With only 5 percent of the world's population the US annually burns 49 percent of the world's gasoline. I can think of no statistic that so clearly sums up America's fortunate position -- and its dangers -- at the present time.
Peter G. Peterson, one-time secretary of commerce in the Nixon administration and presently chairman of the board of Lehman Brothers Kuhn Loeb Incorporated, testified this week before the Joint Economic Committee of Congress. It was one of those big committee rooms whose ceiling is as high as the chamber is wide, but not many people were there because, after all, the dilemma is familiar enough. What was new, perhaps, was Mr. Peterson's apprehension.
"We are ubelievably dependent," he said, "on one of the most unstable parts of the world where the cutoff of oil could do us unimaginable harm." Indeed it is hard for our allies, he said, to understand our complacency.
The witness had an array of charts and tables that helped impress the committee. For years the United States was self-sufficient in oil, he noted. It produced around 12 million barrels of oil a day as recently as 1970 -- the peak; now it is down to about 9.9 million barrels. He said that because other industrial nations are frightened by the prospect of oil cutoffs they have slapped on heavy taxes to conserve the supply. In April 1980 the tax on a gallon of gasoline in the US was only 14 cents, and the overall price per gallon , according to Mr. Peterson, was $1.21. That seemed high to Americans who remembered gasoline at 30 cents or lower. But compare it with four other countries of the same date -- United Kingdom, tax $1.28 a gallon and total price price per gallon $2.85; Japan, tax 81 cents and price $2.35.
In other words gasoline costs twice as much in the four countries and it is higher elsewhere. As Mr. Peterson put it, "can we wonder why the rest of the world suggests that we are being profligate -- they often use more pejorative phrases than that!"
America's use of gasoline is changing, but a transformation can't come overnight. Seven and a half years ago OPEC (Organization of Petroleum Exporting Countries) put on its first embargo. Three presidents urged Congress to act but without much success. Mr. Nixon had his "Project Independence" to make America self-sufficient; President Ford warned that "we face a future of shortages and dependency which the nation cannot tolerate"; President Carter called for a response that would be "the moral equivalent of war." And Congress said "ho-hum".
However, for several years now, US oil imports have declined. They may average 16 to 20 percent below the peak rate of 1977. Congress momentarily debates whether something more can't be done to accumulate surplus oil underground in case of a national emergency. (There is some there now, enough for a few weeks.) America will act in time -- if there is time.
We have enormous supplies of coal, Mr. Peterson points out. American reserves amount to 30 percent of all the world's economically recoverable coal reserves, maybe 200 billion tons. America now exports about 90 million tons a year while continuing to import oil. The sooner we start using more of our own coal the better, he thinks.
The United States has moved to catch up with Soviet Russia in defense, and Mr. Peterson praises the move. "But I am, if anything, even more concerned about the potential danger that we face if we experience another decade of woeful economic performance," he adds. "Project, if you dare, 10 more years of decline in US economic performance versus the economic and technological advances of Japan and our competitors.
"Such a projection produces more than a temporary "window of opportunity': it results in a decade of real danger -- a period of national and international insecurity in which the US has neither the resources nor the credibility to do the lonely job of world leadership that is our unique responsibility."
Mr. Peterson, a Reagan backer, is one of those who thinks there is no time to lose.