The Oil Spill and Bad Energy Policy

Jane Van Ryan
Posted July 30, 2010

With the House and the Senate poised to vote on energy bills before the August recess, editorial and op-ed writers are taking Congress to task for neglecting the primary issues confronting the United States today--jobs and the economy.

At a time when millions of Americans are out of work and worried about their family budgets, they say Congress and the administration are using the oil spill to enact legislation that could do more economic harm than good:

In a Houston Chronicle op-ed, Harry C. Alford of the National Black Chamber of Commerce writes that Congress is addressing the Gulf oil spill "calamity with an even more damaging response--tax increases on our domestic oil and gas companies." He says the unemployment rate in the African-American community stands at 15.4 percent. "Couple this with national unemployment still at 9.5 percent and these new tax burdens simply amount to a recipe for continued hardship."

An Investor's Business Daily editorial says the oil spill "pales in comparison to the self-inflicted wound of increased energy regulation and taxes and the Obama administration's moratorium," and it states the administration "has succeeded in turning a crisis into an economic disaster." The editorial notes that three deepwater rigs have left the Gulf so far, and it cites information from the National Ocean Industries Association (NOIA) which says a six-month moratorium could result in the loss of 50,000 jobs and about $2 billion in lost wages.

Similarly, Bruce Vincent, chairman of the Independent Petroleum Association of America and president of Swift Energy, says Congress is "working aggressively to enact far-reaching policies and billion-dollar tax increases that will lead toward less stable energy costs, fewer jobs and increased dependence on unstable regions of the world for the energy we need." In an op-ed in The Washington Times, Vincent says Americans deserve better. They need "common-sense tax and regulatory solutions aimed at safely leveraging our nation's resources into even more jobs...."

API's analysis of the legislative proposals combined with an indefinite deepwater drilling moratorium indicates the United States could lose 175,000 jobs every year and experience a 27 percent drop in domestic oil production. It's time for Congress and the administration to reassess their priorities.