US economic and energy future will be bright if feds don’t turn out the lights

Andrew Browning Executive Vice President, CEA
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The economy of America’s Rust Belt is showing signs of recovery. Over 37,300 jobs have been added to Ohio’s economy this year. That’s in addition to the 62,500 jobs the Buckeye State gained during 2011 — the fifth-largest increase in the nation. Pennsylvania is now home to the nation’s seventh-fastest growing metropolitan area and two of the nation’s 10 fastest-growing counties, according to the Bureau of Economic Analysis. At the same time, industries that once dominated the region’s economy are returning with a renewed vigor. Nowhere is this more evident than with the U.S. steel industry. Last year V&M Star announced plans for a $650 million rolling steel mill in Youngstown, Ohio that would create 350 jobs. Less than a year later Republic Steel announced it would construct an electric arc furnace that will bring 450 jobs to Lorain, Ohio.

Further south, NUCOR is building a $750 million facility in St. James Parish, Louisiana. That facility is expected to create nearly 500 jobs.

And according to a February New York Times article, Houston, the capital of America’s energy sector, was the first major U.S. city to regain all the jobs it lost during the recent recession.

These are just a few examples of how the resurgence in U.S. oil and natural gas development is reviving state and regional economies. While opinions on the topic may vary, the facts are indisputable — natural gas development is fueling a U.S. economic resurgence.

Of course these benefits aren’t limited to the Rust Belt states, Louisiana and Houston. A recent World Economic Forum report indicates that the oil and natural gas sector created 9% of all new U.S. jobs last year. That’s 37,000 direct jobs, plus another 111,000 “indirect and induced” jobs.

The report also found that lower natural gas prices — a byproduct of shale development — will increase U.S. GDP by 1.1% in 2013, create 1 million jobs in 2014 and result in 3% higher industrial production in 2017 than would be anticipated without shale development.

The responsible production of natural gas is helping to revive the U.S. manufacturing sector by making the U.S. a more attractive place for manufacturers. This is confirmed by an American Chemistry Council study that found that increased natural gas production helped increase U.S. exports in basic chemicals and plastics by 28% in 2010, resulting in a trade surplus of $16.4 billion, a record for the industry. This story, and others like it, are leading the U.S. to meet the president’s goal of doubling the nation’s exports by 2014.

That is, of course, if federal agencies can avoid stifling this momentum through policies that could reverse or halt this significant progress.

In just the last few months, the administration has announced plans to increase taxes on oil and natural gas producers and unveiled a proposal to double royalty payments on federal lands. Meanwhile, multiple federal agencies, including the Environmental Protection Agency, the Department of Interior and the U.S. Forest Service, are seeking to restrict hydraulic fracturing — a decades-old process that even leading environmental experts believe is best regulated by the states.

From the 229,000 jobs supported by natural gas development in Pennsylvania, to a nation-leading 3.1 percent unemployment rate in North Dakota and the resurgence of the industries that made our nation great, oil and natural gas production is putting the U.S. back to work while decreasing our reliance on foreign sources of energy.

As the nation continues to struggle to emerge from the greatest economic downturn since the Great Depression, the federal government should avoid needless and duplicative regulation of an industry that has been a lone bright spot in an otherwise turbulent economy. Overregulation will only reduce the supply of the affordable domestic energy necessary for continued economic success and undermine the president’s manufacturing goals and “all of the above” energy strategy. As President Obama himself has said, we have enough natural gas in America to meet our needs for over 100 years. Let’s embrace this clean-burning resource.

Andrew Browning is an executive vice president at the Consumer Energy Alliance.

Tags : oil
Andrew Browning