Energy, Jobs and the American Dream

Mark Green
Posted July 26, 2013

President Obama gave another speech on jobs and economic growth this week in Illinois, sounding some themes he has touched on in the past, which we’ve noted here and here.  Generally, the president is right that rekindling the American Dream depends largely on creating the opportunity for people to work in secure, well-paying jobs. Here’s how he put it earlier this week:

“What makes us special has never been our ability to generate incredible wealth for the few, but our ability to give everyone a chance to pursue their own true measure of happiness. We haven’t just wanted success for ourselves – we’ve wanted it for our neighbors, too.  That’s why we don’t call it John’s dream or Susie’s dream or Barack’s dream – we call it the American Dream. That’s what makes this country special – the idea that no matter who you are, what you look like, where you come from or who you love – you can make it if you try.” 

Earlier in the speech the president lauded “new American revolutions” in energy, technology, manufacturing and other sectors as keys to providing job and economic opportunity. And he’s right. America’s oil and natural gas industry is driving economic growth, with more than $545 billion in capital spending, wages and dividends in 2011. It’s deploying innovative technologies to develop vast shale reserves, producing a natural gas surge that could make us the world’s leader and also skyrocketing oil production that in just the past two years has grown more than 2 million barrels per day. AEI’s Mark J. Perry’s chart:

And his thumbnail analysis:

“A two million bpd increase in US oil output in only 24 months, almost exclusively from the dramatic increases in shale oil production made possible by revolutionary drilling technologies, is an important energy milestone and has to be one of the most remarkable success stories in the history of US energy production. Welcome to America’s shale energy revolution, which continues to be one of the strongest reasons to be optimistic about the US economy.

Our point exactly! Better yet: Our industry can do more if given the chance. The challenge is for policymakers to see this fantastic energy opportunity, literally at America’s feet, and how relatively little is needed to capitalize on it.

The president is concerned about the middle class? Let’s pursue pro-growth energy strategies to generate the fuels that run and expand our economy while creating well-paying jobs – jobs that are creating economic mobility for thousands of Americans, for example, in the Bakken region of North Dakota and Montana. (See this New York Times article on a study showing that when it comes to ascending the economic ladder, location – and a good energy industry job - matters.)

The president says he’ll fight for sustainable growth that can help a broad swath of Americans:

“The first cornerstone of a strong and growing middle class has to be an economy that generates more good jobs in durable, growing industries. Over the past four years, for the first time since the 1990s, the number of American manufacturing jobs hasn’t gone down; they’ve gone up. But we can do more.  So I’ll push new initiatives to help more manufacturers bring more jobs back to America.”

Already happening, Mr. President. Thanks to the shale energy revolution, fostered by hydraulic fracturing and horizontal drilling, U.S. manufacturing is resurgent, as this NPR report details. Steel for pipe and other equipment, chemicals and other products derived from oil and natural gas, computer technology for state-of-the-art control systems and more.

Oil and natural gas is that “durable, growing” industry the president mentioned, supporting 9.2 million U.S. jobs. And we can do more. With increased access to oil and natural gas reserves, a common-sense regulatory approach and policies that encourage energy investment, our industry could generate more than 1 million new jobs by 2020, according to Wood Mackenzie.

Part of the way forward was mentioned above: simply recognizing the energy wealth we have and what it can do for our economy and future energy security, and charting a direct path to put American energy to work for Americans. The president is concerned about gridlock in Washington processes, yet he can get things moving on the largest, shovel-ready infrastructure project around by approving the Keystone XL pipeline, which the State Department says would create 42,100 annual average jobs over the pipeline’s construction period – jobs American workers want.

The American Dream still works – with policies and strategies that create opportunity to live out the dream – and energy can help lead the way.