The headline reads like a piece from the Onion: “U.S. Navy Paying $15/Gallon for Green Fuel.” But it’s real enough.

It seems that, fresh from its success with Solyndra, the Obama administration is slated to spend $12 million to buy a biofuel/gasoline blend that runs $15 a gallon to power a portion of the Navy’s fleet in a demonstration project.

“We are doing this for one simple reason,” explained Navy Secretary Ray Mabus, “It makes us better war fighters. Our use of fossil fuels is a very real threat to our national security and to the U.S. Navy’s ability to protect America and project power overseas.”

Really? As long as a fuel makes the ships, planes and submarines go, how does using pricey biofuel mixtures improve the war fighting capacity of the Navy? Does it make the officer corps feel better about themselves as good stewards of the Earth’s resources, which in turn makes them shoot straighter?

The investment will certainly brighten the day of T. J. Glauthier, a “strategic advisor” to Solazyme, one of the companies selling the environmentally correct fuel to the U.S. government. Glauthier, reports blogger J. E. Dyer, just happens to have worked on President Obama’s transition team. If the administration pattern holds, Gauthier will be paid off before the taxpayers when Solazyme files for bankruptcy.

The administration didn’t bother to offer the one rationale for investing in alternatives to fossil fuels that might have made a bit of sense: to reduce our dependence on foreign sources of energy. It’s just as well they avoided that trap because among the greatest failures of imagination that the Obama administration has been guilty of is the mismanagement of America’s energy resources.

The United States is an energy colossus. Just this week, the state of North Dakota announced that it had produced 488,068 barrels of oil per day in October, up 100,000 barrels from June of this year. State officials predict that by 2013 to 2014, North Dakota will be producing 900,000 barrels a day, putting it ahead of California and Alaska and behind only Texas (at 1.2 million barrels per day) in domestic oil production.

Though the Obama administration regards our energy wealth as a threat to the planet, the untapped resources could be a pillar of American economic resurgence. The Institute for Energy Research predicts that by tapping shale and other sources, the U.S. should be the world’s top oil and gas producer by 2020, outpacing Russia and Saudi Arabia. The development of domestic oil and gas would boost the economy, providing jobs that cannot be outsourced, as well as genuinely promoting our national security by ensuring a supply of energy that cannot be manipulated by hostile governments.

But the Obama administration, while promoting offshore drilling in Brazil (“We’ll be your best customers!”), placed a damaging moratorium on drilling in the Gulf of Mexico, following the BP spill. Even after it was lifted, the administration delayed the issuance of permits, effectively prolonging the moratorium, while also placing new limits on drilling along the outer continental shelf and on land. The XL pipeline would have delivered an estimated 500,000 to 700,000 barrels of Canadian oil to the U.S. daily. But bowing to pressure from environmentalists, the president delayed the permit at least until 2013.

The administration has proposed $60 billion in tax increases on the energy sector and knee-capped the nuclear industry by blocking uranium mining and pulling all funding for the Yucca Mountain waste disposal site. The Environmental Protection Agency has imposed regulations on coal plants that the agency acknowledges will raise electricity prices.

Perhaps the signature energy policy of the Obama administration was the Chevy Volt – the electric car that the Obama administration tried to bribe Americans (with their own tax money) to buy. These “green” cars, we were assured, were going to transform American industry and energy use. Sucking huge subsidies from taxpayers, the Volts nevertheless sold (or rather, didn’t sell) for an eye-popping $41,000.

But in crash testing, it seems the Volts have a nasty habit of bursting into flames – taking all of those government subsidies, to say nothing of the passengers – down with them. The metaphor is irresistible.

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