Déjà vu – Lessons learned from the “Peak
Oil” crises of 1973 & 1979
By Alice Friedemann.
Howard Bucknell
III. 1981. Energy
and the National Defense.
This is a very important
book because it’s about the energy crises of the 1970’s. Back then, President Carter, Kissinger, Bucknell, and many others saw this as the start of the
energy descent. So it’s very relevant
to today to see what actions were taken, how energy was dealt with politically,
the institutions created to solve the energy crisis, and the issues, failures,
and problems encountered when trying to take action.
Surely we ought to learn
what we can from the “dress rehearsal” given the wasted decades and short time
left.
Although this book talks
about the
Bucknell’s book is also timely because one reason he wrote it
was to warn military planners that lightning raids on oil fields in the
Bucknell wanted to see two main efforts: liquefied synthetic
fuels to solve the transportation problem, and energy conservation.
Bucknell writes with such nuance and subtlety that he’ll
wince at my bluntness, perhaps enough to correct me and enter the energy debate
if he’s still around. There’s a lot we could learn from him. After all, he’s been there, done that.
Making the Energy Transition
Bucknell summarizes past energy transitions and noted that it
took forty to fifty years of social, economic, and political adaptations to
switch from wood to coal and coal to oil. The 1973 and 1979 oil shocks alerted everyone
the time had come to switch to other sources of energy, in a timeframe much
less than past energy transitions.
He felt it was hard for our
government to prepare for the transition because planners had no idea what the
likely reserves were, since private companies and foreign governments weren’t
required to report verifiable data.
He explained why switching
to new energy bases couldn’t be done easily, quickly, or cheaply, and the need
for multiple alternatives.
Where Bucknell
really shines are his explanations of all the non-technical barriers to making
the transition.
The economic barriers are
formidable. Previous energy transitions were market driven. But the new transition must be directed by
the government due to the limited time and domestic oil supplies as well as the
need for military protection during our vulnerability in the transition.
To make the switch in time,
the federal government would need to direct and fund the research and initial
capital investment. The source and
amounts of these funds is bound to become a major political issue. Even with both private capital and public
funds it’s not likely the nation could develop alternative energy resources in
time to prevent social trauma. If imported oil was cut during the transition,
the social disorder would become even worse.
He wasn’t sure how we could
even find the capital to switch our energy base, since so much money was
required, and the defense department would be competing for these funds.
Bucknell wasn’t sure that our social, political, and economic
structures could make it through the transition without being changed in
terrible ways. He felt it was impossible
to take the required draconian measures in the very short time left without
crushing democracy, and the results weren’t certain and might even be plain wrong. Within this “paradox lies the potential for
chaos at home and disaster abroad”.
Bucknell criticized the energy studies of the 1970’s for
being overly optimistic since they ignored the fact you can’t substitute one
energy source for another. For instance,
nuclear power can’t substitute for oil in transportation. These studies also ignored the “legal,
ideological, technological, economic, and political difficulties” energy
decisions move through.
He depicted one of the
political barriers by asking the reader to imagine a politician announcing we’re
“going electric”. From now on, everything
would be nuclear power driven. Everyone
would be up in arms, from the guy who just bought a car to the industrial,
agricultural, transportation, and military sectors -- all heavily invested in
fossil fuel infrastructure. He’d be
thrown out of office.
Another interesting aspect
of Bucknell’s book were charts of how large a piece
of the energy pie the military has always taken, will continue to take, and how
enormous their slice would be if we entered a major war. He worried that during the transition, our
weaknesses could lead to economic or military confrontations that would
threaten our national security.
Most energy studies assumed
there’d be a growing dependence on imported oil and minimized the need to
produce synthetic fuels. Bucknell felt that
was a tragedy, since that would lead to continued voracious consumption of oil,
shortening the time of our oil-based civilization and the time needed to make a
transition.
Decreasing energy and higher
prices would result in massive unemployment and depression, “even though a
transition to a service economy is being made”.
He believed that if we wanted
to preserve our society, our main preoccupation needed to focus on developing a
number of energy sources, especially in transportation fuels.
It’s obvious that the social
and economic future of industrial nations depends on energy at affordable
prices. The survival of our civilization
“depends a great deal on what actions the
Energy and Democracy
Bucknell says that just as democracy in
Democracy requires a large
and strong middle class, but an energy decline will shrink the middle class and
make it more likely the
In times of emergency, the
actions we take change our form of government, such as when we sent many
Japanese to internment camps during World War II. Bucknell wondered
what an energy crisis that lasted for a decade or more would do to our
government.
In 1975 Henry Kissinger said
there was no issue more basic to the future than the energy challenge. Energy drove our economy and sustained modern
civilization. Without energy, nations
risked rivalry and economic depression.
For Kissinger, the 1973 embargo meant we no longer had control over our
economy or our progress, and our well-being was hostage to decisions made by
others.
Bucknell doubts a democracy can make the decisions needed to
survive before being overwhelmed by the obviously coming energy crisis, because
the public’s understanding of the energy situation is so far removed from
reality. When given uncertain and
contradictory information, the public believes what they want to believe. And politicians rarely attempt to educate the
public factually.
How the transition is made
is important as well – if prices are used to change energy consumption, there
are issues of economic and social inequality.
If oil exporters set prices, we risk economic instability, which is
likely to lead to social and political instability, which then leads to
“demagogues and terrorism”.
The only way dictatorship
can be avoided and democracy survive, is to start early and begin moving
forward. The faster the transition is
made, the less social disorder there’ll be, and time may be shorter than we
think.
Bucknell concludes his book with a call to all of us as
citizens to intelligently work hard together during the dangers of the next
decades. It would be a shame if the
epitaph of the great American experiment in democracy were “Canceled due to a
lack of energy”.
Bucknell on Solutions
Bucknell believed there was no one solution to replacing
fossil fuels, and that synthetic fuels were critical to solve the
transportation problem. He also thought
conservation very important, since it could mean the difference between having
to wage war, and winning if attacked. The
National Research Council Committee on Nuclear and Alternative Energy Systems
reached similar conclusions in 1980, urging the development of synthetic liquid
fuels, with an even higher priority on conservation of energy.
Bucknell believed that coal to oil was the best solution, but
wasn’t sure how feasible it was. The ERDA “Coalcon”
project, which attempted to convert coal to oil in an environmentally clean
way, was terminated in 1977. He
speculated it was shut down due to bad management or an inability to cleanly
process high-sulfur coal. He noted that scale-up
factors and costs from a quarter-scale demonstration model to a full-sized
plant are seldom linear.
Since liquid coal was
unlikely within ten years, he foresaw that coal would be burned instead to generate
electricity, and create huge environmental problems. Since the atmosphere at some point would
become lethal, he said new liquid coal plants must be required to remove sulfur
and other pollutants.
He was not hopeful about
economic and political barriers being overcome to construct coal liquefaction
plants. There was no chance the oil companies would build them, since they were
driven by short-term profit-making goals.
Only the government could possibly build these plants, but when the
Synthetic Fuel Corporation was proposed by President Carter, it was opposed by
environmentalists as well as conservatives, who didn’t think the government
should be involved in industrial production.
Other attractive fuels that
could be liquefied, like heavy oils and tar sands, were more economic than coal
liquefaction, but had the drawback of mainly being found outside the
Bucknell knew that natural gas wouldn’t solve our problems,
because production had peaked in 1973, and stated there were only twenty five
years of uranium reserves unless we built breeder reactors.
Nor could
Bucknell pointed out some of the limitations to solutions
being proposed -- city gas didn’t have enough heat content to support many
industrial processes, and we needed more railroads to carry coal. He noted that
the Department of Agriculture was in charge of alcohol production, which he
said was already “a decision of questionable merit”.
Several quite adversarial debates
in the typical “winner-take-all” fashion were preventing action from being
taken. Each side insisted their solution
was the only approach. For example, there
was the “high-tech, hard science” group insisting centrally distributed
electricity from large nuclear and solar plants was the only way to go, while
the “low-tech” group countered with conservation and local wind and solar.
Then there were those who
claimed we were finally about to get our comeuppance for using finite resources
so wastefully. They saw the energy
crisis as a blessing, and sided with the environmentalists who argued against
endless growth. They believed pollution
and other environmental harm needed to be factored into the cost of
energy.
And how could you move
forward when so many of the debates were about whether the energy crisis was
real or not, politicians were blaming the opposite political party, and many
were blaming the oil companies?
Energy Crisis as Seen in the 70’s
Back in the seventies, the
public was convinced oil companies were ripping off the public and engaged in
conspiracies. Bucknell
is exasperated that neither the public nor the energy task force Nixon
commissioned in 1969 grasped that there was a finite amount of oil, gas, and
coal to fuel civilization. This fact has
“yet to be, perhaps cannot be, accepted by the American people”.
The first energy crisis
struck
Carter decided to give the
public the painful news in 1977, building interest up in his speech by releasing
a CIA report which portrayed oil reserves running out. The four percent of the public that was
concerned about energy grew to half the population by the time Carter spoke.
Carter was the first
president to announce that the very foundation of our mechanized and
industrialized mobile society was in danger due to declining energy. His
“Tonight I want to have an
unpleasant talk with you about a problem unprecedented in our history. With the
exception of preventing war, this is the greatest challenge our country will
face during our lifetimes. The energy crisis has not yet overwhelmed us, but it
will if we do not act quickly.
It is a problem we will not
solve in the next few years, and it is likely to get progressively worse
through the rest of this century.
We must not be selfish or
timid if we hope to have a decent world for our children and grandchildren.
We simply must balance our
demand for energy with our rapidly shrinking resources. By acting now, we can
control our future instead of letting the future control us”.
William Simon, secretary of
the treasury under President Ford, attacked Carters speech by saying that
increased demand in the market place has always brought in more supply.
The Wall Street Journal
published Gold’s theory and concluded that there might be enough oil for “20
million years at our present rate of fuel consumption”.
Bucknell concludes that economists ignore the fact that oil
and gas are finite – they think that all you have to do is dig a hole and pour
money into it when you want more.
He doesn’t believe the
market can be counted on to solve the energy situation. Indeed, he sees the unseen hand of the market
as being able to “assume terrifying proportions to the individual as it moves
in its awesome and uncaring way across a society. Bankruptcies, breadlines, lost wars, and
overthrown governments are often strewn in its wake”.
At the time Bucknell wrote, inflation was high due to energy prices. He saw the decreasing soundness of the dollar
as a danger to the international monetary system and inflation of the dollar possibly
bringing on another Great Depression.
War and Terrorism
Bucknell saw foreign policy as critical to how long a
democracy could last, and thought our policies on oil were inept – we treated
oil like any other mineral. Yet minerals
and raw materials were useless without energy.
That made us vulnerable, because we were importing half our oil from
abroad, which put us in the position of having to go to war if there were
energy shortages.
He also didn’t think that
people understood how critical oil was to fighting a war, and has a chart on
page 140 showing what percent of the nations energy the military consumed to
fight several wars in the past. He
points out that the amount needed would deprive civilians as much as the Arab
oil embargo did, which led to half a million people being unemployed. At the time he wrote, the military was the
largest consumer of energy in the
In energy wars of the
future, there would be “no choices between guns and butter”. There’d be a premium on using already
existing machinery, since the energy to produce new weaponry would be
energy-limited.
In 1973, Congressman Lee
Hamilton asked the Congressional Research Service to study seizing foreign oil
fields by force. The study concluded
that such an attack would be successful only if all of the following were
accomplished: seize oil installations intact, secure them for years, restore
the damaged assets quickly, be able to operate oil fields without the
assistance of local staff, and be able to guarantee safe passage of supplies
and petroleum.
Bucknell wrote that at that time, it appeared the
administration was planning to field a military force of 100,000 men in the
He believed that if we
intended to have energy wars, we’d need a strong navy and nuclear arms, but
that starting an energy war would be terribly dangerous, and that the
“deprivations to be visited upon our population are beyond living experience in
this country”.
Because of all of the above,
Bucknell said that military planners tended to think
in terms of short rather than long wars.
But since we weren’t able to predict the length of the Korean and
He believed that war was a
foolish and dangerous risk, plus there was the reaction of the
He pointed out that
environmentalists who opposed energy developments at home (i.e. coal to
liquids, shale oil, etc), had to consider the consequences – it was more likely
there’d be energy wars abroad, requiring much higher defense expenditures,
which would take money away from making an energy base transition.
There was also the chance we’d
be attacked and need to defend ourselves.
The military runs on petroleum (except for nuclear ships), and we needed
to figure out alternatives now, because we wouldn’t be able to invent them
while fighting a war. New resources must
be developed in times of peace – “the granaries of a nation are not filled
during the years of famine”.
Bucknell predicted the alliances formed after World War II might
not survive competition over energy resources and our declining ability to
provide protection to our allies.
Within our own country,
we’ve very vulnerable to terrorist attacks due to the centralization of power
plants and electrical distribution, yet this wasn’t being considered in defense
planning.
Externally, our supertankers
were vulnerable to sabotage or missile attacks, oil loading ports might be
attacked, and there was a large lifeline of oil tankers around the globe to be defended.
Intense competition for oil
would also build up among the different regions of the
Agriculture and Energy
Bucknell throws out several statistics to show that while
we’ve doubled food production in the three decades after 1940, we more than
tripled the energy used in the same time period, which is not the direction we
should be going in and is of basic importance in national policy
considerations.
Lack of energy will
eventually force us back to using human rather than machine labor. When Bucknell’s
book was published, there were 4 million Americans employed on farms that
consumed enormous amounts of energy.
Just the nitrogen fertilizer alone consumed sixty eight million barrels of
oil every year. Bucknell
states that If the farm economy is de-mechanized,
you’d need at least 31 million farm workers and 61 million horses.
The population of the
Bucknell wonders whether our population will accept a
large-scale substitution of manual labor for energy use. He wonders if food production will drop and
food prices soar.
Conclusion
This is a must-read book for
anyone who hopes to influence energy policy, as well as politicians, so that
they can better understand why their predecessors failed to take the necessary
actions.
We don’t seem to have moved
forward much at all since the seventies.
The same debates about which energy alternatives to pursue, or whether
there even is an energy crisis are still happening. And how can the public participate in energy
debates when less than 10% of Americans are scientifically literate? The theory
of evolution is rejected by 51% of Americans, 34% believe in UFO’s and ghosts,
29% in astrology, and students here consistently score near the bottom in math
and science internationally.
Although it’s often said that
those who don’t know history are doomed to repeat it, I’m not sure that knowing
how we failed in the past will prevent failure now, and I’m sure Bucknell would agree.
He doesn’t think that a democracy can cope with huge economic,
technological, social, and political problems in a short time frame.
But perhaps some cities,
states, and even a few national leaders will learn from the past and take the
right actions to minimize the suffering ahead.
About the
author: Bucknell was once the director of the energy
and national security project at
Appendix A President Carter’s National
Energy Plan
Main Principles:
1)
The energy
problem can be effectively addressed only by a government that accepts
responsibility for dealing with it comprehensively and by a public that
understands the seriousness and is ready to make necessary sacrifices.
2)
Healthy economic
growth must continue.
3)
National policies
for the protection of the environment must be maintained.
4)
The Unite States
must reduce its vulnerability to potentially devastating supply interruptions.
5)
The program must
be fair. The
6)
The growth of
energy demand must be restrained through conservation and improved energy
efficiency.
7)
Energy prices
should generally reflect the true replacement cost of energy.
8)
Both energy
producers and energy consumers are entitled to reasonable certainty about
government policy.
9)
Resources in
plentiful supply must be used more widely and the nation must begin the process
of moderating its use of those in short supply.
10)
The use of nonconventional sources of energy—such as solar, wind,
biomass, geothermal—must be vigorously expanded.
Carter’s proposed
solutions:
1)
Annual limits
would be placed on oil imports. After
some discussion this evolved to a figure of 8.2 mbpd
for 1979 with the prospect of a cut to 4 to5 mbpd by
1990.
2)
A new
cabinet-level energy mobilization board would be established with far-reaching
powers to ensure that procedural, legislative, or regulatory actions spurred by
environmentalists no longer cause extended delays in the creation or expansion
of plants, ports, refineries, pipelines, and so forth
3)
A
government-chartered energy security corporation would develop a synthetic fuel
industry producing at least 2.5 mbpd of oil
substitutes from shale, coal, and biomass.
88 billion dollars was earmarked for this task.
4)
A standby system
for rationing gasoline would be prepared.
5)
Each state would
be given a target for the reduction of fuel use, including gasoline use, within
its borders. Failure of a state to act
would result in federal action.
6)
The ninety-four
nuclear power plants now being built or planned would be completed. Additional nuclear policies would be
announced after completion of the
7)
Owners of homes
and commercial buildings would receive interest subsidies of $2 billion for
extra insulation and conversion of oil heating to natural gas.
8)
Utilities would
be required to cut their use of oil by half over the next ten years. Conversion would be partially financed by
grants and loan guarantees.
9)
Bus and rail
systems would receive $10 billion for improvement, while $6.5 billion would be
expended to upgrade the gasoline efficiency of automobiles.
10)
Low-income groups
would receive $2.4 billion each year to offset higher energy prices.
11)
The installation
of solar energy systems in homes and businesses would be subsidized by loans
and tax credits. A solar bank would be
formed.
12)
About $142
billion in federal funds was involved in the Carter Plan over the next
decade. It was envisioned that most of
this money would come from an energy security trust fund financed by a tax of
about 50 percent on the windfall profits earned by