Abolish the Energy Department!

Rolling blackouts in California and motorists paying more than $20 per tank have President George W. Bush threatening to institute a national energy policy. If he’s collecting suggestions, here’s Chatterbox’s: Get rid of the Energy Department.

Killing DOE used to be a pet cause for conservatives. Chatterbox, who is not a conservative, was nonetheless converted to this cause in the course of reporting a 1994 Wall Street Journal story headlined “So, What Do People at Energy Department Do All Day Long?” (The answer turned out to be: mainly answering mail, attending meetings on subjects about which DOE had broad oversight but little or no regulatory responsibility, and devising internal Total Quality Management programs.) In 1995, the newly Republican Congress launched a spirited campaign to pull the plug on DOE. The momentum seemed so strong that the Clinton administration briefly proposed privatizing four of the five federally subsidized power marketing administrations. But doing away with DOE turned out to have very little support within the business community. This was because DOE is a significant source of corporate welfare and also because the energy industry sees the energy secretary as its representative at Cabinet meetings. (Another problem was that Pete Domenici, one of the Senate’s most influential budget hawks, represents DOE’s Los Alamos weapons lab in New Mexico.) By 1996, the Republicans had more or less given up on the idea, though a few brave souls continued to push it.

Spencer Abraham, the new DOE chief, was among those brave souls. Here is how he put it at his Jan. 18 confirmation hearing:

[A]s a Member of the Senate I supported legislation that would have shifted the various and important and vital functions of this department to other departments and agencies or to the private sector. Widely held concerns about the department’s management structure and operational success, combined with the relatively stable nature of our energy markets, led me to support this legislation in the past.

Now that Dubya wants him to run the place, however, Abraham sees things a bit differently. Here’s how he finessed it at the hearing:

A number of developments have occurred that either significantly address these concerns or have put them in a new light. Just to mention a few, I think quite clearly the changing energy situation, as well as the enactment of a National Nuclear Security Administration Act last year which restructured the department to improve agency management, have significantly altered the equation, and I can assure the committee that I no longer support this legislation and its various components, such as the privatization of the federal power marketing administrations.

Unlike John Ashcroft, who will likely soon contradict the moderate policy positions he professed during his confirmation hearings, Abraham will probably remain a convert. After all, if he were to revert to the sensible position that DOE ought to be abolished, he’d be putting himself out of a job.

Is eliminating DOE still a good idea? Absolutely. For starters, the majority of DOE’s $19 billion budget goes toward running the nuclear weapons labs, a responsibility that has to do with energy only in the sense that nuclear bombs release large amounts of it in the process of killing people. The Energy Department has always managed the weapons labs badly–before the latest round of security concerns there was the scandal of inadequate storage of dangerous radioactive materials. Even today, the Energy Department spends as much money on environmental cleanup as it does on maintaining the nuclear stockpile. In any event, it would make much better organizational sense for the Pentagon–which, for all its faults, is a model of bureaucratic efficiency compared to DOE–to be in charge of making nuclear weapons. Management of environmental cleanup could be transferred to the Environmental Protection Agency.

Want to guess how much of the Energy Department’s budget goes toward what we all think of as its primary mission–i.e., subsidizing the energy industry? Twelve percent! (You don’t believe Chatterbox? Check out Jerry Taylor’s chapter on the Energy Department in the Cato Institute’s new Handbook for Congress, on which this item is heavily reliant.) Among the energy sectors subsidized by DOE is the nuclear industry, even though a nuclear power plant hasn’t been built in the United States in decades. (Bill Clinton promised to eliminate this subsidy in 1993, but it never happened.) We can argue about whether it’s wise for the federal government to invest in renewable energy–Chatterbox favors it, Taylor opposes it–but we shouldn’t pretend that DOE expends much effort on it. The programs worth keeping should be transferred to EPA. The power marketing administrations, of course, should have been privatized or transferred to the states long ago.

What about the rolling blackouts? The truth is that the federal government has very little oversight over the power utilities, and what little it has resides in the Federal Energy Regulatory Commission, not DOE. (It’s sometimes argued that environmental regulations make it difficult to build new power plants. But the governing agency there isn’t DOE but EPA.) What about the skyrocketing gas prices? Except for employing the dubious short-term strategy of releasing oil from the Strategic Petroleum Reserve, there’s essentially nothing DOE can do about these, either. The crucial administration decisions on whether and how to open more federal land up to oil and gas exploration–an option, incidentally, that would take too long to ease current price spikes–will be made at the Interior Department. And the dubious tax breaks to the oil industry that seem likely to be included in any Bush energy plan will be cooked up not at DOE, but at Treasury.