In the wake of an announcement by the administration to reverse its plans to expand offshore oil and gas exploration in the Eastern Gulf and up the Atlantic Coast, LSU finance professor and nationally renowned economist Joseph Mason released the following statement:
“Uncertainty is a major hindrance for economic growth. Yet, uncertainty has been the hallmark of the administration’s energy policy over the past seven months. Today’s default on its promise of expanded offshore access marks only the latest move by administration officials to saddle our still unstable economy with more uncertainty.
“By imposing a moratorium on deepwater drilling, the administration cost nearly 20,000 Gulf workers their jobs as of September. While the growing tally of jobs lost as a result of its ongoing de facto shallow water drilling ban remains unknown, this much is certain. If the Interior denies U.S. companies the opportunity to buy new offshore drilling leases in 2011, American policymakers will put an astounding amount of economic potential in jeopardy.
“In a 2009 analysis, I determined that America stood to gain $8 trillion in additional GDP, $2.2 trillion in tax revenue over the next 30 years, and 1.2 million new jobs annually by opening access to our offshore resources. Given that those estimates were based on federal inventories of offshore oil and gas reserves that have not been updated for decades, the actual economic benefits are likely much greater. In the same vein, the economic opportunities denied would be much greater too.
“Rather than opening up the pipeline for future economic investment in the Gulf region and other areas with restricted offshore resources, the administration is sealing them off. Washington must steer clear of harmful policies that unnecessarily extend recovery and, instead, focus on efforts which will invite investment, create jobs, and energize our economy.”
Joseph R. Mason is Director and Principal at Navigant Economics, as well as the Moyse/LBA Chair of Banking at the Ourso School of Business at Louisiana State University and a Senior Fellow at the Wharton School.
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Source: PRNEWSWIRE, December 3, 2010; Image: doi.gov