Jeb Bush had the chance to propose a North American Energy Pact, but lacked the nerve for a daring move
If Republican voters are wondering why the Jeb Bush campaign is languishing, they need look no further than his new energy platform.
In a speech Tuesday at Rice Energy Inc. in Canonsburg, Penn., the overly cautious younger Bush brother argued for lifting the American crude oil export ban, reducing barriers to natural gas exports, giving states more say in drilling approvals, approve the Keystone XL pipeline, and reducing regulation.
Yup, that’s it folks. A slim collection of stale ideas cobbled together from the American Petroleum Institute’s wish list.
If he wanted to pander to the oil and gas industry, five minutes on any energy lobbyist’s website would have yielded two or three times more innovative policy ideas than these old chestnuts.
Making outlandish claims about the economic benefits of his platform doesn’t help, either.
For instance, in what universe will lifting the crude oil export ban “create a million new manufacturing jobs and rapidly reduce gasoline prices”? The highest estimate I could find was 230,000 to 380,000 unspecified jobs if the ban was lifted immediately and perhaps a small drop in gasoline prices.
Meanwhile, Democratic challenger Hillary Clinton has galvanized her campaign by announcing that she would enter into talks with Canada and Mexico to forge a North American Climate Pact with enforceable regulations around greenhouse gas emissions. Public opinion polls show that Democratic voters support strong action on the environment, even if that action comes with a cost.
Clinton promised strong action.
Now, I argued in another column that Canada and Mexico should avoid her Climate Pact as if it was the bubonic plague on steroids. Barack Obama is happy to contradict his climate change agenda when it suits his geopolitical or economic agenda (see West Coast coal exports and Arctic drilling) and no doubt Clinton would merrily do the same.
But Clinton’s policy proposal opens the door to the most obvious Republican rebuttal: a North American Energy Pact.
Canada is already deeply integrated into the American oil and gas economy: Most Canadian oil and gas is exported south of the border (about 70 pipelines cross the 49th Parallel), the Canadian industry is dominated by American energy companies, and many Canadian companies operate in US oil and gas regions.
The integration is so complete that Canada has been worrying about its lack of market options – companies take a significant haircut compared to WTI or Brent prices – for years and there are currently three pipelines in various stages of regulatory approval that would take Canadian oil west to tidewater and on to Asian markets or east to Ontario and Quebec markets currently importing oil from the Middle East and America.
And Mexico is just embarking on a reform of its energy economy, which until now has been dominated by state-owned PEMEX. American producers and service companies are flocking to Mexico to take advantage of the opportunity. New pipelines are being built to carry Mexican product into the American market.
Meanwhile, the US produces only half of the oil it consumes (9M b/d vs. 18M b/d) as politicians bleat about “energy security” and worry about the never ending entanglement in oil-soaked Middle Eastern military conflicts.
Bush is already endorsing the Keystone XL pipeline, which if approved will carry 830,000 b/d of Alberta oil sands crude to Texas refineries.
Why not go one step further?
The oil sands was slated to double production to 6M b/d over the next decade or so. A market already exists because Texas Gulf Coast refineries currently need 2.7 million b/d of heavy crude. Some of that supply comes from political hostile regimes like Venezuela.
Why not ensure that heavy oil has an American buyer at a fair price?
And let’s not forget clean energy. Canada has extensive hydropower resources and is already an electricity exporter to the Northeast. Quebec, in particular, is eager to build more dams and further supply the American market as Obama’s Clean Power Plan (which Bush opposes, but shouldn’t) closes coal power plants.
Doesn’t this scenario cry out for a North American Energy Pact?
With one fell swoop, America could address energy, security, job creation, and foreign policy issues while cleaving closer to its North American neighbors and allies.
The idea of a North American Energy Pact is waiting for a smart and ambitious Republican candidate to recognize the potential and make it his or her own.
Judging by today’s announcement, Jeb Bush is not that candidate.
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