Not related to the financial crisis, but have been meaning to post this nytimes op-ed.
I made this point in a debate I did for the incoming freshman class at Cornell. Nice to see the same point find a larger audience.
Basically, silly that there's so much debate on off-shoring drilling. It is basically a no-brainer.
To be clear, it will not reduce gas prices in any significant way. Oil is a global market, and the US while big cannot move it by itself.
But it will add $1.7 trillion to the economy. Must of it to government coffers. (Easily paying for any costs of the proposed bail out.)
This holds even after taking into account costs due to greenhouse gas emissions.
Green advocates like Thomas Friedman who oppose offshore drilling like to point to Brazil and Denmark as paragons who are energy independent (a stupid goal btw). And while it is true that Brazil and Denmark do have programs for alternative fuels like ethanol, they both get most of their domestic fuel from offshore drilling, a fact green advocates conveniently like to ignore.
Obama and McCain have both reached the same policy conclusion on this (given it is a no-brainer).
My opponent in the debate asked, if it is such a no-brainer, why is there still so much opposition. My (perhaps too flip answer) was to quote Hillary Clinton and Barack Obama. When they were both asked why they supported policies that essentaily all economists thought were a bad idea (Clinton on ABC News re: tax holiday; Obama on NPR re: windfall taxes), they both replied that listening to economists is Elitist.
Nice to see reporters on the ball in these cases. Frustrates me to no end when economic consensus is ignored.
It's fine to ignore economists on subjects on which the profession is essentially clueless (like the sub-prime bailout) but on basics like optimal taxes, economists have a pretty good consensus idea of what's right.