The Ongoing Deepwater Drilling Disaster

Larry Bell, 12.08.10, 12:00 PM EST

Democratic delusions, denial and demagoguery.

Mindful not to waste a perfectly good crisis, the Obama White House and influential congressional Democrats have seized the BP Deepwater Horizon disaster to assert a continuing stranglehold control over offshore drilling operations. On Dec. 1 Interior Secretary Ken Salazar’s seven-year extended prohibition on new oil and gas development off the Florida and eastern Atlantic coasts is once again adding enormous penalties to our already ailing economy and employment market. Costs include many thousands of lost high-skilled job opportunities, increased energy and product prices, more industry relocations overseas and greater dependence upon foreign oil imports.

The Louisiana Mid-Continent Oil & Gas Association has projected that each deepwater rig represents about 1,420 potential jobs, with salaries averaging $1,804 per week. The moratorium will force rig owners to locate their costly platforms, experienced safety-savvy employees and the prosperity and fuel products they generate in more politically friendly foreign venues such as Brazil, China and North Sea sites.

The decision to put the eastern Gulf of Mexico and Atlantic coast off limits to oil drilling has reversed policies that President Barack Obama embraced earlier this year. In April he had announced that “in order to sustain economic growth and produce jobs, and keep our businesses competitive, we are going to need to harness traditional sources of fuel.” Accordingly, he proposed a plan to expand oil and natural gas exploration in the Atlantic, the eastern Gulf of Mexico and Alaska.

Did this apparent departure from the traditional opposition of his very liberal base signal a “drill, baby, drill” epiphany? Or was it primarily a cap-and-trade bargaining strategy? A brief review of some background events might shed a bit of light.

In 2008 public anger over gasoline prices prompted the Bush White House and Congress to lift a long-standing ban on offshore drilling and approve a five-year plan to open a significant portion of the Outer Continental Shelf. This included a lease to begin drilling off the Virginia coast that was to be bid out in 2011. Secretary Salazar later postponed the deal until 2012. Suspicious minds suggested that the reason was to provide time for activist environmental groups to fight implementation in courts.

On Feb. 10, 2009, a new moratorium was placed upon aspects of the Bush plan that would have allowed leasing along the North Atlantic and Pacific coasts. Then on March 31, 2010, the big news was that President Obama vowed to support development of leased areas located off Alaska’s North Slope (referring to a $2.6 billion deal in the Chukchi sea that had been signed in 2008), and that his administration agreed to “study” possible drilling along the South Atlantic coast. Not highlighted in the press was his plan to cancel five other Alaskan leases, including two in Chukchi.

The Obama-Biden administration offered to allow drilling along a strip in the eastern Gulf, 125 miles off the coast of Florida–but there was a big catch. This drilling would require congressional approval, and 10 coastal-state Democrats had recently declared opposition to offshore drilling, presenting a big but not necessarily insurmountable obstacle … at least not if republicans would throw support behind his Comprehensive Energy and Climate Bill (aka, the newly proposed “Power Bill,” or cap-and-trade).

Speaking at a solar panel fabrication plant in Fremont, Calif., on May 26, 2010, Obama used the strategically staged opportunity to connect the Deepwater Horizon disaster with a “green energy” agenda, saying, “Climate change poses a threat to our way of life. In fact we’re already beginning to see its profound and costly impact. … And the spill in the Gulf, which is heartbreaking, only underscores the necessity of seeking alternative fuel sources.”

Any chances for coastal state Democratic congressional leaders to successfully bargain with Republicans to gain support for climate change legislation rapidly waned as attacks on offshore drilling escalated in the aftermath of the BP ( BP – news – people ) oil spill. Whereas late 2009 legislation provided for “additional onshore and offshore oil and gas exploration,” Sen. John Kerry, a principal bill author, confessed in a May 10 Investor’s Business Daily interview that changes had to be made to win necessary Democrat votes in the wake of the oil spill. They included a provision that allowed any coastal state to ban drilling otherwise permitted by a neighboring state within 75 miles of its coastline if mandatory studies indicated that an accident could harm that affected state’s economy or environment.

Read more here.


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