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\'3;↓Q\CSTANFORD UNIVERSITY
\F3\CSTANFORD, CALIFORNIA 94305
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ARTIFICIAL INTELLIGENCE LABORATORY\←L\-R\/'7;\+R\→.\→S   Telephone:
COMPUTER SCIENCE DEPARTMENT\←S\→.415-497-4430
\F0\C15 January 1975




Congressman Paul N. McCloskey
305 Grant Ave.
Palo Alto, Calif.

Dear Congressman McCloskey:

\JThis is in response to your letter soliciting comments on the
energy situation.

	1. I am not convinced that we can't afford the present OPEC
price for oil.  Our exports and imports were in balance for October,
and with a little additional effort we can get them in balance again.
The only reason for cutting consumption would be if the price
could thereby be forced down, but I don't believe the cartel
can be broken that way.

	2. The government seems to have almost forgotten about
increasing energy supplies, and you don't mention it in your
letter.  The Project Independence report seems almost fraudulent
from what I have heard of it.  Namely, every possible difficulty
and disadvantage of increasing supply is mentioned; perhaps the
writers want to reform our way of life and to use the energy
crisis as "an excuse and opportunity" to quote Russell Train.
We need a crash program to convert to nuclear energy for electricity in a hurry
and to get liquid fuels from coal.


	3. If consumption is to be reduced, taxes are better
than rationing.  The thought of writing letters to a rationing
board explaining why I need to make so many trips between the
Artificial Intelligence Laboratory and the Stanford campus is
appalling.  Evaluating people's claims that travel is work related
will be infinitely worse than during World War II, because there
won't be a simple criterion of whether the travel is necessary for
the war effort.

	4. The first step to re-establishing reasonable terms
of international trade is a reassertion of the moral position
of the U.S. and the other industrial countries.  The Arabs did
nothing to discover or develop the oil, and the Arab workers in
the oil fields are not underpaid - at least the countries receive
plenty of money to pay them well.
Americans did more to discover and develop that oil than the countries
where it is located, and a transition from a world in which reward
is based on successful effort to a rentier world where reward is based
on accidental inheritance is just as bad internationally as it would
be within the country.
It must be clearly stated
that the price-gouging is immoral and that we will make sure it
has bad consequences for them sooner or later.
In order to do this, it is necessary to overcome the idea prevalent
here and abroad, that U.S. is guilty for being productive and
prosperous.  I somehow have the impression that you have contributed
your share to the prevalence of this idea, and it would be nice
if you would so something to reverse it.

	5. With regard to the possibility of intervention, the
United States should not take the lead.  We can afford the
prices.  Europe and Japan, who are the hardest hit, can now
are strong enough to pull their own chestnuts out of the fire rather
than criticize our efforts to solve problems that are even more theirs than ours.
Kissinger should tell them that if and when they get desperate
enough to take action on their own, we will again serve as the
"arsenal of democracy".  A strong statement of this kind would
help get them out of the dependent position with regard to defense
that we they have got into.  I know it has the disadvantage that
West Germany may then have to become a nuclear power, but the
dependency relation is increasingly untenable, and maybe the Russians
would pay a substantial price to preserve the present situation
if German nuclear armament were the alternative.  Israel is different,
because they do all they can for themselves.

	6. Enclosed is a copy of a statement to the Project Independence
hearings that were held as San Francisco.  It is sound technically,
but I think it is political and ideological
factors that have prevented the U.S. from acting vigorously.

	I would welcome the opportunity to discuss this with you
- more the politics than the technology -
but I understand that you already have enough energy experts.\.


\←L\→S\←R\-L\/'2;\+L\→L
Sincerely yours,




John McCarthy
Director, Artificial Intelligence Laboratory
Professor of Computer Science
\←S\→L
JMC:pdp-10
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