Up on Capitol Hill today, talking to a senior Democratic Senate staff protege, I was asked "What can we do to counter the Republicans on offshore drilling for oil?"  My response was, "There is no short-term fix to our long-term energy problems.  Drilling won't do it because it will take years to land any oil."  "Yes, but the voters think it's going to help now."  I responded, "Now you're asking me for cosmetics, not a solution."

In a nutshell, that's why we're 58% dependent upon foreign oil.  Every time we have an energy crisis, in 1973, 1979, 1990, and 2008, we rush short-term expedients and cosmetics into law without doing much to solve the long-term problem.  If we were serious about the long-term problem we would never have allowed gas guzzling SUV's onto the road; we wouldn't have starved mass transportation; we would have developed much more renewable energy; we would have done a lot more conservation; and MOST OF ALL we wouldn't have allowed prices to decline after the crisis, killing energy saving investments and leading us right back to profligate energy consumption.

Our energy policy is like our diets.  We diet frequently, but we never stick to our diets long enough or change our lifestyles enough to lose weight. Then, when diabetes and heart disease sets in, we rush to our doctors for the miracle cure that isn't there.

Minnesota Mom's comment to Stan's post on gasoline prices yesterday was right on.  She said, "Whether it is perceived as cheap or expensive really isn't the point. The rapid run up in price has done a number across US economy -- the ensuing inflation is a ripple that effects the price of all goods."  That's what oil prices do, they're volatile. 

Take at look at this Energy Information Agency graph of real (inflation adjusted) gasoline prices at the pump since 1919.  What do you see?  Do you see an upward trend, a downward trend, or a flat trend?  Depending upon the time period, you can see all of the above.  What happens right after every price surge?  Prices drop back to where there were or lower.  Now that we're setting an all-time record, it's hard to imagine gasoline prices dropping that far, but, if history is any guide, eventually that's what will happen.

The policy error is to allow prices to drop that much.  Of course high gasoline prices exact a terrible personal toll and slow the economy.  Today, on the radio as I was driving to Capitol Hill, I heard a poor woman from rural Pennsylvania describe how she had to choose between paying her mortgage and setting aside enough to buy the heating oil to heat her home this winter.  Finally, she decided to ease that choice by cancelling her health insurance! There's something wrong when Americans have to make such choices.  However, we do need to keep energy prices from falling below the thresholds necessary to insure the creation of more domestic energy production and to develop the conservation and production technologies that will get us out of this mess.  After suffering gasoline prices well over $4/gallon this summer, would we have the sense to use taxes devoted to conservation and production technologies to keep that price from dropping below $3.50/gallon or $3/gallon?

Until we learn to live with somewhat higher energy prices, we'll continue to be at the mercy of OPEC and of periodic energy crises.  As long as we demand quick fixes from our political leaders, that's all we will get -- quick fixes that don't work.