In a recent address before the National Press Club in Washington, Energy Secretary Steven Chu said the United States is in clear danger of losing the “energy race” to China.
“For centuries, America has led the world in innovation. Today, that leadership is at risk,” he added. America, he went on, “still has the opportunity to lead the world in a new industrial revolution. But time is running out.” His audience sufficiently alarmed, Chu made his pitch: “Federal support of scientific R&D is critical to our economic competitiveness.”1
And there we have it. In the world of Secretary Chu, the only thing that can save us from being steamrolled by the Chinese is the lavishing of taxpayer dollars on people and projects carefully selected by the powers-that-be in Washington. Specifically, Chu is desperate to protect his cherished Energy Innovation Hubs (regional collaborative efforts involving academia, the government, and the private sector) and similar green-energy programs from the ravages of congressional budget cutters next year.
In truth, Secretary Chu’s Energy Department has been awash in cash these past two years, including a whopping $36 billion in stimulus funds for grants and low-interest loans to jump-start new green technologies and energy-efficiency initiatives. Unable to find investors in the private sector willing to fund their high-risk projects, manufacturers of exotic new batteries and spiffy solar panels have found a generous benefactor in the Obama administration. For his part, Secretary Chu regularly scampers around the country for one-day meetings with companies and institutes eager to get their mitts on the research money their debt-ridden government is offering.2
Chu is right in warning that the Chinese are eating our lunch when it comes to energy, but it’s the Obama administration that is spoon-feeding them. While the administration dumps billions into all manner of commercially dubious renewable energy projects, Beijing, according to Sen. James Inhofe (R-Oklahoma.) “is launching a global energy revolution, the basic makeup of which is consuming vast quantities of oil, gas, and uranium the world over, including from dangerous, anti-American regimes.”
Inhofe is the ranking Republican on the Senate Environment and Public Works Committee, and his staff has just released an eye-opening report, “The Real Story Behind China’s Energy Policy and What America Can Learn from It.” Far from betting the ranch on solar panels and wind mills, the Chinese derive 87 percent of their energy from fossil fuels, the report point out. In fact, wind and solar power account for only 0.6 percent of the Middle Kingdom’s energy. “Surely, China recognizes that wind and solar power contribute to energy security, and undoubtedly they do, but when considered against the backdrop of China’s fossil fuel use, they are, as in the United States, a sideshow,” noted Inhofe.3
The cash-rich Chinese are on a roll, cutting oil deals with Iraq, Russia, Brazil, Kazakhstan, Myanmar, and Cuba. Meanwhile, the Obama administration, in the name of promoting clean energy and combating climate change, is pursuing unilateral economic disarmament on an unprecedented scale. It erects barriers to the exploitation of the nation’s vast stores of oil and natural gas found under federal lands in the West. A 2008 Department of Interior report found that fully 62 percent of the estimated 31 billion barrels of oil beneath federal lands is off-limits to leasing.4 And the White House’s recent announcement of a hands-off policy for oil and gas drilling off the Atlantic and Pacific coasts and the eastern Gulf of Mexico could only be music to the ears to those who do not wish America well.
Secretary Chu, with his Nobel Prize in physics, is no doubt a brilliant academic, but the man doesn’t have an entrepreneurial bone in his body. A creature of government all his professional life, Chu seems blissfully unaware that breakthroughs in commercially viable technologies are largely the stuff of guys in the garage who never gave a thought to asking Washington for a handout. The Industrial Revolution that began in England in the 18th Century wasn’t spawned by a government grant, a taxpayer-backed, low-interest loan, or by the king suddenly showing a deft hand in picking winners and losers. Our next Industrial Revolution, green or otherwise, will come to us courtesy of obscure but creative people who will ask questions that would never occur to a director of a government lab or a grant officer at a federal agency.
Yes, the Chinese are taking care of business, and they are doing so at a level of strategic thinking that is completely absent from the Obama administration. Beijing’s goal is to have at its disposal every strategic mineral and every reliable and plentiful source of energy. Washington is in danger of losing the “energy race” to China, but that’s because the administration is running in the wrong direction.
Bonner R. Cohen, Ph.D., is a senior fellow at the National Center for Public Policy Research in Washington, D.C.
1 Katherine Ling, “Chu Brandishes Specter of China to Urge R&D Funding,” E&ENews PM, Nov. 29, 2010. http://www.eenews.net/eenewspm/2010/11/29/archive/1?terms=Chu+Brandishes+Specter+of+China+to+Urge+R%26D+Funding
2 Steven Mufson, “For Energy Chief, Race is on to Find Alternatives Fuels,” Washington Post, Nov. 12, 2010, p. G1.
3 Chris Neefus, “Inhofe: Playing up China’s Green Energy is ‘Pretext for Imposing that Statist Vision on American Economy,'” CNSNEWS.COM, Dec. 8, 2010. http://www.cnsnews.com/news/article/sen-inhofe-playing-china-s-green-energy.
4 Ben Lieberman, “Louisiana Needs Increased Energy Production, Not Increased Energy Taxes.” http://www.pelicaninstitute.org/main/latest.php?latest_id=104.