Vice President Frederick C. Smith - Center for a New American Security

6/11/08

 
I’m delighted to be here.  And I applaud the Center for a New American Security for putting together today’s national security agenda, and for including energy and climate change as a top priority.  Energy was hardly an issue during the presidential primaries, but now that gasoline has hit $4 a gallon, it’s gotten people’s attention – although the price at the pump is only symptomatic of the problem and not the problem itself.
 
I would like to use my brief allotted time to make a few comments on the military, or “hard power,” approach to energy and the environment, and to comment on the Center’s report and the work we’re doing at the Institute for 21st Century Energy to address these challenges using “smart power” – using Joe Nye’s “smart power” terminology.
 
First, the military or “hard power” perspective.  When I was asked to do this presentation, I thought about my own involvement in these issues dating back to the late 1970s.  Soon after I started working at the Pentagon in 1978, I was put on a study team headed by a Deputy Assistant Secretary in the office of Programs, Analysis, and Evaluation – his name was Paul Wolfowitz.  Our task was to look at protecting U.S. interests in the Persian Gulf after the Shah was disposed.
 
In late December 1979 the Soviets invaded Afghanistan, and the next month, in his State of the Union Address, President Carter articulated the Carter Doctrine – “Let our position be absolutely clear:  An attempt by any outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America, and such an assault will be repelled by any means necessary, including military force.”  The rest of the time the Carter Administration was in office was spent trying to put military reality behind the doctrine.
 
I worked at that time for Bob Komer, who we affectionately called “Komer of Kurdistan.”  Bob tried to devise a military strategy – our Maginot Line was drawn in the Zagros Mountains in northwest Iran – that would protect the oil fields from a Soviet invasion.
 
That led to the formation of the Rapid Deployment Forces, or RDF.  The press immediately proclaimed the RDF was not rapid, nor deployable, and, in fact, there were no forces.  The RDF eventually evolved into the U.S. Central Command as we know it today.
 
In the late 1980s we had Operation Earnest Will, which reflagged and protected 11 Kuwaiti oil tankers.  The justification given to Congress for this operation was the “unimpeded flow of oil through the Strait of Hormuz is a vital interest and critical to the economic health of the Western World.”
 
In 1990 and 1991, we witnessed Operation Desert Shield and Desert Storm, the first Gulf war.  President George H.W. Bush responded to Saddam Hussein invasion of Kuwait with military forces to ensure overt aggression did not go unchecked and to protect vital U.S. interests.  I remember Harry Rowan, then Assistant Secretary of Defense for International Security Affairs, giving the Deputies Committee an economic lesson on how Saddam could control the oil market if Iraq were allowed to remain in Kuwait and possibly venture farther south into Saudi Arabia.
 
I reminisce about these well-known events because it’s interesting to see how our national security thinking has evolved regarding the use of military forces to protect sources of energy, although we did not call it “energy security” at the time.  Throughout the 1970s and 1980s, and into the 1990s, we would devise a military strategy that ensured the flow of oil, and as long as prices at the pump remained reasonable, we had what we thought was an energy policy that seemed to be working.
 
Today, few people would disagree with the statement there is no military solution to our current energy challenges.  Yes, we need a powerful and agile military to back up our foreign policy and, if necessary, to protect sea lanes, ports, and production facilities on a short-term basis.  But the energy challenges today are much broader, far more diverse, and longer-term than can be addressed with military forces.
 
So let me broaden my comments from military strategy to looking at national security.
 
The evolution of the world from the bipolar 20th century, to the very brief uni-polar period, to what obviously will be a long-term multi-polar world is a fact of life we have to deal with and whose implications we have to analyze carefully.  We’re in a complex new century of asymmetrical threats and challenges to our interests.  The traditional concept of national security, therefore, must be expanded and it must include threats to our economy as well as to the environment.
 
Some people make a distinction between national security and energy security.  I believe there’s little, if any, difference, other than to say that energy security should be considered part of our national security.
 
Some nations pose little military threat to us, but they could try to use energy as a political or economic weapon.  Non-state actors, i.e., terrorist organizations, have set their sights, among other things, on disrupting the production and flow of the world’s oil supply.  It is an interesting question, however, whether oil-producing countries, or even non-state actors, could hold us hostage given the nature of the global oil market.  Our Institute has commissioned a major study on “Imported Oil and National Security.”  We hope to present the results of this study in the early fall.
 
The next Administration and Congress should examine closely the security structures and institutions, both national and international, to see if they’re capable of addressing today’s issues.
 
It hardly goes without saying the National Security Act of 1947 is seriously in need of revision, and I know there are people in this town working on that project.  It’s inconceivable, for example, the new President could convene a National Security Council meeting without including the Secretary of Energy.  We should also look at international institutions – everything including NATO, the IEA, the World Bank and IMF, APEC, the G-8, and any other number of organizations.  Most of these institutions were formed decades ago and are in need of restructuring to meet the challenges of the 21st century.
 
Let me make a few specific comments on the report, which makes the right points about reducing dependency on foreign oil, increasing efficiency, investing in innovation, and making energy and the environment bipartisan issues.
 
Energy security in the report is defined, basically, as protecting our way of life from the risks associated with fossil fuels.  I would broaden that definition.  To me, energy security means ensuring that we have reliable access to adequate, affordable, diverse, and clean supplies of energy.  We need energy from all sources, including the continued use of fossil fuels for the foreseeable future.
 
Changes in behavior patterns and our reliance on certain forms of energy will take time, and, as the report states, there is “no silver bullet.”  This will be a long-term process.  There are no quick fixes, and the American pubic should not be duped into thinking these issues can be solved overnight.  Over time, through technology and innovation we can develop alternative sources and make advancements in renewables.  Through greater efficiency, we can reduce demand and stretch out supply.  And over time, we need to expand our nuclear power capacity and increase domestic production of energy sources.  
 
The report does not say this, but energy security does not mean energy independence.  This is a popular slogan used by politicians; it makes a great bumper sticker.  We operate in a global economy and an international energy market – few people realize that in 2007, the United States imported oil from 45 different countries.  Thinking in terms of energy interdependence, which is what the report advocates, will lead to sounder and more realistic policies.
 
Energy and the environment must be viewed in a global context.  What happens in China, India, Russia, and other growing economies will have a profound affect on us and our energy and environmental policies.  Sharon’s report is correct that we need to work in partnership with more nations on these critical, universal issues.  Acting alone will not solve the problem, and it will put U.S. businesses at a global disadvantage.   
 
At the Institute, international work is a major part of our program.  Last fall, we hosted U.N. Secretary Ban ki Moon who gave an address on climate change to a business audience.  In March, we held a U.S.-Japan Business Roundtable meeting to discuss energy and climate change, and next month our Institute, in cooperation with the Atlantic Council, is launching a “TransAtlantic Energy Dialogue” with European energy experts and business leaders.   
 
Three weeks ago we co-hosted a two-day energy forum in Beijing with the Chinese government to look for ways to cooperate on energy and the environment.  This, too, will be a long-term effort – last month’s meeting was our first and we agreed to hold another one next year.  Sharon’s report points to the importance of China for years to come, and she’s absolutely right.  China will be a major factor in the years ahead, in both the global energy market and on environmental issues.
 
Energy infrastructure is every bit as important as energy supply.  As the demand for energy grows and greater supplies are needed, we must ensure we have an adequate infrastructure to produce, transport, deliver, and store that energy.  In the United States, the existing infrastructure, as extensive as it is, is decaying and not adequate to meet future demands.  It takes years to plan and build infrastructure—and we’re not making the investment today to provide for the needs of tomorrow.
 
There’s also a security threat issue associated with the infrastructure. In this country alone, there are 800,000 oil and natural gas wells, over 700 oil refineries, 55,000 miles of oil pipelines, and 200,000 miles of power transmission lines.  And that’s not counting the ports and transshipment facilities.  In particular, the electrical grid is more vulnerable than we care to admit, especially with regard to a cyber-threat.
 
One element of infrastructure often overlooked is human capital.  We do not have enough engineers and skilled laborers in energy-related fields in this country to build and operate the facilities necessary.  I’m told that last year more engineers graduated from universities in South Korea than the United States.  We must do more to entice young people to enter the technical fields necessary to build, maintain, and manage our country’s energy system.
 
There’s a line in the report that says, “The American public understands the risks and dangers of the current situation.”  I hope this is true.  But I believe there’s a great need for public education on energy.  The average citizen is uninformed or misinformed and cannot sort out myths from realities.  We must do a better job of informing the public – and our policymakers – about America’s energy needs and the choices that must be made.  Only through an education program will we be able to get the American citizens engaged and be able to build a consensus – a bipartisan consensus – for a national energy policy.  We can no longer base critical policy decisions on supposition, misinformation, and innuendoes.          
 
Let me conclude on an optimistic note.  Energy and the environment are daunting challenges, but with challenges come opportunities.  America has an exciting opportunity to lead the world to innovative energy solutions that would spur economic growth and protect the environment.
 
We have the opportunity to be the champion of new technologies that foster greater energy efficiency, cleaner use of traditional energy sources, and the development of viable alternatives.
 
Now is the time for government, industry, the scientific community, and individuals to come together to solve these challenges and for the United States to once again show its greatness.  The work of the Center for a New American Security, under Kurt and Michele’s leadership, will help find a way to take advantage of these opportunities and set America on the right path to energy security.

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