From all sides of the political spectrum, we hear calls for
decreasing or eliminating America's "dependence on foreign oil."
To assess the validity of these calls, one must first understand
the history of U.S. energy policy with respect to oil. During
the Gilded Age of American industry, John D. Rockefeller founded
what was to become Standard Oil in 1860. Rockefeller's
innovative and competitive approach led Standard Oil to own
upwards of 90 percent of the oil refining market (a fact which
is often used to accuse Standard Oil of having become an abusive
monopoly), but also dramatically lowered the price to consumers
from 58 cents to eight cents a gallon (a fact which is often
played down or entirely left out). But by the 1920s, oil prices
had peaked causing many to believe that oil would soon run out.
This prompted Congress to put in place generous tax allowances
for producers, which prompted further investments and ultimately
led to the discovery of large, new oil reserves. But then, with
prices dropping, de