Global Realities: How Middle East Unrest Shocks US Economy

By Tom Buis | March 11, 2011

For the past 40 years—across a span of eight presidents—the control of our nation’s economy has been in the hands of oil-producing nations. Every president since Nixon has warned that the influence of foreign oil in our economy is a threat to both our national and economic security. Yet for 40 years, our federal government has failed to ultimately deal with the problem of our national addiction to foreign oil.

Today, we are reaping the bitter fruit of the seeds planted 40 years ago when OPEC first flexed its cartel muscles. Today we are seeing political turmoil and unrest spreading across North Africa and the Middle East. The market is responding to this by pushing up oil prices to highs we have not seen in nearly three years—forcing more Americans through misery at the fueling station.

According to Navy Secretary Ray Mabus, every $10 increase in the cost of a barrel of oil adds more than $300 million to what the Navy pays annually for fuel—just one more example of a cost borne directly by U.S. taxpayers. And for every 24 convoys that transport fuel to military bases in Afghanistan, one American is killed and wounded. 

As the Truman National Security Project points out, the majority of that hard-earned money flows out of the wallets of everyday Americans and into the coffers of nations that are either not interested in American values, or are outright hostile.

How many warning signs will it take for us to realize we are in trouble?

As long as petroleum from unstable, hostile regimes has undue influence over our economy, we will always be at threat. We need to change our policies, and embrace the biofuels we have the capacity to produce here in the United States if we are ever to break the hold that foreign oil has over our country.

Growth Energy is reminding Congress that ethanol—made right here in America—is an engine for job growth and a critical part of our renewable energy future. It is not a someday fuel; it is replacing foreign oil today, and if we lift the artificial hurdles blocking access to the fuels market, it can replace more. American ethanol is the sole alternative to oil from unfriendly and unstable nations like Saudi Arabia, Iran and Libya.

It was 40 years ago that OPEC first manipulated oil production and plunged the U.S. economy into an oil crisis. Since then we have had conflict in and with the Middle East. We’ve invested generations of soldiers and untold trillions in warfare in the Middle East over access to oil. We’ve experienced $4-gallon gasoline, gas lines and oil shocks to our economy. Isn’t  it time we invested in ethanol?

We have had the opportunity in the past to break this chain. Today we have the technology and the know-how to do something about it. But we must get Congress to enact policies that will ensure access to clean, domestically produced alternatives like ethanol if we are ever to break the hold that Middle East oil has over our country.

Author: Tom Buis
CEO, Growth Energy
(202)545-4000
tbuis@growthenergy.org