South Carolina should follow Texas’ energy-production lead
During President Barack Obama’s recent trip to Texas, a state in the midst of a historic energy boom, a White House spokesman said that “even though some in Congress are determined to create more self-inflicted economic wounds, there are things Washington could be doing right now to help American businesses, schools and workers.”
One can only hope that the president and his entourage learned a thing or two about jobs and economic growth Texas-style as they toured Austin on the first leg of their “Middle Class Jobs & Opportunity Tour.”
As a spokesman for Texas Gov. Rick Perry put it, Washington can follow Texas’ lead by cutting taxes and spending, rolling back regulations, passing tort reform, and then “getting out of the way and allowing employers to risk their capital and create jobs.”
But if recent history is any guide, we shouldn’t be too optimistic. The Obama administration has consistently tried to thwart the oil and gas economy that is transforming not just Texas but other states including North Dakota, Ohio and Pennsylvania. These surging economies are largely found where states and private property owners are promoting energy development.
What’s the president’s record? Since taking office, he’s pushed for targeted tax increases on American oil and gas firms of more than $40 billion. He’s dragging his feet on the Keystone XL pipeline, a no-brainer for our energy security. He’s sent the EPA into regulatory overdrive to accomplish what he couldn’t with his cap-and-trade idea.
These anti-growth energy policies flowing out of the White House have huge implications for South Carolina. The Palmetto State could be part of an Atlantic Coast jobs boom — as many as 140,000 good paying jobs created — if the federal government allowed offshore oil and gas development.
Gov. Nikki Haley recently joined North Carolina Gov. Pat McCrory and Virginia Gov. Robert McDonnell in a letter to Interior Secretary nominee Sally Jewell voicing support for the offshore drilling (and revenue sharing for the states). The Interior Department’s current five-year plan for selling offshore oil and gas leases from 2012-17 does not include any planned auctions of Atlantic waters.
So what could offshore drilling do for South Carolina?
For starters, our Legislature could establish a permanent trust fund from the tax revenues, based upon the examples of Alaska and North Dakota. In those two states, annual revenues from these funds throw off millions in annual contributions towards education, infrastructure and public safety. Such a fund, along with revenues from the thousands of new jobs it could bring to South Carolina, could forever transform our state.
Why wouldn’t we want for South Carolina what Texas has? Four of the top 10 best metro areas for jobs are in Texas, and smaller cities like Midland are also booming. Since 2001, according to New Geography, “employment in Houston has expanded 20%; in Ft. Worth, it’s up roughly 16%; Dallas 11%; Austin, a remarkable 26.5%; and San Antonio 18.4%.”
For South Carolina and other parts of the nation to share in this boom, we’ll have to have some fresh thinking on energy policy in Washington. To ensure abundant and affordable energy over the long haul, we need policies that spur development.
Targeting American energy firms for billions in new taxes is not just counterproductive. It’s a jobs killer.
Don Weaver is president of the South Carolina Association of Taxpayers, an independently funded statewide research group that studies taxes and government spending.