ENERGY TOWN HALL TRANSCRIPT

DYLAN RATIGAN: Good evening to you from Oklahoma State University. Again, I welcome everybody in this room and everybody across the internet. We find ourselves as a group — everybody on this panel, myself, everybody in this room and anybody watching at home on their computers in the middle of an incredible transition and the way we all communicate. And I’m excited to have this conversation with all of you tonight and with you tonight, and with you tonight, because for the first time in the history of the world we are able to have a conversation like the one we’re about to have with a group of people like us in a room like this.

At the same time we have people streaming this exact conversation on computers in Cairo, on computers in San Francisco, on computers in Asia simply because of what exists with the internet. And we would not be able to do this if we didn’t have the incredible streaming partners that we do have; most notably, MSNBC.com, my employer. Thank you MSNBC who is carrying this right now this evening and then a whole stack of folks. There’s a new application that Facebook has come out with that’s incredible where you’re able to stream onto Facebook, so get ready, there’s going to be lots of Facebook TV shows, maybe you could have one Boone. We could do Boone TV. But again, Facebook.com/MSNBC, streaming there and then a whole string of folks that we’ll put up the names of our streaming partners on Twitter. But I want to get into the conversation right now, first by introducing our guests.

Obviously, T. Boone Pickens sitting in the orange tie, cowboy orange I understand is the color to be worn in the state if you intend to be fed, so I will be wearing orange at all times as I move around. You are going to be in trouble Ashwin, that blue, I don’t know. And again Boone’s sort of precedes himself in this room but for those out there who want to put him in context, I suggest you look at his investment and his use of his resources as a patriot in this country attempting to provoke a legitimate conversation about what we need to do to secure ourselves and what it really means to be a patriot where it’s not about carrying on, about war and all the rest of it, but it is about getting ourselves into a situation where we’re self-sufficient and we are capable. And I can’t think of anybody that I know Boone who has done more work than you have to that end, so I’m excited that you’re here.

T. BOONE PICKENS: Thank you. Dylan, you know who all these people are?

DYLAN RATIGAN: Your family.

T. BOONE PICKENS: They’re either family or partners.

DYLAN RATIGAN: All right, good, yeah.

T. BOONE RICKENS: Okay, we’re all together though.

DYLAN RATIGAN: It’s been part of the crowd. James Woolsey is with us, Chairman of Woolsey Partners, Chairman of the Foundation for Defense of Democracies, former Head of the Central Intelligence Agency and a man who believes that we must smash, we must shatter — those are his words — the strategic importance of oil in this world if we are ultimately going to move to an environment that is more stable and is more peaceful and ultimate is more prosperous.

Bob Deans is with us from the National Resources Defense Council. Bob is an author of multiple books, most recently “In Deep Water,” look at what happened with the BP oil spill last summer, but it’s not your only book. And again we welcome you Bob to this conversation. And then perhaps the person I’m most excited honestly to have here — with all due respect Bro — is the man standing or sitting just behind me, Ashwin Madia, who is a U.S. Marine, is currently running VoteVets while his colleague Jon Soltz has been sent on another tour of duty in Iraq, and I’m excited to able to hear your perspective on this issue particularly in a combination with somebody like Mr. Woolsey who is sitting with us.

So, let me get rid of this paper and let’s get after this. So much of the conversation about energy in this country is either seen through the economic lands or through the bias of whatever you’re into. If you’re into nuclear, if you’re into natural gas, you’re in solar, you’re into wind, but not nearly enough of the conversation about energy in this country or in this world, but I’ll stick to the country, is viewed through the eyes of patriotism and is viewed through the eyes of the risks to our own security, the sacrifices that are make by our own soldiers, the expenditure of our assets to secure, the strategic asset that is oil and I cannot more emphatically recommend that all of us begin the process if you haven’t already, of thinking about energy as a strategic patriotic issue. It is not just an economic issue. It is a patriotic issue.

We were talking on the way over about the world right after 9/11 and if we could rewrite history and if there was one thing that I wish would have happened or could have happened, it would have been a request that every American as we send our soldiers to war understand that the best way to fight a terrorist is to turn off the lights in the room that you’re not in, that the best way to fight a terrorist is to understand the strategic importance of this asset, that we do have the technology, that we do have the resources, and that we simply need to manifest the political will to get this done. And so I feel like we don’t have a lot of time and I don’t want to spend too much of it talking. I want to get into it with our panel. And Ashwin let me get out of your way so you can see the room here. But give me a little bit of a sense, I would love for you just to pick up with what we were talking about which is energy suffers in some ways from a messaging issue. People don’t relate to it perhaps in the way that they could.

ASHWIN MADIA: Right. So the point that Dylan and I were talking about earlier this afternoon and that I think it’s important to remember in the context of this energy debate is that the sacrifices that we’re making as a country are not just economic through this. I mean I think we all know that we’re losing a lot of money and we’re sending a lot of money overseas. We have trade imbalance and we’re debasing our dollar and so forth because of our dependence on oil. But there’s also other sacrifices, human sacrifices.

I mean even if you think about just the past 10 years, how many young men and women we’ve sent overseas to be deployed in these countries and I think that it’s undeniable that we wouldn’t have as robust a presence in the Middle East and we wouldn’t take as active in interest and maybe we wouldn’t even have these wars if these countries didn’t have a lot of oil that we are absolutely addicted to and dependent on. And so when we talk about the cost was also a factor in how many kids have lost their arms because of our dependence on oil or how many kids have lost their legs because of our dependence on oil or sometimes there are lives or cause mental illness and so forth? How many families have been affected when their sons or daughters come home like this or maybe even don’t come home at all? And those too are cost of our addiction on oil.

And so when we say, “Well, we need to get it so that the wind industry or solar, they need to be able to compete on their own two feet,” we need to remember that the oil industry, they’re passing externalities on to the rest of us, I mean whether it’s garbage being pumped into the air or climate change or these economic cost but also these human cost that we’re bearing that aren’t necessarily reflected in the price you pay at the pump. And so that’s not quite a fair way to measure it and say, “Well, these other industries just aren’t ready to compete yet.”

DYLAN RATIGAN: Yeah. Boone, you’ve spent perhaps more time than anybody in this country the past few years in Washington, D.C. directly engaging both political parties of a variety of presidents. What have you found as the most effective? What connects the most when you’re trying to present the case for energy independence?

T. BOONE PICKENS: Well, when I started this deal back in July of 2008, I got out of politics. You remember that, and I set up no longer political. I’ve always been a republican but this issue is so important to our country, that it’s a non-partisan issue. It has to be addressed and we have to do something about it. We’re the only country in the world that has no energy plan. None. Zero. Never had an energy plan. It’s unbelievable that we use 25% of all the oil every day in the world with 4% of the population and we have no energy plan.

And so it was real easy once I got in front of these guys as I was telling them what the plan was that we have to get on our own resources. Then it was kind of — it was — in a way it was kind of amusing because they said, “Well, I’m not so sure I like your plan.” I said, “Well, tell me what your plan is.” “Well, I don’t have a plan.” I said, “Well, if you don’t have a plan, then it’s foreign oil,” because we’ve gone 40 years with no plan and what do we get? We get more oil and it’s all foreign oil. It’s the way it works. You go back to Richard Nixon in 1970. He said, “Elect me and we’ll be energy independent.” Everybody that ran for president from that point forward said the same thing, “Elect me and we’ll be energy independent,” and none of them ever did anything.

The time Nixon said that we imported 24% of oil. Today, we import 67% of oil. If we don’t do anything, in 10 years we’ll import 75% of oil and you’ll pay $300 a barrel for it. So that’s where we’re headed. Somebody has to do something to change the direction and we have to have an energy plan. So I — listen, I’ve got great support. I’ve got great support. They say on the first vote, the bill will be filed on the 6th of April. I don’t know when it will be voted on. But when it is voted on, you’ll have over 300 votes for the bill.

DYLAN RATIGAN: Talk a little bit, James Woolsey, about your rhetoric about the need to crush oil — period.

JAMES WOOLSEY: Oil’s strategic role?

DYLAN RATIGAN: Yes.

JAMES WOOLSEY: Well, we borrow over a billion dollars a day now to import oil, with oil at $106 a barrel, highest that it’s been in two years. We are essentially turning ourselves into — close to poverty. In order to ship over a billion dollars a day to countries that in many cases not only don’t like us very much, don’t like us at all, in order to finance both sides of a war on Islamist terrorism. That is not a good strategy to pay for your enemy’s side in the war as well as your own. We are facing an organization, OPEC, 12 countries, 8 of them in the Middle East, that dominate the world’s oil reserves. According to their terminology, they have close to 80% of the world’s conventional reserves of oil. It may not be quite that high but it’s very substantial. We in this country have about 3% of the reserves.

So we do not solve the problem by just buying oil from friends or even producing much more domestically. By buying from friends, we don’t do a thing. We buy more from Canada and less from Saudi Arabia. Somebody else buys more from Saudi Arabia and less from Canada, it’s a wash. And with respect to drilling here, that helps with our balance of payments, yes, but it does nothing to disrupt OPEC’s domination of the world oil trade. OPEC is a conspiracy in restraint of trade. It would be called under American law, it is a “cartel” and with its ability to lift oil at — the Saudi said 10 years ago $1.50 a barrel, whereas it costs us tens of dollars of barrel to lift oil here. If they can lift it for $1.50 or even $4 a barrel and sell it for $106, they are to put it mildly attracting a great amount of economic rent. And that keeps the elites in these countries, not just Saudi Arabia but Russia, Venezuela, and so forth keeps the elites in power and these elites are not the people. These are not organizations and groups that all want to work with us.

What we really need to do is turn away from oil as much as possible. One major aspect of that is Boone’s marvelous plan to utilize far more of our increasingly plenteous natural gas reserves not only for electricity generation and heating but also for transportation in trucks, large vehicles, cars as you get the infrastructure in place and so on. There are other possibilities. One is to turn toward electrification, a drive of volt, a drive on very cheap electricity for 30 to 40 miles before I start using gasoline. It works fine. That electrification can definitely help. Being able to have — believe it or not, a slightly different kind of plastic in the fuel line of our cars the way we have for a few and Brazil has for all, makes it possible to burn an alcohol together with gasoline and whatever mixture you want, alcohol sometimes, the ethanol sometimes it might be methanol, and to choose at the pump the way that Brazilians can and say, “Oh, I see what the price is for that today. All right, I’m going to buy gasoline” or “I see what the price for that is. I’m going to buy ethanol or methanol.”

That opens up gasoline to competition. It doesn’t have to compete today. It has a lock on the market. Oil is 96% to 97% of the transportation market. You can’t get away from it. We can improve the efficiency of internal combustion engines. There are a number of things that we can do that will make it a lot easier for us to tell our “friends,” and I use it in quotes, in OPEC that you don’t get to shove anymore close with this analogy. My friend, Anne Korin, came up with this analogy and I don’t — don’t throw anything if you don’t like it because I love it too much. For thousands of years until the early 20th Century, salt was a strategic commodity. It was the only way to preserve meat. It was terribly important. You are the salt to the earth means that you’re important, not that you’re cheap. Roman soldiers salaries, salary comes from salt, were paid in salt. If you had a country that had salt mines, you were a big deal.

Countries fought wars over salt mines until the 1900s. Within a very few years when the electricity grids came into existence in the end of the 19th, beginning of the 20th Century and people suddenly discovered they had refrigeration and freezing, they could preserve meat by freezing and unthawing it. Not only did it taste a lot better but it was a lot cheaper than soaking it in expensive salt. And within a very few years, salt was shattered as a strategic commodity. It’s still traded, international trade. We need it on the sidewalks in Washington, D.C. in the winter. It tastes good on corn on the cob but nobody shoves anybody around anymore because I have salt and you don’t. You didn’t stop at dinner on the way here and looked at the salt shaker and say, “You know, I wonder if we’re salt independent.” Salt is boring. We need to make oil boring.

DYLAN RATIGAN: Yeah. Bob, there’s momentum right now. Oil is at the highest price it’s been in two and a half years. The new cycle between Japan and the Middle East has refocused all of our attention on this. The president has focused his attention on this. We see a piece of legislation emerging, perhaps introduced on April 6th next week that will address some of these. What needs to be done to ensure that the environmental community is both represented as America seizes its energy independence and at the same time we don’t end up going back to Boone’s point which is “if you don’t have a plan, whoever you may be, your plan is foreign oil”?

BOB DEANS: Great question. I think what needs to happen is all of us, the American people, need to speak up because what we know is that our security, young men and women, are in harm’s way over this issue. We know that our economy takes a hit, a billion dollars a year. It’s costing us jobs and we know that Americans going back to President Nixon had been saying, “We’ve got to reduce our reliance on oil. Why haven’t we?” Because the oil industry which is the wealthiest, most profitable industry in the history of the world, it has made $1 trillion in profits over just the last decade has an army in Washington where I am of nearly 800 lobbyists who wake up every morning and say, “How can I go up on Capitol Hill today? Whose palm can I grease? Whose arm can I twist to make sure that my shareholders’ profits are well-represented in our energy policy?”

So we do have a policy on energy policy in this country and the deal is let’s make money for the shareholders of Exxon and Chevron. They have that right. They have that democratic right. We, the people of the United States, have to stand up and speak for our rights. We have to tell the people who represent us on Capitol Hill, “Hey, we don’t have $300 million to spend on lobbying and washing like the oil industry was done in just the past two years, but our vote counts and we care about jobs for Americans, we care about the security of this country, we care about a clean and healthy future for our children, and by golly, we’re going to fight for it.”

DYLAN RATIGAN: Yeah. All right. Listen, it’s in our hands. I really believe that and I thank you, Boone, for helping to push us this close to it and I thank you, Ashwin, for making it so clear what’s at stake when people like you and your colleagues in the military have to serve the way that you do. I want to open up the floor to questions and as we get that set up, I also want to tee up Skype. We’ve got Johnny out at California with a question. Johnny, tell us what website you’re on and where you’re watching this thing streaming and what your question is.

JOHNNY: Okay. My question is — in Mill Valley, California. My question is once you take away the subsidies for oil and gas won’t that immediately make the sustainable forms of energy right away? Won’t they become competitive?

DYLAN RATIGAN: Boone, subsidy elimination from traditional — from oil, would that — how quickly would that make other forms of energy competitive?

T. BOONE PICKENS: Tell me what the subsidies are.

DYLAN RATIGAN: What subsidies are you referring to, Johnny?

JOHNNY: Take away the oil and gas subsidies that are in place now from the government.



DYLAN RATIGAN: Yeah. So just the tax subsidies and other development subsidies for the oil companies.

JAMES WOOLSEY: Depletion allowance, intangible drilling and all of that.

DYLAN RATIGAN: Right, yeah.

T. BOONE PICKENS: Okay. And the take away you’re talking about intangible drilling cost.

DYLAN RATIGAN: All of that.

T. BOONE PICKENS: And depletion allowance.

DYLAN RATIGAN: And how quickly would that make other forms of energy more competitive were those subsidies to be removed?

JAMES WOOLSEY: Remove for oil.

DYLAN RATIGAN: Remove for oil.

T. BOONE PICKENS: See, I want to continue — you know my pitch is I’m all American, so I want American fuel to replace the OPEC oil, the oil from the Mid East is what I want to get rid of. That’s dangerous. That’s 5 million barrels a day. So if you pull the IDC from the intangible drilling cost from the industry, you’d cut the CAPX, their CAPX by 30% which is what he’s saying. Yeah, it would cut the drilling. I don’t want to cut the drilling. I would leave IDC in place. I mean if you’d look at what the industry has done and we mentioned Exxon. Exxon is an international company. It is not a domestic oil company. It’s based in Irving, Texas, but 84% of the revenues come from offshore. So it’s an international company. But our domestic industry does extremely well and does a good job I think for the country.

DYLAN RATIGAN: James, your thoughts on what would happen? Bob as well.

JAMES WOOLSEY: Well, it’s a complicated area because there are a lot of subsidies for oil that have been in the tax code for a long time. You get a lot of disagreement about how much they are total, several billion dollars a year, 20 billion dollars a year or more. It depends on what you count. But it seems to me the key thing is that oil that’s produced domestically does at least help with our balance of payments and that’s not negligible. But other fuels that are produced domestically such as natural gas, such as ethanol and methanol, such as electricity, such as improving the — it’s not a fuel but improving the efficiency of internal combustion engines can reduce the amount of other fuels you need to use.

So I think all of those at least in my mind are superior to even domestic oil as something to use to transport ourselves. But in the real world of trying to figure out how to deal with all this, we will almost certainly have some effort going into drilling domestically and replacing some foreign oil with some domestic oil and we’ll be able to reduce at least our balance of payments problems, but balance of payments is not the only thing. These other fuels I think particularly including gas and the other liquid fuels and electricity I think are on the long term a lot better for us and for all sorts of reasons including environmental and that we need to steer toward, I think I total ultimately, moving away from not oil totally but oil’s dominance. Today, it’s completely dominant.

DYLAN RATIGAN: But what’s underlying his question though, and Bob, you can try this. Is the reason we have not adapted more rapidly to other forms of fuel whether it is natural gas, wind, algae, I don’t care what it is, hydro, because the price of gasoline is subsidized.

BOB DEANS: Absolutely. And the subsidy’s amount according to the Office of Management and Budget at the White House is about $46 billion over the next 10 years. That’s not a small amount of money, but it’s a small portion of the subsidies that they’re getting when you consider the job our military does safeguarding our oil supplies around the world, the environmental price we pay for pumping all the carbon in there that’s warming our planet and threatening our children. But to move away from that, the country has always defined itself by pulling collective resources around big national goals. We have deemed that important.

So what we need to do going forward in this country is to invest in the three things that can help reduce our reliance on oil and make our economy stronger and that is first and foremost investing in efficiency. We can reduce our overall energy use in this country by 70% by 2050 by investing in efficiency gains each one of which will pay for itself in energy savings. We need to invest in renewable fuels. You mentioned wind. You mentioned solar. Wind is a big story right now. We are now getting about 2.5% or our electricity in this country from wind. But Texas, the oil capital of the world is getting 8% of its electricity from wind. This is not George Jetson stuff. It can work today but it needs help. And finally, sustainable communities. Building communities the way people want to live. So if people choose to walk to work, they can. If they choose to ride fast rail, they can do that. That’s the kind of investment we need to make collectively as a nation to push this country forward.

DYLAN RATIGAN: All right. Go ahead.

JAMES WOOLSEY: I want to just distinguish between two things because it helps the discussion. Oil totally dominates transportation and 1.2% of our electricity comes from oil. It was 20% back in the ’70s. It’s not anymore. So the way you produce electricity is terribly important from the point of view of cleanliness, from the point of view of the environment, from the point of view of having a network and a grid that is secure. All of that are terribly important issues, but in the near term they don’t have anything to do really with how we get away from oil. Three major studies who said recently that you could have two-thirds or more of the cars on the road be it plug in hybrids or all electric cars before you need a single new power plant. You don’t need to build new power plants in order to electrify transportation because we have so much unused capacity especially at night and especially natural gas. They could be used to produce electricity and charge vehicles at night.

DYLAN RATIGAN: Go ahead. Please introduce yourself and have at it.

KYLIE HOSTETTLER: Hi, I’m Kylie Hostettler. And I was just wanting to know what we can do as college students to help conserve energy.

DYLAN RATIGAN: You want to take — try that Bob?

BOB DEANS: I’ll start. And I’m sure this is a very green school. I appreciate the question whether it’s turning off your lights in your dorm, that kind of thing. But the most important thing you can do is to get engaged with the huge policy debate that’s underway in our country right now, these very questions that we’re dealing with today. You need to stand up and let people know that you stand for investments and renewables, you stand for investments and efficiency, and you stand for investments in sustainable communities because right now in congress while the President is trying to take us forward, there are people who are trying to take us backward. There are people who are attacking EPA. There are people who are attacking our Clean Air Act. We need to stand up and let people know that we care about the health of our children. We care about the security of our country. We care about jobs for Americans.

KYLIE HOSTETTLER: Thank you.

BOB DEANS: Thank you.

DYLAN RATIGAN: Boone, yeah, go ahead. You’ve got a great line on this as well because this is their problem.

T. BOONE PICKENS: Let’s maybe clear up a point but when we talk about renewables, renewables do not move automobiles or trucks. That didn’t happen. You can’t move an 18-wheeler with a battery. The only way you’re going to move an 18-wheeler is either with diesel or with natural gas and we have an abundance of natural gas. All heavy-duty trucking should go to natural gas. But 70% of all the oil used every day in the world goes to transportation fuel. So when you start to attack the problem, you have to focus on transportation fuel. That’s it. And then you have to understand the different fuels that are available to us. I wanted the President to say in the State of the Union. He almost said it the other night, but I want it in the State of the Union, that all federal vehicles purchased in the future would be on domestic fuel, not identifying any fuel. Just figure that for yourself. All federal vehicles will be on domestic fuel. And then eventually months later he would come to the American people and say, “Look, we’re all together. It doesn’t have anything to do with politics. But we’re together and we have to solve the problem.”

And I told you when I got the nomination back in July of 2008 I said, “We would not import any oil from the Mid East in 10 years.” Now, this is the plan. All of you, us together, the next vehicle we buy and future vehicles will be on domestic fuel, not suggesting any one fuel. That’s it, domestic fuel. I had five kids and that would have been a great topic at dinner at night as our President asked us as patriotic Americans to help him get off of oil from people I consider to be the enemy of America and that this is the way we’re going to do it. Our family next year, we’re going to study it and then we’re going to buy a vehicle that’s on domestic fuel. That would have given me an opportunity for all my kids and me too to be better educated and acquainted with the problems and how these are all solved. I believe that could happen. All this could happen. He could ask for it and we would respond to his request.

Second, my kids forever after will have learned more about energy and getting ready to buy a car at that — because they’re included in it and you all know as I do that kids, I don’t know what age, it must be somewhere around six years old. They start to talk about cars and when they are going to have on and everything else and they do. And I mean my kids did, yours did, you all did. But that’s big in America but buying a car here was buy a car you knew where to put the gasoline in, that’s about what I knew about it. I didn’t know anything about the fuel but I sure knew how to drive a car and fill it up. But now that’s changing fast so with my kids, if this has happened to me when I had my family around the table that at that point forward we would buy a car that will be on domestic fuel, but forever after my kids would understand and they too would buy cars that run on domestic fuel.

And I think you’ve got to get — you’ve got to get everybody educated to what we’re up against. One, and that is — this is a number that I saw today but this year at oil over $100 a barrel if it’s that way for all year 2011, that the OPEC countries not from us — this number is not from us, it’s from the world, OPEC countries will receive over $1 trillion. $1 trillion will come from the rest of the world to OPEC. Now that’s not sustainable. That is crazy. I mean that’s the greatest transfer of wealth in the history of mankind.

DYLAN RATIGAN: Half of our trade — well, 41% of our trade deficit.

T. BOONE PICKENS: Now, this is not the United States.

DYLAN RATIGAN: Understood. Yeah, understood.

T. BOONE PICKENS: Okay.

DYLAN RATIGAN: Anybody else in the room has questions? Now is the time to stand up and make your way to the microphone. If you want to come on up and go do that. In the meantime let’s check in with Facebook for a second here and see what’s going on there. John Stephen Lane Sr. says, “For Mr. Pickens, why were you not able to resolve the transmission line issue for your planned wind farm? This sounds like something the President would have had your back on. I mean, are we serious about green energy or is it just window dressing?” Response.

T. BOONE PICKENS: Yes. Okay, wind I’m in it. I’ve got over $250 million in wind now and what happened, wind is priced off the margin. The margin is natural gas power. Natural gas when it went down before –

DYLAN RATIGAN: What does that mean “priced off the margin”? What do you mean when you say that?

T. BOONE PICKENS: They will take the lowest price of power generation which is natural gas not coal.

DYLAN RATIGAN: So the cheapest way to make electricity is natural gas?

T. BOONE PICKENS: Exactly. And when natural gas went down to $4, it’s now four and a half. When it went down to four, four and a half that you cannot price — you cannot finance a wind deal.

DYLAN RATIGAN: So if we were running a power plant and our choice is to buy natural gas or to buy it from a wind farm, wind farm simply cost too much?

T. BOONE PICKENS: You have to have $6 natural gas to finance wind. The cost of a kilowatt hour and to construct a plant for solar for instance is $6,300. The second under that is nuclear which is $5,300 kilowatt hour. $5,000 for coal because they’ve had to clean up coal and it makes it much more expensive, then you drop to wind which is $2,400 and then the cheapest is natural gas, it’s $1,500. So natural gas is the cheapest for power generation and wind does not move any automotive –

DYLAN RATIGAN: Only for electricity?

T. BOONE PICKENS: It’s only for electricity.

DYLAN RATIGAN: Go ahead Bob, yeah.

BOB DEANS: And Dylan that makes the point about investing in national goals because the economy is a scale or such that the more wind we produce, the lower that price becomes as Mr. Pickens can tell you. And General Electric — good American companies are making these wind turbines, American steel workers, American tool and machine makers, metal fabricators, generator makers, bearing makers all over the heartland of this country, the people who are making these wind turbines. And the more we make, the more we invest in this, the cheaper it is, the more fusible it becomes and this is what we do with nuclear energy. Nuclear energy came out of the United States government. We’ve been subsidizing nuclear energy in this country for 60 years. We continued to subsidize oil and gas industry after 150 years. So giving a little bit of a break, giving some national help to wind development through smart groups, through better transmission facilities, through economies at scale will help. Yeah, that’s where we need to go.

DYLAN RATIGAN: To the room, if you could just tell us who you are and have at it.

SHIRLEY DAVIS: I’m Shirley Davis.

DYLAN RATIGAN: Hi Shirley.

SHIRLEY DAVIS: I’m from Cushing, Oklahoma. I have a question for the gentleman I don’t — didn’t catch his name.

DYLAN RATIGAN: Bob.

SHIRLEY DAVIS: But he said that he drives a car — what’s real cheap electricity.

DYLAN RATIGAN: Oh, Jim — James — Jim.

SHIRLEY DAVIS: Okay. Well, Mr. Obama has said himself that he intends to make electricity much higher. So how is it going to improve anything to drive an electric vehicle?

JAMES WOOLSEY: Well the way he was going to make electricity more expensive was the cap-and-trade system which passed the House of Representatives but not the Senate. And he has perhaps taken some other steps for that would — you know, better than I that would affect the price of coal particularly because they’re requiring coal would be cleaned up. But I drive on 12 cent a kilowatt hour electricity in Annapolis, Maryland for about 30 miles and that’s about 2 cents a mile and when I’m driving on gasoline in the same vehicle, it’s like 10, 12, 14 cents a mile. So even if electricity goes up by 25% let’s say in a number of parts of the country, it’s still not going to wipe out the huge advantage that electricity has in operating costs over gasoline. What has to be done to make sure you move toward electrification of transportation is we have to continue with the tax credits for batteries because it’s the batteries are what are expensive. They’re getting cheaper. They’re getting more effective but together with the tax credit it’s — I think we can move toward electrification reasonably even if in the next year or two Congress should implement a tax — a cap-and-trade system and I don’t think that’s likely given what the politics look like.

T. BOONE PICKENS: Jim, tell them what kind of car you have.

JAMES WOOLSEY: I drive three cars on our farm. First of all, I have a Dodge Ram Cummins Diesel, 10 years old that is happy on completely 100% biodiesel except in the middle of the winter when I put a little bit of diesel in it to keep — because of cold weather. I drive a Toyota Prius that I’ve changed to turn it into a plug-in hybrid. It has a 5-kilowatt hour battery that’s been added and I can drive for about 20 to 25 miles, all electric before it becomes just a regular Prius and I’m driving about 40-45 miles a gallon on gasoline, and I also now have a Chevrolet Volt which I can drive 40 plus miles on a good day, all electric before it switches to requiring essentially solely gasoline. These are early adoption things but they’re technology that’s on the road. They’re not imaginary and if either my Volt or my Prius was also a flexible fuel vehicle which about 30% of the cars coming out of Detroit now are, have the right kind of plastic in the fuel line –

DYLAN RATIGAN: By the way, I think that’ a $40 part. That’s the difference between a flex-fuel vehicle and a non-flex fuel vehicle that the gas –

JAMES WOOLSEY: Yeah, a ballpark. The Ford’s numbers are about $35-$40, General Motors about $70 or $80, many –

DYLAN RATIGAN: If it’s flex-fuel it means they changed the $40 part?

JAMES WOOLSEY: Under $100. If I had either of those cars, able to use 85% ethanol, E-85, I’d be getting a total of about 250 miles per gallon of gasoline because I’d be driving all electric for 20 or 30 or 40 miles a day, and when I was driving on liquid fuel it would be 85% renewable. And those are technologies that are on the road. They are not imaginary. They are not theoretical, they’re there. There are certain technicalities with respect to air quality and so forth. It has to be done right. You can’t just kind of slap it together. But we are not staring at some distant case where we might be able to drive on something other than gasoline. And Boone’s notion of using natural gas in vehicles, that’s done in many parts of the world. Iran is doing it because they don’t have enough refineries for gasoline. So if you put together natural gas and the renewables and electricity, using even something like today’s technology if we could get it implemented we could move pretty fast.

DYLAN RATIGAN: Ashwin, what do you think of the adoption rate? Jim talks about himself as an early adaptor for these technologies. If we were doing a better job of connecting, how patriotic it is to do that? If people knew that Iran is using natural gas to run their cars, how much more quickly do you think this would be that we will get these types of conversions if people really understood the patriotic imperative to step up to the plate?


ASHWIN MADIA: Right. And that China has higher café standards, higher fuel efficiency standards than we do here. I mean, I think that part of this is we have to place ourselves in the context of other countries that I think we traditionally think of as — with Asia they think that United States is number one. I mean, since the 20th Century the United States has been number one economic in military and scientific and technological super power. And I think sometimes the temptation is for us to kind of rest on those laurels and think “Well, we’re number one and that’s just kind of the way it is because we’re Americans.” But I don’t think that’s necessarily true.

I think being number one means you got to constantly strive to be number one. It means we’ve got a lot of different countries that are constantly trying to catch up. And you know objects in the rearview mirror are closer than they appear sometimes and you got a lot of — I mean, even countries now like if China and Iran are beating us in technological areas like this that have to do with the environment fuel, well then we got some issues to take care of. And that doesn’t mean we can’t take care of it. I mean, my goodness, these gentlemen have talked all evening here about the technologies that are currently available that we have, that we could develop here, that we could make here, that we could fuel our economy with. And when you start adding these things up together I think the one thing that’s clear is that there’s no silver bullet to this problem. There’s no one thing.

But you add these things together, you had increase deficiency that is you know pumping your tires up to increase deficiency on your house, you add up carbon sequestration technology, natural gas, you add up all these different things we’re talking about increasing fuel efficiency standards. Nuclear, everything. We put together comprehensive strategy and pretty soon we’re kicking the tail off of Iran and China and all these other countries but it does take some will. You know one advantage that I think these countries might have if you want to call it that is they have this sort of autocratic systems. You know here we’ve got a democracy that’s fantastic in so many ways but it could be messy sometimes. And part of that messy is we got to get everyone together and convince people that “Hey, we need to step forward on this together. We can’t just order it.”

Now, the advantage in our system is once we get it done we can do it a whole better than anybody else. And so right now I think the challenge is as this gentleman was saying is just to get the will together so we can move forward together.

DYLAN RATIGAN: Which brings us to the mission to the moon. Literally, I mean it was the race with Russia in the 60s that provided that competitive spirit. I think it’s good for people to know that Iran is running on natural gas and we’re not. I think it’s good for people to know that China has better efficiency technology than we do even though we think of them as oppressed and behind the times. It’s not true. And just because you believe something unfortunately doesn’t actually make it true as we’re all learning in so many ways, so many days or our lives, whether it’s big issues or little ones. If only what you believe was true it would be an easier world to live in sometimes. Go ahead Boone.

T. BOONE PICKENS: You know there are 12 million natural gas vehicles in the world today. We have more natural gas than any other country in the world, more than Russia and more than Iran. Out of the 12 million we have 134,000. Yeah, I know you’re laughing but you feel a little but stupid that you’re sitting here with more gas than anybody else in the world, and you have 134,000. The place that has the most natural gas vehicles in the world is Pakistan.

DYLAN RATIGAN: How much natural gas do they have?

T. BOONE PICKENS: Not much. They buy from the restaurants. But this all can be solved. But one thing you got to do is you got to understand what we’re working with and — but we have resources in America that can solve the problem. And we’re going to go down, I’m not kidding you when they come back and the historians look at us, that if don’t do something about the problem, the fact that we are actually buying oil from the enemy when we have plenty of resources to replace it, two-thirds of our trade deficit is purchased for foreign oil, we’re going to go down in history as the dumbest crowd that ever came down. I’m not kidding you. I don’t want to go down that way and so…

DYLAN RATIGAN: All right, let’s go out to the internet and then we’ll come back into the room. I think we’re heading back out to California. Kevin in Los Angeles. Hi Kevin, nice to see you. We like your goatee

KEVIN: Thank you. Thank you.

DYLAN RATIGAN: What’s on your mind?

KEVIN: Yeah, so this kind of question is for anyone on the panel. But given what I’m hearing today and earlier on your show, there seems to be some consensus around the idea that oil prices need to rise and consequently gas prices need to go up to $5, $6 or $7 a gallon. This is of course going to stifle the economy and it’s really going to hurt those individuals who have to drive 10, 20, 30 miles to work each day. And so I’m just wondering what the — you know how could this be resolved? And if there’s a solution for that and in the fragile economy that we’re in, if that’s really the right kind of statements to be making and if that’s feasible at all.

JAMES WOOLSEY: Boone, I think he took your $6 natural gas and thought you were saying $6 gasoline.

DYLAN RATIGAN: No, he did say “$6 gasoline” a couple, 2-3 years from now on the show today, right?

T. BOONE PICKENS: Oh, yeah. You’re going to see $6 gasoline 2-3 years, but now. I was talking about $6 natural gas.

DYLAN RATIGAN: $6 natural gas, understood.

JAMES WOOLSEY: But what was desirable was $6 natural gas in order to have the margin for the wind.

DYLAN RATIGAN: Got it. But there’s a bigger issue here which is as gas prices rise, it provides the incentive to find something that’s not gasoline whether it is natural gas or anything else. At the same time, I was just talking with the truckers yesterday down in Oklahoma City, right now they’re getting paid $1,300 for a thousand mile run, fuel for a thousand mile run right now cost $900. That’s if we paid for tires on the truck, insurance on the truck, maintenance on the truck. So while it’s true that a further spiking gas prices will surely cost and move to alternatives. Like Kevin’s point is will that cost such economic disruption on the way to that transition that we couldn’t afford to bear it? Go ahead.

T. BOONE PICKENS: Okay. To focus on here, one Mcf of natural gas which is under $5 — but let’s call it 5 to get a round number, one Mcf of natural gas is $5 is equal to 7 gallons of diesel. They’ll do the same amount of work, move the truck to same distance, same speed and everything else, 7 gallons of diesel is $25. So you’re sitting here with a resource in America selling it for $5 and you’re competing against $25, I mean it’s not too hard to figure that one out.

DYLAN RATIGAN: But if you look at the talk of gas tax, of trying to create more economic pressure to push people towards natural gas or wind or whatever it is depending on whether you’re dealing with stationary power or transportation fuel, is there’s so much risk embedded in the price spike that may happen or could happen in gasoline and the amount of damage that that would do economically in the transition.

BOB DEANS: Well, the car makes the point that our economy is held hostage to the price of oil to the extent that whatever happens we’re paying a price. And so this — a recovery from the recession becomes self-extinguishing because as we increase our demand for oil, the prices go up and that clamps our economy back down again. What we say is at any price we’re using too much of it. We use 800 million gallons of oil in this country every single day. That is enough to fill the Empire State Building three times. If the Empire State Building were our national fuel tank, we have to pull over and refuel every 8 hours, that’s how much we’re using. We need to reduce it when we come back to vehicles. For big trucks, heavy trucks, natural gas makes a lot of sense. But for cars, past your cars that we’re using, we go back to electrics.

You know between 1973 and 1991 this country did a lot to improve our fuel efficiency. We went from 13 miles per gallon average to 21 miles per gallon, but then we quit. We raised our grade point average 60% and then we dropped out of school. We’ve lost 20 years. We are now at about 23 miles per gallon, we’ve lost 20 years. We need to get back on track. We can build a car in this country that would get 60 miles to the gallon by 2025. That’s 15 years from now, we ought to get about the businesses that are doing it.

DYLAN RATIGAN: All right, let’s go out to the floor.

JAMES WOOLSEY: Why does it take that long?

BOB DEANS: Even if it does take that long, if we start now and do it we can save millions of barrels of oil a day. And if we go to electrics, here’s the beauty of electrics like — I mean, I got to say, when the Director of Central Intelligence is doing something we ought to stop and pay attention to that. This man helped to win the Cold War, okay? Here’s the beauty of an electric. When I get into my internal combustion driven automobile and put 10 gallons of gas in it, how much actually pushes my car forward? Who wants to guess? Two gallons. Here’s why. The first 6 gallons are wasted on the inefficiency of the internal combustion engine. A lot of heat, a lot of friction, waste. And the other two gallons of every 10 are wasted by my engine idling when I’m at a stop sign or a stop light or waiting for my children to come in from the soccer game. The electrics turn that around. 75% of the electricity that goes into that motor actually moves his car forward, 75% efficient versus 80% inefficient, that’s where we’re headed, that’s why technology matters.

DYLAN RATIGAN: Go ahead.

CAL PICKENS: Yes, my name is Cal Pickens and no relation that I’m aware of but if–

T. BOONE PICKENS: We could be.

CAL PICKENS: But I am checking –

T. BOONE PICKENS: Where are you from in Oklahoma?

CAL PICKENS: Tulsa originally but I am checking the family tree to see if there’s a –

T. BOONE PICKENS: I’m from Holdenville.

CAL PICKENS: We briefly touched tonight on the idea of nukes in the future mix of America and of course with the events in Japan. I don’t think I have to review those events. I mean, everybody is highly aware of that already and the state that you’re in at the moment has quite a history with that itself because back in the late 70s there was a great deal of time and energy spent in making sure that a nuke was not built in the State of Oklahoma. After about three years of struggling against that, the Black Fox Station which GE was trying to build outside of Tulsa in the Inola area was finally stopped due to the actions of quite a few people. In fact it was the largest civil disobedient arrest in the history of the State of Oklahoma over this. Hundreds of people were arrested time and again to make sure this was — mostly because they envisioned a scenario much like you’re seeing unfold in Japan.

T. BOONE PICKENS: Can you give us the question?

CAL PICKENS: The question is that the Price-Anderson Act that U.S. plant owners here are not really liable for just only a tiny fraction of the damages from a nuke. And what it boils down to is they pay into an insurance pool basically due to the Price-Anderson Act that was passed in ’57 and –

DYLAN RATIGAN: Right. So your question goes to the liability of nuclear power?

CAL PICKENS: It goes to the liability of the situation. Why are we talking about this when a lot of studies have already proven that the damages cost from this property, deaths and so on far beyond that with the — so far beyond amount that is provided by the protection for the licensees of the Price-Anderson Act. Why are we talking about this?

DYLAN RATIGAN: Yeah. Jim will get that one.

JAMES WOOLSEY: One of the many reasons that I like Boone’s natural gas and when much more the nukes is not only does nuclear power have to be very heavily subsidized. You mentioned Price-Anderson. It’s the insurance and it’s the long guarantees, but it cost about 4 to 5 times per watt more to build a nuclear power plant than it does a natural gas plant. Where nukes have been — the people have liked them in the past and for some who are concerned about CO2 like them to some extent, now is that they run without emitting CO2 and they are relatively cheap to operate once you get them built because Uranium is not nearly as expensive as a lot of what else you would have to buy and other — but generally speaking, they are very expensive. From my point of view — and I’ve spent a number of years with Negotiating Arms Control treaties and things like that.

From my point of view, the worst thing about nuclear power is the fact that the nonproliferation treaty which we and 189 other countries were signatories too is modeled after pressing the Atoms for Peace program and the nonproliferation treaty actually encourages countries to get into the fuel cycle and to enrich Uranium or reprocess Plutonium once they have a nuclear power plant and a reactor. Now, indeed up until a few months ago the International Atomic Energy Agency in Vienna was actually sending consultants to Iran to help them improve the efficiency of their enrichment. Now once you are enriching Uranium up to the 5% level which is what you need for fuel, you have done about two-thirds of the work given the way the curves were to get it up to 90% enriched. And when you’re 90% enriched you’ve done the vast majority of the work you need to have a nuclear weapon.

The design of the weapon itself is really comparatively simple. It’s the highly enriched Uranium you need and the treaty doesn’t stop you from going very far along that line, then you can do what North Korea did, resign from the treaty because I think they got 90 or 180 days, and secretly go ahead and finish the job of producing a nuclear weapon as they did. So, as far as I’m concerned, given the advantages now of natural gas, given the steps that have already been taken by wind and I think the long term promise of solar as well. My judgment would be that nuclear power is not a good thing for us to pursue because once the companies get to producing those reactors and the components for — in the United States are going to want to sell them abroad and the countries they want to sell them to already are Egypt, Saudi Arabia, et cetera.

Look at the evening news, at the riots in Egypt and ask yourself if right now that’s a country you think it would really, really be a good idea for them to have a nuclear reactor and enrichment processes to produce what you need in order to have a nuclear weapon. As far as I’m concerned the nuclear power industry comes very, very close to being a Johnny Appleseed of nuclear weapons, skipping about the world, planting the wherewithal to have nuclear weapons in lots and lots of places. I don’t think that’s a good idea.

DYLAN RATIGAN: Ashwin, do you think it would be a good idea if there were nuclear capabilities in Egypt right around now?

ASHWIN MADIA: No. You know that’s a good point. I hadn’t heard that before but the one thing I’d say though is I could see both sides of the argument on nuclear weapons. But what I would say about this disaster in Japan is we should also remember that if you believe in climate change like I think most of the international scientific community does. We’re sort of undergoing a disaster right now even though we can’t see it and we’re contributing to — I mean the things and the consequences that they’re talking about then, you know 20-30 years are things like the ice caps melting and massive political upheaval and hundreds of thousands, there’s been millions of refugees. All of those things would create contagious disease. Those would create humanitarian crises throughout the world that might require U.S. military intervention there and further stretching U.S. military forces.

And so what I would say is I think there’s a lot of good reasons like Mr. Woolsey said to not support nuclear power and even nuclear disasters might be one of them. But in the context, let’s remember that we’re also undergoing environmental disasters right now, and look at the oil industry, I mean — or some of the other things there’s disaster that happen there too. I mean we just dumped how many gallons of oil into — right off the coast and it seems to me that happens every 5 or 10 years. So, let’s consider those also and compare apples and apples as we go through that discussion.

DYLAN RATIGAN: Go ahead, just introduce yourself.

EARL MITCHELL: My name is –

DYLAN RATIGAN: We hear you.

EARL MITCHELL: My name is Earl Mitchell. Mr. Pickens I appreciate your dedication and your passion. I represent a small business, High Plains Technical Services, Oklahoma City, Dallas and London. Part of the discussion should include small businesses in this operation. I know you started small and moved up. But what can you do in terms of the conversation on two things, including small businesses in this operation and also this environmental factor involve two in terms of energy and that is the carbon dioxide sequestration that we should be dealing with. But natural gas for cars is important but also natural gas is used to generate electricity, and coal is not going any place, 50% is coal but the carbon dioxide that’s generated is a problem and how can we keep the conversation going when we look at the changes in energy to find some ways of sequestering the carbon dioxide, and also how can we keep small businesses alive in this process?

DYLAN RATIGAN: Boone?

T. BOONE PICKENS: Sequester carbon dioxide from natural gas or from coal?

DYLAN RATIGAN: From coal.

EARL MITCHELL: And natural gas that generates electricity.

T. BOONE PICKENS: Okay.

DYLAN RATIGAN: So, carbon sequestration and what’s the opportunity for small business.

T. BOONE PICKENS: Well, on the plan I have and we presented to the Senate last year and the Majority Leader Harry Reid. He said “Boone, of all the plans that have come across my desk that yours creates more jobs than any other plan.” And so the jobs were big in what we were talking about and natural gas. You know there’s so many opportunities once you move it into transportation fuel. So, I think I’ve answered the question. I’m not sure for what –

DYLAN RATIGAN: From a small business perspective?

T. BOONE PICKENS: Yeah.

DYLAN RATIGAN: Well, I mean we talked to that one — the gentleman from the Iowa Farmers Union earlier today who was talking about being able to sell wind off of his own farm. Go ahead Jim.

JAMES WOOLSEY: One thing to look into from a small business point of view is something called a feed-in tariff. The Germans started the idea, 40 countries have followed them. Japan, China and India are doing the same thing. Essentially, it is a government supported power purchase agreement that gives you the right to sell renewable energy as a small business essentially into the grid for a modest profit for 20 years and this has worked quite well. And one of the reasons Germany has 19 times per capital, the solar for example of the United States is that it has its feed-in tariff. So, for a small business, it’s made for small business or for churches, or universities, or individuals, or farmers. These are small to medium size installations to generate electricity. But go on the web or come see me here afterward and I’ll give you a contact, and look into “feed-in tariffs,” sometimes it’s called “CLEAN systems” for Clean Local Energy Available Now, C-L-E-A-N.

T. BOONE PICKENS: But Germany is the most highly developed for wind and when you really look at it I mean Germany doesn’t have very good wind. So you say why? Because they do not want to be dependent beyond a certain level for natural gas from Russia, the same situation for us, we’re sitting here dependent on oil from the wrong people. The Germans and Russians — few of you are old enough know what I’m talking about, but that was a tough deal in the World War II, and there were some really hard feelings there. And two winters ago the Russians were a little short of gas and they cut a lot of their stuff off in Eastern Europe that they just couldn’t service it. And so the Germans went to wind at any coast subsidize and did everything they could because they needed power generation from other than natural gas.

DYLAN RATIGAN: All right, we’ve run our hour but I think we’ve been able to buy — I don’t know, 15 or 20 minutes so we can get some of your questions done. I’m going to keep you guys for another 10 or 15 minutes.

JAMES WOOLSEY: Sure.

DYLAN RATIGAN: And we’re going to keep the internet up and running. So again, if you have questions feel free to put them in. I think we’ll check Twitter real quick and then I’ll come back to you in just one second. And if Twitter doesn’t pop up we’ll come right in here. But this is what’s holding back Nat gases and oil, replacement politics, oil companies, we have tons of it in the U.S. and we could stop sending the money. What’s the barrier when we’ve had this conversation.

T. BOONE PICKENS: I didn’t hear the question.

JAMES WOOLSEY: What’s the barrier to using natural gas?

DYLAN RATIGAN: What’s the barrier to natural gas? Why hasn’t it happened? Is it because of the oil companies? Is the because of the government? Is it because of the politic parties? Why are we talking about it and now –

T. BOONE PICKENS: Okay. I’ll be able to tell you in 20 seconds, okay. That you’ve had cheap oil for one thing, that’s changing. It’s changing fast. But the biggest thing that you have that has been the problem for us and you can go back every time and come up with almost the same answer on this kind of question. We have not had the leadership that understood the problem and told us which direction to go.

DYLAN RATIGAN: Hi, go ahead. Just tell us who you are.

MICHAEL PARKS: Hi, my name is Michael Parks. I’m a graduate student of T. Boone Pickens School of Geology. Thank you so much for your generous contributions over the years by the way. My question is in regards to implementation of a smarter grid and more natural gas infrastructure, whether it be at gas stations and municipal plants, things like that. Historically speaking whenever anybody tries to implement any kind of new technology we always over estimate the cost of implementation and we always underestimate the savings that can come from innovation from new people once this kind of thing is online. So right now we hear things like “This is so cost prohibitive. We cannot do this.” The same kind of arguments existed whenever people suggested we do catalytic converters, café standards, whatever it is. Every time something new comes by, industry acts like it’s going to completely bankrupt them. How do we overcome this and foster the political will because I can do it, everyone in this room can do it. But unless our political leaders listen to us and understand that, we’re helpless against that. So, how do we foster that kind of political will to make something like that happen?

DYLAN RATIGAN: Jim.

JAMES WOOLSEY: Well, that’s a great question and you’re right. A lot of these things that were supposed to be extremely expensive turned out to be relatively quick and easy to do. This is to me a sort of a strange answer but basically the fact that we’re continually in log jams on domestic issues is a function of our constitution. We’re supposed to be in log jams until Madison decided that, until we get a big consensus. Once we get a big consensus we can role and we move faster, and we get amazing things done. But it’s hard when there are divisions in American society manifested in the Congress and disagreements between the executives and legislative and all that, regulatory litigation. It’s sometimes really hard to get off dead center.

Now, I think there’s no real answer to this except writing up ads, explaining to people, teaching about it, talking to your representative, talking to delegates. There’s no single answer. It’s a blessing that it’s hard for us to get things done because we haven’t had, say like China, a cultural revolution. We call them and sometimes say, “Wouldn’t it be great if we were China for a day.” Well, if that was the day you decided to have the Cultural Revolution which killed 85 million people probably wouldn’t be a good day to be China. So, we have a hard time getting off dead center. The constitution basically makes it be that way, we got to live with it and build a consensus, build a consensus, build a consensus. A key thing is that there are lots of reasons people can want to do something. You don’t have to sell people on your reason. I think of oil as kind of like Al Capone. Al Capone did a lot of things wrong. They tried to convict him of murder, they couldn’t convict him of murder so they convicted him of tax evasion.

All right, oil maybe you love the case for climate change as a reason we should move away from oil and now it’s really in bad shape on the hill. It’s not climate — the climate change is not as high on a lot of people’s agenda and we’re not going to have cap-and-trade probably for several years. Instead of getting discouraged, go talk to people about the national security importance of moving away from oil. You don’t have to agree with people on the reason to do something as long as the reasons are rational and you could put together a coalition. I talked about a coalition to move away from oil, the tree-huggers, the do-gooders, the sod busters, the cheap hawks, the Evangelicals and Willie Nelson.

DYLAN RATIGAN: Have you put that one together yet? I wouldn’t want to have a fun town hall. Ashwin, go ahead here.

ASHWIN MADIA: No, I concur with everything he said. And you know I’d go back to what we were talking about earlier in this thing is, you know if you went back to — right after September 11th and you think about how closely the country came together and how really the Americans were willing to do anything, I think. I mean this whole nation was at a point, and so maybe as we look back it might have been a missed opportunity but we ought to not sort of lament it but rather learn from it. I mean you at right now, I mean granted we haven’t just had a calamity of that scale but we’re in two wars, three wars depending on who we ask and we’ve got an economy in turmoil. I think people sort of feel like a sense that we might be losing our grip on this number one status and you add that to the fact that we as a nation have a habit. I mean throughout this nation’s history of coming together to get things going.

I mean at any time period you look at, if it’s the great depression or World War II, or we put someone on the moon or even solving the hole in the ozone layer in the early 90s. You know this come together and get things done is what we do and I think this is the time to do it. And so what I would say is that maybe our leaders ought to ask for some sacrifice from us. You know that’s — I think a lot of our leaders are afraid to really ask of anything from us ‘cause we’ve kind of gotten into a society where if you cut spending, if you cut taxes or excuse me — if you raise taxes, or if you do anything like that, you’re going to get hammered. But I think that if leaders had the guts to come forward and say “You know what? I’m going to ask something of you and what I want so that no American ever has to die again because of our need for oil, I want you to make every Sunday a gas free Sunday, and I want you to take the bus, I want you to ride your bike. And you know what else I want you to do? I want you to weatherize your house. And you know what else? I want you to look at this natural gas.”

But I think people would lunge at that opportunity. I think Americans really want to contribute and be a part of the solution. I think people feel guilty that it’s just the troops that are kind of bearing the brunt of this war and tear and no one else gets to do anything. And so I think maybe that’s one thing leaders can do also. And to that gentleman wherever he is, you ought to run for office too. I mean, if your leaders won’t — honestly, if you’re leaders won’t do it, you ought to get in the fray and you ought to run for office in order to help shape that discussion.

DYLAN RATIGAN: And I think Jim Woolsey can perhaps — it sounds like he can give you some good slogans. I would hire him as your speech writer. Go ahead.

DONNA KELLY: My name is Donna Kelly and I am a graduate student in the Fire and Emergency Management Program. And I see our dependence on oil as being, if we don’t get away from the cars and the trucks and our transportation, we’re never going to be able to get there. And my question to you is, I would love to have a Prius, I would love to have a Volt but I can’t afford it and most of the people in my community where I come from can’t afford it. So, how long do you think it’s going to take this technology to get down to the person whose making $12 an hour, $13 an hour to be able to go out and buy a vehicle that can save them this kind of money?

JAMES WOOLSEY: Well, I spent some time looking into this because what I do now is a venture-capital for things like batteries for cars and renewables and so forth. And I think it’s quite remarkable how far batteries have come in a relatively few years. They’re not on a steep a curve as, let’s say transistors or to produce Moore’s Law and doubling in capacity over 18 months, that kind of thing. But they’re still moving along smartly because of their — based on material science and a lot of things are changing. The batteries that we have now are being substituted for by those that have ceramics and nanotechnology in them. I think if you — you need to keep the tax credit that’s there now, the $7,500 for a battery. But you’re down probably to $500-$600 a kilowatt hour for a battery and once you get down to around $200 with the tax credit you would see a plug-in Prius or a Volt to be pretty affordable and in kind of the same ballpark as a midsize car the other way.

Most of the things I read and look at suggest to me, we’re talking 3 or 4 years, not 8 or 10, not 1 or 2. But you still have to keep the credits and people have to keep pressing on and the government has to keep buying these things. I mean you want them to buy the battery cars too which gets people down the learning curve and up the learning curve and so on. But you’re not — it’s not decades. It’s like maybe half a decade before it starts looking I think quite affordable.

DYLAN RATIGAN: Go ahead Bob.

BOB DEANS: It ties back to the other question. It’s a matter of political will. We can do this. We can put these cars within range of Middle Americans. We can do that. This country is a “can’t-do” country. I’m looking out at this audience, looking at these young students here. This is a “can-do” generation. This country won World War II. The Marine Corp helped us do it. We won the Cold War. Jim Woolsey helped us do it. We built the Interstate Highway System. Boone Pickens helped provide the fuel for that. We built the internet. We put a man on the moon and we can make our homes and our workplaces more efficient. We can make power from the wind and the sun. We can do this. What we need is a political will to do it and we can make a car that will go 60 miles per gallon, and don’t ever let anybody tell you we can’t.

DYLAN RATIGAN: Go ahead.

MASAN: My name is Masan. My question is for the panel concerning natural gas. Let’s say we shift transportation into natural gas and will the supply in North America meet the demand, let’s say 100 years from now taking into consideration or like the largest natural reserves of gases in Qatar, Iran and Russia? And don’t you see there’s like a competition that they might produce that natural gas in a cheaper way with all the technology and innovation, and then how do you see like a solution for that? Thank you.

DYLAN RATIGAN: So how long would the natural gas we have service and is there a threat that Middle Eastern countries with natural gas reserves if ours became more expensive, we could find ourselves in the same situation buying foreign natural gas the same way we’re buying foreign oil now.

T. BOONE PICKENS: Well, today at $4.50, the cheapest natural gas in the world. If you’re buying natural gas in the Mid East today it would be $9 to $13 because it’s indexed off oil. We have — with 4,000 trillion cubic feet in natural gas we have well over 100 years supply which I believe will take you to the next transportation fuel easily whether it be the battery, the fuel cell or whatever it is. I won’t have to deal with this. So, whatever you all work out is fine with me.

DYLAN RATIGAN: All right, this would be our last question. I’m going to ask you guys to sit just for the sake of saving your legs and your feet. And sir, it’s all yours.

BOB BELTS: Okay, my name is Bob Belts and I’m an engineering graduate from OSU and I also graduated from Central High School in Tulsa Mr. Woolsey, so I feel right at home here. All right, I had a political question but it’s really been addressed already. So let me ask the question, whatever happened to thinking about using hydrogen gas produced from renewable energy sources and then using that for transportation for anything that will — you know, combustible and can be used in a lot of different areas?

JAMES WOOLSEY: You can go. It’s my big bet to –

T. BOONE PICKENS: Let me hit that because I — but I don’t need long to do it, that the hydrogen is expensive even if it comes from renewables so I hear what you’re saying. But there’s a hydrogen island in a natural gas filling station at LAX, Los Angeles right there at the airport entrance. That is put in there by General Motors to give away hydrogen to anybody that use it and it’s not used but one time a month. But if you were paying for the hydrogen that is in that, it would cost $75 a gallon it’s what it would be. So, I think what you come down to is hydrogen. There would be places you could get it very cheap as you stated. But the equipment is not ready. I don’t think the technology — we have it. Will it move a car? Absolutely will. No question. But that could be that fuel that you use after I’m gone so…

JAMES WOOLSEY: I had occasion I asked a former senior, a government official, who is a big hydrogen enthusiast not long ago. I said, “I’ve been looking at the numbers on this. I think we would have to have an infrastructure hundreds of billions of dollars and it’s not like natural gas, the infrastructures or electricity. The infrastructure for them are already there, you have to build an infrastructure hundreds of billions of dollars.” And he said, “No Jim. No, no. Not hundreds of billions. Well over a trillion.” I think that’s a big part.

DYLAN RATIGAN: Yeah, it’s expensive. Bob, thoughts on hydrogen? Before we wrap this up.

BOB DEANS: No.

DYLAN RATIGAN: Okay. Parting thoughts before we call this a night?

T. BOONE PICKENS: I want to give a closing statement.

DYLAN RATIGAN: I would like you to do that.

T. BOONE PICKENS: Okay, good. I’m really indentified here that I was kind of the super senior cowboy and — but Dylan and I talked about this, I don’t know how many times, but — all right, half a dozen, and you wanted to do this. And we talked about where, of course subtle the way I approached it, and the way he came around in Oklahoma. But I told you, I said “You will get a good audience. They will be very polite people. The will be in the talks. They are interested in what you have. They’re smart people.” And I didn’t let you down, did I?

DYLAN RATIGAN: No, you did not.

T. BOONE PICKENS: Look, this is a great audience and a super senior cowboy says “Thank you.”

DYLAN RATIGAN: Yes, thank you very much. So, we’ll leave it at that. You know if somebody has questions for some of these folks afterwards, if they want to stick around for a second, they may be willing to do that. Boone, thank you very much. You are an inspiration I think for so many people in so many ways, not just with your work on energy but with the way you live your life and the way that you carry yourself. And I think that that means a lot to the folks that are in this room and a lot of the folks that are on this panel. And I think that a lot of us would, as much as we admire some of you business success, more than that would like to live a life with a spirit and an enthusiasm that you exhibit every day, and I thank you for sharing a portion of your time with me and with us. Thank you.

T. BOONE PICKENS: Thank you.

DYLAN RATIGAN: Thank you guys.