Horse apples from a NRCC sock puppet: another Davis talking point bites it
Had we but world enough and time, we might be able to shovel the streets clear of all the horse apples left behind by the Brian Davis campaign. As it is, we often come across the facts while reading about other matters.
So it is with his claim about drilling-related job creation in his Rochester Post Bulletin column back in the beginning of May. This column is one of several places where Davis repeated the urban legend about Chinese-Cuban drilling off the coast of Florida. Now we find more malarkey. He wrote:
. . .the Teamsters union which estimates that over 700,000 jobs would result from this effort.
It's true that the Teamsters made that claim back in 2001, though only about ANWR. How did the union arrive at the claim? How accurate was the estimate?
Turns out that the Teamsters took flack at the time for using the figure, which was drawn from a then-decade-plus-old study by the American Petroleum Institute. In Some Shaky Figures on ANWR Drilling, Time magazine noted:
As for the 700,000 jobs, that number comes from an 11-year-old study commissioned by the American Petroleum Institute that economists complain wildly inflates the employment potential. "It's just absurd," says Eban Goodstein, an economist at Lewis and Clark College, who predicts the real job growth will be less than one-tenth that number.
The Juneau Empire looked at the dispute in 2002. Learn what it found beneath the fold.
It reported in part:
. . .But some independent economists call the figure highly suspect, based on a 12-year-old study using assumptions that may or may not be valid. A separate study for the Energy Department estimates about a third as many jobs. Environmentalists say a more accurate number - though disputed as well - would be about 50,000.. . .
Turns out the study the Teamsters cited seven years ago is now eighteen years old:
. . .The Teamsters cite a 1990 report written by WEFA Group, an economic consulting firm, for the American Petroleum Institute, the oil industry trade group.
But Teamsters lobbyist Jerry Hood said in an interview he now prefers to talk of "a range" of anticipated jobs from ANWR development of from 250,000 to 735,000. "Jobs creation is an art. it's not a science," he said.
Hood's lower figure comes from a 1992 study done for the Energy Department by DRI-McGraw Hill, another consulting firm, that projected 222,480 jobs from ANWR drilling.
Pfeifle said he does not know whether [then Department of Interior Secretary] Norton has seen the 60-page WEFA report, a copy of which was obtained by The Associated Press. He said he had never heard of the 1992 study for the Energy Department.
The authors of the 1990 WEFA study no longer work at the company, according to a spokesman who acknowledged it was "a bit out of date."
"We would not come up with the same numbers today," said Mary Novak, an economist and managing director of WEFA's energy programs. . . .
There's more at the Juneau Empire; go read it. Finally, the environmental group NRDC stated in Fuelish Claims: Jobs and the Arctic National Wildlife Refuge:
The WEFA study predicted that Arctic Refuge development and oil production would generate 735,000 jobs.2 How did WEFA arrive at this conclusion? It assumed that oil from the refuge would lower world oil prices by as much as $3.60 a barrel, which would have a ripple effect on the U.S. economy, producing jobs in the petroleum, trucking, steel, shipping and manufacturing industries nationwide.3
How credible is the WEFA job scenario? A number of critiques found it implausible.
- In 1992, the
Congressional Research Service (CRS) concluded that WEFA's estimate of
employment gains and effects on GNP were "generous" and were based on
"the more, or most, optimistic of underlying scenarios."4 A more recent CRS report, issued in October, predicted that oil drilling in the refuge would generate 60,000 to 130,000 jobs.5
- In 1994, economist Eban Goodstein, who analyzed the WEFA
numbers for the Economic Policy Institute, argued that a more sensible
calculation would have attributed job gains to an increase in demand
for labor and domestic capital goods generated by oil development.
Using that yardstick, Goodstein concluded drilling in the Arctic Refuge
would generate only 55,000 jobs nationwide -- less than 8 percent what
the WEFA study predicted -- for a period of five years.6
- In 1996, the Oil, Chemical and Atomic Workers Union -- which
represents hundreds of workers in the Alaska oil fields -- came out in
support of protecting the Arctic Refuge from drilling. In a letter to
President Clinton, OCAW (now the Paper, Allied-Industrial, Chemical and
Energy Workers International Union (PACE)) said the oil industry's
claims that Arctic Refuge development would produce hundreds of
thousands of jobs across the country are "highly dubious." According to
the union, the industry's job estimates "derived from an economic model
based on the effects of presumed lower oil prices across the nation and
is not a characterization of new, real oil patch of manufacturing jobs."7
- In September 2001, Dean Baker, an economist at the Economic Policy Institute, found that the WEFA study's conclusions rested on "clearly wrong and improbable assumptions." Basing his calculations on current estimates for oil prices and Arctic Refuge oil reserves, and the relationship between U.S. employment and global oil markets, Baker projected that refuge development would create only 46,000 new jobs, many lasting a decade at most. According to Baker, "This number of jobs is fewer than what the economy generated in an average week over the years 1997 through 2000."8
That
was written in 2001. No reliable recent study that we can find has
suggested that drilling in ANWR would lower world oil prices $3.60 per
barrel.
More recently, in June 2008, MSNBC revisited the question, reporting:
. . .According to current estimates, the total volume of recoverable crude in ANWR is 5.7 billion barrels for the low estimate, 10.4 billion barrels for the mean estimate and 16.0 billion barrels for the high estimate.
But even in the best case, the price impact — decades from now — would amount to about 1 percent of current market prices. If work started today, production would peak in 2027 — when increased production would have the biggest impact on prices. According to Department of Energy projections, that impact would cut the prices of light sweet crude (in 2006 dollars) by 41 cents per barrel in 2026 for the low estimate, 75 cents per barrel in 2025 for the mean oil resource case, and $1.44 per barrel in 2027 for the high estimate.
US News and World Report said the same thing back in May, and others have noted the facts since. Since one of the baseline assumptions of the WEFA study simply doesn't hold water, it's no wonder why economists scoff at it.
But far be it for Davis to let facts get in the way of a slick talking point. The figure Davis cites is drawn from a study that's now 18 years ago--not quite as old as Brian Davis's departure from his engineering career, but closer to 1983 than to 2008. Like so much about the candidate, a bit of scratching the surface reveals prime horse apples.
What's more, we question whether Davis himself ever looked at
the study itself--or even contemporary coverage of the 2001-2002 ANWR
debate. We're guessing Mr. Science simply repeated what the NRCC told
him to repeat.
It's also true that the Teamsters continue to support drilling in ANWR; however, it's also true that opening ANWR is not a priority for the Teamsters now and they've endorsed both Barack Obama and Congressman Walz.
Meanwhile,
how many jobs might be created in the renewable energy industry if the
suggestions of groups like the Apollo alliance were followed? Go over and read about it for yourself. The International Brotherhood of Teamsters, BTW, endorses this project as well.
We still haven't gotten to the tin-foil hat stuff that links to the Davis campaign. Stay tuned.
Graphic: We agree: an NRCC's sock puppet is pretty scary.
When is Davis going to go nuclear ?
How many jobs will be created by the 45 to 100 new nuclear power plants that McCain wants to build? But that will lead to more questions of how much additional subsidies will the Republicans want to provide for the nuclear industry plus the oil industry. Not to mention what to do with the waste ... but McCain has a plan ... he wants to elimintate Russia from the G-8 and then work with Russia to store our nuclear waste in Siberia. Great plan, huh ... with all the loose nukes in the old Soviet Union, all we need is to send them more spent fuel.
Posted by: MinnesotaCentral | July 14, 2008 at 08:56 AM