State Of Energy 2011: API CEO Gerard Calls For Future Awash In Oil

Jack Gerard applauds Rep. Fred Upton (R-MI).

In a high-powered rollout at the glossy Newseum, the head of the big oil lobby argued that America today needs to reduce taxes and expand drilling for oil companies. Like a broken clock, American Petroleum Institute President and CEO Jack Gerard repeated his annual call for lower oil taxes and expanded drilling, arguing it would increase jobs and even government revenue, based on a new study from oil consultancy Wood Mackenzie.

Before he made his remarks, Gerard heralded the appearance of Rep. Fred Upton (R-MI), the new chair of the House Energy and Commerce Committee who now rejects limits on oil pollution. Gerard’s speech, and his answers to the questions from the audience, emphasized thousands of jobs tied to “access” to trillions of dollars of oil and natural gas, but also touched on other topics:

On the BP Gulf of Mexico disaster: “I’m proud of the way the industry responded.”

On the oil industry’s safety record: “There is always room for improvement.”

On the future: “Policymakers face two choices: one takes us forward, one takes us backward.”

On global warming pollution: “The Clean Air Act was never thought of to regulate greenhouse gases.”

Gerard’s central argument, that what’s good for Big Oil is good for America, depends on several key fallacies. The most important fact Gerard ignores is true cost of oil — more drilling means more disasters, more pollution, more risk, more global warming, more sickness and death. Even ignoring the existential threat of global warming, oil consumption in the United States causes the premature death of at least 10,000 Americans a year. API’s projection of increasing demand for oil and natural gas for the next several decades would make catastrophic global warming — including mass species extinction, crop devastation, and rapid sea level rise — unavoidable.

The other key fact Gerard ignores is that the oil industry is extremely inefficient at creating jobs — you could even call it a job killer. In fact, you get four times as many clean energy jobs as oil jobs from the same investment. If the federal government raised taxes on the oil industry by $5 billion per year, and invested the revenues into clean energy, that would create a net job gain of 75,000 jobs. Even API’s chief economist John Felmy has admitted that this analysis is accurate. “I have no doubts you can get a lot more jobs,” he said, when asked what would happen if the government invested in clean energy instead of the oil and natural gas sector.

Finally, Gerard’s claim that the Clean Air Act was not meant to regulate greenhouse gases is nonsensical. The U.S. Supreme Court — whose job it is to interpret laws — found that greenhouse emissions are pollutants under the Clean Air Act. This is no surprise, since the law as written includes effects on “climate” and “weather” in the definition of pollution:

All language referring to effects on welfare includes, but is not limited to, effects on soils, water, crops, vegetation, manmade materials, animals, wildlife, weather, visibility, and climate, damage to and deterioration of property, and hazards to transportation, as well as effects on economic values and on personal comfort and well-being, whether caused by transformation, conversion, or combination with other air pollutants.

Policymakers do indeed face two choices — going back towards the 19th-century world of dirty energy and robber barons, or forward to a clean, healthy, prosperous future.

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