From today’s IBD editorial “Natural Gas Exports: A Boost The U.S. Economy Needs“:
The boom in U.S. natural gas production should be igniting a market explosion across the world. But opponents of open trade unwisely want to snuff out progress.
Production of natural gas in this country has swelled from 18.9 million cubic feet in 2005 to more than 24 million cubic feet in 2011 (see chart above). Without this boom, due in large part to hydraulic fracturing, our grim jobs market would be even bleaker. Employment in oil and gas extraction grew 26.2% from January 2008 through January 2013, while the number of nonfarm payroll employees overall fell 2.3%. If not for fracking, the jobless rate would be far higher than the already too-high 7.9%.
The thoughtful Washington Post columnist Robert Samuelson calls the “shale-gas boom” the “crown jewel of the disappointing economic recovery.” This nation has a growing glut of natural gas. So why not sell the surplus abroad?
After all, trade, when it’s free — or at least close to it — makes everyone involved better off. It’s not like there are no markets for natural gas out there. Gas prices are three to five times higher overseas, so “customers,” reports Steven Mufson in the Washington Post, “are lining up.”
As of late last year, at least 15 companies were waiting for the government to OK applications to build these structures. Among those standing in their way is Sen. Ron Wyden, the Oregon Democrat, who, speaking for many, says he wants to be sure gas exports won’t harm consumers and manufacturers, both of whom are enjoying cheap gas due to growing supplies.
Wyden’s Energy and Natural Resources Committee is scheduled to meet Tuesday to “consider issues surrounding natural gas, including environmental implications, exports and impacts on the economy.” Don’t expect him to give companies hoping to increase exports a free ride.
Expect him, instead, to be deferential to a trade group called America’s Energy Advantage, a collection of manufacturers (MP: including Dow Chemical, Celanese, Alcoa, and Nucor Steel) that want the government to restrict natural gas exports because they believe exporting will increase their gas costs.
It’s painful to watch politicians and narrow interests block legitimate business opportunities, to see lawmakers pit consumers against producers, granting favored status to one while handicapping the other. It’s galling when the state won’t let legal goods or services be sold to willing customers because it wants to protect a privileged interest. Rather than obstruct, Washington should approve the liquified natural gas facility applications without delay.
MP: In a stunning display of corporate self-interest and rent-seeking, US chemical and steel companies like Dow, Nucor, Eastman and Huntsman that are trying to restrict natural gas exports and are behind “America’s Energy Advantage for Some Big Chemical and Steel Companies Using Other Companies’ Natural Gas,” somehow feel that they are entitled to the natural resources that other US companies extracted from miles below the ground, that they didn’t invest a penny of their own capital to produce, and that they didn’t employ a single worker to develop. What makes this hypocrisy even more offensive is that these rent-seekers disguise their blatant corporate self-interest by pretending that they are concerned about the “public interest.”
To follow-up on a previous CD post, I hereby second my nomination for Dow Chemical, Eastman Chemical, Huntsman Chemical and Nucor Steel to receive the “Rent-Seekers/Protectionists of the
Year Century Award.”