Word: decontrolling
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...there a compelling alternative to the Carter program? Many parts of the plan-the stand-by gasoline taxes, the moves to push industry toward using coal-make sense. Moreover, a Democratic President cannot be expected to ask a Democratic, heavily liberal Congress for immediate decontrol of oil and gas prices that would indeed allow oil companies to make enormous profits. Aside from the political realities, such decontrol, as Carter noted, would give the economy an inflationary shock that it could not readily absorb...
...there could be another way: a phased decontrol that would allow prices to seek their own level-and discourage consumption-without dealing too great an inflationary blow in any one year. The Government could ensure that the profits oil companies make from higher prices would be devoted to exploration and development of new fields by placing a tax on any earnings that were not -with the proceeds to be devoted, perhaps, to joint federal-private exploitation of resources that are particularly difficult and expensive to tap, such as those lying under water on the outer continental shelf. The impact...
...what drilling people would like?a full-out drilling boom." In addition, adds Davis, producers argue that even a price of $1.75 per 1,000 cu. ft. for natural gas "is not going to have much impact. It won't get producers out drilling deep wells." Short of decontrol, the producers want a price...
Until Carter and Schlesinger settle on just what kind of decontrol they will recommend, no one can judge the program's adequacy. But the portents are not favorable. The idea of keeping a "cap" on prices is unwise. It would interfere with what should be a prime goal of decontrol: letting the market adjust prices so that a B.T.U.* would cost roughly the same whether it was produced by burning oil, gas, coal or whatever. Only in that way can the U.S. get the most efficient use of fuels...
...reserves. But as long as they face a serious threat of breakup, they will not make the investments required. In return for a pledge to stop dismemberment, Carter should extract a promise that the companies will devote a large share of the profits they would reap from price decontrol to exploration and development of solar, nuclear and synthetic fuels...