3 must read columns/editorials on gas prices and energy policy by The Journal

The Wall Street Journal Editorial Page continues to be one the best (if not the best) sources for clear, coherent, free market solutions to what troubles us. These three are must reads:

#1: $4 Gasbags

Money quote:

...the U.S. remains one of the only countries in the world that chooses as a matter of policy to lock up its natural resources. The Chinese think we're insane and self-destructive, while the Saudis laugh all the way to the bank.

#2: Drill, drill, drill! by Daniel Henninger

Henninger hits on a lot of the same notes, such as:

At this point in time, is there another country on the face of the earth that would possess the oil and gas reserves held by the United States and refuse to exploit them? Only technical incompetence, as in Mexico, would hold anyone back.

But not us. We won't drill.

#3: The coming oil investment boom by Holman Jenkins

Money quote:

If today's towering price of oil reflects some speculator's bet on a long-term scarcity of liquid motor fuels, this will prove the misguided bet of a lifetime. Hydrocarbons are abundant and can be extracted from living plant matter as well as from their fossil remains. Many oil fields under current technology are considered depleted when they're still 50% full. But technology advances, doesn't it?

Yes, they do Mr. Jenkins. As Julian Simon would say about any commodity:

More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity, and prompt inventors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred.

No comments: