Assault on the Gulf Coast Economy

Irony. President Obama decides to demonstrate his outrage, and show the country that he's hopping mad. I'll tell you what... I live on the Gulf Coast here in Houston, and I'm mad, too. Well, maybe not furious, but definitely concerned. Here's a quote from an AP article titled "Calm no more, Obama lashes out at BP on Gulf visit".

Dogged for being too calm in crisis, President Barack Obama unleashed frustration for all to see Friday, warning BP it had better do right by the people whose lives it has wrecked.

I don't think it's BP that the people of the Gulf Coast need to fear, and it's not BP that seems to be heel-bent on making sure that Louisiana and the Gulf Coast are suffering for years to come. Louisiana's fishing industry is reeling, and will take a beating. There is no doubt that tourism will suffer on the Gulf Coast as a whole. That leaves only a few pillars for the economy to rest on; gambling, the military and... offshore drilling. President Obama has already announced the imposition of a six month drilling ban in the Gulf of Mexico, presumably to give his team time to conduct a leisurely review of the Deepwater Horizon disaster. What do you think might happen to the Gulf Coast in the interim? Bloomberg gives us an idea in an article titled," Obama's Drill Ban May Trigger Job Losses, Slow Gains".

The moratorium will cost as many as 20,000 Louisiana jobs in the next 12 months to 18 months during "one of the most challenging economic periods in decades," Governor Bobby Jindal said in a letter to Obama released yesterday. Each drilling platform idled by the ban puts 1,400 jobs at risk, according to the National Ocean Industries Association, a Washington-based group for drillers and companies that support oil production.

Obama, who plans to visit Louisiana today, declared the moratorium to give a presidential panel time to investigate the April explosion and sinking of the Deepwater Horizon drilling rig, which killed 11 workers and unleashed as many as 19,000 barrels of oil a day. The interruption may extend beyond six months, further crimping U.S. oil-and-natural gas production, raising energy prices and costing jobs, lawmakers have said.

"The last thing we need is to enact public policies that will certainly destroy thousands of existing jobs while preventing the creation of thousands more," Jindal said in a statement.

The moratorium will shut 33 deepwater rigs in the Gulf of Mexico, including 22 near Louisiana, costing as many as 6,000 jobs in the next three weeks and 20,000 by the end of next year, Jindal said. At least 100 miles (161 kilometers) of coast has been fouled by oil and the fishing industry has "huge economic losses," he said. Lost wages could reach $10 million a month for each rig.

I have no doubt that the moratorium will extend beyond six months, and in the mean time, the price of oil & gas will likely rise as he cuts off Gulf of Mexico production. It's not just Louisiana that the drilling moratorium is going to punish. Houston is an epicenter of the drilling industry, with more than a few oil and service companies headquartered here. Like Louisiana, Houston has also suffered some major setbacks; we are also a fishing community, NASA is closing down its manned space programs, the BEA Systems facility that worked on Army fighting vehicles west of Houston has moved to Wisconsin, and Continental Airlines has merged with United and will be moving to Chicago.

I shudder to think what's coming down the pike for the Gulf Coast, and I harbor no illusions about the Obama Administration's intentions do right by the people whose lives will be wrecked.