Freedom from Oil by David Sandalow, pages 21-25



Print and post this notice on gasoline pumps.

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Review of Freedom from Oil, by David Sandalow

What did you do last summer to reduce our country's dependence on oil?

In June 2006, I was making short videos for my web site. I'm an advocate for putting 100,000 electric cars on the road to supplement the 5,000 cars converted to run on battery power. Those additional electric vehicles (EVs) could boost demand for an advanced battery with longer range. I figured that, in addition to converting my vehicle to run on battery power, I could motivate others to do something to become ?economic patriots.?

David Sandalow did something even more creative than my video series on youtube. The policy analyst from the Brookings Institution had lunch with Newt Gingrich and Howard Dean.

The question he put to both men was the same one that advocates of a post-oil economy have asked since the OPEC embargo of October 1973: ?What should the United States do about its dependence on oil??

Surprise: The answer from both Dean and Gingrich was essentially the same.

Sandalow ?s book is a work of sheer imagination: Why didn't I think of that? Organize a book around the next President's first major policy speech. Imagine that it's April or May 2009, all of the appointments to cabinet positions have been confirmed and the first task facing these new Secretaries is a memo from the President:

The structure of the book is straightforward. Anyone with some chutzpah could have written this, but Sandalow's access through his employer made it easier to compile. By showing responses from the Secretaries of Agriculture, Homeland Security, Labor, Housing, and Defense (as well as the more obvious areas of transportation, commerce and energy), the author shows how pervasive oil has soaked its dependence in our economy and lives. Since reading the policy statements of the Carter Administration (and the ?Moral Equivalent of War? speech), I've seen just about every attempt to reduce dependence on oil fail to produce significant results. As Amory Lovins (Rocky Mountain Institute, a think tank for energy analysis based in Snowmass, Colorado) put it so clearly, the only reason the U.S. economy became less dependent on oil after 1973 was a direct response to price. As soon as motors became more efficient, the demand for oil softened, more supplies were uncovered, the price for gasoline slid, and the pressure to find more substitutes for oil subsided.

Around 1992 Lovins wrote a clever tale about a housewife who was appointed by ?the next president? to lead the Department of Energy. What would an ?ordinary? person do to ?clean house?? The tale took the housewife and the reader through every advance then under discussion in the 1990s and the structure of Lovins? book helped the reader see the many savings possible when the life-cycle costs of projects are considered. Life-cycle analysis is the hallmark of the Lovins approach to discussing alternatives to petroleum and since his Soft Energy Paths appeared in 1977, there hasn't been much doubt that something remarkable could be done ? if we just decided to do something about our dependence on oil.

Four impacts

Sandalow begins his analysis by noting that our policies aimed at reducing oil dependence have failed because the focus was on reducing dependence on FOREIGN oil. Duh. Big surprise. We should have been looking at ways to reduce dependence on oil in general.

He captured on five pages the four points that I failed to summarize in 30 minutes of video (that currently sits on youtube in an account labeled ?Mistermath?). If there is just one portion of this book that future car buyers should be forced to read, it should be pages 21 to 25. One point is central to the drumbeat that electric car enthusiasts have been repeating for three decades: our dependence on oil strengthens oil-exporting nations. The second, that oil dependence helps Al Qaeda, is a new extension of this theme.

The third comes from a military analyst: dependence on oil leads to deaths in Iraq and Afghanistan. In fact, anywhere there are troops deployed in the field, the dependence of armed forces on oil puts personnel involved in transportation of fuel supplies in jeopardy.

Sandalow's point is emphasized with a profile of General Richard Zilmer (who deserves a medal of honor for pushing solar-powered generators to replace the need for gasoline or diesel powered generators). Nine additional profiles are sprinkled through the text, making the executive summaries more digestible. Sandalow is not just a policy wonk adept at summarizing talking points. His imaginative selection of advocates has introduced me to the complex variety of skills that will be needed to move into the post-petroleum era.

His fourth point should be displayed on every gasoline pump: ?oil dependence undermines democracy and good governance around the world.?

The most disappointing feature of the book is the timing. Sandalow assumes that the next president won't act until months have passed in the new administration. As I write this review in October 2007, I fear I'll have to wait 18 months before the major energy policy speech is given. But there's always the hope that some current candidate for the nation's highest office will start the process now to sift through recommendations by various future secretaries. Sandalow's key points (push more batteries, use the federal buying power to jumpstart demand for plug-in hybrid vehicles that run largely on batteries, change zoning to encourage compact development, reduce highway subsidies) will attract detractors, but some candidate could gain a bump in the polls by driving in an all-electric vehicle now and avoid using any gasoline for the next year of campaigning. (Ha!)

The book ends with the text of the major policy speech, which could in fact turn into both a stump speech for current candidates and a major segment of the next inaugural address to the nation. Can you imagine the next president saying the following sentences on January 2009?

> The federal gasoline tax will be increased 10 cents per gallon per year for the next five years.

> Within six months, every car I drive in will be a ?plug-in? hybrid vehicle.

> When U.S. automakers invest in energy savings and higher fuel efficiency, then the federal government will cover health care for retired autoworkers (the proposed ?great bargain? with carmakers)

As an impatient advocate of alternatives to gasoline, I also quibble with how to build demand for the next generation of batteries. Sandalow focuses on plug-in electric vehicle hybrids. He correctly identifies lithium-ion batteries as the next bleeding edge technology breakthrough needed to give hybrid cars the extra range on battery-only to truly make a difference. But manufacturers have to be persuaded somehow to raise the threshold for when the gasoline side of the car turns on. In the Lexus hybrid, which I recently test-drove, the fastest electric-only speed is around 24 mph. Any faster and the gasoline engine engages. Slowly accelerating from a full stop is possible on battery only, but if I stomp on the pedal, the non-electric side of the car takes over. My hope is that it will be possible to drive an electric hybrid up to 35 or 45 mph without the gasoline engine starting up.

The book correctly focuses on the need to increase the number of lithium-ion batteries in use. By increasing demand for a better battery, the price of the battery should come down. Huh? Doesn't increased demand turn into a higher price? Well, initially, of course, but if 100,000 hybrids were suddenly on the road, needing 10 batteries each, that's 1 million more batteries than before. More battery manufacturers would be attracted into a stable new market for batteries if there are lots of users of the batteries. In short, higher demand for lithium batteries should attract more makers of the batteries, increasing production, and, as Adam Smith pointed out roughly 250 years ago, increase in supply leads to a fall in the market price.

Again, why wait for Detroit? Why wait for the federal government to buy 100,000 vehicles? Why not call now for economic patriots to convert their vehicles to battery power? Two years after installing lead acid batteries, the owners of these new electric cars will need 1 million replacement batteries ? which is the same impact that Sand's policy would achieve. The electric vehicle that I'm waiting for (delivery date postponed several times) will have lithium-ion batteries'if 200 other people also come together to buy several containers of these new batteries and help bring the price down. I list on my web site the full story and I encourage economic patriots to consider their ?power of one consumer? acting with others to drop the price of lithium-ion batteries.

Richard Minner, the co-author of the 1991 book Why Wait For Detroit? Drive an Electric Car Today, calls this ?priming the market.? Just as some pumps need water to be in the pipe leading to the pump in order to build suction, so, too, the market for battereies won't get growing until about 100,000 additional EVs are on the road. That would mean about 1 million lead-acid batteries that would have to be replaced every two years, which would provide a steady stream of about a half-million batteries that could be turned into the longer range of an advanced battery (like lithium-ion).

Well, many EV advocates live in the state of ?What if?? and experience suggests that what will really happen is closer to what Sandalow suggests: Wait until spring 2009 for a major policy shift away from dependence on oil. Enthusiasts who want to push the envelope can visit my web site and get more tips on how 100,000 friends of the U.S. economy could help build demand for lithium-ion batteries now, instead of waiting two years for Sandalow's speech to be delivered.

Steve McCrea maintains a web site, whywaitfordetroit.com, that advocates electric vehicles.