An economic boom ahead?
By David Ignatius, Published: May 4
With so much talk these days of America’s decline, it may sound strange to ponder the prospects for an American economic boom a decade or so from now. But that’s the thrust of two new studies, which have me thinking like Dr. Pangloss, Voltaire’s caricature of optimism.
These analyses predict the repair of two of America’s greatest economic vulnerabilities in recent times — dependence on foreign energy, with the threat of supply disruption, and the decline of the manufacturing sector in the face of lower-cost foreign competition. Both problems are on the way to being reversed, the analysts argue.
First, the case that America is entering a new era of energy security: My expert here is Robin West, a friend who is chairman of PFC Energy, a Washington-based advisory group. He argues in a series of recent reports to clients that, because of the rapid expansion of oil and gas production from shale, America is likely to become by 2020 the world’s No. 1 producer of oil, gas and biofuels — eclipsing even the energy superpowers, Russia and Saudi Arabia.
West explains that the natural-gas boom will mean a dramatic change in energy imports and, thus, the security of U.S. energy supplies. He forecasts that combined imports of oil and natural gas will fall from about 52 percent of total demand in 2010 to 22 percent by 2020. The totals are even more impressive if supplies from Canada are included.
“This is the energy equivalent of the Berlin Wall coming down,” contends West. “Just as the trauma of the Cold War ended in Berlin, so the trauma of the 1973 oil embargo is ending now.” The geopolitical implications of this change are striking: “We will no longer rely on the Middle East, or compete with such nations as China or India for resources.”
Energy security would be one building block of a new prosperity. The other would be the revival of U.S. manufacturing and other industries. This would be driven in part by the low cost of electricity in the United States, which West forecasts will be relatively flat through the rest of this decade, and one-half to one-third that of economic competitors such as Spain, France or Germany.
more:
http://www.washingtonpost.com/opinions/an-economic-boom-ahead/2012/05/04/gIQAbj5K2T_story.html
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