FOR IMMEDIATE RELEASE
July 24, 2009
Patrick Creighton, 202.870.0850
Laura Henderson, 202.621.2951
Biden Promotes Free-Market Energy Principles Abroad
Will He Check Those Beliefs on Air Force Two?
Washington, DC – Vice President Joe Biden recently told Ukrainian officials how they could strengthen their country by altering their energy policies. Ironically, Biden’s message dovetails perfectly with what the Institute for Energy Research (IER) has been saying for years.
“We are truly impressed,” said Robert P. Murphy, resident economist with IER, a leading free-market energy think tank. “Vice President Biden is calling for an end to government subsidies that distort energy markets, recognizing the benefits of liberalizing natural gas markets and boosting domestic energy production. Here at IER, we could not agree more.”
Key excerpts from a Wall Street Journal report on Biden’s remarks regarding free-market principles as a means to achieving energy independence and stronger national security:
- Mr. Biden saved his toughest criticism for the government’s handling of the energy sector, where the government provides large subsidies on imported natural gas that is sold domestically. Analysts have argued the disparity between market prices and the cheap government-sold gas has created a black market where corruption is rampant.
- In addition, analysts said, the large subsidies have forced Kiev to rely on below-market-price imports from Russia, which allows Moscow to directly influence Ukraine’s domestic economy. Twice in the past three years, disputes between Russia and Ukraine over gas payments have shut down a major gas pipeline that transits from Ukraine to the rest of Europe, leaving parts of Eastern and Central Europe shivering during the winter.
- Although he didn’t mention Russia by name, Mr. Biden said reform of the energy sector was essential to Ukraine’s independence and national security, saying only if the country liberalized its gas market would it be free of dependence on foreign powers and their suppliers.
- “Your economic freedom depends more, I suspect in this country, on your energy freedom than on any other single factor,” Mr. Biden said, urging conservation as well as reform. “That will be a boon to your economy and an immeasurable benefit, I respectfully suggest, to your national security.” Mr. Biden also announced the establishment of a joint U.S.-Ukrainian working group on energy security.
The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.