The Truth About the President's Energy Strategy—A Blueprint for Higher Prices

March 13, 2012

On the same day that The Washington Post reported that nearly two thirds of Americans disapprove of the president's handling of rising gas prices, the White House blasted out a progress report on the president's so-called "Blueprint for a Secure Energy Future," claiming credit for a number of successes in improving America's energy security. But the president's effort to take credit ignores the facts. Despite his "all-of-the-above" rhetoric, the president's energy policies have sought to reduce domestic energy production and failed to bring Americans relief at the pump. As Louisiana Governor Bobby Jindal wrote in The Wall Street Journal, "This administration willfully ignores rational choices that would lower energy prices and reduce U.S. reliance on foreign energy sources."

Below is a sampling where the White House's rhetoric doesn't match up with the facts:

White House Claim: "Domestic oil production has increased every year President Obama has been in office."

Truth: Domestic oil production is up in spite of President Obama's obstructionist policies. The president likes to boast that American oil production has risen, but that is due to production increases on private and state lands. Production on federally controlled lands actually declined from 2010 to 2011 by 14 percent.

White House Claim: "Since 2009, the United States has been the world's leading producer of natural gas. In 2011, U.S. natural gas production easily eclipsed the previous all-time production record set in 1973."

Truth: Increased natural gas production can be largely attributed to advances in new technologies that have allowed companies to extract gas from shale rock, not federal policies. In fact, natural gas production has been so successful largely because the federal government has stayed out of the way. Similar to oil production, natural gas production has mostly taken place on state and private lands where the federal government plays little to no role....

White House Claim: "Overall, oil imports have been falling since 2005, and net imports as a share of total consumption declined from 57 percent in 2008 to 45 percent in 2011 - the lowest level since 1995."

Truth: Oil imports have declined primarily because the weak economy has suppressed demand for imports. The economy requires less gasoline when fewer people have jobs to drive to everyday. Increased domestic production from private and state-owned lands has helped, but the federal government has failed to do the same on lands and waters it controls. To meet our long-term needs and reduce reliance on oil from unstable and unfriendly countries, we need to increase domestic production on federal lands and approve the Keystone XL pipeline project to allow more Canadian oil to reach the U.S.

White House Claim: "…DOI has continued to approve plans and permits for exploration activities throughout the Gulf of Mexico."

Truth: The administration's moratorium in the Gulf has sent rigs and thousands of jobs permanently overseas. While the moratorium was temporary, its effects are permanently damaging to our energy security. Likewise, the administration's current sluggish pace of offshore permitting in the Gulf is denying our ability to break free from unstable sources of oil.

White House Claim: "…in February 2012, President Obama welcomed the news that TransCanada plans to build a pipeline to bring crude oil from Cushing, Oklahoma, to refineries along the Gulf of Mexico… The Administration has also approved dozens of new pipelines to move oil and gas, including a pipeline known as the Alberta Clipper, which brings oil from Alberta, Canada, to Superior, Wisconsin."

Truth: The president may take credit for approving oil pipelines but he rejected the one Americans are clamoring for. President Obama chose not to approve the permit needed for construction of the Keystone XL Pipeline, which, if constructed, would deliver much-needed secure and stable Canadian oil supplies to U.S. refineries. Most pipelines—including TransCanada's southern leg of Keystone—do not require approval from the president since they do not cross international boundaries.

White House Claim: "The Obama Administration has put in place the first-ever fuel economy standards for heavy-duty trucks, and proposed the toughest fuel economy standards for passenger vehicles in U.S. history, requiring an average performance equivalent of 54.5 miles per gallon by 2025. Over time, these standards will save consumers more than $8,000 in fuel costs."

Truth: The new fuel economy standards provide no relief until you buy a new car or truck, and are not a substitute for taking steps to reduce gas prices. Further, the higher sticker price resulting from these rules - up to $1,000 by 2016 and $3,000 by 2025 according to EPA, and higher according to outside estimates - raise questions about how many consumers will benefit from them. Indeed, the cost of these rules will force many prospective car buyers to either put off purchasing a new vehicle or to buy a used car instead of a new one....

White House Claim: "Through loan programs, DOE has supported nearly 40 clean energy projects that are expected to employ more than 60,000 Americans, generate enough clean electricity to power nearly 3 million homes and displace nearly 300 million gallons of gasoline annually."

Truth: The White House failed to take credit for its most famous loan guarantee—Solyndra. Despite clear warning signs, the Department of Energy gave away $535 million to a solar firm that went belly-up. At the request of the White House, former Treasury official Herb Allison audited DOE's loan guarantee portfolio and found the government can expect to lose at least... $3 billion.

White House Claim: "The Administration is reviewing the BRC's recommendations carefully, and taking steps within DOE's existing authorities to lay the groundwork for a sustainable, consent-based nuclear waste strategy."

Truth: One of the first acts of business for the president was to shutter Yucca Mountain, making good on a campaign promise. With complete disregard for the law, the administration closed the nation's only long-term nuclear waste disposal site, throwing away the decades of work and over $15 billion dollars in taxpayer dollars and ratepayer fees that have been spent on the repository.