Government involvement in the energy business has little to recommend it, unless you like the idea of $5 a gallon gasoline. When state and federal officials decide to make energy policy, they often do more harm than good.
Gasoline prices of $4 a gallon now — and probably higher in the future — can be blamed to at least some extent on government action. State and federal governments have made it all but impossible to build new refineries in the United States. They ban drilling for oil in promising locations. They mandate more expensive blends of fuel in some locations.
One decisive action taken by Congress in an effort to put more fuel on the market — promotion of ethanol as an alternative to petroleum-based gasoline — has done little, if any, good. It has failed to hold down fuel prices, while helping to increase the cost of food.
All that said, U.S. Rep. Shelley Moore Capito may have a good idea in regard to production of liquid fuel from coal.
Capito, R-W.Va., wants Congress to mandate production of 6 billion gallons of liquid fuel from coal each year, by 2022.
As Capito points out, Americans are being foolish if we do not make more use of the vast reserves of coal we possess. Higher prices for petroleum have made coal liquefaction a competitive business — but one requiring enormous capital outlays and one under fire from environmentalists.
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