Yesterday, the Journal ran a long, page one story featuring claims by retired Air Force General Charles Wald that oil production facilities around the world are dangerously vulnerable to terrorist attack and that the U.S. hasn’t done enough about it. General Wald is primarily worried about unguarded pipelines and chokepoints for tanker traffic and believes that the U.S. military needs to make “oil security” one of its chief concerns.
I was invited this morning by producers at CNBC’s Kudlow & Co. to debate General Wald, but alas, the General turned out to be unavailable, so the spot was scrapped. That’s too bad, because I was looking forward to engagement.
In short, General Wald is arguing that:
- Market actors — who have spent billions of dollars on these facilities — are underinvetsting in security;
- Producer states — who rely on oil revenues for most of their state revenue — are underinvesting in security as well; and finally:
- If the U.S. military doesn’t do something about this, nobody will.
This is all pretty hard to swallow. Why would investor-owned oil companies be so carefree about their multi-billion-dollar facilities and capital assets? Are those companies run by stupid or myopic individuals? Likewise, poor governments have even more reason to be worried about securing oil production facilities and transit lanes than does the United States, because the economic harms caused by disruption would be far greater on the former than the latter.