Jimmy Carter on Energy & Oil

President of the U.S., 1977-1981


1970s windfall taxes reduced domestic production

Some in Washington want to punish oil companies through so-called "windfall taxes." They forget their history. Jimmy Carter tried a similar approach back in the 1970s, with the predictable result that domestic production fell and our reliance on foreign oil grew. For a lot of reasons, American oil production has already declined from 9.2 million barrels a day in 1973 to 5 million barrels a day in 2007. A basic rule of economics is that if you want less of something, just tax it more.
Source: Leadership and Crisis, by Bobby Jindal, p.210 , Nov 15, 2010

Installed solar panels on White House roof

Carter claimed to the press that he was saving energy by having solar panels installed on the roof of the White House to heat hot water. "It would not generate enough hot water to run the dishwasher in the staff mess," a White House staffperson says. "It was a fiasco. The staff mess had to go out and buy new equipment to keep the water hot enough. That blew any savings."
Source: In the President`s Secret Service, by Ron Kessler, p. 75-76 , Jun 29, 2009

Attempted to inspire conservation by personal example

Carter did not manage to broker an adequate energy policy. He tried to promote conservation by example, turning down the thermostats at the White House and in other government buildings, wearing cardigan sweaters, and installing solar panels and a woodstove at the White House. He also deregulated energy prices, launched a program to develop synthetic fuels, and successfully legislated fuel-efficiency standards. But in an era of soaring oil prices and long lines at the gas pumps, it did not add up to a policy.

In fairness, transforming America's energy consumption would have been a Herculean feat for any president. But Carter lacked two core qualification. He never mastered the art of either inspiring the people or working with Congress. Carter was a man of abiding principle, idealism, and morality. Those qualities shone through in his post-presidency. However, as president, his attempts to appeal to ethical norms often sounded merely reproachful or preachy. His high purpose was not enough.

Source: Obama`s Challenge, by Robert Kuttner, p. 56 , Aug 25, 2008

Boycott oil supplied from ANWR

As a consumer of petroleum products, I would make my last choice for a supplier of any of those oil companies who were drilling in our refuge, and there may be several million other environmentalists with the same inclination.

Our nation consumes 7 billion barrels of oil per year, and even if the refuge provided the hoped-for 1 million barrels per day, the slight increase in domestic supply would not significantly lessen our dependence on foreign oil. At best, according to various energy experts, the refuge would yield less than a year's supply of oil for the US.

The tragedy of the decision to savage the Alaska refuge is that when oil from the area might reach peak production, 15 to 20 years from now, it will equal the amount that could be saved by requiring the efficiency of "light trucks" (SUVs) to be the same as that of ordinary cars (20 miles/gallon).

Source: Our Endangered Values, by Jimmy Carter, p.167-168 , Sep 26, 2006

Pushed alternative energy program to fight oil shortage

Carter faced a drastic erosion of the value of the US dollar and a persistent trade deficit, much of it a result of US dependence on foreign oil. The president warned that Americans were wasting too much energy, that domestic supplies of oil and natural gas were running out, and that foreign supplies of petroleum were subject to embargoes by the producing nations, principally by members of OPEC. In mid-1979, in the wake of widespread shortages of gasoline, Carter advanced a long-term program designed to solve the energy problem. He proposed a limit on imported oil, gradual price decontrol on domestically produced oil, a stringent program of conservation, and development of alternative sources of energy such as solar, nuclear, and geothermal power, oil and gas from shale and coal, and synthetic fuels. In what was probably his most significant domestic legislative accomplishment, he was able to get a significant portion of his energy program through Congress.
Source: Grolier’s Encyclopedia, “The Presidency” , Dec 25, 2000

Invest windfall profits tax in synthetic fuels & solar

Q: US dependence on Arab oil as a percentage of total imports is today much higher than it was at the time of the 1973 Arab oil embargo. Can the US develop synthetic fuels and other alternative energy sources?

CARTER: With the windfall profits tax as a base, we now have an opportunity to use American technology and American ability and American natural resources to expand rapidly the production of synthetic fuels; to expand rapidly the production of solar energy; and also to produce the conventional kinds of American energy. We will drill more oil and gas wells this year than any year in history. We'll export more coal this year than any year in history. This exciting future will not only give us more energy security but will also open up vast opportunities for Americans to live a better life and to have millions of new jobs associated with this new and very dynamic industry now in prospect because of the new energy policy that we've put into effect.

Source: The Reagan-Carter Presidential Debate , Oct 28, 1980

Gasoline conservation by oil import fee; rationing if needed

The American people are making progress in energy conservation. Last year we reduced overall petroleum consumption by 8% and gasoline consumption by 5% below what it was the year before. Now we must do more.

We will set gasoline conservation goals for each of the 50 States, and I will make them mandatory if these goals are not met. I've established an import ceiling for 1980 of 8.2 million barrels a day. I expect our imports to be much lower than this, but the ceiling will be enforced by an oil import fee if necessary. I'm prepared to lower these imports still further if the other oil-consuming countries will join us in a fair and mutual reduction. If we have a serious shortage, I will not hesitate to impose mandatory gasoline rationing immediately.

The single biggest factor in inflation last year was from one cause: the skyrocketing prices of OPEC oil. We must take whatever actions are necessary to reduce our dependence on foreign oil--and at the same time reduce inflation.

Source: Pres. Carter's 1980 State of the Union message to Congress , Jan 23, 1980

Passed energy policy of some decontrol & some regulation

The total energy package pushed by Carter in 1978 was extremely complicated, but far-reaching in its beneficial effect on our nation. The production of gas-guzzling automobiles would be deterred by heavy penalties; electric utility companies could no longer encourage waste of energy with their distorted rate structures and would have to join in a common effort to better insulate buildings; higher efficiency of home appliances would be required; gasohol production and carpooling were promoted with tax incentives; coal production & use were stimulated, along with the use of pollution-control devices; and the carefully phased decontrol of natural -gas prices would bring predictability to the market, increase exploration for new supplies, & reduce waste of this clean-burning fuel. The new bills also included strong encouragement for solar-power development, and tax incentives for the installation of solar units in homes and other buildings. These and many more provisions now became the law of the land.
Source: Keeping Faith, by Jimmy Carter, p.107 , Oct 15, 1978

Increase production; cut waste; use plentiful fuels

Never again should we neglect a growing crisis like the shortage of energy, where further delay will only lead to more harsh and painful solutions. Every day we spend more than $120 million for foreign oil. This slows our economic growth, it lowers the value of the dollar overseas, and it aggravates unemployment and inflation here at home.

Now we know what we must do--increase production. We must cut down on waste. And we must use more of those fuels which are plentiful and more permanent. We must be fair to people, and we must not disrupt our Nation's economy and our budget.

Now, that sounds simple. But the fact remains that on the energy legislation, we have failed the American people. Almost 5 years after the oil embargo dramatized the problem for us all, we still do not have a national energy program. Not much longer can we tolerate this stalemate. It undermines our national interest both at home and abroad. We must succeed, and I believe we will.

Source: Pres. Carter's 1978 State of the Union message to Congress , Jan 19, 1978

Proposed Energy Dept. to share sacrifices of rising prices

The proposal by the oil and gas industry for solving our energy shortage was simple: remove all laws and regulations. [But that] would allow OPEC to control both the international market and our domestic oil prices.

We realized that our domestic prices would have to rise in order to stimulate American production and encourage conservation, but the increase needed to be brought about in a predictable & orderly fashion. Also, the unearned profits from higher prices needed to be shared with the consuming public. Even with such protection, some sacrifices among the people would be required, making it doubly important that our proposed plan be fair.

On March 1st, I sent to Congress our proposal for the new Department of Energy. It was like pulling teeth to convince the people of America that we had a serious problem in the face of apparently plentiful supplies, or that they should be willing to make some sacrifices or change their habits to meet a challenge which, for the moment, was not evident.

Source: Keeping Faith, by Jimmy Carter, p. 94-97 , Apr 18, 1977

Energy policy needed to avoid kowtowing to oil countries

Under the last Democratic administration 60% of all weapons that went to the Middle East were for Israel. Now 20% go to Israel. This is a deviation from a commitment to our ally in the Middle East and a yielding to economic pressure on the part of the Arabs on the oil issue; and it's also a tremendous indication that under the Ford administration we have not addressed energy policy adequately. We have no comprehensive energy policy.
Source: The Second Carter-Ford Presidential Debate , Oct 6, 1976

Develop a varied energy portfolio, including solar

Q: There seems to be a difference between you and the President on the use of nuclear power plants, which you would use as a last priority.

CARTER: We're gonna run out of oil. We now import about 44% of our oil. We need to shift from oil to coal. We need to concentrate our on coal burning and extraction, with safer mines, but also clean burning. We need to shift very strongly toward solar energy and have strict conservation measures. And then as a last resort only, use atomic power.

FORD: In 1975 I submitted to Congress the first comprehensive energy program recommended by any president. It called for an increase in the production of energy in the United States. If you're going to increase domestic oil and gas production--and we have to--you have to give those producers an opportunity to develop their land or their wells. I think you have to have greater oil and gas production, more coal production, more nuclear production, and in addition you have to h