In offering these recommendations for reducing American oil dependence, the members of the
Energy Security Leadership Council have one central goal: the enactment of public policies to
significantly improve the nation's energy security.
For more than two decades, federal energy policy has been afflicted by paralysis. Although much
energy legislation has been passed into law during this period, America's energy security has grown
worse with each passing year. This deteriorating condition has created enormous economic and
national security vulnerabilities.
Chief among the nation's formidable energy challenges is its dependence on oil, which fuels 97%
of U.S. transportation needs. Since there are few readily available substitutes for oil, even a relatively
minor disruption of the global oil supply has the potential to cause economic dislocation for tens
of millions of Americans.
In an age characterized by instability throughout much of the oil-producing world, a supply crisis
cannot be reasonably dismissed as a low-probability event. On the contrary, hostile state actors
and terrorist organizations clearly intend to use oil as a potent strategic weapon to attack the United
States. The threat is made ever more serious by rapidly rising global consumption.
Even in the absence of an outright supply crisis, oil dependence constrains American foreign policy
by strengthening the nation's adversaries and placing enormous burdens on the U.S. military. While
difficult to quantify with precision, these constraints and burdens unquestionably render the pursuit
of U.S. national interests far more difficult and costly.
America must address this critical weakness. Continued government inaction presents
inexcusable risks.
Improving America's energy security requires a meaningful reduction in the oil intensity of our economy
and prudent expansion of secure oil supplies. By improving the fuel efficiency of the transportation
fleet, increasing the availability of alternative fuel sources, and making responsible oil exploration
and production more feasible, government policy can place the country in a far better position to
endure the next supply crisis.
In truth, we have already proven that we can dramatically reduce oil intensity. The amount of oil
needed to generate a dollar of GDP has essentially been cut in half since 1975. The result is a U.S.
economy that still sees steady growth despite high oil prices such as those experienced over the last
few years. Unfortunately, progress toward reduced oil intensity has slowed noticeably in the last
decade. We must do better.
Political forces have often portrayed increased supply and decreased demand as mutually exclusive
ambitions. In fact, both goals are indispensable components of any comprehensive policy for obtaining
genuine energy security.
The policies we advocate will require many years to implement before benefits are evident. Strong and 05
consistent leadership will be needed—not only to avoid panic during periods of high oil prices, but also
to prevent complacency when costs to consumers temporarily recede.
In bringing together representatives of the business community and retired senior military officers, the
Council intends to break the longstanding energy policy stalemate. We recognize that this task will be
difficult. Nonetheless, we are firmly committed to seeing our recommendations through to enactment.
The following document outlines a new direction for energy policy. The suggested initiatives are
aggressive while being balanced and credible. The Council calls for achievable and verifiable targets.
The false hope of domestic energy independence is replaced by strategies for better managing
the reality of global energy interdependence. Where the market has failed to provide solutions,
government has been asked to apply workable standards capable of spurring the needed privatesector
response.
The Council bears no government imprimatur. We have not been empowered by the Congress or the
Administration, and we have received no public funds. The Council has been motivated by a shared
belief in the pressing need for a comprehensive and realistic energy policy to reduce oil dependence
and improve America's economic and national security.
During the past five years, the American people have been shocked by the cruel realization of worstcase
scenarios. Having witnessed the attacks of September 11, 2001, we know all too well the human
cost of failing to address national security threats on our own terms, rather than those of our enemies.
America's oil dependence threatens the prosperity and safety of the nation. Continued policy paralysis
is unacceptable precisely because we can take action to improve our energy security. Many challenges
lie ahead, but we have no doubt that the efforts of the American people will meet with success.
The time for action arrived long ago. We must not waste another moment.
General P.X. Kelley, USMC (Ret.)
28th Commandant, United States
Marine Corps
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Frederick W. Smith
Chairman, President and CEO
FedEx Corporation
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