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VIEW Bloomberg Businessweek January 29, 2018

If Shale 2.0 output keeps prices low, Russia would be a yields little diesel, the fuel that powers manufacturing.
big loser. Moscow has used oil revenue to finance aggressive Such limitations may be mere speed bumps. But U.S. dom-
foreign intervention from Ukraine to Syria. The only solution inance is far from a panacea. It won’t reverse climate change.
is to continue cooperating with Saudi Arabia on keeping pro- It won’t lessen the political influence of fossil-fuel producers
duction low—not something the oligarchs relish. in Washington. Nor will it completely neutralize the political
With shale surging, U.S. imports of Saudi oil plunged to a influence of erratic petrostates.
30-year low last year. The turnabout makes China and Japan With demand rising despite the emergence of renewables
far more dependent than the U.S. on the Middle East. It’s now and the development of electric vehicles, shale may struggle
possible for the U.S. to argue that other countries should help to keep pace with global consumption. There’s a chance the
shoulder the burden of policing the shipping lanes leading to world will witness that rarest of market loop-de-loops—high
Middle Eastern and North African oil exporters. oil prices as well as rising U.S. production.
Yet not all traffic lights are green for the U.S. It’s not Saudi Arabia and Russia could then remain formidable
immune from the ups and downs of the world market. obstacles to U.S. energy independence. They would be crow-
When the price rises because of, say, political upheaval in ing from the top of the hill even as they keep a wary eye on
the Middle East, it doesn’t matter where you are and how America’s shale drillers.
much you pump. The price rises in America, too. These are troubles that would have been an embar-
There’s another problem: Shale 2.0 could hurt refiners. rassment of riches for Americans who had to wait in line to
Shale oil is too good. For years, refiners spent billions of dol- fill up in the 1970s, when the U.S. determining its own energy
lars on special equipment to process the dense, high-sulphur, future was just a dream. Any celebration over this accom-
low-quality crudes coming from Mexico, Venezuela, Canada, plishment ignores the evidence that such dependence on
and Saudi Arabia. The quality of shale oil is so high that it fossil fuels is no independence at all. —With Joe Carroll

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More Assaults benefits. This would let insurers create of when the need arises. Keeping this
system running well requires that the
cheap, weak-coverage plans and mar-
On Obamacare ket them to people who expect no big healthy and not-so-healthy all pay into
health-care expenses. Second, the ad-
the same pool and that their insurance
ministration wants the duration of covers any care that may be needed.
unregulated short-term policies to grow Trump is attacking this core idea.
○Trumpplanstoattackthecore from three months to as long as a year, The split-market problem will be com-
principleofhealthinsurance letting some healthy people pay smaller pounded in 2019 by the loss of the
premiums for minimal insurance. Third, “individual mandate” penalty for going
Trump would allow employers to offer without insurance, a change Congress
The year ahead looks to be dangerous workers tax-favored “health reimburse- enacted in its tax bill. Facing no pen-
for health-care security in the U.S., as ment” accounts that aren’t paired with alty, some healthy people will gamble
the Trump administration continues to health insurance. This would also draw on going without coverage, keeping
sabotage the law Congress couldn’t re- healthy people out of the market. their premiums out of the pool.
peal. New proposals would let many Why is it wrong to let healthy people State governments should do what
more healthy Americans drop their opt out? Partly because, as experience they can to push back—for instance,
Obamacare coverage—raising costs for before the Affordable Care Act proved, by creating their own individual man-
the unhealthy and risks for everyone, weak-coverage plans often serve their dates, as Massachusetts did long ago
sick or well. buyers badly. Insurers misled consum- and Maryland is proposing to do now.
First, the administration intends ers about the benefits, leaving them with They ought also to place limits on
to expand and deregulate association astronomical bills to pay. But the more association health plans and short-term
health plans. Under current law, such fundamental problem is that opting plans. Unfortunately, it’s safe to assume
plans, sold to trade and professional out defeats the basic principle of insur- that not all states will do so. Thanks to
associations, must cover “essential ance, to spread risk. Premiums paid by Trump and a Congress that’s failing
health benefits” such as hospitalization, everyone—young and old, healthy and the country, many more Americans
maternity care, and prescription drugs. sick—collectively pay for health care. will soon be left where they were be-
Trump wants to increase enrollment in People in good health today gain the se- fore the ACA—unable to afford decent
these plans and end the restriction on curity of knowing they’ll be taken care health care.