Monday, December 19, 2005

 

Leverage Through Innovation: Energy Security Policy

Its probably because of terrorism or the recent gas price spikes as a result of the horrible hurricane season on the Gulf Coast on the United States, but in this past year I have become increasing interested in alternative fuels and energy security. I don’t have encyclopedic knowledge of the subject; I can’t throw around impressive sounding theories or statistics when I talk about it with friends. I just have the base line idea that the competition for reliable sources of energy is one of the most serious issues confronting the United States in the early 21st century. It has environmental, economic, and security implications all and it represents an issue that will pit our vital/realist interest against our national ideological conscience. How do we achieve our vital national interest of achieving energy security without compromising our national ideals?

It seems as if the United States forced itself into bed with some of least desirable governments in the world for the sake of energy security for the 20th century. Regardless of the internal behavior of those governments the United States continued to do business with them on the basis of securing energy supplies. While we may have secured access to vital supplies of energy, the US did not pursue this goal with adequate attention to the internal behavior of the governments supplying these energy products. Like most things in life, there were consequences for this strategic decision. Despite some of these negative consequences, I have absolutely no problem with the execution of that strategy in the 20th century. But this is a new century with a whole new set of threats and a whole new strategic context, therefore it only makes sense the US develop an alternative energy security strategy that reflects the new dynamics in the international system.

The first component of that strategy should be the devotion of equal amounts of energy into finding alternate suppliers of crude oil outside of the Middle East. Already the United States government and business community is pursuing oil industry opportunities in alternative markets such as Central Asia and West Africa. This development is positive, as the US is looking to diversity its sources of crude oil beyond the turbulent deserts of the Middle East. The bad news is, Central Asia and West Africa are not world renowned for their stability. Unfortunately these areas are not models for their strict adherence to the rule of law, civil institutions, and good governance either.

The often-contradictory relationship between increased oil revenues and decreased civil liberties in underdeveloped oil states is well documented. This is why the US needs to move intelligently with expansion of oil ties with these countries. Isolation is not the way; I’m not saying the US should cut itself off from these states economically or diplomatically because their governments do not represent the best practices. I think brutally honest engagement is required to positively influence the internal behavior of the governments of some of these suddenly popular petrol states. A dynamic public diplomacy strategy needs to be implemented to engage political leadership and their populations. A common critique of the United States throughout the Middle East is that in our pursuit for reliable crude oil supplies we turn a blind eye to the living conditions of the people in these countries. In essence, that the US cares only about their oil not their liberty. I think this reputation is based much upon a misconception often perpetuated by false propaganda dispersed by some of these governments in an effort to divert attention from their own dismal performance as leaders. If the United States is going to make sustainable in-grounds in these new oil markets, a significant public diplomatic effort needs to be undertaken to combat the negative misconception of American policies so prevalent throughout the Middle East. The lessons learned from US energy policy in the Middle East must be applied to our energy policy in West Africa and Central Asia for there to be any hopes of a long term, relatively consequence free energy relationship in these regions.

The difficult problem with that policy is the United States needs the oil no matter what. From a realist or vital interest perspective, the US is going to be forced to pursue those relationships regardless of the internal behavior of the governments in the region because we need the oil…period. Our crude oil needs alone make this a reality. But another factor influencing US policy in these regions is the involvement of Iran, China, India, and Russia in some of those same markets. With the possible exception of India, none of those states make the internal behavior of state governments or their human rights and human dignity records a serious issue. Due to their own less than stellar records on these same issues, things like human rights and individual liberty just do not get in the way in negotiations for access to oil fields. This ultimately puts the United States at a disadvantage as it pursues the expansion of oil markets in other parts of the world. Especially if it makes the internal behavior of state governments a condition of doing business. China, Russia, and Iran simply aren’t as demanding as the United States when it comes to the internal behavior of state governments. So countries like Kazakhstan, Azerbaijan, and Armenia don’t have to undertake the economic and political reforms necessary to improve the lives of their people because most of their oil customers won’t demand those changes a condition of doing business. Essentially the market place is not demanding these reforms be made so there is no incentive to make them. If you were Kazakhstan whom would you do business with? Would you choose the country making demands regarding how you treat your people as a pre-condition of doing business? Or would you choose the country that stream lines the process and doesn’t really care how you do what you do as long as access to oilfields is secure?

As an American I can see the gaping holes in the strategy of pursuing oil security at any price. It can contribute to negative popular opinion among the local populace. As I said before, I believe most of those bad feelings are based upon misconceived notions and false propaganda, but I’d be ignorant not to realize at least part of it is true. Strategically the US needed a secure, reliable, stable source of oil. I believe US polices assured that, but there was indeed a consequence to those policies. The perception, true or false, the US only cares about itself and oil and that it doesn’t care at all about the people in those petrol states. But the point is, the US might in fact lose in the battle to gain access to new oil markets if it attempts to apply its lessons learned from energy policies in the Middle East. How can the US protect its flank and assure its vital interest or securing a reliable and stable energy supply if its not willing to budge on its demands for improved internal behavior for state governments?

This is why the second component of US energy security strategy has to include an equal investment in time, effort, and money into the pursuit of alternative energy sources and technology beyond conventional petroleum products. Former US Secretary of State, George Shultz along with the former Director of the Central Intelligence Agency, James Woosley recently published a paper titled Oil and Security. http://www.fightingterror.org/ This paper explicitly outlines the risks of inaction and with the pursuit of a predominantly petroleum based energy policy. Issues such as the political volatility of supplier states, environmental concerns, susceptibility of oil pipelines to terrorist attack, and trade deficits are all potential threats to US national and economic security when we have a predominantly oil based energy policy. After outlining the risks, the two former US officials identified some potential solutions for decreasing our dependence on foreign oil supplies and gaining more consequence free energy security. The steps identified were:

1. Encourage improved vehicle mileage using technology now in production
a) Diesels
b) Hybrid gasoline-electric
c) Light weight carbon composite construction

2. Encourage commercialization of alternative transportation fuels that can be available soon, are compatible with existing infrastructure, and can be derived from waste or otherwise produced cheaply.
a)Biomass (cellulosic) ethanol
b)Bio-diesel and renewable diesel

3. Plug in hybrids and battery improvements


The steps suggested are as practical as they are fascinating and deserve further discussion in a future blog entry. The point I wish to highlight is that in pursuit of these solutions, the United States can not only improve its overall energy security, it can also regain its leverage in influencing oil supplier states to improve and reform their systems of governance. It is the best way for the United States to pursue its realist interests while not turning its back on its ideological conscience. The US can afford to be unbiased advocates for greater reform in he countries with plenty of oil but deficits in freedom because we will have achieved our own energy security through innovation, technological advancement, and ingenuity. And the best part is we will have achieved this energy security due our hard work not at the expense of those people who are oppressed by the petrol revenues gained by their corrupt governments. Innovation, respect for human rights, economic and technological security….What more could you ask for from an energy policy?

Wednesday, December 14, 2005

 

African Oil and African Freedom

Much has been written about the potential negative impact sudden natural resource richness can have on the expansion of civil liberties, especially in the developing world. The discovery of valuable natural resources in countries without transparent and accountable governments can actually inhibit the expansion of their civil liberties for state populations. Corrupt leaders immune from removal from office due to the absence of elections or balance of power are able to maintain their positions through bribery, coercion, and abuse of national resources. The United States is working on diversifying its international oil providers network in an effort to reduce its vulnerability and exposure from more volatile suppliers in the Middle East. While I would applaud greater political and financial investment in alternative energy sources, I understand the immediate need to address American oil supply. How the United States goes about gaining access to different oil suppliers and the impact it has on the standard of living for the population’s of those supplier countries is a critically important issue.

Africa is receiving increased attention from the United States (and other energy hungry countries) in the effort to diversity oil suppliers. Among others in Africa, Nigeria, Angola, Chad, Mauritania, Sao Tome and Principe, have largely proven though under developed crude oil deposits. Most major international oil corporations maintain a presence in the oil rich states in Africa and are taking advantage of the international onus to increase and diversify oil supply. Industry giants such as Chevron, Total, Exxon Mobil, are all expanding their operations on the continent trying to get in on the ground floor of much expected oil boom in Africa.

As the United States works to expand relationships with oil producing states in Africa, government and business leaders should take a moment of pause and analyze the approach they are taking with the oil industry in Africa. There is potential for great success and equal potential for overwhelming damage in developing the oil export industry in Africa. If the United States and other countries pursuing energy ties to Africa do not take a careful approach to the expansion of the oil industry there is a chance the standard of living and quality of life for the people of Africa could be even worse than it is today. Market forces can be powerful mechanisms of change. African states with vast oil deposits require access to foreign expertise, markets, and investment. States looking to secure supplies of African oil should use their overwhelming leverage to promote economic and government reforms in order to ensure access to oil does not come at the expense of the personal freedoms of the local population.

In my last “blog Entry” I discussed an article written by an international affairs observer who said the United States needs to balance its realist objectives with its ideological conscience. I can think of no better opportunity to experiment with this philosophy than in African oil industry. Clearly the United States has a realist objective in obtaining oil from more sources. Expanding the oil industry in Africa can help fulfill this objective. However, many of the governments in these oil rich countries do not practices the tenets of good governance. So while obtaining the necessary oil may fulfill a realist objective or vital interest, it could also result in a development that is contrary to US national ideals. Providing poorly governed states with extra revenues could work to perpetuate the survival of their regime and further restrict the civil liberties and quality of life for their civilians. Corrupt leaders have shown the tendency to concentrate revenues for regime survival rather than social investment and improvement. Securing regional stability and access to oil supplies remains important for the United States. But if these conditions are met at the expense of expansion of civil liberties and democratic values, there will be a price to be paid in the future. Stability at the price of freedom is an volatile formula.

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