Week Ending January 15, 2016

In His Final State of the Union Address, U.S. President Obama Advised the Nation to “Not Fear the Future, But Shape it;” Among Other Pledges, He Promised to Push for Changes in the Way Oil and Coal Resources are Managed

This Article Appears as Published in Foster Report No 3082
In His Final State of the Union Address, U.S. President Obama Advised the Nation to “Not Fear the Future, But Shape it;” Among Other Pledges, He Promised to Push for Changes in the Way Oil and Coal Resources are Managed

President Barack Obama’s final State of the Union (SOTU) speech to Congress and the Nation on Jan. 12 portrayed the U.S. as a nation weathering many headwinds but doing so successfully in most circumstances under his leadership.  At the time he assumed the Presidency, Obama reminded the audiences that the country was facing the worst economic crisis since the Great Depression.  “Seven years later, our businesses have created 14.1 million new jobs over the past 70 months.  We’ve rebuilt our manufacturing base, reformed our health care system, and reinvented our energy sector. We’ve welcomed home more than 160,000 troops.”

“We are living through an extraordinary moment in human history,” he suggested, with technological and social change reshaping the way Americans live and work, deal with the environment, and make a place in the world.  As Americans, “we should not fear the future, but shape it.”

Obama acknowledged that because it was a presidential election cycle “expectations for what we’ll achieve this year are low.”  Instead of presenting a laundry list of action items to Congress and the new Speaker of the House, Rep. Paul Ryan (R- Wisconsin), Obama mentioned a few priorities, including: fixing a broken immigration system; pursuing criminal justice reform; protecting kids from gun violence; equal pay for equal work; paid leave; raising the minimum wage; combatting prescription drug abuse; helping students learn to write computer code; and personalizing medical treatments for patients. “[Also], our foreign policy must be focused on the threat from ISIL and al Qaeda.”

The President hoped “we can work together this year on bipartisan priorities,” and praised the “constructive approach” Speaker Ryan and other Congressional leaders took at the end of last year to pass a budget and make tax cuts permanent for working families.

He stressed that the progress over the last seven years was “not inevitable,” and that it was “the result of choices we made together.” Now, going forward, the country is facing four “big questions” that it has to answer, Obama said – (1) how to give everyone a fair shot at opportunity and security in this new economy; (2) how to make technology “work for us, and not against us — especially when it comes to solving urgent challenges like climate change”; (3) how to keep America safe and lead the world without becoming its “policeman”; and (4) how to make our politics “reflect what’s best in us, and not what’s worst.”

Obama claimed the U.S. — right now — has the strongest, most durable economy in the world.  “We’re in the middle of the longest streak of private-sector job creation in history,” he said, citing “the strongest two years of job growth” since the ’90s and an unemployment rate cut in half.  “Anyone claiming that America’s economy is in decline is peddling fiction.”

The President proposed to “reignite the spirit of innovation” to meet the Nation’s biggest challenges, including climate change.  Citing the example of the Space Race, he urged the country to get onboard with climate measures.  “Sixty years ago, when the Russians beat us into space, we didn’t deny Sputnik was up there,” he admonished.  “We didn’t argue about the science, or shrink our research and development budget. We built a space program almost overnight, and twelve years later we were walking on the moon.  Look, if anybody still wants to dispute the science around climate change, have at it.  You’ll be pretty lonely, because you’ll be debating our military, most of America’s business leaders, the majority of the American people, almost the entire scientific community, and 200 nations around the world who agree it’s a problem and intend to solve it.”

The President said he doesn’t want to the country “to pass up the chance for American businesses to produce and sell the energy of the future.” He boasted that “seven years ago, we made the single biggest investment in clean energy in our history,” resulting in “fields from Iowa to Texas, in which wind power is now cheaper than dirtier, conventional power.  On rooftops from Arizona to New York, solar is saving Americans tens of millions of dollars a year on their energy bills, and employs more Americans than coal — in jobs that pay better than average.  We’re taking steps to give homeowners the freedom to generate and store their own energy — something environmentalists and Tea Partiers have teamed up to support.  Meanwhile, we’ve cut our imports of foreign oil by nearly sixty percent, and cut carbon pollution more than any other country on Earth.”

“Gas under two bucks a gallon ain’t bad, either,” he quipped.

“Now we’ve got to accelerate the transition away from dirty energy,” Obama pressed on.  “Rather than subsidize the past, we should invest in the future — especially in communities that rely on fossil fuels.”  He promised to “to push to change the way we manage our oil and coal resources, so that they better reflect the costs they impose on taxpayers and our planet.  That way, we put money back into those communities and put tens of thousands of Americans to work building a 21st century transportation system.”

Obama acknowledged there are “plenty of entrenched interests who want to protect the status quo.”

The President lobbied Congress for the Trans-Pacific Partnership (TPP) “to open markets, protect workers and the environment, and advance American leadership in Asia.”  The agreement cuts 18,000 taxes on products “Made in America,” and supports “more good jobs,” Obama claimed.  “With TPP, China doesn’t set the rules in that region, we do.  You want to show our strength in this century? Approve this agreement.  Give us the tools to enforce it.”

Lastly, he urged Congress to lift the embargo with Cuba.  “You want to consolidate our leadership and credibility in the hemisphere –recognize that the Cold War is over and lift the embargo.”

Reaction from Energy Industry.  Following the President’s speech, segments of the energy industry and businesses continued to display skepticism toward the Administration’s policies and Obama’s outlook.  The Western Energy Alliance (WEA), often critical of the government’s actions that affect western Federal lands, claimed the President’s final SOTU address only reaffirmed his “go-it-alone posture on key issues,” including energy production and the environment.  WEA warned that Obama would continue “side-stepping Congress” through the use of executive orders to implement his climate change goals, and change the rules targeting oil and natural gas producers across the West.

“The president still fails to accept one basic fact about climate change: The U.S. has dramatically reduced greenhouse gas emissions, more than other developed countries, primarily because of increased use of natural gas,” said Tim Wigley, WEA’s president.  “It is not because of wind or solar.”

Obama’s legacy, WEA predicted, will be “overreaching regulations” designed to constrict production of oil and gas in favor of “unreliable” alternatives.  “It’s no coincidence there’s a significant decline in production of natural gas on federal lands while it has soared elsewhere.  Since 2008, production on public lands is down more than 19%,” Wigley said.

Wigley harshly alleged that Obama didn’t include a prescribed list of new policy goals to Congress “by design,” since he has “no intention of working with elected leaders to implement his goals for energy and the environment.”  Obama will close out his term by continuing to issue new rules through the federal agencies “that kill jobs and economic growth in order to promote his climate change agenda, which he couldn’t even pass when Democrats controlled both the House and Senate.”

After the past seven years, Wigley suggested, “we need a president with a vision that embraces innovation, technology and the abundant oil and natural gas available in the West, not centralized Washington policies.”

The American Petroleum Institute’s (API) president and CEO Jack Gerard was not quite so strident in his posted response to the SOTU, but called on the President to “put consumers first and not disrupt America’s energy renaissance with unnecessary, duplicative and costly” regulations.  “The energy revolution has created a proven model to improve the environment while creating jobs and strengthening our national security and lowering consumer costs,” Gerard stated.  “We call it the U.S. model, and it can be achieved without over-regulating.”

He complained that the oil and gas industry has had to address “nearly 100 regulations impacting all aspects of our business.”  API is going to urge the administration “to take a close look” at the regulations to see: (1) are the regulations necessary; and (2) what the cost will be to consumers.

“Instead of pursuing a barrage of job-crushing new regulations, many of which are duplicative and unnecessary, – President Obama has the opportunity to seize the initiative and embrace policies that recognize the value of the energy resurgence and acknowledge that the goals of environmental progress and energy production are not mutually exclusive,” Gerard advised.  “By looking to science and real-world proven results to guide the policy choices during his final year in office, the president can ensure that America’s energy resurgence continues to provide economic growth, environmental progress and security benefits.”

From the environmentalists’ camp, the Environmental Defense Fund (EDF) applauded Obama’s efforts.  “President Obama has built an impressive environmental legacy during his seven years in office,” said Fred Krupp, EDF’s president.  “Tonight’s State of the Union address showed that climate change and clean energy will continue to be priorities for this White House in 2016, and that’s good news for all of us.  The President is right that working for a clean energy future, including giving families the freedom to generate and store their own energy, is an area where people should work together across the political spectrum.”

The American Gas Association’s (AGA’s) President and CEO Dave McCurdy, in posted remarks, touted the successes accomplished by the natural gas segment of the energy industry.  The direct use of gas was “helping to meet our national goals of boosting our economy, improving our environment and increasing our energy security.”  The U.S. has “a credible leadership role” on climate change, in part, because of the country’s abundant supply of natural gas and the adoption of aggressive automobile fuel economy standards that have led to significant and continued declining emissions –allowing President Obama’s “aggressive action at home and abroad to reverse the effects of climate change.”

Natural gas remains “part of the solution to climate change” and the fuel will help the U.S. make progress toward ambitious emissions reduction targets, McCurdy suggested.  He offered that households with gas versus all-electric appliances save an average of $840/y, and that the low domestic gas prices have led to savings of almost $69 billion for residential natural gas customers over the past four years.  “In addition, households with natural gas versus all-electric appliances produce 37% lower greenhouse gas emissions,” McCurdy concluded.


Copyright © 2016 by Concentric Energy Publications, Inc.  All rights reserved.

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