Biden Begins Climate War With Attack On Energy Industry That Will Ignite Inflation
In what will be remembered as the ‘shot heard round the world’ fired by the Biden Administration, the first salvo of Executive Orders foretells pain for consumers and the economy in the form of higher energy costs.
Donald Trump’s legacy of the United States as an energy independent superpower benefiting from the lowest energy prices in decades is on life support, and the new Administration in Washington is pulling the plug.
With the exception of the Trade War with China, Trump was a peacetime President, with laissez faire policies that resulted in both low energy prices for consumers and a record expansion and penetration rate of the green energy sector across the entire U.S. economy. Electric cars, solar and wind power, and cleaner use of fossil fuels through a myriad of new technologies – all were beneficiaries of Trump’s hands-off, free market policies.
But when it comes to the issue of Climate Change, Biden has made it clear that he is a wartime President with interventionist policies, and there will necessarily be casualties and collateral damage as battles are fought. Using the fight against climate change as the moral basis for limiting oil and gas exploration, Team Biden seems willing to sacrifice consumers, and indeed the entire U.S. economy, on the front lines of a war that will last longer, be harder to fight, and cause more pain for consumers and the economy than most people are prepared for or even suspect.
President Biden’s administration, in an unprecedented flurry of executive orders, has taken direct aim at fossil fuels, most especially oil and gas. Climate impacts will take precedence over energy use and production, and costs to all energy users will go up, affecting every facet of the US. economy.
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U.S. consumers will be hard hit as affordable supplies of traditional energy shrink faster than demand. The conversion of the U.S. economy and infrastructure from fossil fuels to one powered mainly by electricity generated from clean sources will take decades to implement, but the effects of the immediate “…pause on entering into new oil and natural gas leases on public lands or offshore waters to the extent possible…” will be felt within only a year or two.
The timing disconnect between the halting of new exploration on federal properties and the tightening of regulations on existing fossil fuel production enterprises, versus the implementation of vague goals and objectives designed to offset job losses and economic hardships in communities through a “… new Interagency Working Group (that) is also directed to explore efforts to turn properties idled…into new hubs for the growth of our economy…” will be insurmountable and devastating.
Energy costs for all consumers will rise, and those on the bottom rungs of the income ladder will suffer the most. As the U.S. economy expands and requires more and more energy, the U.S. will once again become more reliant on foreign sources of fuel (think crude oil) because the build-out of the new green energy sector won’t be able to keep up with total energy demand. Oil prices will rise; it’s a simple supply/demand equation.
The return of global, oil-centric, geopolitical relations that historically result in less stable and more expensive energy supplies will be an additional result of the headlong rush into a Climate War. Think about the U.S. becoming more reliant on foreign sources of oil while it carries out its fossil fuel purge and forced build-out of a green energy based economy. Oil supply from foreign sources will be less stable, and oil extracted within U.S. borders will be more expensive to produce. Oil companies will have to raise prices, and consumers will pay.
Hopefully the new administration will step back and take a thoughtful pause from its initial attacks on the traditional energy sector, giving consideration to the pain and collateral damage that consumers on the front lines will have to endure.