Saturday, May 7, 2011

Governor Palin and Forward Focused Leadership--Part I

President Reagan once said, " to grasp and hold a vision--that is the very essence of successful leadership". One of the keys to leadership is being forward focused. This involves seeing beyond the next release of one's polling data, seeing beyond the next budget, and beyond the next election. It involves seeing the possible barriers and knowing how to address them based upon the successes of the past while also seeking for ways to address problems in the future. However, so often politicians make decisions based upon their own selfish myopic vision or a vision based upon yet to be proven ideas. True leadership involves making decisions in light of what's best for both the present and the future. When we look in particular at energy, we can certainly see that Governor Palin has exhibited forward focused leadership.

We aren't energy independent, and energy prices are high because politicians have not had the political will to drill in America, which would both make us more independent and help increase the worldwide oil supply so that it is not so dependent on unstable countries. A forward focused politician like Governor Palin understand this very well. To address an energy price crisis, you must prepared for the crisis. You can't be floundering looking for companies and speculators to demonize, nor be unable to offer true solutions. One major way to combat a potential crisis is essentially to prevent it and/or mitigate its effects. It is simple supply and demand economics, as Governor Palin discussed last night. If supplies are decreased and demand is held steady or increased, prices are going to go up. Unrest in oil rich countries like Libya have decreased supplies, which has influenced President Obama to call for the Saudis to ramp up their production. Additionally, he has praised and funded drilling in Brazil in hopes of helping America to be one of Brazil's "best customers". Neither of those supposed solutions bring America any closer to energy independence, nor are they the result of a forward focused plan.

Of course, the better option is to have been drilling here in America which would add to the supply of oil internationally in addition to adding to the economic, monetary, and the national security strength nationally. Governor Palin, of course, has been a strong and longtime proponent of drilling in places like ANWR. In 1996, President Clinton vetoed a bill that would have allowed drilling in ANWR. Liberals often poo poo such notions as drilling because it would supposedly take ten years for oil to be produced. Of course, it has now been fifteen years since President Clinton's veto. Oil producers in Alaska could have been developing for at least five years by now, which recent estimated would result in oil production at a minimum of around a half million barrels per day.

Yesterday marked the one year anniversary since President Obama put a moratorium on offshore drilling following the Gulf oil spill. Although he has lifted the moratorium, he has been very slow in issuing permits, and the EPA, an additional regulatory arm of the Obama administration, has been antagonistic to offshore drilling. Governor Palin also has been very critical of President Obama's offshore drilling moratorium. In fact, in response to a question on what she would do to help ease oil prices, she mentioned that she would not have instituted the drilling moratorium:
I never would have done what President Obama did and that’s engage in that moratorium after the tragedy in the Gulf with the spill. He should have been more sensible in figuring out what the problem was, what the solution was to the gulf spill but not take it out on the rest of the country and prohibit drilling onshore and offshore is what he did. 97% of our offshore area locked up after that and there still is a quasi-moratorium because the EPA is making it virtually impossible for drillers to be out there extracting responsibly the God-given resources that we have domestically.

[...]

Now the President is engaged now in what he wants to get to the bottom of with whether it be collusion, or price fixing, or speculators, what else is driving up the cost. Well he can look at other states like Alaska. We already did a study to find out was it collusion? Was it speculators? What was driving up the last big spike in gas prices? And we found that no, more than anything it is a supply-and-demand, a very basic economic principle, supply-and-demand.

These are not the words of a woman who is merely engaging in armchair politicking. Governor Palin was forward focused during her tenure a Governor. In addition to being a strong proponent of expanding energy development to help make America more energy independent through drilling for oil, she also acted to move development of natural gas forward through the development of a pipeline that would bring natural gas from Alaska to the Lower 48. As Governor, she moved a natural gas pipeline project further than any of her predecessors. A New York Times hit piece in March tried to attack AGIA, but all of the evidence points to AGIA as being right on target:
The New York Times also questions the progress of Governor Palin’s natural gas pipeline project–the Alaska’s Gasline Inducement Act (AGIA)–which will bring natural gas from the North Slope of Alaska through Canada to the Lower 48 as an additional means of achieving energy independence. Governor Palin’s pipeline project was done in a transparent free-market friendly manner with proposals available for public consumption-- a far cry from the behind-closed-doors pipeline discussion with oil companies that were commonplace and unsuccessful in previous administrations. The New York Times argues that neither gas suppliers nor federal permits had been obtained for the project.

However, at the end of the first open season for bidding by gas suppliers this past summer, there were “several major players” who had submitted bids. Additionally, the pipeline company TransCanada and oil company ExxonMobil, both partners on AGIA-backed pipeline project, have had discussions with BP-ConocoPhilips to work together on the project. Additionally, the permitting process with both American and Canadian regulatory agencies has made “significant progress,” and the progress is right on track with time projections.

Following one of the early successes of this project nearly two years ago, Governor Palin was interviewed by Matt Lauer, where he questioned the need for the pipeline as natural gas prices were low at the time.Governor Palin called such an idea "short sighted" (see especially at the 2:15 mark and following):



Governor Palin is right about the need to make America energy independent when it comes to both oil and natural gas. She also was right to note the short sighted nature of evaluating future energy development entirely upon current prices. The most recent natural gas futures were at $4.58 per MMBtu (million British thermal units). When Governor Palin was interviewed in June of 2009, natural gas futures were at $3.56 per MMbtu. Prices have increased. Governor Palin was right to note that it would have been short sighted not to proceed when natural gas prices were low. As you can see in this chart here, natural gas prices are volatile, just as oil prices are. What is the best way to deal with both? Ensure that there are sufficient supplies produced in the United States. Increased domestic supplies soften the blow when instability in other energy producing nations affect the world energy market. Additionally, such efforts would provide jobs and protect America's national security.

Critics may claim that someone who is forward focused on energy would be looking to green energy initiatives as President Obama has focused on green energy in his last three weekly addresses and in much of attempt to deal with the current high energy prices. Governor Palin has been rightly critical on the overemphasis of such initiatives, pointing to the failure of green energy in Spain that has crippled employment and contributed to their massive debt problem. Meanwhile, President Obama is pushing for electric cars that have proven to have major problems and are mostly re-charged on energy derived from fossil fuels like coal. Governor Palin recognizes that in the desire for energy independence, knowing what doesn't work is just as important as knowing what does.

Part of leadership involves solving problems, but another part of leadership involves having the foresight to both prevent problems from happening in the first place and mitigate the effects when there are problems. This is why Governor Palin warned that not seeking energy independence would result in the federal government being tempted to tap into our strategic petroleum reserves. That is why Governor Palin has been a very vocal proponent for expanding offshore drilling and drilling on land in the United States. That is why she championed the natural gas pipeline to bring Alaska's abundant natural gas to the Lower 48. That is why she has the justified skepticism with the social engineering disguised as "green energy" focus of the Obama administration. Governor Palin has shown that she has the leadership skills to be both a problem solver and a problem preventer.
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