Let the Market Decide Prices.
Government should not be promoting drilling or the extraction of resources.
December 29, 2008.
I have a real problem with the notion of "drill, baby, drill". It's not because I believe oil prices should be high, it's because I believe that oil prices should not be artificially low. Government has responsibility to protect resources and wilderness for generations to come, it does not have a responsibility to keep energy prices artificially low.
People based on market signals can learn to consume less of a particular resource. Nobody is insisting that the United States government should take over South Africa so that everybody can posses 100 lbs of diamonds and spend only a $1000 a year for diamonds. Such an argument would be called silly and people would realize that invading a foreign country for cheap diamonds is morally wrong.
It may take a number of years for people to get used to the impact of higher energy prices, but people can adapt. People can buy smaller cars and take mass transit around town, if that's what their budget permits. Likewise, people can seek to develop alternative forms of energy or alternative vehicles based on price of energy. High energy prices, driven by market forces, don't mandate alternative technology, but they do much to spur it.
Government has a role in defending the helpless and the general public good. It must protect public resources. It should not be an active participant in the market to force artificially low prices on products. Governments may prevent monopolies and artificial price hikes, but that's different from subsidizing resource consumption. When it comes to resources, markets always know best how to distribute them based on the willingness of the public to purchase them.
