Red flags on the energy front

The news this week that China topped the United States last year as the No. 1 global consumer of energy is a point on the arc of history that will have far-reaching policy and economic implications for this country and the world. The United States had held that distinction for nearly all of the 20th century and the first decade of the 21st century.

Among other things, China is now the world’s leading importer of oil. China, not the United States, is the top customer for oil from Saudi Arabia. No wonder the Saudis, Venezuelan strongman Hugo Chavez and the Islamic theocrats who run Iran are all enthusiastically courting China, often ignoring U.S. policy and desires in the process.

For instance, attempts by this country and its allies to impose punitive economic sanctions on Iran for its drive to obtain nuclear weapons are severely undercut when Iran is working with China’s largest oil company to develop new production facilities and new markets for its oil.

When it comes to coal, China is in a league of its own — using triple the amount of coal the United States does, and producing all of the coal domestically, according to The Wall Street Journal.

It’s that heavy reliance on coal to produce electricity that caused China to surpass the United State in CO2 emissions in 2007. What’s more, China is constructing new power plants at the rate of one a month. And, although it is ahead of the United States in the use of clean-coal technology in new plants, its emissions of CO2 and other climate-change gasses are increasing far faster than those in the United States.

China passed the United States and every other country last year to become the No. 1 purchaser of automobiles. Many of them are imported from Japan, Europe and the United States. General Motors now sells more autos in China than any other country. And, despite the fact that the demand for automobiles in China has cooled along with the global economic downturn, China’s domestic auto industry is also growing.

The United States still maintains the world’s largest economy overall, followed by Japan, but China’s economy is growing by leaps and bounds compared to ours. Its energy consumption has doubled in the past decade. Furthermore, as many Americans are aware, China now holds massive amounts of U.S. debt.

This doesn’t mean the United States is in danger of being swamped by China’s economic juggernaut. This country still leads the world in technological innovation and — though you may not know it from recent news — in total manufacturing output. However, China is expected to overtake the United States in that category next year, the Financial Times reported last month.

What all of this does mean is that U.S. policy makers — whether they’re considering decisions about our relations with other countries or domestic regulations on climate change and energy development — need to factor into their calculations how action by China may affect our policies.


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