Obama administration policies have caused “irreperable harm” to the Gulf Coast economy, stifling the energy sector and culling employment within it to a degree previously underestimated by the administration itself.
That is the conclusion drawn by Louisiana State University economics professor, Dr. Joseph Mason, author of a new critique of the Obama administration’s Inter-Agency Economic Report released last week estimating losses due to the deepwater drilling moratorium currently in effect. According to Dr. Mason, that report understated the ban’s impact on job losses by as much as 60 percent.
During a conference call Tuesday, Mason criticized the administration’s methodology for calculating the economic effects of the ban, and said the administration used inflated, flawed logic to calculate its valuation of economic offsets—such as unemployment wages—and their counter effects on the economic downturn. He said the report was inaccurately rosy in describing the Gulf States’ economic recoveries following the BP spill.
“Those states have been irreparably harmed,” Mason said. “Essentially all of these economies have taken the summer off and are trying to get back to the baseline.”
Mason said the Obama administration’s approach, harming business activity in the name of environmental defense, was part of a broader trend of stifling economic growth. He said administration officials did not approach him for advice on their analysis and that no serious forecasting was conducted prior to the ban.
“I find it quite honestly shocking that an economic analysis was not undertaken prior to the policy being put into effect,” Mason sad. “[T]here’s been a growing influence in the Environmental Protection Agency over roughly the last decade to undertake environmental policy without economic consideration whatsoever.”
The critique comes at a time when the Obama administration has also been taking fire for pursuing tax hikes that would target the energy sector. On Wednesday, the U.S. Chamber of Commerce held a conference call during which these proposed tax hikes were discussed. Speaking on the call were Dr. Daniel Yergin and David Hobbs of IHS Cambridge Energy Research Associates, co-authors of a new report detailing how U.S. tax policy impacts the competitiveness of American companies, globally.
According to Hobbs, legislative proposals such as the possible tax changes could exacerbate disadvantages already experienced by U.S. companies, making them less competitive than companies from other countries analyzed in that report. Yergin and Hobbs say that is because companies from countries such as Canada, China, Italy, the Netherlands, Norway, Russia, and the United Kingdom pay less tax on repatriated income than do American companies. This in turn gives them a competitive advantage, which would presumably be expanded were the proposals being pursued in fact implemented.
Were such changes pursued, said one industry expert, it would be more bad news for energy workers, many of whom live along the Gulf Coast. ”And apparently,” that expert added, “they’ve had more bad news than the government itself either thought or wanted people to believe.”