Where the boom is allowed to happen

This post starts out with a video. Watch it and then read what I say next.

Call it propaganda from oil company shills, but the fact remains: North Dakota leads the nation with the lowest unemployment rate – even better than Washington, D.C. They have 3% unemployment, which is 0.9% better than the next state on the list (Nebraska) and a full 3.8% better than Maryland’s number. The BLS also notes that “the largest over-the-year percentage increase in employment occurred in North Dakota (+6.8 percent).”

I will caution that fracking isn’t a panacea for all unemployment ills – Pennsylvania could eventually add over 200,000 jobs related to the energy industry by decade’s end but still has a higher overall unemployment rate than Maryland does.  Part of the reason for North Dakota’s success is that it really had few other job producers before energy companies invested heavily into the Bakken play; as one observer notes in the video it wasn’t all that long ago that young people left the area because no jobs were available.

And note that not all the jobs are directly related to energy extraction, with one entrepreneur featured in the video opening her own diner and others getting work from the surge in construction. Obviously that industry will mature as supply catches up to demand but there will be other needs which will eventually have to be addressed in a growing area.

Maryland has a small piece of the Marcellus Shale formation; unfortunately the state seems to be dragging its feet on allowing its exploitation. The two counties which would stand to most benefit, though – Allegany and Garrett – have unemployment rates just about the state average as of April, with both coming in just above 7 percent. Granted, we aren’t talking about a large population center – the two counties combined are just a shade larger than Wicomico County by itself and only a small fraction of Maryland’s overall population. But imagine the impact of 2,000 new jobs in that area – I’m not saying that would necessarily be the case with fracking but that’s certainly in the realm of possibility.

It can’t hurt, can it? Moreover, cheap and abundant energy can bring industry – unlike far-off North Dakota, the western edge of Maryland is within a day’s drive from a number of large markets because of its reasonable highway access. And their success would make life just a little easier on us in the rest of the state as Annapolis can have another source of income besides raising taxes. A rising tide lifts all boats.

Why should the barren, frigid wasteland of North Dakota have all the energy fun? Let’s open Maryland up for business.

The McDermott notes: weeks 11 and 12

Yes, I missed last week, but Mike had such a long week I didn’t have a chance to post in a Sunday slot – and I had a lot to write about anyway.

We’re now at the point in session where the hearings have pretty much ended and the House is now taking up a number of bills which have passed through the Senate. But as Mike wrote at the top of his Week 11 notes, “The news I bring you this week from Annapolis is not good.”

Some of the lowlights included the passage of a bill to further hinder Maryland’s opportunity to join in on the Marcellus Shale bonanza. “There was a significant amount of propaganda put forward by Chairman McIntosh citing many ground water contamination concerns”, wrote McDermott. “Although none of these instances has shown to have been caused by hydraulic fracturing in the process described, the chairman is a believer and is not swayed by many known facts.” But as he describes in week 12, there’s no problem with rushing offshore wind.

Continue reading “The McDermott notes: weeks 11 and 12”

Environmentalist doesn’t tell the whole story

A good friend of mine tipped me off to this op-ed in the Baltimore Sun from March 5 and encouraged me to write a rebuttal. The paper wouldn’t take it as an op-ed nor run a shortened version as a letter, so in the spirit of never letting good writing go to waste I’m posting it here.

As the energy industry has arrived in our state in hopes of extracting the natural gas which lies underneath in the Marcellus Shale formation, the term fracking has become part of our vocabulary. As a Maryland resident who has no stake in the energy industry, aside from my role as a consumer of those elements used to create the gasoline and electricity I need for my various jobs and the heating oil I use to heat my hot water and household, my main concerns are twofold: reliable energy which doesn’t cost me an arm and a leg. I suspect those concerns are shared by a vast majority of us.

The cost competitiveness and abundant supply of natural gas gives Americans a great asset, but only if we choose to take advantage of it. This choice, though, is one environmentalists want to frighten us away from because natural gas is not a renewable source. And it’s obvious that some people just can’t stand prosperity as a recent op-ed by Sierra Club executive director Michael Brune demonstrates.

In his piece Brune disparages the entire natural gas industry with a palette of half-truths and wild assumptions. But the bad news for Marylanders is that Brune seems to have the ear of Governor O’Malley. It’s obvious that both are only too happy to impact the coastal environment of the Atlantic as well as areas of western Maryland by building noisy, unreliable, and unsightly windmill farms because they’re perceived as the politically correct thing to do, but those tried and true methods of getting the energy and job creation our state desperately needs are unappealing to them.

And the allegations that Brune makes don’t stand up to scrutiny. For example, hydraulic fracturing has been used in more than one million oil and natural gas wells in the United States since the 1940s, and despite Brune’s strictly anecdotal reports to the contrary not one confirmed case of groundwater contamination stemming from fracturing has been documented, according to a recent University of Texas study. And regarding his shrill warnings about the dangers of piping the natural gas he fails to mention that natural gas is already piped to points across the country via a network spanning well over 300,000 miles nationwide – including almost 1,000 miles lying under Maryland and Washington, D.C. An existing pipeline already services the Cove Point LNG terminal!

One has to wonder why Brune isn’t telling you those facts I easily found with a little bit of research. Perhaps it’s because he wants us to “invest in” (read: subsidize with taxpayer dollars) sources like wind, solar, and geothermal, as well as emphasize energy efficiency. Most of us realize taxpayers can pump all the money we want into these sources but we can’t spend our way into making the wind blow just the right speed to make turbines work effectively all the time, nor can we compel the sun to shine 24 hours a day. Geothermal energy is more promising, but has a limited amount of effectiveness and also requires hazardous pipeline fluid chemicals to handle the wide temperature swings.

And while we should strive for cost-effective energy efficiency, it shouldn’t come with a price tag of reducing our standard of living. A shuttered coal plant is neither efficient nor a job producer, but it’s a badge of honor to a radical like Brune. For those placed out of work by the closure, though, it’s only their economic livelihood they’re losing. No doubt Brune and O’Malley would gladly “invest” government dollars into teaching them the skills needed for a non-existent “green” job.

Environmentalists could be taken more seriously and provide a better service to residents by not obfuscating their argument with scare tactics. Most people have the sense to know that fossil fuels won’t be around forever, but for the foreseeable future the market favors reliable sources of energy including natural gas. If you’re enjoying the current decline in natural gas prices and the resulting extra money in your pocket, you can thank hydraulic fracturing because it’s that decades-old “new” technology increasing supplies, driving down prices, and actually bringing back a discussion about helping our nation’s balance of trade by exporting natural gas.

Who would have ever thought we could beat OPEC at its own game? Let’s put Maryland to work building for the prosperity of tomorrow by making use of that which we have in abundance.

Movin’ on out

As I’ve said from time to time on this forum and others, Maryland is the first place (besides, to a limited extent, my college alma mater) where I lived by choice. And the main reasons I moved here, as opposed to other prospective places where I could have worked like Jacksonville, Las Vegas, or Phoenix, were the somewhat rural setting and the idea that this area had plenty of room for growth. Needless to say, when compared to those urban areas, Salisbury was by far the smallest location I considered.

There are serious economic handicaps about living here which have always existed more or less, but at the time of my arrival they were held somewhat in check by the state government in place in the fall of 2004. Sure, Bob Ehrlich was no doctrinaire conservative but most of his ideas for revenue enhancement were limited to increasing user fees, and Maryland participated fully in the national economic boom which was taking place during the Ehrlich era here. Unemployment for the state was just 4.4% when Ehrlich took office and 3.6% when he left – the rate never exceeded 4.6% during his tenure. Obviously things are different now, and Maryland reflects the national situation in that respect. Oddly enough, though, the other three places I was considering were among the hardest hit by the recession, so while Salisbury never quite reached that exhilarating height this fact made the low point easier to handle.

Continue reading “Movin’ on out”

Odds and ends number 29

Since I started cleaning out my video archives last night, today seems like a perfect time to do the same with my e-mail box. As always, these are interesting items but ones to which I need only devote a paragraph or two.

In the 2008 election I found the Club for Growth a valuable resource, as did Andy Harris (for a different reason.) And once again they are preparing white papers on each of the major GOP candidates; so far they have released two for Newt Gingrich and Tim Pawlenty. Others on the horizon (once they officially announce) are Mitt Romney, Sarah Palin, Rick Santorum, Jon Huntsman, Ron Paul, Michele Bachmann, and Herman Cain. (They may have to add Texas governor Rick Perry to that list.)

One thing which might be a campaign issue for the Club to consider is the price of gasoline. While it’s retreated slightly from its peak of a few weeks ago, there’s still a long way to go before we reach the price point of a couple years back when our current President took office. But instead of shifting blame, the problem could be solved in a matter of weeks according to the Heritage Foundation:

Others, like the American Petroleum Institute, are chiming in as well. The fact of the matter is that increasing our domestic production could assist in bringing down the price because over 2/3 of the price comes from the crude oil itself. More supply to meet the demand commonly means lower prices.

And maybe I should share this graphic with the Maryland General Assembly – I know a lot of them read here – since they’re trying to cut the western end of the state out of the Marcellus Shale bounty.

(Thanks to some good friends of monoblogue, Ericka Andersen and Jane Van Ryan, for sharing. I have another Maryland energy-related piece for tomorrow too.)

And then we have the newly redesigned fuel economy stickers for 2013 models. Now there’s a little bit of sense in trying to compare the apples and oranges of electric cars vs. conventional fuel models, but the EPA isn’t telling the full story. And considering their original intent of giving letter grades for fuel economy (with electric vehicles rating an A and SUVs generally getting a D) we can see how they’re trying to influence behavior of the carbuying public rather than letting the market determine our fate.

Let’s change the subject and return to someone mentioned above. Perhaps you recall how Newt Gingrich savaged the Ryan plan for Medicare, much to the chagrin of conservatives and others who feel Medicare is unsustainable. Well, in an e-mail to supporters and others who happen to be on his list, he furiously backtracked:

The only way our country can win the future is by engaging our fellow citizens in serious discussions about major reform—not by avoiding hard choices. Congressman Ryan has made a key contribution to entitlement reform, courageously starting the conversation about how to save and improve Medicare. And that’s exactly the kind of national conversation I want our campaign to be about!

There is a reason over 1.4 million Americans are joining me in the online conversation to help win the future.

Yes, Newt, you were busted. But it is interesting to know that you have 1.4 million on your e-mail list.

So my mailbox is now relatively clean, and hopefully you’re much more well-informed.

Conway, Mathias join O’Malley in electric rate hike bid

It’s more than just the regular hot air coming from Annapolis – in this case, they want to mandate that it turns a wind turbine.

Proponents of a wind farm off Ocean City say electric rates could ONLY increase $1.44 a month for residential electric customers, but others claim it could be more like $3.61 per month. Or it could be much, much more – what government-sponsored plan ever comes in on time and under budget?

Included in that group backing the rate hikes are Delegate Norm Conway and Senator Jim Mathias. They are respectively co-sponsoring House of Delegates and Senate measures that will force utilities to purchase power from a offshore wind farm which could be on line as soon as 2016, according to a recent Washington Post story by Aaron C. Davis and Steven Mufson. Never mind that:

  • the project will produce power at 16.4 cents per kilowatt hour (the average going rate is about a dime.) I thought wind was free!
  • O’Malley’s former Chief of Staff, Michael Enright, is spearheading the effort for one company to secure federal leases. No conflict of interest there, move on, there’s nothing to see…
  • The last line of the Post story: “Banks consider the projects high-risk, so developers are seeking Energy Department loan guarantees to bring down financing costs.” Can you smell the pork? I can.

Contrast this with O’Malley’s approach to extracting the proven and much less expensive natural gas reserves at the opposite end of the state, our small portion of the Marcellus Shale formation. He’s supporting a moratorium on natural gas permits until August, 2013. (A bill dubbed the “Marcellus Shale Safe Drilling Act of 2011” is also in both the House of Delegates and Senate; notably, none of the co-sponsors are from the affected area. Instead, it’s the usual gang of limousine liberals, mainly from MoCo.)

If it wasn’t already crystal clear, this is more proof that O’Malley and his environmentalist wacko friends are just a bunch of liberal do-gooders who would love to saddle the average consumer with much higher energy costs. Even if they wouldn’t love to do so, their actions will create the situation of making Maryland even less industry-friendly than it already is, if that’s indeed possible.

A far smarter approach would be to leave the wind farmers (who ironically are leasing territory originally intended for oil exploration) twisting in the wind and let the natural gas companies do what they do best out west in the Maryland panhandle. Considering unemployment in two of Maryland’s three far western counties was above even the national average in December, they sure could use the jobs that natural gas exploration would bring.

And I’d rather have jobs in the hand now than those pie-in-the-sky green jobs in the bush, perhaps three years down the road (if they ever come at all.) The electric ratepayers of Maryland, who already get about 3% of their power from natural gas, would be thankful as well.

As for the duo of Conway and Mathias, well, we see where their loyalties lie. Sure, there could be some temporary job creation as these windmills are built, but those rate increases are much more permanent. It’s worth noting that Delegate McDermott isn’t signed on so apparently he stands with the ratepayers and not the special interests and friends of O’Malley. But I repeat myself.