In the long run, however, natural resources are what give power to a society, and modern societies are not isolated like primitive tribes. Consequently, economic power, defined as fungible resources, is necessary to support modern military power. [Emphasis added]
"Fungible" means "interchangeable" meaning the consumer or user cannot tell the difference between the product from source A or source B. While looking it up I came upon the above Dilbert cartoon that states:
Oil is a fungible commodity, the capitalist system virtually guarantees that you'll end up buying the lowest cost oil from sources unknown to you. [Emphasis added]
True, but does that negate Dilbert's desire to buy a fuel efficient car or the newly-forming national consensus that we need more domestic sources of oil and other energy? I think not.
Similarly, any decision to permit new drilling or wind farms or nuclear power plants or biodiesel and so on, will eventually increase supply and therefore reduce prices or at least reduce the rate of increase that would have occured absent the increased supplies.
The argument that newly-permitted drilling (or wind or nuclear, ...) will not "add a drop of oil for ten years" is, IMHO, a phony one. It is like telling a high school graduate not to go to college because it will take ten years to recover the lost income during the four to eight years he or she will not be in the workforce. You have to look at the long-term payoffs!
Also, since part of the price of oil is based on future expectations, the change in public attitudes about tradeoffs between the environment and energy has already reversed some of the rapid rise in energy prices worldwide.
Of course our energy conservation and expansion of supplies must be done in a reasonable and responsible way.
When we purchased our Prius we knew we were facing short-term increased costs and were "betting" on the long-term payback. The Prius costs a few thousand bucks more than a comparable non-hybrid and we were told we'd have to spend $4000 bucks to replace the batteries in four years. We originally figured it would not pay back our investment for five or six years. Well, with the more than doubling of gas prices over the four years we've owned it, and the new estimate that we'll only have to spend about $2000 to replace the batteries and they will last six years or more, it has already paid off!
Smart energy conservation could pay off much sooner than we think if energy prices continue to rise worldwide. Now that China and India and Russia and other countries have adopted something like capitalism, their productivity and standard of living have shot up and are expected to continue to rise to the level of western democracies. That means, despite energy conservation and development of new supplies, energy demand and therefore energy costs will continue to go up.
As I wrote in my Global Warming Topic, the increased use of energy worldwide will mean more release of previously sequestered carbon (gas, oil, coal) into the atmosphere. While I am not an alarmist who thinks all global warming is caused by humans and the "tipping point" is ten- or twenty-years away, I do accept that humans are responsible for a significant fraction of global warming and we should curb the release of sequestered carbon into the atmosphere to the extent possible without ruining the worldwide economy.
Politicians and "do-gooders" can trumpet conservation until they are "blue in the face" but most consumers and industries will do little until it hits them in the pocketbook.
I have long supported a punitive carbon tax. I believe, within ten years, most governments will screw up the courage to impose a substantial carbon tax despite its unpopularity with voters. Government regulation and imposed mileage standards and subsidies for alternative energy are counterproductive and simply enrich the well-connected and bloat government. Just raise the costs of excessive carbon and allow market forces to do the rest!