Be pragmatic about energy, Dow CEO says

Dow Chemical CEO Andrew Liveris is no newcomer to the energy debate. He's been saying that the USA needs a comprehensive policy since 2004, when a barrel of oil was less than $40. His company, which makes Styrofoam insulation, pesticides and chlorine, among other products, has been so slammed by energy costs that its net income dropped 27% in the second quarter, and it continues to raise the price of its products. Liveris, 54, talked with USA TODAY management reporter Del Jones. Following are excerpts, edited for clarity and space.

Q: It's the political season, and energy has become a campaign issue. As a matter of disclosure, what presidential candidates have you and your wife contributed to?

A: (Mitt) Romney, (John) McCain and (Hillary) Clinton. I'm Australian. I can't vote, and I have no partisanship with U.S. politics. I'm utilitarian and support those with the best ideas and policies.

Q: You say the U.S. is shooting itself in the foot regarding energy. If you could wave a wand, what could be done to get us out of a mess?

A: We have seen a tsunami of price increases. A country this advanced should use every single weapon. Energy is complex, but the U.S. has major weapons it can bring. Get them on the table. Forget partisanship. Forget who gets what share of the pie. Don't worry about an oil company enriching itself. Go straight to what is pragmatic and practical.

First, remove the ban on drilling, and do it environmentally responsibly. Second, put efficiency into place with building codes, efficient power stations and fuel standards on cars. Third, find deployable alternatives. Some will require Apollo-like projects. Two examples: Why do we still do a once-through burn to create nuclear energy? We are the Saudi Arabia of coal, but coal brings its attendant, which is CO2. A government investment could solve those.

Q: What one thing would help most?

A: Efficiency. Dow Chemical dow has improved efficiency by 22% from 1995 to 2005. If the country did that, we would not import one drop of oil.

Q: Efficiency is something the Democrats and Republicans may agree on. Is there anything else that could get past a legislative stalemate?

A: Coal gasification could happen if Democrats get away from the notion that coal is dirty. We have the ability to use coal cleanly. It's complex, but you could get both sides to at least consider it. We're not going to solve our problems with wind. You have to use fossil fuel somehow. Dare I say it: responsible drilling. It's getting harder and harder to go down that path, but we need bipartisan efforts.

Q: Drilling opponents say it would endanger the environment and have minimal impact on energy prices, around 2 cents a gallon.

A: That's ludicrous. It would send an enormous signal. If China can drill in Cuban waters 50 miles off the coast of Florida, I find it almost insane that people would worry about spoiling beaches, when the U.S. has the best technology in the world.

Q: What U.S. energy steps have backfired?

A: Corn-based ethanol, one of the dumbest ideas of all time. Its energy balance is poor. You just move the problem around, as we've found out on the food side. The whole hydrogen (fuel-cell) approach is dumb. Hydrogen is an energy carrier, not a source. It's nonsense. Another dumb thing I've heard: "Why should we do anything, because it will take five to seven years before anything happens?" You're telling me we shouldn't do anything logical, because I can't solve my immediate pain?

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