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Milton Friedman on Energy and oil

OPEC is a convenient excuse for the energy crisis. But OPEC itself was largely created by our own foreign and economic policies—and it could never have reached its present level of influence and power without the unintended and unwitting support of our mistaken domestic policy.

Context. From a 1979 Newsweek column. The column is framed as a daydream: he imagines President Carter giving a televised talk, and everything inside the talk is his own recommendation voiced through that imagined Carter, not anything Carter said. Written during the 1979 gasoline shortages, after a passage tracing energy shortages to price controls on natural gas from 1954, the 1971 wage and price freeze, and the continued controls on domestic crude oil.

What Carter Should Do
Column, 1979, Newsweek, June 18, 1979; reprinted in the Congressional Record, Extensions of Remarks, June 13, 1979, p. 14740, introduced by Representative G. William Whitehurst of Virginia, who cites “the June 18, 1979, issue of Newsweek”, Congressional Record, June 13, 1979, p. 14740
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Milton Friedman, “What Carter Should Do” (Newsweek, June 18, 1979; reprinted in the Congressional Record, Extensions of Remarks, June 13, 1979, p. 14740, introduced by Representative G. William Whitehurst of Virginia, who cites “the June 18, 1979, issue of Newsweek”, 1979), Congressional Record, June 13, 1979, p. 14740. https://miltonfriedman.org/quotes/opec-convenient-excuse-energy-crisis-1979

Quoted for commentary and research. Rights in the underlying work remain with its rights holder, so cite the work itself, not only this page.

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He also said

  1. The most effective way to cut consumption and encourage production is simply to let the prices of oil products rise to whatever level it takes to clear the market. The higher prices would give each of the 210 million residents of the U.S. a direct incentive to economize on oil, to find substitutes for oil, to increase the supply of oil.

    Context. From a Newsweek column written about a month into the Arab oil embargo of 1973, while retail gasoline and fuel oil prices were still held down under the price controls President Nixon began on August 15, 1971. Later in the column he adds that what is called for is higher prices for oil products “relative to other products—not general inflation.”

    Why Some Prices Should Rise
    Column, 1973, Newsweek (November 19, 1973); reprinted in full in the Congressional Record, Extensions of Remarks, November 29, 1973, p. 38775, introduced by Representative John H. Rousselot of California, who gives it as “an article which appeared in the November 19, 1973, issue of Newsweek”, Congressional Record, November 29, 1973, p. 38775
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  2. There is an energy crisis, there are gasoline lines, for one reason and one reason only. Because government has decreed that there shall be. Of course, government has not done so openly. The President never sent a message to Congress asking it to legislate an energy crisis and long gasoline lines.

    Context. From the Newsweek column of June 4, 1979, so “the President” is Carter. Note that the next sentence on the printed page names a different president, Nixon, as the one who imposed maximum prices in 1971, so a reader going to the source can mis-resolve the referent.

    Blaming the Obstetrician
    Column, 1979, Newsweek (June 4, 1979); reprinted in the Congressional Record, Extensions of Remarks, pp. 14007 to 14008, introduced by Representative G. William Whitehurst of Virginia. The running head reads June 7, 1979, which is the issue; the entry’s own dateline reads Wednesday, June 6, 1979, which is when he spoke., Congressional Record, June 7, 1979, p. 14008
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  3. There is one simple way to end the energy crisis and the gasoline shortage tomorrow—and I mean tomorrow and not six months from now, not six years from now. Eliminate all controls on the price of crude oil and other petroleum products. The gasoline lines would melt faster than the snows of winter. Other misguided policies of government and the monopolistic behavior of the OPEC cartel might keep petroluem products expensive, but they would not produce the disorganization, chaos and confusion that we now confront.

    Context. “petroluem” is the Congressional Record’s own misspelling and is reproduced as printed. The same excerpt spells “petroleum” correctly two sentences earlier, exactly as the page does. The excerpt joins two adjacent paragraphs of the source with nothing omitted between them, and stops at a paragraph end just before the subhead “GAS WOULD COST LESS”.

    Blaming the Obstetrician
    Column, 1979, Newsweek (June 4, 1979); reprinted in the Congressional Record, Extensions of Remarks, pp. 14007 to 14008, introduced by Representative G. William Whitehurst of Virginia. The running head reads June 7, 1979, which is the issue; the entry’s own dateline reads Wednesday, June 6, 1979, which is when he spoke., Congressional Record, June 7, 1979, p. 14008
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