Energizing America.

• Author: Saunders, Paul J.

Energy has been a fundamental driver of human advancement across millennia. At the simplest level, having more energy--whether in its biological, chemical, thermal mechanical, electromagnetic or other forms--allows individuals and societies to do more. From this perspective, human history and its many contests among nations have in part reflected continuous efforts to develop, control and use energy of one type or another. Consider how Imperial Japan's lack of oil played a role in its (ultimately self-defeating) efforts to dominate East Asia. Or how the Soviet Union's energy wealth sustained what might otherwise have been an unsustainable political and economic system.

Energy innovation--including finding new and more efficient ways to generate and use energy--can also help to build and sustain empires. Britain's coal-fired steam-powered mills, factories and ships propelled it to global dominance. To maintain U.S. international leadership in the face of growing competition, the Trump administration and Congress should work together to promote modern-day American energy innovation.

President Donald Trump and his team have already focused intently on energy and its role in America's prosperity and security. They doubtless recognize that the oil and gas industry supports approximately ten million jobs, while the electric power industry accounts for about seven million. Between them, and discounting for possible overlap, these two sectors could account for roughly ten percent of American jobs in an overall labor force of 163 million. On top of this, the American Public Power Association reports that electricity sector jobs pay 50 percent above the national average, while the American Petroleum Institute says that earnings in oil and gas jobs generate three times the national mean wage. Trump regularly connects energy and jobs in his public statements.

Energy and electric power contribute importantly to the U.S. economy in many other ways as well. At the simplest level, energy and electricity drive everything else--without them, our manufacturing, transportation, agriculture and communications would shut down. Since this is an unlikely scenario, however, a greater concern is that higher energy costs make everything else more expensive, slowing growth. Lower energy costs make other activities less expensive, facilitating growth and individual opportunity. Relatively low energy costs likewise improve America's international competitiveness in energy-intensive industries--witness the movement of some German manufacturing to the United States over the last decade.

Energy matters in U.S. national security policy too. America has pursued a decades-long strategic effort to ensure stability in the Middle East and to protect oil and gas flows that fuel not only our own economy but also those of our allies in Europe and East Asia, as well as the global economy. Some see this as an attempt to guarantee that specific hydrocarbon molecules reach the United States, and therefore hope that expanding domestic oil and gas production will allow America to reduce its imports, make the nation energy "independent" and obviate the need for U.S. engagement with the region. Yet, so long as the United States consumes oil and gas, and the Middle East sells them in substantial volumes through global markets, it will be impossible to disconnect our domestic economy from global oil and gas prices or from the security environment in the Middle East. And because a healthy economy is the essential foundation for sustained defense spending, something especially significant in an era of great power competition, the U.S. military depends in part on Americas continued access to adequate energy supplies at reasonable prices as well as open energy markets and a generally stable global economy.

While the president often refers to "energy independence" as a goal, the Trump administration has done well to search for a new concept, and a new vocabulary, to describe America's energy policy objectives at home and abroad. "Energy dominance" is an initial step toward a new energy policy framework but moving further along that path will require serious thinking about America's preferred destination, the most promising routes and the appropriate pace. Energy innovation should be at the center of this process.

President Trump first articulated his desire for "energy dominance" in a June 2017 speech to business, labor and government leaders at the Department of Energy. In his remarks, the president called for maximizing U.S. energy production to create jobs, boost exports and "provide true energy security to our friends, partners, and allies." He also announced several initiatives, including efforts to develop the domestic nuclear power industry and to promote new offshore oil and gas development, steps to simplify the financing of coal-fired power plants overseas, and approvals of a new oil pipeline and applications to export additional liquified natural gas (LNG). All seemed narrowly aimed at expanding growth and output in the energy and electricity sectors. Senior officials such as Secretary of State Mike Pompeo and Secretary of Energy Rick...