The President is spending a little time out on the left coast looking for ideas on what government can do to help create jobs. On Thursday he was in San Francisco meeting with local business leaders, including Facebook founder Mark Zuckerberg, and today he is in the Portland area and will tour computer chip maker Intel’s factory in Hillsboro. I submit that the President is talking to the wrong people. San Francisco and Portland are both blue state strongholds and therefore he has little chance of hearing solutions that will actually work. I’m not a business leader or an economist, but I’ve got a couple of common sense and logical suggestions the White House should look into that the President probably won’t be hearing about during his west coast visit.
“DRILL HERE – DRILL NOW.”
There are currently 103 permits for offshore drilling in the Gulf of Mexico that are being held up by the Obama Administration, even though the moratorium on offshore drilling has been lifted since October 12. Worse yet, the Obama regime shows no sign of changing it’s position on blocking offshore drilling at the expense of the American people. Interior Secretary Ken Salazar canceled a Gulf lease sale last October. He postponed another, originally scheduled for March, until 2012. Yet another one that had been planned for October 2011 could be delayed until 2012. That would make 2011 the first year since 1965 that the federal government has authorized any drilling in the Gulf of Mexico.
The Gulf region accounts for more than 25 percent of domestic oil production and the lack of drilling there is having a devastating economic impact on the region and also threatens to exacerbate the problem of rising oil prices for the rest of the nation. It also means less money for the federal government, which is apparently not a major concern to the Obama White House. Rebecca Blank, under secretary for economic affairs at the Department of Commerce, told a Senate committee last fall that the revenue loss to the government would be “negligible.” Not everyone agrees.
With production in the Gulf of Mexico expected to drop this year by 220,000 barrels per day, according to the US. Energy Information Administration, that equals about $3.7 million in lost revenue each day for the U.S. Treasury, (based on the $90/barrel oil and the royalty rate of 18.75 percent). Over the course of a year, that adds up to more than $1.35 billion dollars in lost revenue to the federal government. A recent study conducted by Wood Mackenzie for the American Petroleum Institute estimated that increased access to those areas would bring $150 billion into federal coffers by 2025. If these numbers don’t phase the administration at all, here are some other numbers that should be causing alarm. According to Dr. Lee Hunt, President of the International Association of Drilling Contractors, there are 75,000 people who are unemployed because of this administrations opposition to domestic oil drilling in the Gulf of Mexico, (or anywhere else for that matter). Imagine if those 75,000 people were working, and paying income taxes instead of drawing unemployment checks. It’s called real wealth creation, not transferred wealth that the government has to either confiscate from someone else or borrow from China.
If the White House is serious about creating jobs, the President should order Ken Salazar to expedite the approval of those 103 oil permits. While were at it, lets approve the construction of an oil refinery or two in this country. The United States has not built a new oil refinery in 35 years. The last refinery built is in Garyville, Louisiana, and it started production in 1976. Demand has increased as our population has grown, but our supply is still the same, which is why gas costs what it does. That bad news it, it’s going to get a lot worse if we don’t change our misguided environmental policies.
Where Barack Obama is concerned, there are always two ways of doing things, the right way, and Obama’s way. Sadly, the two are mutually exclusive and there is little chance they will ever meet.
