Now is the time to think about the next Euro-Russian conflict. Europe is steaming toward a new Cold War with Russia and dragging America along in its geopolitical bow wake. The U.S. is also embroiled in Russia’s proxy activities in the Middle East, where we have seen an Arab Spring dwindle into darkness as conflicts expand.
When American leaders talk about the “world community” responding to crises, they mean the United States plus Europe. The E.U. and U.S. together account for half of the global economy, but Europe’s dependence on Russian oil and natural gas is the bear in the room.
It’s time for a true Marshall Plan for energy. There have been a variety of aspirational energy ideas co-opting the iconic words “Marshall Plan,” but none rooted in the goal-oriented realpolitik that America used to make such a difference for Europe a half-century ago.
When George C. Marshall announced his European Recovery Program in Harvard Yard in the summer of 1947, he said: “It is logical that the United States should do whatever it is able to do to assist in the return of normal economic health in the world, without which there can be no political stability and no assured peace.” The world desperately needs realism again — this time energy realism — for both economic health and political stability.
Every realistic scenario sees the world consuming more, not less, oil and gas in the future. As for alternative energy, even if the hyperbolic goal of supplying all new global demand were met, the world would still consume 40 billion barrels of oil and natural gas annually. In a business-as-usual future, Russia and the Middle East would continue as the dominant suppliers of oil and gas to global markets. But America now has a chance to break that oligopoly.
There has been a lot of talk about using American energy resources as a diplomatic tool — the proverbial “carrot” rather than a “stick” (sanctions). Rhetoric aside, seven key energy numbers underscore just how close we are to a geopolitical game-changer for Europe — and for the U.S. — and what that might mean for the American economy.