Can Biden’s Green-Energy Czar Succeed?

Harold Ickes was a one-man brain trust, confidant, and brass-knuckled enforcer for Franklin D. Roosevelt. To his political adversaries, including the Republican doyenne Clare Boothe Luce, he possessed the “mind of a commissar and the soul of a meat axe.” As head of the Public Works Administration during the 1930s, Ickes quickly turned billions of dollars in New Deal appropriations into dams, bridges, schools, and badly needed structures. As an ardent conservationist later serving as secretary of the interior, he ran roughshod over the oil industry. But in May 1941, with war looming, Roosevelt appointed the man he called “Horrible Harry” the nation’s first “oil czar.” The longtime bane of American petroleum oil executives would oversee the opening of 13,400 new wells in his first year—a production increase to 40 million gallons daily, and a 30 percent expansion of refinery output. It was later written that the Western allies “floated to victory on a sea of oil.” 

This remarkable turn of affairs has resonance as America takes on another world-historical challenge—this time against authoritarianism and military adventurism in Europe and potentially Asia as well. When it comes to competition with Russia and China, it is energy and other critical supply chains that represent the crucial battle space. The collective ability of the technologically advanced democracies to resist coercion—whether emanating from Moscow, Riyadh, Tehran, Caracas, or Beijing—depends on access to critical minerals and other industrial materials. Landmark pieces of legislation—in particular, the Inflation Reduction Act plus the Infrastructure Investment and Jobs Act—have provided massive new funding and incentives (nearly $400 billion worth) to grow the market, build the infrastructure, and develop reliable suppliers for electric vehicles (EVs) and other clean energy and transportation technologies. To make sure it all happens, effectively and expeditiously, President Joe Biden has turned to his own brainy and pugnacious D.C. insider (and oil industry antagonist)—John Podesta

Like Ickes, Podesta will have to bulldoze through the bureaucracy and reach out beyond traditional political allies and ideological comfort zones. As importantly, and like the curmudgeonly New Dealer, Podesta will need to work constructively with industry—including mining firms, heavy manufacturing, and energy companies associated with fossil fuels—that are traditional political adversaries. Ultimately, an effective energy transition will require building a secure and reliable supply chain among the U.S. and its close allies and trading partners that is not dependent on China or Russia. For instance, the average EV requires five times the quantity of critical minerals (by weight) as a conventional car. The U.S. currently extracts negligible amounts of lithium, cobalt, nickel, and other minerals essential to EV batteries, though some allies and partners can and do produce more. The picture for processing the most critical minerals—anywhere from 50 to 90 percent of which are controlled by Chinese companies—is even bleaker.

As Ickes steamrolled the Public Works Administration during the 1930s—and then corralled oil companies during the 1940s—Podesta needs to lean hard on both industry and government to achieve significant (but responsible) expansion of domestic mining and processing of critical minerals and materials. He must overcome obstacles to generating more reliable, cleaner, and cheaper electricity, including an expansion of transmission infrastructure across the country—a priority that has foundered in the face of local NIMBY opposition in the past. Additionally, the IRS will need to provide clarity and a degree of flexibility to ensure maximum eligibility for purchasing tax credits while still incentivizing the transition away from problematic foreign sourcing.

Otherwise, the long-overdue energy transition will never gain sufficient traction and take root beyond the current administration. Such a failure will leave the U.S. dependent on the most pollutive fuels and at the mercy of the countries that produce them.

Ultimately, the energy transition will succeed or fail based on its capacity to power future economic growth and improve the living standards of all Americans. Doing so requires an “energy czar” willing to work both sides of the congressional aisle, gain the trust of responsible members of the business community, and sustain support among fair-minded environmentalist leaders.

To meet this historic moment, Joe Biden need not become another FDR. But John Podesta will need to channel his inner Harold Ickes. And soon.

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