|Move over Jed…|
If the U.S. economy seems to be inching slowly toward recovery, the real credit should go to the energy sector. That’s where the new jobs and wealth seem to be coming from. As the Wall Street Journal points out today (subscription required), there are sections of the country that are booming thanks to the dramatic increase in energy production. And just to get clear here, we’re not talking about solar or biodiesel: we are talking good old fashioned fossil fuels. Oil and natural gas domestic production in booming, thanks to new technological developments. The Journal offers one number that is incredibly impressive: ”Some $145 billion will be spent drilling and completing U.S. wells this year, up from $13 billion in 2000…” This is creating jobs, high-paying jobs, not just in the energy sector but in spin-off sectors like housing. Home builders in Idaho are doing great business building homes for oil workers in North Dakota. Landowners are getting rich selling mineral leases to producers. (In Pennsylvania alone, the industry paid out $6 billion from 2008 to 2010.) And the same time, booming production is helping drive down natural gas prices to record lows, which benefits consumers. It also cuts costs for energy-intensive manufacturers, like the plastics industry.
Competitors in Asia pay six times the price for natural gas.
All the more amazing is that this is taking place as Washington continues to block energy production at every corner. It’s American industrial ingenuity that is going to turn things around. Not “whiz-kids” in Washington.
But that won’t stop them from taking the credit.