When former Texas governor Rick Perry ran for president in 2012, he promised he'd abolish the U.S. Department of Energy (at least when he could remember it). Liberals wrote this off as typical conservative stupidity.
Why would anyone want to abolish the DOE? According to one liberal commentator, it was because the department "was established during Jimmy Carter's administration and it perhaps sounds like it might have something to do with solar panels."
Jimmy Carter created it, all right, but solar panels were only a symptom of the real problem. The DOE was conceived in dark and pessimistic beliefs and forecasts that have proven totally wrong. As Obama might say, the DOE is on the wrong side of history. As it stands the department needs to either be rethought or retired.
The original legislation justified a Department of Energy because, 1) we were rapidly running out of fossil fuels, especially oil and natural gas; 2) as a consequence of this we were becoming increasingly dependent on energy imports — dependence that made us vulnerable to embargoes and political blackmail; and 3) so therefore we needed "a strong national [read government-directed] energy program."
Even before fracking proved the dire warnings to be utterly wrong, we had for the most part taken care of our energy dependence. We significantly reduced any possible vulnerability to an embargo by diversifying our suppliers; over sixty countries were supplying us with oil in the 2000s. Our No. 1 supplier? Canada. Mexico also has been in the top five. This information makes "foreign oil," a bit less scary, no?
Then again the fear of oil cartels was always overblown; from 1980 until the mid-2000s, oil importers like the U.S. thrived while the exporters were the ones who suffered because of excessive dependence on oil revenues.
In the meantime, we've endured wasteful, panicked policies such as massive subsidies for the wind and solar power, and electric cars. Worst of all, Congress has saddled consumers with ethanol subsidies and mandates. These boondoggles cost us billions of dollars, and none of them are commercially viable in their own right. In fact, the DOE has produced no dramatic breakthroughs in energy technology despite 40 years of trying (and failing) to pick winners.
The only energy breakthrough of the last four decades has been fracking, and its only connection to government was a tax break for developing hard-to-get oil resources. This was an exemption from the ludicrous windfall profits tax of 1980, which was repealed in 1988 when windfall profits (whatever they were supposed to be) equaled zero for three years running.
With the fears of foreign energy or energy shortages waning in 2009,President Obama sought to gin up a sense of crisis over climate change. Yet Congress never passed the 1400-page Waxman-Markey climate bill of 2009. Even though the president took every opportunity to tell us we've frying the planet by burning fossil fuels, there has been no sense of crisis among the public.
Just as many experts began to downplay the catastrophe rhetoric, the president did not, and finally, exasperated with Congress, he tried to impose energy legislation through the DOE and the EPA with, as he said, "a pen and ... a phone." The Trump administration can undo or minimize much of the DOE's Obama-era legislating on energy.
Many would argue that the DOE does some good, even essential work. It watches over nuclear waste, for example. And there is some useful research and development going on at many of the DOE laboratories.
But any valuable work done by the DOE could be carved off into independent agencies just as the Federal Energy Regulatory Commission (FERC) was created by Congress so that the DOE would not have control over natural gas prices. Nuclear power concerns should be part of the Nuclear Regulatory Commission (NRC), and the labs could be placed under an independent agency such as the Energy Research and Development Agency (ERDA) that existed from 1974 until it was folded into the DOE three years later.
Overall, the rationale for the DOE needs to be rethought and restated in ways that make it sensible for the 21st century — where fracking and enhanced oil recovery have made us confident of long-term fossil fuel supplies, and human-caused climate change, though a problem, does not seem to be generating a crisis or catastrophe.
If the Trump administration can't articulate a good reason for the continued existence of the DOE, then we should follow Gov. Perry's inclination and abolish it.
Peter Z. Grossman is the author of "U.S. Energy Policy and the Pursuit of Failure" and is a professor of economics at Butler University.
