Yesterday, this came out (and, most surprisingly, on Ezra Klein’s blog, although not by Ezra Klein):
What’s the real harm of a massive government deficit? Carmen Reinhart, Vincent Reinhart, and Kenneth Rogoff find that high public debt is associated with a significantly lower level of GDP in the long run.
In a new paper for the National Bureau of Economic Research, the researchers examined the historical incidence of high government debt levels in advanced economies since 1800, examining 26 different “debt overhang episodes” when public debt levels were above 90 percent for at least five years.
And what do you suppose they found?
The debt episodes included everything from Netherlands’ Napoleonic War debts and the Japan banking crisis of the 1990s to Greece’s current fiscal crisis. On average, the researchers found that growth during these periods of high debt were 1.2 percent lower on average, consistent with Reinhart and Rogoff’s findings in 2010. What they also found, however, was these episodes of high debt and lower growth were quite lengthy, averaging 23 years. And the accompanying long-term drag on GDP was substantial. “By the end of the median episode, the level of output is nearly a quarter below that predicted by the trend in lower-debt periods,” they explain.
Japan’s “lost decade” has lasted much more than a decade, hasn’t it?
And the policies being pursued by this president seem to be offering up an attempt to see if this country can’t move that average beyond 23 years.
Need a picture?
We’re at 101% of debt/GDP so, according to these folks, we’ll actually perform below the red line.
But hey, more spending please. Because, you know, we need more government jobs (the private sector is doing fine).
Forward (into economic oblivion)!
Tell me if you know which Republican Congressman said this:
"President Obama and others in Washington need to realize that we cannot spend our way to prosperity and that to in order to create jobs," … "We need to address unfair trade deals that ship jobs overseas and enact policies that allow us to take advantage of our vast natural resources such as coal and natural gas in a safe and responsible manner which will lower energy costs and create jobs and approving the Keystone XL Pipeline would be a good first step."
House Speaker Boehner? Paul Ryan? Eric Cantor?
Uh, no … it wasn’t a Republican at all. It was Rep. Mark Critz, D-PA. The guy who represents most of John Murtha’s old district. Does this sound like a guy who is wanting the president anywhere near his district as he runs for re-election?
Meanwhile the President gave a “major speech” yesterday in Ohio that was 54 minutes long and could be boiled down into one sentence – No change: more spending, more taxes, same old failed economic policies and blame Bush.
President Obama’s much-anticipated speech Thursday on the economy didn’t lay out any new initiatives or make any new arguments. It often sounded like a recap of his first three years, or another version of the familiar "how we got here" blamefest.
Meanwhile, going back to part of Rep. Critz criticism, the Keystone XL pipeline, something which would mean jobs for this country and a big step toward increasing our energy security, is indeed proceeding – toward China or elsewhere:
While Joe Oliver, Canada’s minister of natural resources, said in an interview that the United States would remain Canada’s “most important customer,” billions of barrels of oil that would have been refined and used in the United States are now poised to head elsewhere. Expansion of Canada’s fast-growing oil-sands industry will be restricted by the lack of pipeline capacity before the decade’s end, he said, which “adds to the urgency of building them so that the resources will not be stranded.”
Three new pipeline network proposals — two that call for heading west and the other east — have been put forward.
If ever there were a blunder of historic proportions, Obama’s petulant and politically motivated disapproval of the pipeline rank up in the top.
The scale of this blunder, which the President made ostensibly on environmental grounds, is compounded by the fact that there is no putting the genie back in the bottle. Once a new pipeline is built, Canada has no reason to return to selling its oil products solely to the U.S. at a reduced price. The decision not to approve Keystone XL makes Solyndra look like a stroke of genius.
Oh and finally, can anyone guess what was required to attend the President’s Ohio speech?
Yeah, that’s right – a photo ID.
The latest little dust up is about President Obama claiming we need to hire more teachers (i.e. we need more government jobs) and the Romney campaign saying we really don’t. Who is right?
Former Gov. John Sununu steps in with the following:
Former New Hampshire Gov. John H. Sununu, a surrogate for Mitt Romney’s presidential campaign, defended the presumptive Republican nominee’s comments that the nation should have fewer teachers, firefighters and police officers, saying there was "wisdom" in Romney’s remarks.
"There are municipalities, there are states where there is flight of population, and as the population goes down, you need fewer teachers. As technology contributes to community security and dealing with issues that firefighters have to issue, you would hope that you can as a taxpayer see the benefits of the efficiency in personnel you can get out of that," Sununu said during an interview on MSNBC’s "Jansing & Co." Monday, prefacing that he was speaking "as a taxpayer" and not a representative of the Romney campaign. "There may be others who run away from those comments, but I’m going to tell you that there are places where just pumping money in to add to the public payroll is not what the taxpayers of this country want."
So do we or don’t we need more teachers? That should be fairly easy to determine, shouldn’t it? And, as it turns out it is:
Since 1970 we’ve seen a 100% increase in Public School employment and a, what, an 8% increase in Public School enrollment?
Am I missing something here? It would seem we have a plethora of educators available. Or at least education employees. If they’re not educators, then my suggestion is perhaps the way to get “more teachers”, if they’re really needed, is to look at the current employee mix and reduce administrative overhead while increasing the number of teachers. Problem solved.
That, of course, could be done without spending a dime. And that, as Sununu points out, would certainly be satisfactory to taxpayers. Oh, wait, teacher’s unions – yeah, not going to happen is it?.
But let’s get real about this Obama gambit – it is the usual appeal. Whenever the Democrats want to increase the size of government, the first jobs they talk about are “teachers, firemen and cops”. Without exception. It is a tired old ploy that most people ought to be on too by now.
And yet we continue to see it employed and, unfortunately, it works. The scare factor. See the above chart if you don’t believe me.
In the case of schools, what has it given us over the years as the taxpayer has answered the inevitable appeal and thrown money at schools?
A 90% increase in cost and flatlined (and even subpar) achievement.
We don’t need more teachers.
We need less government.
Myth: The US has only 2% of the world’s proven reserves.
From Canada to Colombia to Brazil, oil and gas production in the Western Hemisphere is booming, with the United States emerging less dependent on supplies from an unstable Middle East. Central to the new energy equation is the United States itself, which has ramped up production and is now churning out 1.7 million more barrels of oil and liquid fuel per day than in 2005.
“There are new players and drivers in the world,” said Ruben Etcheverry, chief executive of Gas and Oil of Neuquen, a state-owned energy firm that is positioning itself to develop oil and gas fields here in Patagonia. “There is a new geopolitical shift, and those countries that never provided oil and gas can now do so. For the United States, there is a glimmer of the possibility of self-sufficiency.”
Or, as the article from which those two paragraphs are taken is entitled, “Center of gravity in oil world shifts to America”.
And, given recent finds, there’s more than a “glimmer of the possibility of self-sufficiency for the United States” there is a real possibility for self-sufficiency if a coherent energy policy is put together that exploits the reserves we have.
Currently the US imports 45% of its petroleum needs. 29% of all imports comes from Canada, 8% from Mexico. Saudi Arabia supplies 14% Nigeria 10% and Venezuela 11%, with lesser suppliers picking up the rest.
Canada’s supplies of crude oil are going to continue to rise, from a current base of 4.3 million barrels a day to 6.6 million a day in 2035. But the US is projected to see a big an increase as well. From the current 10 million barrels of oil a day to 12.8 million in 2035.
But that’s the case only if we tap into it or are allowed to tap into it, much being found under land controlled by the federal government who has been anything but friendly to the idea here recently.
Production has risen strikingly fast in places such as the tar sands of Alberta, Canada, and the “tight” rock formations of North Dakota and Texas — basins with resources so hard to refine or reach that they were not considered economically viable until recently
Technology has made the recovery of these resources economically viable and they promise a abundant energy future.
Then, of course, there’s natural gas, something the US is blessed with in huge quantities as well. It is a distinct possibility that the use of natural gas will increase markedly over the next few decades as it is applied to more and more uses traditionally the realm of other energy sources. Part of that may come among auto and truck fleets. If so, then it is more than a “glimmer of a possibility of self-sufficiency” we’re beginning to see.
It is a real possibility.
But only if we use it. And, only if the government and radical environmentalists get out of the way.
One of those two problems can be helped this November.
Via Charlie Cook, some things you most likely know:
First, there’s Europe and the eurozone. It’s possible that the situation could be worse in Greece, but not that much worse. There’s a pretty good chance that country will be exiting the eurozone soon, but either way, Greece is putting enormous stress on its economy. Then there’s Spain, which has an economy larger than Greece, also in trouble. With Europe teetering on the edge of recession, there are limits to how much even Germany can do to keep the eurozone—now the world’s largest single economy—from going into a serious tailspin. Europe contributes 21 percent of global economic growth, so there is rather obvious significance for the U.S.
And something you might be somewhat aware of:
Then, there is China, whose economy is slowing. Acknowledging the problem, the Chinese government just announced that it was placing greater emphasis on economic growth. Its central bank is expected to lower rates soon. It’s unlikely that China will go into a recession, but don’t expect purchases of U.S. goods there to match those of the last few years.
Key point in last sentence. We may buy a lot of stuff there, but we also sell a lot of stuff to China. And, our other major trading partner is what? The Eurozone. So what Cook is pointing out is the real possibility of a major slowdown and the problem that would present for a fragile US economy at, if you’re a Democrat, exactly the wrong time.
So Cook lays this out for your consideration. And while you may not agree with everything, read it through:
But it’s the fragile nature of America’s own economy—and questions about whether our political process is capable of coping with immediate and simultaneous challenges—that make things so much worse. The Federal Reserve Board has acted heroically to pump up the economy. As the International Strategy and Investment Group reports, the Fed’s efforts put the trade-weighted dollar at close to a record low, making it almost as competitive as it ever has been. But a weak world economy still limits the U.S. advantage to sell.
The term “fiscal cliff” has been rapidly entering the economic lexicon. People using the phrase may not know exactly what is scheduled to happen at the end of this year. Probably more than anything else, though, they may know that the George W. Bush-era income-tax cuts will be eliminated both for earners above and below the $250,000 level if not renewed by Dec. 31. They also may know that some significant spending cuts will automatically be made, unless Congress takes action, that will cut defense and nondefense funding pretty much evenly. Of course, Social Security, Medicare, and Medicaid, the real drivers in the increase of federal spending, are exempted from those cuts.
A few may even know that the capital gains tax rates will go up unless Congress acts. According to ISI Group, the top rate on dividends would almost triple, going from 15 percent to 43.4 percent. Andy Laperriere, who heads up the ISI shop, said understatedly in a report to his clients, “We find investors to be interested in the many facets of the fiscal cliff, but we don’t believe investors have repositioned their portfolios yet. We suspect that will change late this summer and into the fall as investors begin to focus on the outlook for next year.”
Call me simple, but I think that means that people will start dumping their stocks.
Bingo. He calls it a “fiscal cliff”. I’d characterize it as a fiscal trainwreck. Dale might bring up the red kangaroo and point to the fact that none of this is a surprise – we’ve been able to see it coming for miles. And, as is the nature of politics and government, at least in this country, to date nothing of any significance has been done to address it. Nothing.
The result, at least to now:
The danger, of course, is another stalemate over taxes and spending, but bigger this time. Policy moves that collectively could take an estimated 3.5 percentage-point bite out of the U.S. Gross Domestic Product are scheduled to kick in at the start of next year, hitting a very fragile economy. And let’s not forget the threat of another debt-ceiling showdown. We have the ingredients for enough economic uncertainty that it would be bizarre if many large companies and financial institutions didn’t freeze hiring, expansion, investing, borrowing, and lending. Individual investors would also probably head for the exits.
Sequestration, taxmageddon, the debt ceiling, a global economic slowdown, etc. All looming large. And about all that is happening is finger pointing. If you wonder why business isn’t expanding, hiring and reviving the economy, look at this mess and wonder no more. It’s because of policy – government policy. Or the lack thereof.
Cook, naturally, tries to pass it off to the Republican House. But let’s get real here. All of this – all of it – could have been addressed in the first two years of Obama’s presidency when he had a fully Democratic Congress and told us he was focused like a laser on the economy. But in reality he ducked it for ObamaCare. He was more concerned about his legacy than the country’s economic problems. And now, after the Democrats were spanked by the electorate in 2010 for their economic inattention, he’s stuck with having to compromise, something he’s refused to do to this point.
So yeah, the Charlie Cooks of the world will be spinning this as Republican obstruction – that’s a sort of knee jerk position for the left – but in fact, this is malfeasance by the Democrats and the President. Their opportunity came and went and they did basically nothing. The usual cure was tried – throwing trillions of debt ridden dollars at the problem – and it didn’t work. Now they have this fiscal trainwreck coming and their solution is?
Blame the other guys.
But as we’ve been pointing out here, reality is reality. And it is about to visit the finger-pointers in a big way.
For a libertarian blog, this is a subject that we rarely opine about. Probably because its a rather dead horse that just doesn’t need any more beating. Even so, we do all too often have occasion to discuss the ill effects of the War on (Some) Drugs, such as the asset seizure case Bruce highlighted.
In that vein, Randy Barnett offers up his latest law review on the subject “The Harmful Side Effects of Drug Prohibition” and this abstract:
Some drugs make people feel good. That is why some people use them. Some of these drugs are alleged to have side effects so destructive that many advise against their use. The same may be said about statutes that attempt to prohibit the manufacture, sale, and use of drugs. Advocating drug prohibition makes some people feel good because they think they are “doing something” about what they believe to be a serious social problem. Others who support these laws are not so altruistically motivated. Employees of law enforcement bureaus and academics who receive government grants to study drug use, for example, may gain financially from drug prohibition. But as with using drugs, using drug laws can have moral and practical side effects so destructive that they argue against ever using legal institutions in this manner.
This article will not attempt to identify and “weigh” the costs of drug use against the costs of drug laws. Instead, it will focus exclusively on identifying the harmful side effects of drug law enforcement and showing why these effects are unavoidable. So one-sided a treatment is justified for two reasons. First, a cost-benefit or cost-cost analysis may simply be impossible. Second, discussions by persons who support illegalizing drugs usually emphasize only the harmful effects of drug use while largely ignoring the serious costs of such policies. By exclusively relating the other side of the story, this article is intended to inject some balance into the normal debate.
The harmful side-effects of drug laws have long been noted by a number of commentators, although among the general public the facts are not as well known as they should be. More importantly, even people who agree about the facts fail to grasp that it is the nature of the means — coercion — chosen to pursue the suppression of voluntary consumptive activity that makes these effects unavoidable. This vital and overlooked connection is the main subject of this article.
It’s a pretty interesting read. You can download the entire article by visiting Randy’s post linked above.
Q: Why doesn’t Delaware fall into the ocean?
A: Because Maryland sucks.
Q: Why doesn’t California fall into the ocean?
A: Because Maryland really sucks.
I see that your financial picture is looking rather dicey again. Sorry to hear that. Who could have guessed that high taxes, profligate spending and a general hostility to business would lead to such things? No worries, though. I’m sure political leaders will continue to work hard at righting the ship and get Maryland sailing along smoothly again (how is that plan to repeal the laws of economics coming anyway?).
On a related note, I understand that the Maryland legislature, in collaboration with Gov. O’Malley, has passed a new tax on all six-figure income earners in Maryland. Well, bully for you! That’ll teach those nasty capitalists to stop being so productive. And Gaia knows that they really need to pay their fair share (I mean, how is it that the top 20% of earners only pays about 68% of the income taxes? How’s that “fair”?). So, here’s hoping that works out for you (fingers crossed!).
Of course, I seem to recall that the last time you all did something like this (with that “Millionaires Tax” thingy), we here in Virginia experienced a bit of an influx of former Marylanders. Not too many that we couldn’t handle it, mind you, and probably fewer than some thought. But it does raise an issue, especially since the latest tax scheme stands to affect a much larger portion of Maryland’s population. While we’re always happy to welcome you all into the Commonwealth, we’d really appreciate it if you’d leave things here the way you found them.
You see, all too often when Virginia takes in refugees of high tax and high regulation states, they tend to bring a lot of those policies with them. They seem to really like our neighborhoods, schools and business environment, but for some reason they get all worked up about the fact that our government doesn’t spend as much money as they’re used to (in fact, we’ve actually had a budget surplus the past couple of years, and look to do so again this year!). They also tend to push for more state intrusion into our lives. Thing is, we really don’t like that. (In fact, it’s a fairly common complaint in the South.)
You see, before they came, we were doing just fine. Sure, some of us moved to places like New York and California so that we could enjoy that wonderful embrace of the Nanny State, but for the most part it’s been the other way around: people moving from high-tax/high-regulation states to places like Northern Virginia. We completely understand why you would want to leave a place whose policies increase your costs of living, impair your livelihoods, and generally intrude on your lives in unwanted ways. That’s why we try not to do that sort of thing here (albeit, with some annoying exceptions). Problem is, when you all move in, you start enacting all the same policies that made the place you left so bad. We’d all really appreciate it if you wouldn’t do that.
So, like I said, I really hope that whole tax-the-hell-outta-the-rich thing works for you. If it doesn’t, and your looking for change of scenery, you’ll always be welcomed with open arms on this side of the Potomac. Come on over, make yourselves comfortable and set a spell. Just don’t go touching anything.
Michael J. Wade
There’s a report out that Wisconsin Democrats are furious with the DNC for not supporting their efforts to recall Gov. Scott Walker.
Walker, the target of unions since he tried to curtail their power in the state, is in a runoff election with the former mayor of Milwaukee, Tom Barrett. This is a race the unions have made a “national election”. They’ve poured money, time and effort into this recall election that has been unmatched in recent electoral history. But it seems it isn’t enough. At this point, with 3 weeks to go, Walker leads Barrett by 9 points.
Some of the strength of the base supporting Walker was evident in the primary. Ace fills us in with some numbers:
You know those 626,000 Republicans who turned out in Wisconsin yesterday? Go higher. A LOT higher.
Big number, but if the Marquette Law poll released last Wednesday is to be believed . . . that number is actually low.
MU found that of the voters confirming they would be voting in the Democratic primary, 17% were Republicans.
We will never know the actual numbers per party since there was no exit polling.
Assuming that even HALF of that number stuck by their decision to cross over to cause some mayhem, that means that over 50,000 votes on the Democratic side were just devilish Republicans, bringing the total turnout to over 676k for our side.
If you go by the Marquette number, those "hidden Rs" swell to an additional 110k, bringing total turnout to 736,000: nearly matching Prosser’s share in 2011 for a primary.
There is no way to spin turnout Tuesday in the Democrat’s favor. . . .
Dane County gave the Democrats a massive edge in votes of about 80,000, but proportionally that did not materialize in Milwaukee, which is a big concern for anyone trying to unseat Walker. If you remember earlier discussions here at the AOSHQDD, depressed Democratic turnout in Milwaukee county relative to the rest of the state actually saved Justice Prosser. The Madison vote will show up. The pro-Walker vote will show up from the Milwaukee burbs. Will traditional Presidential-race Democrats in Wisconsin’s largest city bother for a special election, even one as hyped as this? So far, the little evidence we have points to a big fat nuh-uh.
Walker won the largest uncontested share of a primary vote for governor last night in 40 years. His base is behind him when they really didn’t need to show up at all.
If you don’t recognize the name “Prosser”, he was a Republican justice who most felt would fall to a pro-union Democrat. But the election results most desired by the union didn’t materialize. Prosser won. The key graf in Ace’s analysis is the last one. Walker was uncontested. Yet, his base demonstrated their strength and intent. And, if the Marquette poll is to be believed, you can add up to 17% more in June.
It looks like union effort is faltering. How badly? Well, they couldn’t even get their preferred candidate elected in the Democratic primary:
Kathleen Falk’s drubbing in Tuesday’s Democratic primary has some political insiders questioning the decisions, and influence, of the state’s major public labor unions.
Falk, 60, was the first Democrat to enter the recall election, announcing her candidacy even before the race was official. Major labor unions, including AFSCME and the Wisconsin Education Association Council, quickly endorsed her and then went on to spend nearly $5 million to help her win the nomination.
But on Tuesday, Milwaukee Mayor Tom Barrett — a candidate for whom the unions initially showed very little love — defeated the former Dane County executive by 24 percentage points; a margin of victory all the more startling given that he entered the race late and was outspent 5-to-1. Barrett’s victory was even more pronounced in Dane County, Falk’s backyard, where he won by 30 points.
As Jim Geraghty asks:
So if the AFSCME and the Wisconsin Education Association Council couldn’t move votes in a Democratic primary, why should we expect them to move more votes in the general election?
That’s why they’re now whining about the DNC. My guess is if they lose, the DNC will be the fall guy, the “if but for the DNC’s failure to throw good money after bad, we’d have won” assertions. It’s time to become a victim. Gov. Walker has returned Wisconsin to at least a semblance of fiscal sanity with a budget surplus this year. His program of changes is working. The voters in Wisconsin aren’t blind or stupid. So victimhood is about all the recall proponents have left at this point.
In a last desperate attempt to salvage the effort, Wisconsin Democrats are trying to rewrite a little history:
“Scott Walker has made this a national election,” the Wisconsin Dem tells me. “If he wins, he will turn his victory into a national referendum on his ideas about the middle class. It will hurt Democrats nationally. The fact that [national Dems] are sitting on their hands now is so frustrating. The whole ticket stands to lose.”
Scott Walker had nothing to do with initiating a recall election, throwing collective temper tantrums in the state capitol or bussing in union members (and buckets of money) in from out of state. Democrats and unions did. It is they who have been appealing nationally. It is they who have elevated the Wisconsin recall election a “national election”. And, to this point, it is they who are fumbling the ball.
But they’re right about one thing. Thanks to them, it has been turned into a national referendum of the sort they don’t want to lose. And, unfortunately for them, at this point, they are.
With the following quote, which Anu K. Mittal, the GAO’s director of natural resources and environment provided in written testimony to Congress, forever kills the meme that we have only 2% of the world’s proven oil reserves:
“USGS estimates that the Green River Formation contains about 3 trillion barrels of oil, and about half of this may be recoverable, depending on available technology and economic conditions,” Mittal testified.
“The Rand Corporation, a nonprofit research organization, estimates that 30 to 60 percent of the oil shale in the Green River Formation can be recovered,” Mittal told the subcommittee. “At the midpoint of this estimate, almost half of the 3 trillion barrels of oil would be recoverable. This is an amount about equal to the entire world’s proven oil reserves.”
Of course the 2% myth has been useful to deny the viability of “drill, baby, drill”. President Obama has used it repeatedly (and I have no doubt he will continue to do so because he seems to come from the school that thinks if they repeat something that is untrue enough times, well, it becomes true, or something). The entire argument has centered around the premise, given the 2% figure, that even if we were to drill everything, we’d still be dependent on foreign oil. And so, the logic then goes, since that is “true” then it would seem we should instead concentrate on alternate energies, especially clean and renewable energies, to displace fossil fuel use, decrease our foreign dependence and replace oil with those alternatives (even if they’re more costly).
Naturally, this works perfectly into a further claim that we’ll also save the planet from warming, increase net job growth by creating domestic green jobs and everyone will live happily ever after.
None of it is true. Myth after myth has been shattered. Global warming, despite James Hansen’s insistence, is simply not happening the way he and his alarmists claimed. He continues to beat the same drum he was beating years ago as if nothing has disputed his initial theories. Just last week he doubled down with a NY Times op/ed piece that barely yielded a yawn.
Should we be pursuing alternate and so-called “clean” energy sources? Of course we should. And we will as necessity and markets guide entrepreneurs. But this myth that we must be a net oil importer forever and ever and can’t find ways to fully secure our own supply (i.e. not have to import oil from unfriendly or potentially unfriendly countries or be subject to their whims) is a myth.
That is, unless we don’t exploit this resource. And remember, the estimate Mittal is talking about covers one area in the US. We’re not talking off-shore, where most of the off-shore area also holds vast amounts of oil but remains off-limits. We’re talking right here on dry land.
The Green River formation is near where the state borders of Colorado, Utah and Wyoming come together. The unfortunate aspect of that is most of the land is owned by the Federal government. And, under this administration, anyone who has been following the energy policy of the administration knows that’s bad news for Americans.
“The federal government is in a unique position to influence the development of oil shale because nearly three-quarters of the oil shale within the Green River Formation lies beneath federal lands managed by the Department of the Interior’s (Interior) Bureau of Land Management (BLM),” she testified.
Again, with this administration, most know what that means. If history is a guide, little if anything will be done to take advantage of this petroleum windfall by Mr. “All-Of-The-Above”.
Look at the Bakken oil fields and their impact in this down economy for an example of what Green River could mean in real terms. Here’s blurb published today from a Billings, MT newspaper:
Thousands of workers chasing quick riches by flooding into the Bakken oil field have helped jump-start home sales in Billings.
And the wave is starting to make Billings houses harder to find — and more expensive.
Well-site geologist Joe Hallgren works under contract for SM Energy of Billings. He and his family live in Williston, N.D., the oil boom’s epicenter. But, they’re building a house in Billings and when it’s finished in July they’ll move here and Hallgren will commute to the oil patch.
“I’ve seen a few boom-bust cycles. This one is crazy,” he said. “We got to the point where, for our family, Billings is just going to be better for us.”
Last week, Bozeman resident Doug Pezoldt, who surveys land for local engineering firm Sanderson Stewart, and his wife started moving into their custom-built Billings home.
“Really, in one year’s time, the boom in the Bakken has increased the volume of work and we just need more people in Billings to support that,” Pezoldt said. “My wife and I just feel like Billings is where we want to make our home long term.”
That is the reality of Bakken and the potential of Green River in a very down economy.
Question: Do you think the administration will bother to take advantage of it?
Jeffery Folks at American Thinker begins his article with:
Imagine a president who gets behind drilling, welcomes the cutting-edge technology of companies such as ExxonMobil, and offers generous 15-year tax breaks to ensure that new drilling projects move forward. That’s the kind of energy policy America needs in order to achieve energy-independence.
I’d love to imagine that. In fact and unfortunately, we have a president who does exactly the opposite.
If you want someone like Folks is wishing for, you’ll have to go to Russia:
Unfortunately, it’s not Barack Obama who’s behind those positive energy policies; it’s Vladimir Putin.
As Russian president-elect, Putin has made it clear that he intends to open his country’s arctic and Black Sea regions to drilling. The potential is so great, and the necessary investment so immense, that even Russia’s giant state-run oil companies, Rosneft and Gazprom, lack the resources and technology to proceed. So, with Putin’s blessing, Rosneft and Gazprom have entered into joint-production agreements with Exxon, Italian major Eni, and other Western companies. The stakes are huge — not just for these companies, but for the Russian economy.
The arctic and Black Sea fields being jointly developed by Rosneft and Eni contain an estimated 36 billion barrels of oil equivalents. Those under development by Rosneft and Exxon, which may ultimately require an investment of as much as $500 billion, contain estimated reserves of 36 billion barrels in the arctic Kara Sea fields alone. (Total recoverable arctic reserves have been estimated at 134 billion barrels of oil equivalent but will likely go higher as exploration proceeds.) In addition to the arctic and Black Sea fields covered in the Exxon and Eni agreements, president-elect Putin has expressed an interest in the possibility of joint ventures to develop vast Siberian tight shale formations.
The US has an incredible amount of natural resources including huge reserves of oil and natural gas. We’re already the number 3 oil producer in the world. And guess who actually leads the world with recoverable fossil fuel reserves? Yes, that would be the US. Imagine an energy policy that made extraction of that fuel a priority? With aggressive exploration and drilling (as well as approval of the Keystone XL pipeline) we could have a 92% secure liquid fuel sources by 2030. Not to mention, in a time of high unemployment, a jobs bonanza.
But what do we get?
Not that, that’s for sure. We instead get a president who talks about an “all-of-the-above” energy policy while his actions belie his claims. He’s turned lose a executive agency (EPA) on the fossil fuel industry that has already been slapped down numerous times by the judiciary for over-reach. Drilling and permits on federal land have gone down dramatically.
In an oil market that has seen supplies tightening and prices going up, his administration has done everything to keep it that way.
And voters aren’t happy with his performance at all.
If this is going “Forward”, I’d hate to see backward.