issue: Energy & Environment

Agenda 2016: Reviving U.S. Economic Growth

Posted on by The Progressive Policy Institute

The Progressive Policy Institute (PPI) teamed up with Columbia University’s Richard Paul Richman Center for Business, Law, and Public Policy to co-host a compelling symposium Nov. 6-7 in New York on revitalizing the U.S. economy. The event featured a distinguished roster of Richman Center economists and scholars, as well as PPI analysts and special guests, and more than two-dozen top policy aides to Members of Congress, Governors, and Mayors.

Held on Columbia’s Manhattan campus, the symposium examined the U.S. economy’s recent performance, as well as the causes of the long-term decline of productivity and economic growth. Against the backdrop of the 2016 election debate, the participants grappled with specific ideas for unleashing more economic innovation, modernizing infrastructure, reforming taxes, improving regulation, expanding trade and reducing inequality by ensuring that all children have access to high-quality public schools.

The discussions, which were off-the-record to encourage maximum candor, featured the following speakers and topics:

  • An overview of the U.S. economy’s recent performance by Abby Joseph Cohen, President of the Global Markets Institute and Senior Investment Strategist at Goldman Sachs.
  • A roundtable on key elements of a high-growth strategy, led by Michael Mandel, Chief Economic Strategist at PPI, Andrew Stern, former head of the Service Employees International Union and now Ronald O. Perelman Senior Fellow at the Richman Center, and
Philip K. Howard, Founder of Common Good, a nonpartisan reform coalition. The conversation touched on ways to improve the regulatory environment for innovation, including reducing regulatory accumulation and requiring faster permitting for big infrastructure projects, as well as a lively debate on the future of work in a tech-driven knowledge economy.
  • An insightful macroeconomic analysis of why productivity and economic growth have slowed, by Pierre Yared, Associate Professor at the Columbia Business School and Co-director of the Richman Center. Yared highlighted three potential contributors to the slowdown: labor demographics and participation; “capital intensity” or business investment; and the “production efficiency” of U.S. companies.
  • A detailed examination of the impact of energy innovation—from the shale boom to renewables and the construction of a new, “smart” grid—on jobs and economic growth. Leading this segment were Jason Bordoff, formerly energy advisor to President Obama and Director of Columbia’s Center on Global Energy Policy, and Derrick Freeman, Director of PPI’s Energy Innovation Project.
  • A dinner conversation at the Columbia Club with Edmund Phelps, the 2006 Nobel Laureate in Economics and Director of Columbia’s Center on Capitalism and Society at Columbia University. Drawing on his recent book, Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge and Change, he stressed the importance of indigenous innovation in creating the conditions for broad upward mobility. He also emphasized the crucial role of “modern” or individualistic cultural values in sustaining the mass innovation and entrepreneurship America needs to flourish again.
  • A detailed look at business taxation and reform as a potential driver of economic growth. It featured Michael Graetz, Alumni Professor of Tax Law at Columbia Law School, David Schizer, Dean Emeritus and the Harvey R. Miller Professor of Law and Economics at the Columbia Law School and Co-director at the Richman Center, as well as PPI’s Michael Mandel. The discussion ranged widely over global tax frictions, including the OECD’s new “BEPS” project; the need for corporate tax reform; “patent boxes” and mounting U.S. interest in consumption taxes.
  • A roundtable on trade and productivity growth with Ed Gerwin, PPI Senior Fellow for Trade and Global Opportunity and the versatile Michael Mandel. Noting President Obama’s controversial call for a Trans-Pacific Partnership, Gerwin stressed the agreement’s potential for “democratizing” trade by making it easier for U.S. small businesses to connect with customers abroad. Mandel underscored another PPI priority: raising awareness among policymakers of the growing contribution of cross-border data flows to growth here and abroad, and the need to push back against proposals that would impede “digital trade”
  • A luncheon presentation on “financial regulation after the crisis” by Jeffrey Gordon, Richard Paul Richman Professor of Law at Columbia Law School and Co-director of the Richman Center. Gordon described the new regime put in place by Dodd-Frank and other rules to guard against “systemic risk” of another financial meltdown, and suggested its “perimeter” may been to be expanded beyond banks.
  • The symposium’s final panel featured a vigorous discussion on K-12 education reform and the economy. The discussants were Jonah Rockoff, Associate Professor at the Columbia Business School and David Osborne, who directs PPI’s Reinventing America’s Schools Project, and is a co-author of the seminal “Reinventing Government.” Rockoff highlighted research showing that the returns to school improvement are enormous, and recommended reforms that could increase school quality. Osborne traced the evolution of school governance in America, and offered detailed looks at new models emerging in cities like New Orleans and Washington, D.C., both of which are leaders in the public charter school movement.

The symposium gave the policy professionals who participated a rare opportunity to delve deeply into complicated economic realities, guided by presenters of extraordinarily high caliber. The conversations were highly illuminating and will inform PPI’s work on Agenda 2016—a new blueprint for reviving U.S. economic dynamism and opportunity.

RealClearEnergy: Nuclear Power Going Dark in New England

Posted on by The Progressive Policy Institute

The U.S. commercial nuclear fleet will shrink by one more plant, as Entergy Corp. recently announced its plans to close the Pilgrim Nuclear Power Station in Plymouth, Mass. While some environmental and anti-nuclear activists are no doubt popping corks, it’s bad news from a climate perspective.

And it’s part of a trend. Pilgrim is the fifth nuclear power station slated for shuttering over the past two years. Entergy, which announced it would shut down Vermont Yankee in 2013, cites falling revenues and rising operational costs for its decision to close Pilgrim. What’s happening in energy markets that’s tilting the playing field against nuclear power?

For the last few years, nuclear industry leaders have warned that decreasing electricity demand, low natural gas prices, and price regulation are making it uneconomical to keep small nuclear plants (600 megawatts or less) up and running. Specifically, they complain that regulators don’t allow them to reap the full value of the services nuclear energy brings to consumers — reliability, efficiency and grid stability which permits the smoother integration of renewable energy. That makes it difficult to defray operations and maintenance costs, which have risen because of new regulations imposed by the Nuclear Regulatory Commission after Japan’s Fukushima crisis.

The economic viability of nuclear power plants is also threatened by state energy policies that subsidize renewable energy projects. For example, Entergy cited a Massachusetts proposal that would require utilities to buy hydro-electric power from Canada at above-market prices. The amount of electricity they would be required to buy would amount to about one-third of the state’s electricity demand.

Continue reading at RealClearEnergy.

 

The Daily Beast: Will Iran Get a Better Deal Than U.S. Oil?

Posted on by The Progressive Policy Institute

As Congress takes up the Iran nuclear deal next month, it ought to confront this paradox: The agreement allows the Iranians to do something Americans can’t—sell oil to the rest of the world.

Don’t get me wrong. I support the deal, under which Tehran would stop enriching weapons-grade uranium for the next 15 years in return for relief from economic sanctions. It’s not perfect, but President Obama is right that it’s better than what we’d have if his conservative critics got their way—no deal, leaving the Islamic Republic on the brink of acquiring nuclear weapons.

Still, freeing Iran to crank up its oil exports stands in stark incongruity to what’s happening here at home. Domestic oil production has soared by an amazing 68 percent over the past decade, yet we can sell very little of it abroad thanks to outdated laws banning U.S. oil and gas exports.

Passed during the energy crisis of the 1970s, these laws were intended to protect the nation’s then-dwindling oil and gas resources as a strategic reserve against supply disruptions like the Arab oil embargo. But the premise used to justify this deviation from our country’s free trade principles—energy scarcity—has been shattered by America’s shale boom.

Continue reading at the Daily Beast.

RealClearPolicy: A Bipartisan Approach to Energy

Posted on by The Progressive Policy Institute

The infrastructure debate in Washington usually centers on planes, trains, and automobiles. However, President Obama recently highlighted America’s other great infrastructure challenge — modernizing the way we move kilowatts to power our homes and businesses — by unveiling the first Quadrennial Energy Review (QER). Developed by the U.S. Department of Energy, the QER is a strategic plan for upgrading the nation’s energy systems — the vast network of storage, distribution, and transmission facilities that power the U.S. economy. Based on similar exercises at the Pentagon and the State Department, the QER provides a new roadmap for policymakers struggling to understand America’s fast-changing energy landscape.

The last comprehensive national energy report was published nearly 14 years ago — well before two key developments that have transformed America’s energy landscape: the shale gas and oil boom and the rapid expansion of wind and solar energy. While the QER is not a comprehensive document, it does examine, and calls for measures to improve, America’s energy backbone.

With the QER, Congress has an opportunity to move beyond the distracting and highly partisan Keystone XL pipeline debate and focus instead on urgently needed improvements to America’s aging energy systems.

Continue reading at RealClearPolicy.

A Bottom Up Approach to Reducing U.S. Carbon Emissions

Posted on by The Progressive Policy Institute

With last year’s landmark U.S.-China agreement on climate change, the Obama administration has raised the bar for America when it comes to reducing greenhouse gas emissions (GHG). That deal set new targets for reducing emissions by 26—28 percent (from 2005) levels by 2025, well above the previous pledge of 17 percent by 2020. Given implacable Republican opposition to taking action against global warming, how can the United States deliver on this ambitious promise?

Congress has tried, and failed repeatedly, to pass legislation that would cap greenhouse gas emissions. In June of 2009, the House of Representatives, then controlled by Democrats, narrowly passed a bill that placed an economy-wide cap on greenhouse gas emissions. Attempts to move a Senate bill floundered in the summer of 2010 on Democratic defections; monolithic Republican opposition and, some environmentalists complained, tepid White House support. That fall, Republicans took back the House and narrowed the Democrat majority in the Senate, killing any prospect of national legislation to reduce greenhouse gas emissions.

The impasse led President Obama to reach for the only policy lever he had left—executive action. In a landmark 2007 decision, the Supreme Court gave the Environmental Protection Agency the green light to regulate greenhouse gases as pollutants under the Clean Air Act.

Download “2015.03-Freeman_A-Bottom-Up-Approach-to-Reducing-US-Carbon-Emissions”

The Hill: The Keystone distraction

Posted on by The Progressive Policy Institute

The Senate will vote soon on what the GOP has made their top legislative priority: expedited approval of the Keystone XL pipeline. Given the realities of today’s crude oil market, the political wrangling over Keystone has a decidedly retro feel.

The United States has experienced an energy revolution since the Keystone XL pipeline was first proposed seven years ago. Most important is America’s shale oil and gas boom, which has contributed to a sharp drop in global oil prices. With U.S. oil production in particular surging, why do Republicans persist in claiming that Keystone is a matter of such urgent national interest?

The answer clearly has more to do with politics than with the new realities of U.S. energy abundance.

The energy sector has become an important driver of U.S. investment during our painfully slow economic recovery. Investment is projected to total $890 billion over the next two decades. And all this investment is spawning good, middle-class jobs for Americans. Unfortunately, inadequate infrastructure constrains our ability to take full advantage of such investment and job growth.

Continue reading at The Hill.

Pipeline Politics: The Keystone Distraction

Posted on by The Progressive Policy Institute

The decision by Senate and House Republicans to make approval of the Keystone XL Pipeline their first legislative priority has a decidedly retro feel. Much has changed since the Keystone project was first proposed in 2008. Most important is America’s shale oil and gas boom, which has contributed to a sharp drop in global oil prices. With U.S. oil production in particular surging, why do Republicans persist in claiming that Keystone is a matter of such urgent national interest?

The answer clearly has more to do with politics than with the new realities of U.S. energy abundance. Republicans see Keystone as a classic wedge issue that splits two important Democratic constituencies, labor and environmentalists. So much for claims by Senate Majority Leader Mitch McConnell and others that the GOP will use its new Congressional majority to govern responsibly and put problem-solving over partisanship.

That’s a shame, because the Keystone debate is a distraction from a bigger and more important issue: How to move America’s shale windfall to market. A good portion of U.S. production is happening in places like North Dakota, which is far outside America’s original “oil patch.” When Keystone was first proposed, about 60% of domestic production came from Alaska, Texas, and the Gulf of Mexico, where significant oil and gas infrastructure is located. However, with production now occurring in shale developments like North Dakota, surpluses are developing at storage and transportation hubs making it difficult to get to market.

Download “2015.01-Freeman_Pipeline-Politics_The-Keystone-Distraction.pdf/”

PRESS RELEASE: PPI Statement On New York State Fracking Ban

Posted on by The Progressive Policy Institute

WASHINGTON—Derrick Freeman, Director of the Energy Innovation Project at the Progressive Policy Institute, today released the following statement after New York Governor Andrew Cuomo announced Wednesday that his administration would ban hydraulic fracturing in New York State:

“For the past five years, the shale boom has provided the United States with a vibrant new source of economic prosperity. States across the country have experienced soaring economic growth and expanded job creation from utilizing hydraulic fracturing, while conclusively illustrating that it can be performed safely and in an environmentally sustainable fashion. That’s why today’s decision by Governor Cuomo to ban fracking in New York State is so baffling.

“If political constraints and government interference on this proven technology continue, we risk shutting down investment and innovation in one of the most productive areas of the American economy. PPI strongly urges Governor Cuomo to avert such a disaster and reconsider his decision.”

Free Energy Trade: Time to Lift the Oil Export Ban

Posted on by The Progressive Policy Institute

In July 2014, the United States passed Saudi Arabia and Russia to become the world’s biggest oil producer for the first time since 1970. This dramatic turn of events marked the end of an era in U.S. energy policy—an era that began in the 1970s with two oil embargoes, soaring gas prices, and growing dependence on imported oil, especially from the Middle East.

For better or worse—and some environmentalists think it’s definitely for worse—America unexpectedly finds itself richly endowed with fossil fuels again. The question now is how can we take advantage of this new energy abundance without accelerating global warming?

The answer, in PPI’s view, lies in a balanced national energy strategy that promotes both economic growth and a healthy environment. Such a strategy would capitalize on the domestic shale oil and gas boom while also enabling America to meet its international commitments to reduce greenhouse gas emissions. There are two ways to square that circle. One is to boost public investment in energy-related research and development. The other is to price carbon accurately, which will spur more investment in efficiency, clean tech innovation, and renewable and nuclear energy.

This approach steers a pragmatic course between “drill baby drill” conservatives, who ignore or deny the overwhelming scientific evidence for climate change, and extreme environmentalists who imagine that Americans will go along with their demands to keep the nation’s shale bounty “in the ground.”

Download “2014.12-Freeman_Free-Energy-Trade_Time-to-Lift-the-Oil-Export-Ban.pdf/”

Exporting U.S. Natural Gas: The Benefits Outweigh the Risk

Posted on by The Progressive Policy Institute

In a remarkably brief period, America has become awash in oil and natural gas. According to the U.S. Energy Information Agency (EIA) we have surpassed Russia as the world’s leading energy superpower, producing more oil and natural gas combined than any other country. This newfound abundance has turned old assumptions about U.S. energy scarcity and security on their head. For the first time since the energy crisis of the 1970s, there is mounting pressure—both domestically and abroad—for the United States to once again become a major energy exporter.

According to the EIA, America’s proved reserves of natural gas have increased in each of the last 15 years to a total of 308.4 trillion cubic feet (Tcf) in 2013, up 84% from 1999 estimates. The agency also estimates that unproved natural gas resources were at an increased level of 1,903.7 Tcf in 2009. These U.S. government estimates are in line with other assessments reported by several respected sources.

Most of these reserves are unconventional resources like coal bed methane, tight gas, and shale that have become more accessible due to significant advances in gas extraction technologies. As a result, the oil and gas industry, including expanding gas and oil production, have accounted for more than 9 million full- and part-time American jobs over the past few years.

The energy revolution also shows up in the results of the Progressive Policy Institute’s recently released 2014 U.S. Investment Heroes, an annual survey of the top 25 U.S. companies that invest most in the United States. On that list are 10 energy companies, involved in the exploration and production of oil and gas or energy distribution and power, that invested a total of $57 billion in 2013, representing 37% of the top 25 investment.

Download “2014.10-Freeman_Exporting-Natural-Gas“

Energy investment boom drives economic recovery

Posted on by The Progressive Policy Institute

Americans seem to have a love-hate relationship with major energy companies. On the one hand, our iconic brands are global leaders and symbols of U.S. technological and economic prowess. On the other hand, Big Energy takes the heat when the public gets restive over rising gas prices, or there’s an extended power outage.

A new Progressive Policy Institute (PPI) report highlights an underappreciated fact about energy companies—they are huge investors in the U.S. economy. In fact, along with telecoms and Internet-based businesses, they are leading our economic recovery.

Each year, PPI economists Michael Mandel and Diana Carew rank America’s top 25 “Investment Heroes”—the U.S. companies (excluding finance) that are making the biggest capital investments in economic innovation and jobs here at home. This year’s report shows that 10 U.S. energy companies made the list. These companies, involved in the exploration and production of oil and gas, or in energy distribution and power, invested a total of $57 billion in domestic capital expenditures last year. That figure represents 37 percent of the $152 billion that all 25 companies pumped into the U.S. economy in 2013. The energy companies on the list included many household names—Exxon (3), Chevron (4), ConocoPhillips (8), Exelon (10), and Duke Energy (11). But some lesser-known firms made the cut too, including Energy Transfer Equity (16), Enterprise Product Partners (18), and FreeportMcMoRan (24). All are helping to spur America’s energy transformation by investing in the nation’s shale oil and gas boom.

Continue reading at the Hill.

U.S. Investment Heroes of 2014: Investing at Home in a Connected World

Posted on by The Progressive Policy Institute

In this era of globalization, goods, services, money, people, and data all cross national borders with ease. Indeed, connectedness to the rest of the world is now essential for the data-driven economy we find ourselves in to thrive. It follows that our tax, trade, immigration, and regulatory policies must be oriented to encourage that connectedness.

But perhaps paradoxically, prospering in a connected world requires a dedication to investing at home. It is impossible to participate as a full partner in the global economy unless we are investing in digital communications networks, education, infrastructure, research, energy production, product development, content, and security domestically. Investment generates increased productivity, higher incomes, new jobs, and more opportunities for the economic mobility and growth that we all desire.

Such prosperity-enhancing investment comes in many flavors, both private and public. In this report, we focus on identifying the U.S.-based corporations with the highest levels of domestic capital expenditures, as defined by spending on plants, property, and equipment in the United States. Currently, accounting rules do not require companies to report their U.S. capital spending separately, although some do. We fill in this gap in available knowledge using a methodology outlined at the end of this paper, based on estimates derived from published data from nonfinancial Fortune 150 companies.

To understand which companies are betting on America’s future, we rank the top 25 companies by their estimated domestic investment. We believe this list can help inform good policy for encouraging continued and renewed investment domestically.

Download “2014.09 Carew_Mandel_US-Investment-Heroes-of-2014_Investing-at-Home-in-a-Connected-World“

USA Today: AT&T, Verizon, Exxon are top corporate spenders

Posted on by The Progressive Policy Institute

PPI Economist Diana Carew was quoted in a USA Today exclusive covering PPI’s newest report, U.S. Investment Heroes of 2014: Investing at Home in a Connected World. Carew co-authored the report with PPI Senior Economic Strategist Michael Mandel.

PPI economist Diana Carew says the government should promote faster capital spending growth and contributions from more industries through policies that encourage investment.

Last year, three sectors — telecommunications and cable, Internet and technology, and energy — accounted for 83% of the top 25 firms’ total investment.

“Policies need to make investment an explicit focus,” Carew says.

Continue reading on USA Today.

MSNBC: Hillary Clinton’s hard choices on energy

Posted on by The Progressive Policy Institute

PPI President Will Marshall was quoted by MSNBC’s Alex Seitz-Wald on the Democratic Party’s divide on energy policy.

One salutary effect of Republican radicalism is to unify Democrats,” said Will Marshall, president of the Progressive Policy Institute, a moderate Democratic think tank that helped feed Bill Clinton’s White House with new policy ideas. “Having said that, there are some important fault lines that will become apparent as we move into the next presidential election cycle.”

…

Both sides are members in good standing of the Democratic coalition, and have legitimate claims, so it may require some Clintonian triangulation. “Anybody who wants to be the Democratic nominee will have to strike a balance between the needs of the economy and concerns about the environmental impact of energy production,” Marshall told msnbc. “It’s a fault line, so you’ve got to walk a line.”

Read the entire article at MSNBC.

The Hill: Don’t reform the tax code on the backs of over-taxed energy producers

Posted on by The Progressive Policy Institute

William F. Shughart II, writing for the Hill, referenced an observation made by the Progressive Policy Institute that major U.S. energy companies are “Investment Heroes.”

A high-growth strategy requires strong investment — private and public — in our nation’s productive and knowledge capacities.

To read the rest of the article, visit The Hill’s website here.

Bringing U.S. Energy Policy Into the 21st Century

Posted on by The Progressive Policy Institute

U.S. lawmakers don’t drive around in 1970s-era cars, yet they don’t seem to mind energy policies that are equally out of date. Attempts to export shale oil and gas, for example, have run smack into legal and regulatory barriers as old as a Gran Torino.

Energy companies have been urging Congress to lift the lid on exports and start treating oil and gas again like any other commodity that’s freely traded in world markets. Tapping global demand for U.S. shale oil and gas, they say, will spur domestic production and create even more jobs in a sector that’s already racked up robust employment gains.

Russia’s naked power play in wresting Crimea from Ukraine has given fresh impetus to the export push.

From outraged Republicans to eastern Europeans living anxiously in Moscow’s shadow come calls to use America’s shale windfall to wean Europe off dependence on Russian gas, oil and coal.

The idea that surging U.S. gas and oil production is a new source of geopolitical power is a seductive one, though there are practical difficulties inherent in using energy as an instrument of foreign policy.

Vladimir Putin’s Russia is not as scary as the Soviet Union, but it remains an energy superpower. Moscow supplies Europe on average with roughly a third of its energy; many Baltic and central European countries rely almost completely on Russian gas, oil and coal. Some observers think such realities have muted Europe’s reaction to Putin’s aggression.

Taking market share from Moscow would diminish its political leverage, while also weakening its petro-centric economy. Energy accounts for as much as a quarter of Russia’s GDP, 60 percent of its exports, and the lion’s share of its revenues. The problem, of course, is that Washington doesn’t export oil and gas, companies do. They go where the profits are, not where geopolitics dictates.

In any event, U.S. gas and oil exports are stalled by old laws and rules as well as potent domestic opposition. For example, the 1975 Energy Policy and Conservation Act bars most exports of U.S. crude oil. Exporting natural gas isn’t illegal, but it requires getting the U.S. Department of Energy’s approval to build terminals for liquefying the gas so it can be shipped overseas. Amid industry complaints that the Department of Energy is slow-walking approvals, Congress recently held hearings on ways to expedite LNG export licenses.

America’s import-oriented energy policies are a legacy of the 1970s energy crises. They are predicated on an assumption of fossil fuel scarcity and U.S. vulnerability to volatile global oil markets. Today’s reality is abundance, thanks to horizontal drilling techniques and shale fracturing, aka, “fracking.” Next year, the United States is expected to overtake Saudi Arabia as the world’s largest oil producer.

The energy world has been turned on its head, but U.S. policies haven’t changed. Powerful interests are invested in preserving the status quo. Chemical companies, which use natural gas as a feed stock, say ramping up exports would raise domestic gas prices and thereby threaten a revival in U.S. manufacturing. Some analysts say we’d be better off using more natural gas in the transportation sector, for cars as well as heavy-duty trucks, because this would cut both carbon emissions and oil imports.

The fiercest opposition to exporting oil and gas comes from environmental activists. In an open letter (PDF) to President Obama, a coalition of environmental groups led by anti-XL Pipeline crusader Bill McKibben, slammed the administration’s plans for building LNG terminals along U.S. coastlines. “We believe that the implementation of a massive LNG export plan would lock in place infrastructure and economic dynamics that will make it almost impossible for the world to avoid catastrophic climate change,” the letter asserts. Most of the nation’s fossil fuel reserves, it adds, should stay “in the ground.”

It’s highly unlikely, though, that the public will support attempts to stuff the shale genie back in its bottle. According to the U.S. Energy Information Administration, jobs in the oil and natural gas industry grew by 32 percent between 2007 and 2012, even as overall employment fell 11.4 percent. The glut of cheap gas is also a boon to energy-intensive industries in the United States, which are beginning to attract significant investment from Europe, where energy costs are much higher.

Moreover, it’s not a foregone conclusion that taking advantage of America’s shale bonanza will bring on an environmental catastrophe. On the contrary, fuel switching in the electricity sector from coal to natural gas already has brought a 10 percent decline in U.S. greenhouse gas emissions, according to the Environmental Protection Agency. If gas catches on as a transport fuel, that also would yield lower emissions. In any event, fossil fuels will continue to be a major part of America’s fuel mix for decades to come, green fantasies notwithstanding, and lawmakers must manage the nation’s energy portfolio — including zero-carbon-emitting nuclear energy—in a way that both spurs economic growth and reduces the risks of global warming.

In truth, no one really knows what will happen if America once again becomes a major energy exporter. We can’t say for sure whether domestic prices will spike, or how global markets would react to an influx of U.S. oil, or what the net effect on global carbon emissions would be. Nor is it certain that exports by energy companies would buttress U.S. diplomacy. The sensible course is to experiment—to lift restrictions on oil and gas exports at a measured pace, measure economic and environmental impacts, and make adjustments as we go. That should be part of a political bargain in which Democrats agree to ease export controls in return for GOP support for more public investment in research and development of renewable fuels and clean technology.

What makes no sense is to let the dead hand of 40-year-old energy policies constrain America’s freedom of action today. As the shale revolution approaches its 10th anniversary, it’s time to bring U.S. energy policy into the 21st century.

This piece was originally published at the Daily Beast.