SHOCK! Offshore Drilling Moratorium Would Cost United States 175,000 Jobs Per Year Through 2035

During a 45-minute conference call with journalists this morning, Jack Gerard shared some startling predictions about the future health of the nation’s oil and natural gas industry if the Obama Administration gets its way in adding more regulation and increasing taxes on offshore drilling in the Gulf of Mexico.  The biggest one of all is enough to cause anyone to take pause:

Jack Gerard

“The administration’s moratorium, if continued indefinitely — or similar legislative proposals which would make the deep water unavailable or uneconomic — would cost this country 175,000 jobs every year between now and 2035, according to our latest analysis,” said Gerard, president of the American Petroleum Institute, a group representing some 400 oil and natural gas companies.

And that’s not all!

“The Gulf of Mexico accounts for 30 percent of our domestic oil production and 13 percent of natural gas,” Gerard explained.  “The deepwater areas account for 80 percent of the Gulf’s oil production and 45 percent of its natural gas production.  Twenty of the highest-producing leases are in the deep water.”

When one considers that the oil and natural gas industry, according to Gerard, supports 9.2 million workers and 7.5 percent of all U.S. gross domestic product, even a small percent of decline can have a tremendous impact on the economy.

According to an API-produced report released today, the economic impact of a complete shutdown of deepwater drilling would yield some awful results.  For instance:

  • Reduce direct and indirect employment in the oil & gas and its service industries by 93,000 jobs1 – every year through 2035;
  • Reduce an additional 82,000 jobs every year through 2035 in non oil & gas related industries due to less income in the economy;
  • Reduce annual GDP by over $20 billion per year or a cumulative impact of approximately $500 billion in the next 25 years;
  • Reduce long-term U.S. oil production by 27 percent; and
  • Increase long-term U.S. foreign oil imports by 19 percent.

If you agree that now is not the time to increase regulation and taxation of oil and natural gas companies — or anyone for that matter, CONTACT YOUR ELECTED OFFICIALS IN WASHINGTON, D.C., and DEMAND THEY ACT TO OPPOSE END PRESIDENT OBAMA’S MORATORIUM ON OFFSHORE DRILLING!

FYI: I was joined on the call by representatives of nearly 40 major media outlets, including Bloomberg News, Dallas Morning News, Dow Jones Newswire, Hearst Newspapers, Reuters and The Wall Street Journal, just to name a few.  If/when a transcript of the conference call becomes available, I’ll post it — or a link to it — as an update to this post.

UPDATE 7/27/10 at 1:37 p.m. Central: Cross-posted at

UPDATE #2 7/27/10 at 4:37 p.m. Central: Jack Gerard just issued a statement about the proposed energy bill introduced this afternoon by Senate Majority Leader Harry Reid (D-Nev.).  After calling the provision on oil spill liability a “jobs killer,” Gerard added, “Requiring an unattainable level of insurance coverage for domestic energy producers on the Outer Continental Shelf will force the vast majority of American companies out of U.S. waters….”

President Obama to Hold Banking Summit Monday

"Big Banks" by David Donar at Political Graffiti

Click to enlarge.

President Barack Obama plans to hold a Banking Summit Monday, according to a Bloomberg report today.

Among those participating in the event, said to be a forum for discussing the president’s proposals to boost small-business lending and overhaul industry regulations, will be executives from 12 banks, including Citigroup, Goldman Sachs and JPMorgan Chase and others among the so-called “bailout banks.”

Will small business owners be represented at the one-day event? Doubtful.

Cartoon courtesy David Donar at Political Graffiti.

Greatest Wealth Transfer in Nation’s History No Longer Voluntary, Thanks to President Obama

As recently as two years ago, the prospect of being involved in what was expected to be the greatest transfer of wealth in the history of the United States had financial planners, philanthropists, development officers and others licking their chops. Today, thanks to President Barack Obama, that excitement has waned as involuntary wealth transfer appears to be replacing the voluntary kind that has fueled the nation’s charitable engine for decades.

In a paper (PDF) published two years ago, Paul G. Schervish discussed the transfer of an even-higher amount.  In fact, the director of the Boston College Center on Wealth and Philanthropy estimated that $41 trillion would be transferred by 2052!

The excitement in the world of philanthropy was palpable then.  I know, because I was in it. But it’s not any more.

According to a Bloomberg article (“Obama Bear Market Punishes Investors as Dow Slumps“) today, the Dow Jones Industrial Average has fallen 20 percent since Inauguration Day and has lost 53 percent from its October 2007 record of 14,164.53.

Assuming that the individuals and families once considered likely to participate in the wealth transfer of $41 trillion have been hit equally as hard as the stock market, one can surmise that only $19.3 trillion remains available for transfer.

Factor in the impact of President Obama’s plans to redistribute wealth — by, among other things, raising taxes on so-called “high earners” and greenhouse gas emitters — and the amount remaining to be transferred between generations and to nonprofits becomes even smaller.

We can HOPE for a different outcome.  It is, however, conceivable that, by the time President Obama’s is through, the only assets remaining to be transferred wil be referred to as CHANGE (i.e., nickles, dimes and quarters).

Obama Stimulus Plan Could Ruin Your Health

Tragically, writes Betsy McCaughey in an opinion piece published by Bloomberg yesterday, no one from either party is objecting to the health provisions slipped into the so-called “economic stimulus package” without discussion.

Betsy McCaughey

Betsy McCaughey

And that opinion piece by McCaughey, former New York lieutenant governor and current adjunct senior fellow at the Hudson Institute, has the nation buzzing with concern over the future of the nation’s health care system.

Here’s a sample of her concerns that have generated so much interest:

Republican Senators are questioning whether President Barack Obama’s stimulus bill contains the right mix of tax breaks and cash infusions to jump-start the economy.

Tragically, no one from either party is objecting to the health provisions slipped in without discussion. These provisions reflect the handiwork of Tom Daschle, until recently the nominee to head the Health and Human Services Department.

Senators should read these provisions and vote against them because they are dangerous to your health. (Page numbers refer to H.R. 1 EH, pdf version).

The bill’s health rules will affect “every individual in the United States” (445, 454, 479). Your medical treatments will be tracked electronically by a federal system. Having electronic medical records at your fingertips, easily transferred to a hospital, is beneficial. It will help avoid duplicate tests and errors.

But the bill goes further. One new bureaucracy, the National Coordinator of Health Information Technology, will monitor treatments to make sure your doctor is doing what the federal government deems appropriate and cost effective. The goal is to reduce costs and “guide” your doctor’s decisions (442, 446). These provisions in the stimulus bill are virtually identical to what Daschle prescribed in his 2008 book, “Critical: What We Can Do About the Health-Care Crisis.” According to Daschle, doctors have to give up autonomy and “learn to operate less like solo practitioners.”

Keeping doctors informed of the newest medical findings is important, but enforcing uniformity goes too far.

President Obama and members of the Democrat-controlled Congress — and even a handful of Republican senators — are trying to turn our health care system into a substandard one on par with Great Britain and Canada.  We can’t let that happen!

CONTACT YOUR ELECTED OFFICIALS — as well as turncoat Republican Sens. Arlen Specter of Pennsylvania and Olympia Snowe and Susan Collins, both of Maine — and demand they defeat this pork-laden measure immediately.  Threaten them with your vote.  Say whatever it takes to convince them that the socialized, or nationalized, medicine is something we don’t want.

The turncoat senators can be reached at the following phone numbers:

Sen. Susan Collins (202) 224-2523;
Sen. Olympia Snowe (202) 224-5344; and
Sen. Arlen Specter (202) 224-4254

Don’t wait!  Act now!

Turncoat photos above courtesy Doug Ross @ Journal

* * *

See also: Obama healthcare plan would shut down private sector

Senate Approves ‘Economic Stimulus Package’ (Updated)

UPDATE 2/10/09 at 11:55 a.m. Central: The U.S. Senate just passed the now-$838 billion “economic stimulus plan by a vote of 61-37. It now moves to a conference committee where members of both the House and Senate will iron out their differences over the bill before voting on it again and, presumably, forwarding it to the White House for President Barack Obama’s signature.

In a cloture vote of 61-36, the U.S. Senate voted today in favor of the so-called “economic stimulus package,” a measure that will cost taxpayers nearly one trillion dollars.

By passing the pork-laden measure, members of the Democrat-controlled body have, in effect, voted in favor of raising the government’s commitment to solving the financial crisis to $9.7 trillion, enough to pay off more than 90 percent of the nation’s home mortgages, according to a Bloomberg report today.

Now, the measure –  which has grown to $837 billion, according to an update from the Congressional Budget Office — moves to a conference committee where members of both the House and Senate will iron out their differences over the bill before voting on it again and, presumably, forwarding it to the White House for President Barack Obama’s signature.

Paulson Among Buyers of Failed IndyMac Bank

The FDIC issued a news release Friday to let the world know the agency’s board had approved a letter of intent to sell IndyMac Bank to a thrift holding company controlled by IMB Management Holdings LP.  Though one of the men involved in purchasing the bank shares the same last name as Treasury Secretary Henry M. Paulson, members of the mainstream news media have failed to acknowledge that fact.

A Los Angeles Times report Saturday listed John Paulson as one of two hedge-fund operators (the other being billionaire George Soros) among a small group of owner-investors, while an article published Friday in the San Jose Business Journal noted that the limited partnership includes John Alfred Paulson, the same man.  Neither article, however, deemed it worthwhile to report that the man involved in purchasing a large failed bank shared the same last name as the man who oversees the nation’s banking system, Secretary Paulson.

Noticing that, I decided to see if any other news outlets had seen fit to address the nagging question, “Is John Alfred Paulson related to Henry M. Paulson?” After all, even the pseudo-journalists behind the desk at ESPN Sports Center know enough to toss in an occasional “No relation” upon noticing that two unrelated players who share the same last name.

Surprising me again, none of the articles I found — neither the above-mentioned articles nor others published in the Wall Street Journal Jan. 5, at Jan. 3 and via Associated Press Jan. 3 — addressed the question.  That’s when I decided to ask people who should know.

I called IMB’s corporate offices early this afternoon and was told to send an e-mail inquiry to Armel Leslie at Walek & Associates, IMB’s Madison Avenue public relations counsel.  Twice given the opportunity to respond to the question, “Is John Alfred Paulson related in any way to Secretary of the Treasury Henry M. Paulson?” the PR specialist responded by e-mail as follows:  “No relation” and “Yes, no relation.”

Though I had an answer, I was not yet convinced; therefore, I called the Treasury Department Public Affairs Office in Washington, D.C., and asked them to field a nearly-identical question, “Does Secretary Paulson have any immediate relatives by the name of John Alfred Paulson?”

With true bureaucratic efficiency, the buck was passed at least twice during my phone call before I was dispatched with a promise that someone would call me back with the answer.  Unfortunately, that was almost five hours ago.

Is John Alfred Paulson related to Henry M. Paulson? Perhaps not, but that’s not what motivated me to write this article.  Instead, my chief concern was the news media’s seemingly-collective decision to ignore any possible connection between the men.  That kind of collusion, I fear, might portend a much greater problem for our nation’s future than banking failures.

Author: World War II Was a ‘Relative Bargain’

Barry Ritholtz, author of the soon-to-be-published book, “Bailout Nation,” might have summed up the nation’s financial crisis and subsequent government bailout efforts best when he wrote, “Go figure: WWII was a relative bargain.”

In a post published yesterday on his blog, The Big Picture, Ritholtz reveals research findings that show the government’s $7.75 trillion in bailout commitments will cost more than the combined inflation-adjusted total costs of the Marshall Plan, the Louisiana Purchase, the race to the moon, the savings and loan bailout, the Korean War, the New Deal, the Iraq war, the Vietnam war and NASA’s lifetime budget!

Ritholtz’s revelation comes two days after Bloomberg reported the U.S. government is prepared to provide more than $7.76 trillion on behalf of American taxpayers after guaranteeing $306 billion of Citigroup Inc. debt yesterday. The pledges, amounting to half the value of everything produced in the nation last year, are intended to rescue the financial system after the credit markets seized up 15 months ago.

To see a recent interview of Ritholtz by The Wall Street Journal Online, click here.  The research findings were provided to him by Jim Bianco of Bianco Research.

Hat tips:  Counterpunch and Red County