United States' Oil Dependence Threatens National Security
By Senator Richard G. Lugar
As submitted to the South Bend Tribune
November 25, 2005

Virtually all of America’s transportation sector depends on a single, largely foreign commodity—oil. As world crude prices recently doubled, motorists watched the price of gasoline ratchet steadily upward. What is harder to visualize, however, are the huge economic, environmental—and especially strategic—costs we pay for our national dependency on oil.

Concern about over-reliance on oil, especially foreign oil, is hardly new. When President Nixon in 1973 announced Project Independence, with a goal of energy self-sufficiency in seven years, America imported 35 percent of its oil. Today the figure is more than 60 percent.

With soaring petroleum prices, driven in part by insatiable demand from India and China, the river of dollars flowing to foreign producers has become a flood. This year, Americans have paid some $19 billion a month for oil imports, accounting for a third of our record trade deficit, and over the next decade trillions of dollars may pour out of the U.S.

Overseas, oil is a magnet for conflict. Since 1991, we have fought two major wars in the oil-rich Middle East, and oil infrastructure and shipping lanes are targets for terrorists. In addition to the enormous dollar cost we pay for the military forces necessary to maintain our own access to foreign oil, the world’s petroleum dependence changes the geopolitical landscape, extracting a high price in terms of foreign policy and international security. It forces us to make unwelcome policy compromises and saddles poor countries with debt to pay their oil bills.

From the Middle East to Eurasia to Africa to Latin America, massive infusions of oil revenue distort regional politics and embolden leaders hostile to United States interests. Russia, for instance, uses its oil and natural gas reserves as leverage over new democracies in Eastern Europe, Iran last month threatened to wield oil as a weapon to protect its nuclear ambitions, and Venezuela’s Hugo Chavez employs his growing petroleum revenues to sow trouble region-wide. In the harsh light of Iraq, it is clearer than ever before that oil dependence is a major national security issue.

As economic and security concerns have grown, two things have changed in the six years since former CIA director James Woolsey and I called for rapid development of biofuels to break oil’s stranglehold on our transport sector: advances in key technologies, and, I believe, new-found political will to make the necessary investments.

Shifting away from an oil-dominated economy to enhance our national security is not as hopeless as pessimists say. Without completely eliminating oil imports, we can still achieve significant benefits simply by ending oil’s monopoly on the transportation sector, which accounts for 60 percent of American oil consumption. What we need is a realistic effort to give American consumers a choice in fuels and automobiles to ease the pain of high oil prices and help ensure America’s future.

A key is cellulosic ethanol, a home-grown fuel made from biomass like straw, corn stalks, or prairie switchgrass. Corn ethanol is already providing many Midwesterners a lower-cost fuel option. The technology for converting far more abundant and cheaper biomass—or cellulose plant matter—into ethanol is poised for commercial take-off. The 2005 energy bill offers incentives, which I sponsored, to produce 7.5 billion gallons of renewable biofuel annually.

New legislation I have proposed would require carmakers to install flexible-fuel technology in new vehicles, an easy and cheap modification—about $150 per car—that allows autos to run on a mixture of 85% ethanol and 15% gasoline. With aggressive development of the ethanol industry, we could slash oil imports in half over the next 10 years.

If at the same time we promote hybrids, next-generation plug-in hybrids, low-pollution diesels and lightweight, strong carbon construction composites for cars, the vehicle fleet could see a dramatic leap in mileage, to well above 100 miles per gallon of petroleum-based gasoline.

We will get even greater payoffs if we can lead other nations with us away from oil. Only 21 countries are net oil exporters. The rest, representing nearly 85 percent of the world’s population, could like us, improve their trade deficits and declare independence from the whims of the oil oligopolists by democratizing the fuel market. Moreover, developing countries could be important new markets for fuels technology developed and manufactured here in the United States.

This shift to a mixed-fuel transportation economy may look daunting at first, and may require substantial research-based information to overcome public skepticism. But a persistent high price for crude oil will impel constructive changes over time that will prove to be both good policy and a good deal for energy consumers.