Photo via UK Today
We've spent most of our time here detailing how the BP Gulf spill is impacting the environment, and discussing the event's significance in terms of our nation's energy future. But there's another important element that needs to be considered, and that's the massive economic impact the spill will have. Between the loss of jobs in the tourism and fishing industries around the Gulf, as well as those lost from the moratorium on offshore drilling, at least one analyst says that one million people will be out of work as a result of the spill. Now, this is important to consider for a few reasons -- first, the long-term loss of income for the thousands of fishermen, charter boat operators, and others will certainly be devastating. The $20 billion Obama forced BP to set aside (and for which some Republicans apologized for) is a fund created to help those people recoup their losses. It may or may not be adequate to do so, depending on a number of factors -- it may be too small.
But the other source of lost jobs is bound to be a greater source of controversy -- and it's why we're already seeing a bevy of politicians calling for more offshore drilling in the midst of the greatest offshore drilling-caused crisis the US has ever seen. Offshore drilling employs hundreds of thousands of people in high-paying jobs -- many of whom already are or will be left out of work from the moratorium.
Here's that aforementioned analyst, David Kotok, on the potential impact of the offshore drilling ban:
We estimate that an extended moratorium, which we now expect to continue because of Obama political calculus, will cost up to 200,000 higher-paying jobs in the oil drilling and oil service business and that the employment multiplier of 4.7 will put the total job loss at nearly 1 million permanent employment shrinkage occurring over the next few years.Obviously, the ban was instated for reasons beyond 'political calculus' (though that certainly played a role). The CEOs of other major oil companies themselves have admitted that they aren't able to deal with such oil spills if they should occur -- the revelations from the Deepwater Horizon disaster make clear that we've been playing with fire.
Nonetheless, the moratorium will leave a void in the economy, and will cause many people serious pain (even if Kotok's figures are over-dramatic). There's going to be increased pressure for the administration to remove the offshore ban, especially after the well is plugged (if that ever happens ...). And obviously, it's not a good idea to allow further deep water drilling -- we've seen firsthand how high the stakes are, and how devastating the consequences.
So Obama needs to find a way to address the economic pain caused by the moratorium. He's reportedly attempting to get BP to help fill the gap, but that likely won't suffice. This could be an ideal opportunity to implement some sort of fossil fuel-to-renewable program that provides incentives to employers in cleaner energy fields (or other green jobs) to hire workers from the fossil fuel industries. Or to provide major tax incentives for clean energy companies to set up shop or expand in the Gulf. Some such program that hires oil workers to work in clean energy would of course also have a symbolic significance, too.
Hey, it's a thought ...