Energy - Cheap Energy

This will be the first of many posts on energy.

Today I heard the Obama campaign say that the Republicans did not address any issues regarding the middle class. I hope this is just a campaign ploy and not ignorance of one of the most important issues affecting the poor and middle class, i.e. the price of energy.

A quick economic review, in a free-market economy, the price of an item will fall when supply exceeds demand and rise when demand exceeds supply. Given that world population is increasing and the peoples of the world want increasing prosperity, it is a common sense that the need for greater energy supplies is undeniable.

It is also common sense that as the price of energy increases, that these extra costs will be passed on to the consumer. Everything that uses energy in production or transportation will see price increases. These price increases proportionally will hurt the poor the most and the rich the least.

Therefore, to increase the prosperity of us all, it is necessary to drive down the cost energy. We must increase the supply of all types of energy and decrease demand where possible. Energy conservation is great but it alone will not lead to increase prosperity.

What this country needs to compete with other countries is relatively cheap energy. The earlier we address our energy problems, the quicker we can drive prices down.

In future blogs I will address this.