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END THE OBAMA JOBS MORATORIUM
July 27, 2010

Posted by David Lungren David_Lungren@epw.senate.gov

EPW POLICY BEAT:

END THE OBAMA JOBS MORATORIUM

It was dubbed the "Rally for Economic Survival"-nearly 15,000 Louisianans gathered in the Cajun Dome on July 21st to protest the Obama Administration's jobs moratorium in the Gulf.  The reason was clear: the moratorium is destroying people's livelihoods. "I'm here because I'm worried," said attendee John Henry, whose company does cement work for offshore wells. "We're already slowing things down at work. If companies can't drill, it will get worse."

This is not about Big Oil; it's about the people who earn a decent living because of domestic offshore energy production, which contributes to the goals presumably everyone shares: fueling America's economy and reducing our dependence on foreign oil.  And if there is one brutal fact about the jobs moratorium, it is this: the impacts are widespread, affecting everyone from entrepreneurs and innovators, waiters and waitresses, small and large businesses, hotel and restaurant owners, equipment suppliers and pipe manufacturers, and shrimpers and fishermen. 

As the moratorium continues, tens of thousands of people are running out of options.  Think for a minute about Glenn LeCompte, owner of a Louisiana catering company that provides food to offshore rigs. "It's going to put us out of business," he said of the moratorium. "My payroll probably runs about $150,000 a week. That payroll is going to disappear."  Or Jim Funk of the Louisiana Restaurant Association, who said, "You're looking at figures as high as 30,000 high paying jobs that are gonna be lost as a result of this moratorium.  That will hurt us all the way from Southeast Louisiana all the way over to Lake Charles and Cameron."

Helicopter companies in Lafourche transport 15,000 workers each month to offshore sites.   Rodney Doucet, a parish councilman, told CNN.com that "layoffs have begun." The 1,200 truckers who bring daily supplies to Port Fourchon "are only paid if they're hauling, and they're only hauling if their supplies are needed.  Mechanics who service vehicles, equipment renters, even a tattoo artist fears lost income."

These impacts are not just confined to Louisiana.  As CNN.com reported, "the wires used on rigs come from Texas, the gears from Ohio, and the motors from Tennessee."  And according to a recent study by Louisiana State University, the moratorium will have "spillover effects" on the national economy: it will cost $2.8 billion, kill 12,000 jobs in six months and 36,000 jobs in 2011.  The federal government also will lose about $220 million in tax revenue. 

If President Obama is serious about spurring job creation, there's no better place to start than with his Gulf jobs moratorium.  End it, and end it now. There's no question that ensuring safe and environmentally responsible energy production is important and necessary, but those goals can be achieved as production continues.  Slapping an arbitrary cease and desist order on the industry costs jobs and undermines safety. 

But don't take our word for it.  Recall several of the expert panelists who reviewed the Interior Department's report assessing safety on offshore rigs after the Deepwater Horizon disaster.  The Interior report misleadingly implied that those engineers supported the report's recommendation to impose the moratorium.  The experts made clear that they did not.  As they wrote in a letter explaining their views: "A blanket moratorium is not the answer. It will not measurably reduce risk further and it will have a lasting impact on the nation's economy which may be greater than that of the oil spill...We do not believe punishing the innocent is the right thing to do."

Meanwhile, the damage to the innocent continues, and there's little reason to think the Administration will change course.  Perhaps the plight of thousands will change hearts and minds in the White House.  "I'm hoping Obama gets the message," said Allen Comeaux, a truck driver whose customers include oil companies. "It's not just the people out on the rigs, it's the people driving trucks, delivering services, and selling food."

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