Friday, December 23, 2011
Growth Requires Energy
The connection couldn’t be more obvious.
by John Hayward
The awful, grinding unemployment afflicting America for the last few years is not evenly distributed across the states. Some are doing better than others. Three are doing particularly well: North Dakota, Alaska, and Texas. North Dakota has the lowest unemployment rate in the country, at just 3.4%. Along with Alaska, it has already regained the jobs lost during the past recession, with Texas due join them during the first quarter of next year.
In each case, energy production is crucial to their success, as a Bloomberg News report explains:
The economies and labor markets in Alaska, North Dakota and Texas all reflect rising energy prices and increased spending on exploration, Diffley said.
Through October, Texas has recovered 94 percent of the jobs lost during the recession, compared with just 27 percent for the U.S., Comptroller Susan Combs wrote in a Dec. 12 letter to Republican presidential candidate and Governor Rick Perry.
North Dakota and Alaska led tax collection increases from July to September, with revenue more than doubling because of “taxes driven by higher oil and mineral prices,” the Nelson A. Rockefeller Institute of Government said Dec. 8.
Since 2005, oil production in North Dakota has nearly quadrupled at the same time employment in mining, quarrying, and oil and gas extraction has increased 185 percent, IHS said.
What’s more, energy-producing regions are seeing “significant wage gains,” said Drew Matus, senior U.S. economist at UBS Securities LLC. “Go to North Dakota and try to rent a hotel room for the night. Good luck, right? You cannot do it.”
One of the reasons North Dakota is doing so well is that the federal government owns very little of the land, and thus cannot stop them from developing their resources, much as the rabidly energy-hostile Obama Administration might like to try. Removing deliberate government barriers to the development of oil and gas resources would almost immediately create jobs, as a great deal of skilled labor would be needed.
Even more jobs would be produced as energy prices dropped. Production requires energy. So does distribution. No one outside of this Administration, which has been deliberately working to “transform” the economy in a “green” direction – not coincidentally, to the benefit of many deep-pocketed Obama contributors – should find that notion difficult to grasp. What sort of “recovery” could a high-tech industrial society possibly have, without a plentiful supply of affordable energy?
To read another article by John Hayward, click here.
Posted by Brett at 2:45 PM