Energy is a key ingredient that leads to the creation of wealth and the formation of modern democracies, according to former Secretary of State Gen. Colin Powell.

Speaking at Hart Energy’s DUG Permian Basin Conference in Fort Worth, Texas, Powell told an audience that 20 years ago, when he was National Security Advisor, energy security was a huge national concern. With the development of new technologies that can develop unconventional resources, the industry has facilitated the creation of large amount of wealth that can be used to develop emerging economies.

“You all have shown what is possible with investment, technology, with the ability to think out of the box,” he said. Powell won over the audience with a wide-ranging speech that was frequently humorous, always engaging and occasionally self-effacing.

Powell said the rise of modern democracies across the globe has helped create a vast amount of economic wealth that meets basic human needs. “This is wealth that will bring whole societies up and bring people out of poverty,” he said.

Authoritarian governments do not allow for wealth creation. He cited China as an example of what can happen when the country opens up its economic system: About 400 million people were lifted out of poverty over the long haul. He recognized that another 600 million Chinese are still waiting for significant changes.

“Every country that has come out of this authoritarian leadership has to go through this process,” he said. Energy is a key ingredient that enables this process to happen. Energy allows societies to build factories, bridges, schools, highways and railroads that drive this economic transformation, he added.

As his speech turned to a more domestic focus, Powell lamented the current state of U.S. politics, particularly the bitter debates that have enveloped Congress and the media, which he called more polarized than he had seen in years.

Powell noted that one of the problems in Washington is the inability to compromise when developing a national agenda. “You have to compromise to reach a consensus and to move forward,” he said.

Here in the U.S., the top concern for many Americans is the lackluster economic recovery. Economics, energy and environment are three challenges facing every modern industrial country. The challenge for the energy industry is to produce as much as possible as cleanly as possible.

“I congratulate you for what you are doing,” he said.

Powell was the 65th U.S. secretary of state, the national security advisor, the commander of the U.S. Armed Forces and the chairman of the Joint Chiefs of Staff.

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