John McCain and Barack Obama on Energy Policy and Offshore Drilling

This summer $4-a-gallon gas put energy issues front and center.

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Even before $4-a-gallon gas became a reality this year, concerns about energy supplies and climate change were generating historic buzz in the campaign. The primaries saw Barack Obama vie with Sen. Hillary Clinton for the title of biggest fan of renewable energy, and John McCain and former Gov. Mitt Romney tussle over whether green manufacturing jobs could help revive Detroit.

Turning point. On July 11, when crude oil prices reached a record $147 a barrel and the average price of a gallon of gas topped out at $4.10, energy issues moved front and center as a rancorous debate erupted in Congress over the merits of expanding domestic oil drilling.

Where McCain stands. McCain has a mixed voting record on offshore drilling, but in June, citing rising gas prices, he said he now favors increased domestic drilling (although the "pristine" Arctic National Wildlife Refuge would stay off limits). McCain tends to believe that government support should be limited to research and development and that the market should pick winners and losers in the renewable energy industry. But he is also a proponent of nuclear power—which is heavily subsidized—and has called for building 45 new reactors by 2030.

Where Obama stands. Obama is much cooler to the idea of expanding domestic offshore drilling, although in August he softened his position and said he would consider "limited new drilling" as leverage to allow Congress to move forward with efforts to fund alternative energy. Obama has consistently voted in the Senate for tax incentives and subsidies to promote wind and solar energy, and he has proposed spending $150 billion to advance new renewable technologies.

Bottom line. The next president will be under pressure to move quickly on energy issues. Though McCain tends to tout free-market policies and Obama favors government investment, both would have to reckon with tough new fiscal realities. Obama, for example, has suggested he might have to scale back some of his ambitious energy proposals because of the bailout package's drain on government resources.