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FedEx CEO: Ending Oil Dependency Will Save Money, Fight Terrorism

FedEx chief executive officer Fred Smith, co-chairman of the Energy Security Leadership Council, envisions a future transportation system that does not rely on oil.

Smith said increased dependence on foreign oil represents the biggest threat to the U.S. economy and national security after terrorism and the proliferation of weapons of mass destruction.

The U.S. consumes 20 million barrels of petroleum a day, and in 2008, that oil cost the nation nearly three quarters of a trillion dollars, said Smith, founder of the Memphis-based transportation and services company, “There can be little doubt that a major part of the financial crisis that led to the current recession was the 2007 and 2008 run-up in oil prices,” he remarked at The National Press Club.

To reverse the trend, Smith, together with several military and business leaders, promote a transportation system that no longer relies on oil. They back the council’s plan released in September for “the electrification of short-haul transportation.” Electrical power can be generated from solar, hydroelectric, wind, nuclear, coal or natural gas, reducing the nation’s dependence on one fuel source or producer, he said.

In addition to national security benefits, Smith noted the Council’s policies will create jobs and strengthen the U.S. economy. However, it also means “reducing the corporate tax rate and changing the tax code to allow the expensing of capital equipment.”

Smith also called for increased funding for the Department of Energy’s applied research and development budget, together with the reform of the existing R&D structure to streamline spending and new institutions that can accelerate the commercialization of energy technologies.

A study commissioned by the Energy Security Leadership Council finds that the policy proposals would result in significant benefits for the U.S. economy, remarked Smith. Released Monday by the University of Maryland and Keybridge Research, the study projects that if the U.S. reduces consumption of imported energy by 2050, it will result in higher employment and annual household income, less pollution, an improved trade balance and a higher level of federal tax revenue.

Smith concluded that a “reduced dependence on imported oil that results from our policy will act as a 400 billion dollar insurance policy for the U.S. economy, saving 1.8 million jobs in the event of a severe oil shock.” Click here for the full transcript of Smith’s remarks and here for a video

FedEx has recently announced plans to cut aircraft emissions and increase vehicle fuel efficiency.

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2 thoughts on “FedEx CEO: Ending Oil Dependency Will Save Money, Fight Terrorism

  1. as previously stated bush screwed up invading iraq to put more oil on the world market.this was chaney and bushes response to the us energy problem and a failure.bush chaney will be held accountable as the senate starts investigation.obamas bill states there will be oil tax cuts and revenues applied to alternative forms of energy. including upgrading a failed us car manfacturing industry.these last 8 yrs bush/chaney will be held financially accountable for their decisions.there will be zero rest on the bush ranch as he is a failure and forward looking policies are put in place by the usa’s legitimately elected leader.
    republicans will be held accountable as they have lost seats and power for their failure.and all ceos will fly straight as their lobbying will no longer work
    sustainable energy is the answer as sustainable guy stated more than 9 yrs ago.ps. its probably time for fred smith to upgrade his term paper from 30 yrs ago as his idiot fool college professor only gave fred a “c” for his overnight express term paper.

  2. Evacuated Tube Transport (ETT) offers the enormous benefits of frictionless “Space Travel on Earth” for everyone to enjoy at any time. The first nations to leverage ETT will trigger and ride a wave of unprecedented global prosperity. ETT will: eliminate oil reliance, enhance global security, green the earth, invigorate stagnant industries, and net millions of high paying jobs. Most importantly, ETT will stimulate the global economy by availing an extremely high return on investment (ROI) for companies who build it.

    How ETT works: ETT is a patented technology where travel occurs without air resistance or rolling resistance. ETT can accomplish fifty times more transportation per kWh than electric cars or trains. ETT is silent, ultra safe, faster than jets, and is electric. Air is permanently removed from two five foot diameter tubes built along a travel route. ETT is not pneumatic tube transport commonly used at drive-up banks. Car-sized passenger/cargo capsules travel in the tubes on frictionless maglev. Airlocks at stations allow transfer without admitting air. Linear motors safely accelerate the capsules, for most of the trip they coast through the vacuum without using additional energy. Acceleration energy is recovered by using linear generators to decelerate the capsules. ETT will eventually serve most homes.

    ETT is networked like freeways, the capsules are automatically routed like internet traffic, yet a capsule can exit at any desired branch. Speeds of 350 mph for in-state use will develop to 4,000 mph for cross country (45 min. from NYC to LA) and global travel. Empty ETT capsules weigh 400 lbs yet can accommodate six people or three pallets of cargo. Guideways to support ETT capsules require 1/20th the material needed to support trains. Material efficiency and automated production will drop cost to less than 1/10th that of High Speed Rail, or 1/4th that of freeways. Automated switching allows a 350mph ETT route to exceed the capacity of a 32 lane freeway, producing further economy.

    The opportunity: ETT value will produce ROI high enough to guarantee private investment. ETT benefits will compound for generations. Collectively companies have invested billions developing ETT (though most are yet unaware of it); for instance, many companies currently produce the hardware and software necessary to build and automate ETT. The technology is owned by et3.com Inc., an open and growing consortium of licensees. These companies and individuals collectively network, and leverage their assets to implement, manage, and improve, ETT.

    Private investment of $500B in optimally placed ETT routes will displace up to half of US transportation. The manifold annual return on this investment will include: direct savings of $1.4T (includes energy), time savings of $625B, environmental benefits over $200B, security $70B (saves cost of protecting oil assets), 20,000 lives saved, and reduces uninsured losses. This totals almost $2.3T/yr. Secondary benefits include: economic expansion, better distribution of commodities, improved global standard of living, and accessibility to education and markets to mention only a few.

    Building a 14,500 mile ETT backbone from New York to London (via Alaska, China, India, and Europe) for less than $1T would capture 10% of the $8.5T global transportation pie by connecting major population and production centers. Traveling from New York City to Beijing in two hours on ETT (with a comparable fare to flying) would yield 90% profit margin. This allows greatly reduced transportation cost. In less than a generation the ETT network expansion could capture a majority of earth transportation, with potential to grow to over $30T/yr. present value.

    China recognizes the immense value of ETT and holds a five-year advantage over the US in its implementation. Instead of waiting for others, we have a patriotic duty to leverage our IP advantage and be the first nation to commercialize ETT leading the world out of the present global economic crisis. We can boldly create unprecedented environmental, social, and economic returns through ETT. This will usher in an age of global prosperity for many generations. The United States will enjoy enormous profit by providing transportation, like Saudi Arabia sells oil.

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