State should chart its own course for energy future

  • John Burbank / Syndicated Columnist
  • Tuesday, May 30, 2006 9:00pm
  • Opinion

The summer driving season is upon us, or is it? With gas prices more than $3 a gallon and rising, we have a powerful incentive to take our vacations at Mount Rainier, the North Cascades, Ocean Shores or Olympic National Park rather than Glacier or Yellowstone. We can cut down on our mileage and still enjoy some time off. And spend our money in Washington state, helping the economy.

So maybe rising gas prices have an up side. After all, we Americans have to get hit over the head to realize that maybe it is not such a good thing that our 20th of the world’s population consumes one quarter of its petroleum. But the galling thing about these gas prices is that they feed the appetites of the very companies that discourage energy conservation.

These major integrated oil companies – Exxon, Shell, BP, Conoco, Chevron – are raking in profits, thanks to their near-monopoly on supply. It is in their interest to keep demand as high as possible and supply as short as possible. And while vacationing in Washington helps our economy, the increasing price of fuel sucks money out of the Washington economy at the rate of $537 each second. That’s about $1,500 per person per year, or a total of $9.6 billion a year sent out of Washington for oil and gas.

Where does this money go? Oil company profits rose 40 percent between 2004 and 2005, and are already 10 percent higher in 2006 than they were in 2005. Each time crude oil prices get jacked up, it is a direct mainline into profits.

Sure, in other democracies the price of gasoline easily exceeds $5 a gallon. But three-quarters of that is for taxes. The taxes go into the transportation infrastructure, trains that are fast and run on time, mass transit in the cities, energy conservation and health care. Those decisions are made by democratically elected parliaments.

How the extra money that comes out of American wallets is spent is decided in the board rooms of Houston, London and the Netherlands. So that is how the head of Exxon, Lee Raymond, pulled in a cool $50 million last year, not to mention paying for his personal travel, club memberships, financial planning services and tax (avoidance) assistance, as well as a retirement package worth $400 million.

With all the huffing and puffing in Washington D.C., still nothing happens. So it falls to the states to figure out how to develop an energy policy that works for people, businesses and the environment, and how to fund that. In our state, it is time for the governor and the Legislature to develop a windfall profits tax on oil and use it to fund renewable energy and convenient transit.

Each price rise at the pump is a warning that the energy market is monopolized by oil giants that don’t work to the benefit of Washington state industries and citizens. So we have to redirect some of this money back into our economy. One version of the windfall profits tax written by state Rep. Bob Hasegawa, D-Seattle, would do just that. It would bring in $500 million. Instead on going to Exxon’s Lee Raymond, it could fund the transportation network and renewable energy industry in our state. And just in time, because we need to get ahead of the curve fast if we are going to keep our quality of life.

Here’s an example. Driving up I-5 between Marysville and Arlington, you’ll notice that there’s a lot more traffic now. This is a growth corridor, with a projected population of 100,000 in the next decade. So how are these folks going to get to work?

Crowding up I-5 isn’t the answer. The state could start now to invest in rail transit to move people from place to place. It would keep our air clean and ensure that time spent sitting in cars doesn’t devour our lives. The choice for our elected officials: Do we allow Exxon, Royal Dutch Shell and the Saudi Arabian Oil Company to make this decision for us and leave us breathing gasoline fumes, or do we have the guts to make this decision ourselves?

In a democracy, that question should be easy to answer.

John Burbank, executive director of the Economic Opportunity Institute (, writes every other Wednesday. Write to him in care of the institute at 1900 Northlake Way, Suite 237, Seattle, WA 98103. His e-mail address is

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