Final McCain-Obama debate focuses on US auto industry bailout, energy, oil

Amongst pot shots and jabs typical of any political campaign, the final presidential debate on CBS, moderated by Bob Schieffer, managed to stick to issues for most of the time.

Both US Presidential candidates spoke of their plans for the US economy. A key election issue, it was underscored by the fact that the Dow Jones Industrial Average dropped over 700 points on the day of the debate, sparking talk about the recession having arrived.

Detroit's automakers and the $25 billion bailout package that was given to the American auto industry a few weeks ago were discussed at length. (See: US House of Representatives approves $25-billion loan package for American auto industry)

Senator Obama, the democratic nominee reiterated that even as he supports free trade, negotiations with other nations need to be fair to workers, and that the US will need to ensure that those nations are complying with human rights standards, and not shielding their companies from US competition.

Obama said the US can get only around 4,000 to 5,000 vehicles annually into South Korea. ''That is not free trade'', he said, while going on to say that the US needs a president who is going to advocate on behalf of American business and workers. ''I make no apology for that'' he said. South Koreans are not fond of buying imported automobiles, mainly on account of a blend of legal issues against imported cars, and a mix of nationalism. A proposed trade deal with South Korea is opposed by many congressional Democrats as it would lower tariffs on trucks imported into the US, which is a move opposed vehemently by American auto manufacturers Ford Motor Co and Chrysler LLC, and by the Union of Auto Workers.

Obama said the US auto industry was ''obviously getting hammered right now'' by the credit crisis, adding that he would ''hold them responsible'' for making more fuel-efficient models. He has proposed a doubling of the $25-billion loan program approved by Congress earlier in the month. His campaign has stated that all options must be available to aid the industry. ''We invented the auto industry and the fact that we have fallen so far behind is something that we have to work on'' he said in his remarks.

Energy
Both Obama and McCain talked about new energy policies that would save money.

Obama said the US needs to fix its energy policy that is ''giving our wealth away'', and said that his policy would ''save the amount of money we borrow from China and send to Saudi Arabia.''

McCain said that the US must stop sending hundreds of billions of dollars to oil exporters ''that don't like us very much,'' and repeated a call for developing more new nuclear reactors to accomplish shift the balance of energy from oil to electricity.

For the most part, till now the US has been running on foreign oil since it was cheaper than any energy solution available onshore. However, alternative fuels may just change that balance, and even turn out to be more cost effective than oil, which is predicted to touch $200 sometime in the near future, even though presently it is trading at sub - $70 levels on account of falling demand. The current $70 level makes it hard for alternative fuels to compete with foreign oil.

Sceptics of McCain's plan point out those new nuclear reactors will replace other energy sources such as coal and natural gas. However, they will have little impact on oil, as very little of it is used in generating power. So, with the current technology, there would be very little impact on the demand for oil that can be effectively replaced by nuclear power.

Therefore, McCain's plan would need the auto industry to come up with durable and price-competitive electric vehicles that would allow motorists to traverse the first 20 to 40 miles each day on electricity for oil imports to be reduced. Even then, reactors would be only one of the sources for electricity.

Oil imports
Both presidential candidates advocated the idea of ceasing imports from Venezuela and the Middle East to become ''independent'' of those sources.

Even as moderator Bob Schieffer asked both candidates to respond to what they would accomplish in their first term, both chose a longer time frame to answer him.

Senator McCain talked about a seven to 10 year window to build nuclear power plants that are a key element in his energy policy. Observes consider that time frame short, given the standards of constructing a nuclear power plant, as global capacity to manufacture reactor vessels and other components for a nuclear power plant is rather limited. Some experts opine that only a handful new reactors would be finished during that time.

Obama talked about wind, solar and geothermal energy. Each of these renewable or green modes of electricity generation are already in use today. Experts again point out that new technologies for electricity generation will not lessen the demand for oil, unless accompanied by new battery technologies or huge improvements in fuel cells that can use hydrogen as a substitute for gasoline.

Both candidates agreed that the US could reduce a lot of its dependence on foreign oil within a decade, though they both had their own ideas about how it should be done.
While McCain claimed that the US could eliminate its dependence on foreign oil by building 45 new nuclear plants, power plants, right away, Obama countered by saying that as a country using a quarter of the world's oil, while owning only around four per cent of the world's oil reserves means that ''we can't drill our way out of the problem''.

McCain said that the point with nuclear power, wind, tide, solar, natural gas, development of flex fuel, hybrid, and even clean coal technology, the US can ''easily, within seven, eight, 10 years'' eliminate its dependence on the places in the world that harm its national security.

Obama said he focuses on putting resources into solar, wind, biodiesel, geothermal, since drilling is not the option. He also said that it is ''absolutely critical that we develop a high fuel efficient car that's built not in Japan and not in South Korea, but built here in the United States of America.''