In September, the ESLC released A National Strategy for Energy Security, a comprehensive set of solutions to the very real threats posed by our nation's dependence on oil. The National Strategy presents a bold vision: the transformation of our transportation sector from one dependent on petroleum to one largely powered by electricity. Because that is a long-term goal, the recommendations also detail the policy steps necessary to reach it while preserving our economic and national security in the short and medium term, including dramatic increases in funding and reforms to our research, development, and deployment system; demand reductions; and an expansion of domestic oil and natural gas production.
Shortly after developing the National Strategy, the ESLC commissioned the Interindustry Forecasting Project at the University of Maryland and Keybridge Research to study the long-term economic effects of their policy proposals. In short, the study shows, under the ESLC policy package, employment and disposable income would be higher, the trade balance would improve, and federal budgets would receive a boost from higher economic growth. Most importantly, however, the study finds that the U.S. economy would be far more able to withstand future oil shocks under the ESLC policy plan. In essence, the ESLC energy package can be thought of as a self-financing insurance policy that will make the economy more robust in good times and more resilient when subjected to energy shocks.
Specifically, the study finds that:
- By 2050, the typical U.S. household would have $4,046 more in annual income, an increase of nearly 2.1 percent.
- Over four decades, households would experience an aggregate increase of $13.9 trillion.
- When you add in lower energy costs, the average household would be able to enjoy $5,025 more every year by 2050.
- By 2050, annual oil imports would be lower by 6.6 million barrels; cumulatively, we will have imported nearly 60 billion fewer barrels of foreign oil by then.
- As a result, the U.S. trade balance would improve by about $275 billion by 2050.
- Because of the higher levels of income and GDP, net U.S. federal revenues would be a cumulative $1.46 trillion higher.
- By 2050, total employment would be 3 million jobs higher, including:
- 225,000 more jobs in manufacturing
- 514,000 more jobs in travel and tourism
- 108,000 more jobs in professional services
- 44,000 more jobs in agriculture
- Perhaps most important is what the ESLC policy package will do to help the economy withstand future oil shocks. Under the plan, in the event of a severe oil shock in the year 2040:
- Reduced dependence on imported oil will act as a $400 billion insurance policy for the U.S. economy.
- 1.8 million jobs would be saved.
- Difference in national disposable income would be $448 billion.
