March 13 2012
Can the entire Obama presidency be summed up in a single anecdote?
Yes, it can, according to James Pethokoukis of the American Enterprise, who nominates this anecdote from a book entitled The Escape Artist: How Obama’s Team Bungled the Recovery:
Energy was a particular obsession of the president-elect’s, and therefore a particular source of frustration. Week after week, [White House economic adviser Christina] Romer would march in with an estimate of the jobs all the investments in clean energy would produce; week after week, Obama would send her back to check the numbers. “I don’t get it,” he’d say. “We make these large-scale investments in infrastructure. What do you mean, there are no jobs?” But the numbers rarely budged.
And they still have not budged significantly. Pethokoukis quotes a report from the Washington Post that a $38.6 billion loan guarantee from the federal government that promised to create 65,000 jobs has created only a few thousand.
But new jobs are being created: the problem for the president is that they are being created, not in the president’s beloved “clean” energy field, but in the oil and gas industry, a sector the president would like to replace. The World Economic Forum estimates that the oil and gas inductries “added approximately 150,000 jobs in 2011, 9% of all jobs created in the United States that year.”
The World Economic Forum explains why these jobs are good for the economy:
A common measure of the relative contribution of an industry to the overall economy is the value added per worker or, in other words, the monetary value of work performed by an individual in a given year. The higher the ratio, the greater each worker’s contribution to GDP. On average direct employees in the US oil and gas sector contribute US$ 171,000 to US$ 371,000 to GDP. The average figure for all other US industries in 2010 was approximately US$ 112,000. The larger economic contributions per worker highlight the impact of improving technology on productivity in the sector.
The Keystone XL pipeline, which the president refused to okay, after extensive vetting for its possible effect on the environment, wouldn’t have helped the president by adding immediate jobs. But ultimately, it would have helped future presidents, not to mention U.S. citizens who would have been put to work by the project.
Whenever President Obama responds to high gasoline prices, which could turn out to be a huge political liability for him, he can only address the issue by talking about reducing our dependence on oil and gas. That is fine. Who doesn’t hope we can generate energy from clean sources? But right now the president should be thankful for the oil and gas industry.
One other disturbing possibility raised by The Anecdote: that POTUS doesn’t really have a firm grasp of how economies work.