The Arab oil embargo we really needed

What's it going to take to force public opinion to dispense with the fiction that cheap oil is only one or two big drilling projects away? Too bad history worked out differently.

Earlier this month I was in Israel moderating a panel on the myths and realities of alternative energy. The good news to report is that technologists are making steady headway in so-called green alternatives like solar and wind. The bad news is that governments aren't yet providing enough investment support for their ideas.


So it's been more than slightly amusing to watch the media circus around the discovery by the United States Geological Survey that the Arctic may hold around one fifth of the planet's future oil and natural gas reserves. Since that Wednesday announcement, every talking head worth his or her salt has been paraded (in some cases multiple times) on Fox, MSNBC and CNN.

But beyond the predictable polemics, is it such a grand idea? Alternative energy technologies represent the future, and drilling in the Arctic constitutes yet another (temporary) diversion. Others have pointed out that we're talking about only three years' worth of oil (at current consumption rates), though the natural gas reserves in the region are gauged to be three times as large. Texas oilman-turned-wind power enthusiast T. Boone Pickens, hardly a garden variety Berkeley leftist, is hitting the stumps making the case that "this is one emergency we can't drill our way out of."

All of which left me wondering what it's going to take to force public opinion to dispense with the fiction that cheap oil is only one or two big drilling projects away. With Ford and General Motors now anxious to get rid of truck and large-vehicle divisions as fast as they can, clearly, change is in the air.

My former CNET colleague, Michael Kanellos, now working for GreenTech Media, offers a fascinating what-might-have-been had the Arabs followed through with an oil embargo if the United States recognized Israel in 1948. Kanellos argues that a strict embargo would have forced the U.S. auto industry to move to 4-cylinder cars and fostered a more conservation-conscious approach.

For one thing, U.S. auto companies likely wouldn't be the bumbling boneheads of the industrial world. General Motors, Ford and Chrysler would have had to retool quickly. But turning on a dime was something they learned to do thanks to the wartime experience, when the federal government ordered these automakers to start building planes. Germany and Japan were still in shambles at the time so U.S. automakers could have eked out an early, sustainable lead.

In turn, that might have meant softening, or even avoiding, the blight that hit Detroit in the 1970s. And the focus on efficiency could have bled into the steel industry. Who knows? The U.S. could have become an early leader in solar manufacturing with all the intellectual capital focused on efficiency and energy.

History worked out differently. The Arabs didn't impose an oil embargo until 1973. The resulting gasoline shortage forced a shift in consumer preferences for smaller, more efficient vehicles. Temporarily, that is. Then Detroit went back to its business as usual. We know the rest of the story.