President’s Day: Best and Worst, Energy-wise

“There are far too few heroes and far too many failures in the history of presidential energy politics.”

Who can claim to be a true energy President from a pro-consumer, pro-taxpayer, pro-free-market perspective?

Which U.S. heads qualify for an anti-energy label for violating economics 101–and endangering the health and welfare of all of us who rely on the MasterResource?

Of the 30 or so candidates from the Lincoln-to-Biden era (the first commercial oil well dates from 1859), just a few names compete for the best, while many more vie for the worst.

Two Best: Trump and Reagan

The best two from a classical liberal perspective are Donald Trump and Ronald Reagan. A third candidate just does not come to mind, certainly in the modern energy era.

Trump has been thoroughly evaluated at MasterResource, from his courageous climate policy to his pretty solid fossil-fuel energy policy to the not good ethanol policy. The most courageous ‘libertarian moment’ for Trump was withdrawing from the Obama-era Paris Climate Accord of 2015, itself a problematic remake of the failed Kyoto Protocol of 1997.

Trump also reprioritized the U.S. Environmental Protection Agency away from climate change and fossil-fuel obstructionism toward true air-and-water environmentalism. [1] He even considered closing much or all of the agency itself, a momentous possibility. [2]

President Reagan’s finest energy moment was his  “Statement on Signing Executive Order 12287, Providing for the Decontrol of Crude Oil and Refined Petroleum Products” (January 28, 1981). Carter’s phased decontrol, the result of a political trade for the Windfall Profit Tax of 1980 (WPT), but Reagan immediately terminated the regulations stating,

Fears that the planned phaseout of controls would not be carried out, for political reasons, have also hampered production. Ending these controls now will erase this uncertainty.

Reagan yielded to politics to back off of this campaign pledge to abolish the Carter-era U.S. Department of Energy, and he was slow to terminate the WPT. But his do-no-harm view which puts our 40th President in very good light.

Worst Competition: Wilson, FDR, Nixon … Carter

The battle for worst, before the 1980s, is between Woodrow Wilson, Franklin Roosevelt and Richard Nixon (with Jimmy Carter in the mix third only because Nixon created the framework that produced the central-planning 39th President.

Woodrow Wilson used the excuse of World War I (an unnecessary war to begin with in retrospect) to implement wartime planning in the oil and coal industry. Wilson’s Food and Fuel Control Act (Lever Act) gave him the unprecedented power to “provide for the national security and defense by encouraging the production, conserving the supply, and controlling the distribution of food products and fuel.” A plethora of interventions followed, with one distortion leading to another under the nation’s first energy bureaucracy United States Fuel Administration.

FDR brought a ‘New Deal’ to petroleum that preserved and universalized oil-state wellhead proration, which subsidized small inefficient producers against consumers on one side and integrated majors on the other. The National Recovery Act’s “Code of Fair Competition for the Petroleum Industry,” premised on the fallacy that higher prices and profits would bring economic recovery, was a regulatory labyrinth from the wellhead to the service station. And with World War II, FDR went the planning route with the Petroleum Administration for War, forsaking the free-market alternative of price and profit/loss reliance.

Richard Nixon was the father of the oil crisis of 1973/74 with his continuing price control program, originally begun in August 1971. Price and allocation controls in 1973 politicized the industry and set up the failed energy presidencies of Gerald Ford and Jimmy Carter.

The second oil crisis of 1979, the legacy of Ford and Carter, draws its roots from Nixon, who foreshadowed today’s anti-energy agenda of the Joe Biden Administration.

… Clinton/Gore, Obama

The disappointment of center-to-left Bush 41 led to Bill Clinton, whose vice president was Earth-in-the-Balance Al Gore. Gore could not act on his radical anti-fossil-fuel notions, with the Administration failing to enact a so-called BTU tax against all three fossil fuels. But Clinton/Gore did just about all that could be done against oil and particularly coal. (Natural gas was considered apart, the ‘green’ fossil fuel per Enron.)

After centrist George W. Bush (remember his ‘addicted to oil” speech?), Barack Obama put Climate Change at the forefront. Cap-and-trade to price carbon dioxide (CO2) failed in 2010 despite House passage and strong White House support. Otherwise, it was a war on coal, mostly a battle against oil, and growing unease with even natural gas.

Most Disappointing: Eisenhower, Bushes

President Dwight Eisenhower goes down as the most disappointing, having used a political excuse for vetoing a natural gas deregulation bill in 1958 that led to a very wasteful regulatory regime and, ultimately, the debilitating natural gas shortages of winter of 1971/72 and 1976/77. Ike also implemented the Mandatory Oil Import Program of 1959, which was a regulatory tar baby and the impetus for the formation of OPEC in 1960.

Father-and-son Bush were both short of a free-market worldview that could have been a bulkhead to the gathering momentum of climate alarmism and forced energy transformation.

George H. W. Bush listened to Ken Lay and others too much to put the U.S. into the global warming game in 1992. And, as I stated elsewhere:

Bush [41] restored federal subsidies to the Carter-era renewable-energy and energy-efficiency programs that had been cut under Reagan. All-Things-to-All-People Bush also signed the Clean Air Act of 1990, which took the acid-rain scare at face value, a signal about his openness toward the global-warming issue to come.

Conclusion

Biden has started–and started with a vengeance against free-market energy reliance. His war against dense mineral energies is futile, but it is very wasteful too.

There are far too few heroes and far too many failures in the history of presidential energy politics. A fuller account of the above needs to be written, but this can serve as a start.

[1] Coral Davenport, “The Trump Administration Rolled Back More than 100 Environmental Rules, New York Times (January 22, 2021). Ninety-eight done, 14 in process for a total of 112 “rollbacks.”

[2] Reported Kevin Bogardu of E&E News in “Pruitt: Trump asked, ‘Should we shut down the agency?‘” February 11, 2021):

“As I’ve looked at the mission of the agency, I recall very distinctly when I went to Trump Tower,” [Scott] Pruitt said. “When I met with the president-elect at the time, he asked me a question. He said, ‘Scott, should we shut down the agency?’”

Pruitt said closing the agency has been discussed at times, primarily because EPA was created by executive order. On the campaign trail in 2016, Trump talked about reducing the agency, leaving “a little bit.”

But EPA’s 14th administrator said the agency should remain….

“I said, ‘No, Mr. President, the agency has a very, very important mission in this country with respect to the environment,’” Pruitt said, pointing to issues like air quality across state lines and the Superfund toxic waste site program.

Also, as Trump’s first EPA administrator, Pruitt began a series of rollbacks of environmental protections on air, climate and water. Some have since been tossed in court, like the Affordable Clean Energy rule, which replaced the Obama-era Clean Power Plan designed to curb power plants’ carbon emissions.