Monday, 16 November 2015

Why the US needs Electric Cars: Saudi Arabia threatens Pivot away from US

The royal family of Saudi Arabia, an absolute monarchy with no constitution and no elected legislature, is in a snit about US foreign policy. King Abdullah doesn’t like even the mild American criticism of the Sunni Bahrain monarchy’s brutal crackdown on the majority Shiite community in that country. He is furious that President Obama went with the Russian plan to sequester Syria’s chemical weapons rather than bombing Damascus. He is petrified of a breakthrough in American and Iranian relations that might permit Iran to keep its nuclear enrichment program and allow Tehran to retain a nuclear breakout capacity, which would deter any outside overthrow of the Iranian regime. Those are the stated discontents leaked by Saudi uber-hawk Bandar Bin Sultan.
Behind the scenes, another Saudi concern is that the US likes democracy too much. Washington ultimately backed the Arab upheavals that led to the fall of presidents for life in Tunisia, Egypt, Libya and Yemen. Saudi Arabia hated this outbreak of popular politics and parliamentary competition. It connived with Egypt’s generals to roll back gains in Egypt in favor of more authoritarian rule. It has just cut off Yemen because the post-Saleh situation there isn’t developing its way. Only in Syria do the Saudis want regime change, and there it is because they want to weaken Iran and depose a Shiite ruling clique in favor of a fundamentalist Sunni one.
The Saudi royal family is looking for a different model of politics in the world, one where absolute monarchy and hard line Wahhabi fundamentalism wouldn’t look out of place. America is not it. They have been toying in Riyadh with a pivot to China. An unelected Communist Party that has taken the capitalist road and desperately needs Saudi petroleum has started to look good to the king. Beijing would make no annoying demands to open up Saudi politics. And if a Riyadh-Beijing axis could be established, Iran’s favored position with the Chinese might be cut back. Saudi Arabia is after all a much bigger oil producer and much less problematic as a trading partner.
Why should the US care if Saudi Arabia wants to abandon its special relationship with America? Oil.
The world produces about 90 million barrels of petroleum a day. Saudi Arabia produces about ten percent of that amount. And, it exports most of what it produces (unlike the US, which produces a similar amount but uses it all and half again as much). While there are small differences in the spot price of oil in various world markets, on the whole and by and large, petroleum is a single global market. Imagine several people in a hot tub filled with oil. If someone allows the oil to drain, the level will go down for everyone. Tub attendants with small canisters of oil could not refill it fast enough to stop the level from going down rapidly. But someone with a lot of oil who could dump it into the tub expeditiously could keep the level high. That someone is the Saudis. Because they are such a large exporter, they are a swing producer and have great influence on pricing.
The United States uses roughly 18.7 million barrels of oil a day, mainly for transportation. It now produces 12 million barrels a day of oil, ethanol and liquid hydrocarbons. That means it has to import a whopping 6.7 million barrels a day of oil this year. While US production has surged in recent years because of hydraulic fracturing (fracking), it is very far from being self-sufficient in fuel, and there is little early prospect of it being a net exporter of oil. Many fracked fields are thought to be shallow and might run out pretty quickly, and the enormous water use and environmental damage involved in the process has caused many countries, including France, to ban it. It would be foolish to bet the future of the United States on this flash in a pan. Not to mention that burning oil causes global warming and threatens to destabilize our climate and submerge cities like Miami.
Moreover, since oil is a single world market, it doesn’t really matter for security or economics solely that the US produces a lot of it. It also doesn’t matter that America gets relatively little oil directly from the Middle East any more. What matters is the world price, which is determined by global supply and demand. Note that when the US was only producing 8 million barrels a day of oil and other fuel liquids, a few years ago, the price of a barrel of oil was $33. Now it is around $100. Despite the surge in US production, the price is at a historic high, because China, India and other Asian countries are rapidly increasing their demand as they turn to having automobiles rather than riding bicycles. If there were another major supply interruption, the US would be as vulnerable today as in the 1970s— we would feel the shortages and higher prices just as would our allies, whom we would want to protect. Using petroleum as a fuel source, even if you produce a lot of it yourself, makes you dependent on other countries in myriad ways.
So if the Saudis were to start doing proprietary deals with China, locking in a 30 year supply at a particular price range, and if world demand went up (as it will) markedly, the US could end up being like the player in a game of musical chairs, who ends up without a chair. Despite its large domestic production, it still needs millions of barrels a day of imports. If the US economy starts roaring again, the need for imports would likely increase.
US energy security cannot be secured by fracking, which is polluting, dirty, and contributes to climate change (itself a challenge to American security), quite apart from its present inability actually to supply our fuel needs.
If the US wants to avoid being hostage to Saudi pique, and wants to avoid losing the game of musical chairs while China sits pretty, it needs to move quickly to electric cars fueled by solar panels and wind.
Most people don’t drive long distances every day. Even now, there is no reason for every middle class American who wants a new car not to get a Chevy Volt. The car is not expensive for what it is (it is a high-end sedan), and is positively cheap if you put solar panels on your roof and run it off the sun. Many other car makers are also introducing plug-in hybrids. We don’t have to deal with the Saudis and we don’t need dirty hydrocarbons or destructive fracking. Everyone with a Chevy Volt should proudly put an American flag bumper sticker on it. There is no more patriotic car on the road today.
With regard to global warming, at the moment, if you run your electric car for more than three years and if your electricity mix is no more than 40% coal, you would be carbon neutral in the fourth year. This takes into account carbon used to construct the car. Silly articles about electric cars that tell you how green they are by how much coal your utility uses in your state or country don’t take account of individual consumers’ ability to put solar panels on their homes. Likewise, how much carbon is used to build the car will change as factories themselves come to be fueled by wind and solar (something already happening in e.g. California). Another reason to buy a volt is to encourage Chevrolet to do more research and development and invest in EVs more, to ensure better batteries and to ease the transition in the next decade. The batteries are being eyed after the car’s natural life as a way to store solar energy for utilities, in which case its carbon footprint will go way down.
But with regard to national security, you’d be fuel-independent, i.e. Saudi-independent, from the moment you drove it off the lot.
Two big reasons to go rapidly to electric vehicles and solar and wind and wave power.

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