Douglas Holtz-Eakin

As a policy matter, don’t read much into the recent dip in oil and gasoline prices. Sure, dropping at the advent of the summer driving season bucks historic trends, but this is just one more episode of fluctuations in prices on the global market. To be sure, there’s no one to thank for this trend, either.

Just as prices dropped during the recession in 2008, prices are dropping now. Europe’s fiscal maladies are undercutting growth, Japan’s economy is slow to recover, China’s economy is seeing its weakest growth in over a decade, and the U.S. economy is failing to gain momentum. At the same time that global demand is weakening, OPEC is upping production to edge out competition from new fields in the Western Hemisphere. On top of this, diplomatic tensions with Iran are easing, diminishing nerves in the marketplace. The fundamentals haven’t changed; we’re just benefitting from the confluence of several global trends putting some bearish pressure on the oil markets.

The seemingly low oil prices are looking good right now

President Obama owns high gas prices, whether he’s responsible for them or not. As he travels the nation trying to claim credit for glimmers of good news in our energy economy, he can’t shed blame for high gas prices, no matter how dire they seem for his reelection prospects.

So if the president isn't responsible for high gas prices, who or what is? It doesn't help that oil is a global commodity, easily transported to the land of the highest bidder. And developing nations are aggressively trading for oil, seeking to fuel economic development and ever richer populations. Concern about the combustible Iranian regime and what that means for the future of their oil production is also driving up prices. Since global crude oil prices make up about three fourths of the price of a gallon of gas, these are considerable obstacles to affordable gasoline.

There are local issues, too. Like the glut of supply at Cushing, Oklahoma, with no practical way to get the oil to refineries and buyers. This week, Obama will go to Cushing and talk about what his admini

As a member of the McCain campaign that popularized the “all-of-the-above” slogan, I shudder at the president’s use of the term. While we used the phrase to talk about opening up energy development and innovation in every corner, Obama is trying to pacify disgruntled Americans who are sick of his “anything-but-fossil” energy policies. In a deft re-election tack, the president seems to have figured out that oil & gas development can actually be good politics. Unfortunately, he has yet to discover that it is also good policy.

This administration – contrary to their press releases – has hardly lifted a finger to increase production of oil & gas. In the State of the Union, the president proudly declared that he’d open more than 75 percent of our potential offshore oil and gas resources to development. This is part of Interior’s existing five year offshore leasing program, which comprises fifteen new lease sales in the Gulf and Alaska – fourteen of those sales in areas already being explored and developed

President Obama’s politically-motivated decision to turn down the Keystone XL pipeline probably shouldn’t have been a surprise, but it’s informative to learn how the president weighs an economic no-brainer versus a political opportunity. With stubbornly high oil prices and unemployment, his refusal to grant approval for Keystone is easily an embarrassment to our national energy policy. With the progressive green wing already in his camp, it’s a speculative move, at best. Lesson learned: a small probability of political self-promotion trumps the national interest – and the law.

Blaming Congressional conservatives for imposing a “rushed and arbitrary” 60 day deadline to decide on Keystone, the president said that the State Department didn’t have time to fully assess the pipeline. Unfortunately for the president, this accusation is toothless. The State Department has been considering the pipeline route for more than 3 years, and the final Environmental Impact Statement for the pipeline – demonstrating no significant

In an ideal world, Congress would pass a clean bill to fund government operations past Friday. Policy riders on spending bills diminish our ability to consider and make good policy, and cloud spending decisions with controversial extras. But with high unemployment, exploding federal debt, and a stagnant economy, it’s entirely appropriate to make spending contingent upon thoroughly reviewed, pro-growth policies. Here’s my energy wish list.

Approve Keystone. Alberta tar sands will be developed and sold to market, regardless of American action or inaction on a new pipeline. By punting on the decision to build Keystone XL, President Obama challenged Canadian oil developers to find another buyer, compromised our ability to expand our profile in the international oil market, and put to bed thousands of American jobs. Congress can and should use the spending debate to force the administration’s hand. Speaker Boehner has kept his eye on the prize – job creation – and it’s time the administration stepped up.

Retire energy tax

This Thanksgiving, I visited my mother at her retiree community in Florida. When she moved there I remember people walking, or getting around by tram. This time, I saw an army of golf carts. Government-subsidized golf carts.

The Emergency Economic Stabilization Act of 2008 included a low-speed electric vehicle tax credit, applying to vehicles purchased in 2009. More than 20 companies got approval for golf cart-like vehicles that year; many were specifically designed to receive credits up to the full purchase price of the vehicle. That means some folks got free golf carts, courtesy of Uncle Sam. Talk about waste.

That’s the beauty of expiring tax credits: We get to step back and reevaluate if this is really how we want to use limited resources. In the case of energy tax credits, especially in the current fiscal climate, there’s a better way to spend government funds.

Many argue that tax credits promote economic growth in emerging markets and level the playing field with incumbent technologies. Instead, these subsidies muddy the playing

As a member of the McCain campaign that popularized the “all-of-the-above” slogan, I shudder at the president’s use of the term. While we used the phrase to talk about opening up energy development and innovation in every corner, Obama is trying to pacify disgruntled Americans who are sick of his “anything-but-fossil” energy policies. In a deft re-election tack, the president seems to have figured out that oil & gas development can actually be good politics. Unfortunately, he has yet to discover that it is also good policy.

This administration – contrary to their press releases – has hardly lifted a finger to increase production of oil & gas. In the State of the Union, the president proudly declared that he’d open more than 75 percent of our potential offshore oil and gas resources to development. This is part of Interior’s existing five year offshore leasing program, which comprises fifteen new lease sales in the Gulf and Alaska – fourteen of those sales in areas already being explored and developed

Punting on Keystone XL is a mistake, but consistent with the President’s record. While touring the country blaming Congress for all his political ills, President Obama is pulling the plug on 13,000 private sector jobs, an infusion of $7 billion into the economy, and a secure supply of future oil.

Let’s start with why Obama punted on Keystone XL. The Ogallala aquifer isn’t exactly a new discovery, and this wouldn’t be the first pipeline to traverse it. The White House is playing the politics of punting not out of concern for the environment, but out of concern for their hide. The pipeline is dividing two of Obama’s key constituencies: unions that are advocating for new construction jobs, and environmentalists arguing against Canadian oil. Unable to please both sides, the president is meeting this latest challenge with his practiced response of political cowardice (see also: healthcare reform, super committee).

If the environmentalists think they’ve won, they’re foolish. Canadian tar sands will be developed, no matter

We keep talking past each other about the EPA, so I think we should refocus the discussion: With 9% unemployment and 2.5% economic growth, is the pace of EPA regulation appropriate today?

Sam Batkins, Director of Regulatory Issues at the American Action Forum, keeps a running tally of the costs – in both dollars and man hours – of every piece of legislation the administration has proposed or implemented in 2011. The math isn’t great: By EPA’s own estimates, 2011 will cost industry $37 billion, 6.3 million paperwork burden hours, and 60,100 jobs.

To defend their actions in the current environment, the administration and others on the left are touting a sort of “regulatory Keynesianism,” in which new regulations create good, high-paying compliance jobs. Though it may be a fashionable and timely claim, the idea that the EPA is some engine of economic stimulus is utterly laughable. They

This is becoming a common refrain: When it comes to helping our energy sector invest in critical technologies, the government should promote robust competition on a level playing field, reduce disincentives to investment and trade, and support basic research and development. Any government assistance beyond these basics increases uncertainty, distorts the market, and generates boom-bust cycles for some favored technologies (see: Solyndra).

Let’s back up. Anyone who speaks of “winning” a “race” in clean energy is assuming a rather abrupt and methodical shift away from fossil fuels. This is unrealistic. Fossil fuels are – and will continue to be – the backbone of our energy infrastructure. A rapid transition away from these fuels will be unduly expensive and economically damaging. Instead, I expect a slow shift toward new sources of energy fueled in large part by improving the ways we extract and burn fossil fuels. This is happening now, and America is undoubtedly winning this race.

When alternative energy sources become su

Absolutely, the administration should green light drilling in the Arctic. That this is still a question is a reflection of the lethargic and burdensome permitting process that is tying up resources and hobbling domestic economic investment.

We hear a steady stream of chatter from the left that Big Oil is sitting on profits instead of launching new investments in the United States. But what choice have we given them? Shell has invested $3.5 billion and five years in the Arctic. They’ve complied with every request to make their drilling fleet cleaner, prevent and protect against catastrophic spills, and guard against damage to Arctic ecosystems. Still, there’s no answer as to whether they’ll be able to turn this investment into a drop of oil or a cent of profit. To their credit, Shell hasn’t packed up and moved on.

We all know that developing Arctic oil isn’t going to bring back $2 a gallon gasoline, and I’ll be the first to say that we need to set ourselves on a path that diversifies fuels and weans our transportation sect

The role of government in energy production should be limited to promoting robust competition in the market by leveling the playing field, removing barriers to trade and investment, and funding basic research that leads to new technologies in the market. Instead, this Administration favors a disjointed and uneven set of favored technologies and fuels that provides no long run incentives for technological advancement.

Solyndra is just one (albeit dramatic) example of failed government policy. No amount of spending will find us a shortcut to American dominance in a solar- or wind-powered world.

Tax credits, loan guarantees, and other subsidies undercut market competition and substitute opaque bureaucratic processes, and limit opportunities for private investors to support ground-breaking discoveries that will change our energy future. If the Administration wants renewable energy technologies to succeed, it should reduce barriers to private investment and push the market to innovate on its own.

President Obama’s decision to delay revisions to federal ozone standards—a move which EPA’s own analysis priced between $20 and $90 billion—was one of self-preservation heading into a re-election campaign while job creation ranks as the top concern among voters. With unemployment above 9 percent and a tenuous short-term economic outlook from the Federal Reserve, it’s a political liability to institute rules which hamper the ability of American businesses to grow and generate new employment opportunities.

The EPA has been touting the proposed ozone rule and many of its other regulations as job creators. In fact, the agency recently released a cost-benefit analysis indicating that existing regulations under the Clean Air Act would add $1.75 trillion to the economy by 2020—nearly 10 percent of projected U.S. GDP. Any policy which could deliver such a boon to America’s economy would certainly be coveted amongst Presidential candidates. To date the American people haven’t bought the line that regulations are the key to 21st Cent

There is little doubt EPA imposes a tremendous burden on job creators. Most economists will admit that regulations operate ostensibly as a hidden tax on American consumers. The higher EPA’s regulatory burden, the more Americans must pay, and the more our economy suffers.

According to American Action Forum research, EPA imposed more than $25 billion in compliance costs since January 1. In addition, EPA’s own estimates reveal that its recent proposals could cost more than 61,000 jobs. With the exception of its greenhouse gas regulation, most of these measures implement existing federal law. The problem of runaway regulators, however, is widespread.

Net neutrality, the Department of Education’s Gainful Employment rule, and a slew of NLRB rulemakings embody regulators routinely circumventing Congress and imposing their own legislative agenda.

With these obvious problems and the current political climate, bipartisan regulatory reform must pass. President Obama’s recent Executive Order was a first step, but major rescissions are rare. Bi