The artificially low cost of oil

As with many products, perhaps most, the cost of oil, whether we see it as high or low, is artificially low due to the externalizing of costs. In the case of oil, the price is further lowered by subsidies and tax breaks for corporations involved in the supply chain of bringing oil and its derivative forms (gasoline, kerosene, etc.) to market. Externalized costs include military, diplomatic, environmental costs, foreign aid to oil-producing countries, and the detrimental effect of extractive industries on regional economies in the United States and elsewhere. Then factor in the corrupting influence of oil lobbyists (powerful even among the despicable campaign slush-fund of lobbyists in their be-suited legions in the halls of Congress) on democracy, and you have a mere indication of the true costs of oil.

Even if only 5% of U.S. spending (a remarkably conservative number, I would wager) on the military, diplomacy, foreign aid, and environmental clean-up (i.e., only the monetary aspect of environmental damage) can be traced to our dependence on oil and ‘energy security’ in the Middle East and Libya, the sum is massive. And none of this sum is reflected in the price at the pump.

So the next time the price of oil shocks you, think again, and consider walking, biking, or using public transportation instead. Support candidates that maintain and strengthen environmental regulations and the power of regulatory agencies. Petition for the removal of all subsidies and tax breaks for corporations involved in the production of oil, and other finite, dirty-burning sources of energy. And, as always, reduce, reuse, and recycle. Choices by average individuals are not enough to combat global warming, but, when combined with political activism, they increase the chances that we will be able to do so effectively.