Last Friday, March 16, President Barack Obama may have quietly placed the United States on a war preparedness footing, perhaps in anticipation of an outbreak of war between Israel, the West, and Iran. A newly-propounded Executive Order, titled “National Defense Resources Preparedness,” renews and updates the president’s power to take control of all civil energy supplies, including oil and natural gas, control and restrict all civil transportation, which is almost 97 percent dependent upon oil; and even provides the option to re-enable a draft in order to achieve both the military and non-military demands of the country, according to a simple reading of the text. The Executive Order was published on the White House website.
The timing of the Order — with little fanfare — could not be explained. Opinions among the very first bloggers on the purpose of the unexpected Executive Order run the gamut from the confused to the absurd. None focus on the obvious sudden need for such a pronouncement: oil and its potential for imminent interruption.
If Iran was struck by Israel or the West, or if Iran thought it might be struck, the Tehran regime has promised it would block the Strait of Hormuz, which would obstruct some 40 percent of the world’s seaborne oil, some twenty percent of the global supply, and about 20 percent of America’s daily needs. Moreover, Tehran has promised military retaliation against any nation it feels has harmed it. The United States is at the top of the list.
Blocking the Strait of Hormuz would create an international and economic calamity of unprecedented severity. Here are the crude realities. America uses approximately 19 to 20 million barrels of oil per day, almost half of which is imported. If we lose just 1 million barrels per day, or suffer the type of damage sustained from Hurricane Katrina, our government will open the Strategic Petroleum Reserve (SPR), which offers a mere six- to eight-week supply of unrefined crude oil. If we lose 1.5 million barrels per day, or approximately 7.5 percent, we will ask our allies in the 28-member International Energy Agency to open their SPRs and otherwise assist. If we lose 2 million barrels per day, or 10 percent, for a protracted period, government crisis monitors say the chaos will be so catastrophic, they cannot even model it. One government oil crisis source recently told me: “We cannot put a price tag on it. If it happens, just cash in your 401(k).”
Since 2007, when the prospect of Iran blocking the Strait of Hormuz became a daily threat enunciated by Iran, our local, state, and federal governments at all levels have been criticized for having no specific plan in the event an oil interruption occurred. The National Defense Resources Preparedness executive order appears to be the first step toward developing a potentially vast, far-sweeping plan that could reach into every garage and grocery store shelf. Government experts who watch the day-to-day ebb and flow of oil stocks were surprised at the sudden move. One quipped, “If this is true, it would be such a departure in policy, I can scarcely believe it.”
The March 16 Executive Order is based on the Defense Production Act of 1950, as amended (50 U.S.C. App. 2061 et seq.), and Section 301 of Title 3 of the United States Code, and reads as a near-verbatim restatement of President Bill Clinton’s 1994 Executive Order 12919, and several other orders of prior presidents. No specific plan was every outlined based any of the enabling Executive Orders.
Obama’s Order sets forth as its rationale that “the United States must have an industrial and technological base capable of meeting national defense requirements and capable of contributing to the technological superiority of its national defense equipment in peacetime and in times of national emergency.” It goes on in Section 103 C to authorize the President, “in the event of a potential threat to the security of the United States, to take actions necessary to ensure the availability of adequate resources and production capability, including services and critical technology, for national defense requirements.” The task of advising is assigned, in Section 104 to “the National Security Council and Homeland Security Council, in conjunction with the National Economic Council,” which “shall make recommendations to the President on the use of authorities under the Act.”