds on the already-existing need for Biden to talk about how he’s working to fight inflation and raise American purchasing power. As I’ve written before, Biden should accelerate visa issuance to bring more workers to the US, which he can do under current legal authority; he should lift Trump-era tariffs; he should look for ill-designed regulations that are restricting supply of needed goods and services, especially in the medical sector. I’m sure Biden will tout the administration’s anti-trust efforts against meatpackers as part of an effort to bring down meat prices.
But the political problem of inflation remains foremost a gasoline price problem, and Biden faces a political imperative to say and do things about the price of gas. The political logic of a gas tax holiday has only strengthened due to the invasion, but it’s also time to bring back talk about “energy independence,” which has two prongs: incentivizing US production of oil and gas so we can become the supplier of the marginal barrel of oil and our gasoline prices are less sensitive to global events; and expanding zero-carbon energy production including nuclear so hydrocarbons are less important to our economy overall.
The last fracking boom was driven by irrational exuberance about future oil prices, and a lot of producers lost their shirts, so despite what some Republicans say, it can’t be recreated simply by deregulating and offering leases more easily. But you could create rational exuberance through loan guarantees or other subsidies to favor domestic production. And you could combine that with BBB-type provisions to expand investment in renewable energy, all of which would reduce our economic exposure to whatever happens in the global energy trade, including in and around Russia.
A similar turn is needed even more urgently in Europe — canceling the certification of Nord Stream 2 is a good start, as is a German plan to build two Liquid Natural Gas terminals so American imports can replace Russian ones, but the continent needs to be opening more nuclear power plants and closing fewer of them while investing even more in renewable energy — but most of that is beyond Biden’s direct purview.
I think people sometimes think it’s crass to talk about momentous foreign policy choices in terms of gas prices. But the whole point of our economic actions against Russia is that, even in an autocratic society, governments are vulnerable to public discontent about economic conditions. In a democratic society like ours, that pressure is even more acute.
Of course, the economic effects of this crisis are going to be much smaller here than in Russia. But the more those effects are felt here, the more the public will be interested in hearing alternative visions for how to approach the Ukraine situation — either visions involving more aggressive military action, or visions that entail accepting a wider sphere of Russian influence in Europe, both of which seem to me like worse paths than the one we’re on now.
To head that off, Biden needs to present an affirmative vision of how we will insulate our economy from trouble in Russia and its neighborhood. As with efforts to de-prioritize the Middle East, that has to involve taking more control over our own energy needs, so our economic forces don’t foreclose the best geopolitical options available to us.
Democrats lack discipline. At least three Democratic members of the House of Representatives will give “response” speeches to the State of the Union: “Squad” member Rashida Tlaib will give a progressive response; Colin Allred will give one on behalf of the Congressional Black Caucus; and moderate Josh Gottheimer will speak along with Republican Brian Fitzpatrick in a forum organized by centrist pressure group No Labels.
Of course, a response is easier than ever to issue in the YouTube age, and it’s always been true that members of both parties will tend to say things about what the president has said in a major speech. But the point of the “response” framing is that the speech exists as a rebuttal to the president — if not disagreeing with the agenda he lays out, then at least seeking different emphasis and/or trying to produce a different political direction for the party and the country than the one Biden is seeking.
These three Democratic members are all political actors with agendas in their own right and it’s their prerogative to seek to advance them. But Democratic voters should be mad at them — the State of the Union is supposed to be an agenda-setting tool for the party, and they’re undermining the president’s use of it. It’s not teamwork, and it’s not helping keep control of the Congress at November’s elections. This is behavior that well functioning parties punish.
A programming note: Tomorrow’s newsletter will contain my reaction to the State of the Union address, and so this week’s Mayonnaise Clinic will be delayed until Friday. (That means you still have time to send in questions.) And I’ll have a new podcast for you, featuring Liz Bruenig and Tim Carney, on Thursday.
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Define energy independent for us. We've been a net exporter of petroleum products since 2011. We've been a net exporter of oil and petroleum products since 2021, and are only marginally a net importer of crude oil.
The "energy independence" talking point seems like hollow (but perhaps good) political sloganeering.
I don't think we need to do much with respect to the frackers. Previous spikes in oil prices have shown how resilient frackers are and how quickly they bring on supply. There are already stories of frackers returning to once abandoned regions. Biden should just take credit for what's going to happen (like eventual lowering inflation) but not stress too much about financing these efforts IMO.
One quibble: the State of the Union address is meant to be an agenda setter for the country, not the party. That it has become so partisan is another indication of how are politics have deteriorated into doctrinaire performance art instead of thoughtful and engaged governance.
To the end of increasing our energy independence as we transition to a lower/zero carbon economy, if there is to be a huge federal program of support for sustainable generation, why not commit several billion to the installation of PV and wind turbine systems on houses and apartment buildings as part of distributed mini-grids that would reduce the need for large scale construction projects that support the legacy power industry more than they do anything else?