You ought to watch an interesting video of oil/economic experts James Hamilton and Daniel Yergin giving testimony before Congress. Their testimony begins about 11 minutes into the video. Note at the beginning though where Congress Critter Carolyn B. Maloney (D-NY) says she wants to avoid drilling new oil supplies.

A good text overview can be found at The Star. Another valuable look at the hearings is at Talk Radio News Service. Some very good quotes from the hearings are available from The Washington Post. A good discussion in the comments and more links can be found here.

Jevons Paradox says that energy efficiency will not gain us as much as the numbers suggest. An increase in efficiency of 10% might only decrease use by 5% or it could increase use by 5% depending on the supply/demand curve.

That can be offset by increased taxes. However, what you usually get from taxes is a large dead weight loss. If it costs to increase efficiency (it will) the net effect of more taxes can be anything from a reduction in growth to negative growth.

The only way out is to increase energy supplies. Where is that to come from? Oil shale reserves in America are very large. There is also a lot of offshore oil yet to be discovered. Alaska has untapped reserves. All of those are off limits to varying degrees by law.

If we started tapping those reserves we have more than enough energy to carry us through the 50 to 75 years it will take to develop ECONOMICAL alternatives. By pushing alternatives before they are economical we are creating further dead weight losses to the economy.

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Fortunately our new President and Congress understand all this and will do the right thing. (/sarc off)

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Well OK. Our Congress and our President only exist to make things worse. What can be done? We need to invent cheap sources of energy NOW. Cheap enough so converting that energy to liquid fuels provides a ceiling on liquid fuel prices.

Well - talk is cheap. But I do have a suggestion. Polywell Fusion. It is no sure thing. But the cost to find out if it will work is minuscule in comparison to even a one cent rise in the cost of a gallon of gasoline. At an American consumption rate of 140 billion gallons a year, a one cent rise in the per gallon cost of gasoline would cost Americans $1.4 billion a year. What would five years of experiments (the time to get a certain yes or no answer) cost? Around $200 million. So five years of experiments would cost 1/7th of a cent a gallon for one year. And what is our government putting into the experiments? About $5 million a year. You know, with the brilliance found in our current Congress it is a wonder that any of them can move their lips and talk at the same time.

You can learn the basics of fusion energy by reading Principles of Fusion Energy: An Introduction to Fusion Energy for Students of Science and Engineering

Polywell is a little more complicated. You can learn more about Polywell and its potential at: Bussard's IEC Fusion Technology (Polywell Fusion) Explained

Why hasn't Polywell Fusion been fully funded by the Obama administration?

H/T Econobrowser

Cross Posted at Power and Control