‘Intellectual Bankruptcy’, Dr. Krugman? | RedState

‘Intellectual Bankruptcy’, Dr. Krugman? | RedState

‘Intellectual Bankruptcy’, Dr. Krugman?

  

Posted by Steve Maley (Diary)

Sunday, March 18th at 8:40PM EDT

12 Comments

Paul Krugman’s op-ed, “Natural Born Drillers” (New York Times, March 15), purports to show with a hard look at the numbers why no thinking, perceptive person could possibly believe that “Drill, Baby, Drill” is a solution to the nation’s energy and economic woes:

[G]iving the oil companies carte blanche isn’t a serious jobs program. Put it this way: Employment in oil and gas extraction has risen more than 50 percent since the middle of the last decade, but that amounts to only 70,000 jobs, around one-twentieth of 1 percent of total U.S. employment. So the idea that drill, baby, drill can cure our jobs deficit is basically a joke.

Hmmm. Shall I take the strawman, or the phony statistics first?

{Coin flip}: It’s heads. Strawman!

In this op-ed, Dr. Krugman beats the “carte blanche” strawman bloody. I defy him to name a single industry leader who has called for unrestricted drilling. (Enron doesn’t count, Paul.) Oil and gas people live and play in the same environment where they work. We want clean water and pristine beaches, too. We also know that responsible development is compatible with environmental protection.

Historically, groundwater protection and other well-construction matters have been left to the States. That makes sense because geologic and climatic conditions vary widely from Pennsylvania to Louisiana to California to Alaska. Self-appointed experts outside the industry push for more Federal regulation. I know that the EPA can smother industry with regulation, but I don’t trust them to protect my groundwater.

As for the employment statistics, “lazy” and “inept” are two words that come to mind.Although he doesn’t cite a source, Dr. Krugman has apparently relied on the database of the Bureau of Labor Statistics. Indeed, the industry subsector called “Oil and Gas Extraction: NAICS 211″, (part of the Mining, Quarrying, and Oil and Gas Extraction sector) shows the gain in jobs he describes, from roughly 120,000 jobs in 2004 to about 190,000 now. And he apparently stopped there.

190,000 jobs? Doesn’t that seem kinda low for an industry that comprises 8% or so of the economy?

Well, of course it is, because lots of oil industry jobs are counted in other categories. Most notably, the related subsector “Support Activities for Mining: NAICS 213″.

In NAICS 211, you find geologists, draftsmen and petroleum engineers like me, employed directly by the oil companies. NAICS 213 contains people that work for the “service companies” who work for the oil companies. These companies would include Halliburton, Transocean and Schlumberger, the companies that drill, frack, service and equip the wells. Job titles include roughnecks, roustabouts and service pump operators.

NAICS 213 is twice as big as NAICS 211: 379,100 at last count. NAICS 213 is where you find the really explosive job growth: nearly 200,000 jobs since 2004, including almost 70,000 just in the last year.

Neither category includes the jobs in pipelines, refineries, petrochemicals or steel mills that are directly supported by oilfield activity. Or the trucking and construction jobs that aren’t in the oil industry per se, but nonetheless depend on oilfield activity. [The American Petroleum Institute estimates that there are 2.2 million jobs in the upstream sector alone; more statistics (& backup!) at the end of the diary.]

I guess Dr. Krugman either didn’t know, or didn’t think it was important.

He concludes his piece with this remark:

…[I]ntellectual bankruptcy, I’m sorry to say, is a problem that no amount of drilling and fracking can solve.

On that we can agree, Dr. Krugman. On that we can agree.

Cross-posted at stevemaley.com.

From American Petroleum Institute’s State of American Energy (pdf link), January 2012.

The oil and natural gas industry currently supports 5.3 percent of total U.S. employment. To put this in perspective, the number of jobs supported by the upstream oil and natural gas industry segment alone in 2010—2.2 million—is larger than the populations of 15 states.

In addition:

• One out of every five new jobs created between 2003 and 2011 was in the oil and natural gas industry;
• A Gallup poll found that energy-producing states ranked among the highest in terms of job creation in the first half of 2011, as they did in 2010; and
• By 2030, the upstream oil and natural gas industry segment could support an additional 500,000 jobs under current U.S. energy policies.

Now consider the projections of a recent Wood Mackenzie study, which found that the industry could add nearly 1.4 million jobs by 2030—or almost three times the number of new jobs currently projected—if the United States adopts policies that encourage development of domestic oil and natural gas resources and facilitate Canadian oil sands production, including construction of the necessary pipeline infrastructure and other related projects.

[Emphasis added. Disclosure statement here. H/T Jxn's Mom.]

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Category: 85% of statistics are just made up, Bureau of Labor Statistics, Dr. Paul Krugman,Inept, Lazy, New York Times, Nobel Prize for Economics

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Routine dishonesty from the left

Plumb_Bob (Diary) Sunday, March 18th at 9:29PM EDT (link)

I tire of the routinely dishonest garbage from leftist shills like that imbecile, Krugman.

Even if the proposed energy “solutions” from the left, like wind and solar, were viable energy sources for the 20% of US energy they’re proposed to meet — and truly, they’re not even close — there is no reason on God’s green earth why we should not drill as much oil as possible. Why send our dollars to Canada, Mexico, and Saudi Arabia when we can pay them to US workers? Even if it were only 70,000 workers, that’s 70,000 Americans with better jobs than they would have otherwise. What’s the reason they hate these companies so much that they’ll spite American workers to deny them any profit? It’s completely irrational.

Sane energy policy would allow the market to produce whatever energy sources it can. The left genuinely believes that nobody but them REALLY understands how dangerously short we are of fossil fuels. They are insane; America’s industries have no great love for oil companies, and are not sitting by idly letting things run out. They’ve been working on alternative sources of fuel for decades. They don’t need a bunch of subsidies to do it; they’ve got their own incentives. All they need is for the government to keep its hands off them so they can do what they do.

What the left really needs to figure out is that they’re not really so very smart. In fact, they’re insanely stupid. Those whose livelihoods depend on reliable sources of energy will make far better choices than the self-anointed Saviors of the Planet.

(Unrelated to this topic, please visit my political blog, “Plumb Bob Blog: Squaring the Culture,” at http://www.plumbbobblog.com. Thanks.)

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A journey of a thousand miles begins with a single step

6eorge Jetson (Diary) Sunday, March 18th at 10:20PM EDT (link)

The Statists know this and will try to deny any initiatives that threaten their power.

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I hope someone gets this rebuttal info published in the NYT

carolina Sunday, March 18th at 9:36PM EDT (link)

The NYT should have fired Krugman years ago. He is always wrong, and full of socialist propaganda. He is way up near the top of my “disgusted with” list.

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I hope someone gets this rebuttal info published in the NYT

carolina Sunday, March 18th at 9:36PM EDT (link)

The NYT should have fired Krugman years ago. He is always wrong, and full of socialist propaganda. He is way up near the top of my “disgusted with” list.

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carilina, why would the NYT ever fire an America-hating,

demsaresatanic Sunday, March 18th at 11:25PM EDT (link)

Christian-hating liar such as Krugman? A leftist liar with a Nobel is pure gold for them, it gives the lies a credential.

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Steve Maley, Another Point: Krugman Forgets He is a Keynesian.

quill67 (Diary) Sunday, March 18th at 10:40PM EDT (link)

Another amazing point about this piece is that Krugman conveniently forgets he is a Keynesian for this piece. Keynesians believe that increased income and employment for one group will increase their demand for goods and services. The people who produce those goods get an increase in income so they buy more. The process repeats (in Keynesian view) and creates what they call the Keynesian multiplier effect.

In this way, a small increase in income might cause national output to increase 10 times in theory (Although Keynesians testing this have found multipliers up to 5 but usually almost 2) Using a multiplier of 5, if oil and gas jobs created $20 billion in wages, this would result in an increase of $100 billion in national output. creating income for those people is that here he is

I would add (as a non-Keynesian) that small changes in the supply of oil make for large changes in the price of oil. So not only do we get the benefit of jobs producing the oil, we also get the benefit of lower oil prices which lower the cost of producing other goods. This increases national output, employment, and improves the quality of life.

But Krugman is blinded to opposing views. It is really a shame. I have read his old work and he was not always….a….well…a nut. It may be hard to imagine but his early work really was brilliant. To me, it shows that liberals will say or do anything— even drop any professional ethic to promote their viewpoint.

I try when I write about economics to be very careful about my analysis. Only on non-economic political analysis am I not as guarded with my words.

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quill, yes it is "hard to imagine but his early work really was brilliant???."

demsaresatanic Sunday, March 18th at 11:40PM EDT (link)

Do you have any links to his early brilliant work, by any chance. Anybody who still buys Keynes after dismal failure upon failure in application doesn’t sound too brilliant.

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One would be inclined to believe that someone

romeg Sunday, March 18th at 11:00PM EDT (link)

so knowledgeable as regards the Energy Industry as Krugram that he was chosen by Enron as an adviser would not be so sloppy with his research. Perhaps Krugman has more accountability with the demise of Enron than previously thought.

“Of all tyrannies a tyranny sincerely exercised for the good of its victim may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated, but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.” – C. S. Lewis

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Krugman

gunnyg Sunday, March 18th at 11:15PM EDT (link)

is little more than a useful idiot for the NY Obama Times. He has been wrong so many times he would not know what it is to be right!

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Aren't some jobs better than none?

dajeeps (Diary) Sunday, March 18th at 11:16PM EDT (link)

Even if he had his data correct, it’s really stupid argument to be making with persistently high unemployment.

I don’t think it really matters how many jobs there *might* be if we liberalize drilling. Even if it were just 70k, it’s 70k more than we had and we have people who need to feed their families who can’t see the light at the end of the unemployment tunnel. We need domestic oil. We have people who need work. Go get the oil, and put the ones who can do the job to work. It’s that simple.

…”I would quarrel with both parties and with every individual of each, before I would subjugate my understanding, or prostitute my tongue or pen to either.”
–John Adams

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The real problem on dislpay is not intellectual bankrupcty...

anotherindyfilmguy (Diary) Monday, March 19th at 1:03AM EDT (link)

it is moral bankruptcy from those who would ignore the real way of the world when it does not forward their political agendas.

Santorum? Well, at least he’s not Romney…
http://www.zazzle.com/enemy_of_the_statist_tshirt-235977043035297478

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A Rising Tide Floats all Boats - A Personal Observation

kipling (Diary) Monday, March 19th at 1:43AM EDT (link)

Thanks Steve for correcting Paul Krugman. I always enjoy reading your posts on the energy sector.

Recently I was in a small town near the Eagle Ford Shale area and stopped to eat at what used to be a sleepy Mexican restaurant. The place was packed and all but a few of the cars in the parking lot were company trucks belonging to various service companies connected to the oil fields. Other communities have experienced a housing boom as new workers flood into the fields. Many of the interior towns are using the new tax revenue for needed repairs and infrastructure developments. Even the gulf towns have experienced a boom as the oil flows via pipelines and trucks to the various coastal cities.

The only role Mr. Obama has played in the oil business around here is the loss of drilling in the gulf, which has hit us hard.
What Obama needs to do – and will not – is to set the oil and gas industry free from the excessive regulations.

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