Oil and gas states are dragging America's GDP down

Look West: Public lands and energy news from the Center for Western Priorities


** Why windfall oil profits don’t mean economic growth
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Wednesday, July 13, 2022
An oil rig in Eddy County, New Mexico. Blake Thornberry, CC BY-ND-2.0 ([link removed])

New economic numbers show why boom-and-bust extraction doesn't mean economic stability for Western states. In New Mexico, oil and gas revenues added more than $1.7 billion to state coffers ([link removed]) in the first four months of 2022—more than doubling the $782 million brought in during the same period in 2021, which was itself a record year.

But despite getting a share of the windfall profits that oil CEOs have raked in ([link removed]) thanks to high gas prices, oil producing states are dragging the rest of the country down in overall economic output. Pew Stateline reports that the states with the largest declines in gross domestic product are all oil and coal states ([link removed]) , including New Mexico, Montana, Alaska, and Oklahoma. Wyoming had the largest drop in GDP in the first quarter, a 10% decrease.

Nationwide, there was a 1.6% drop in GDP for the first quarter. But oil and gas companies have refused to increase output ([link removed]) , leaving drilling rigs and workers idle as gas prices spike.

New Mexico lawmakers are expecting more than $5 billion in oil revenue this year, according to State Sen. George Muñoz. But lawmakers know that's a one-time windfall that can't be used to fund new programs, add jobs, or increase pay for teachers.

“I have ridden the roller coaster,” Muñoz told Capital & Main ([link removed]) . “I came in in [2009] where we had to cut a billion dollars out of the budget” during the great recession.

New Mexico economist Kelly O'Donnell warns that the state often has “selective amnesia” during boom times. “To progress economically, over time, we are going to have to get out of this boom-bust resource cycle,” she said. “When it goes down next time, it may not come back up, and we have to be prepared for that reality.”
Quick hits


** White House keeps dangling oil and gas projects to woo Manchin on climate bill
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Washington Post ([link removed])


** Arizona tribe, ranches say proposed lithium mine will ruin their water
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Phoenix New Times ([link removed])


** Interior IG finds former Zinke aide abused his position
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E&E News ([link removed])


** Former Oath Keeper connects the dots from Bundy Ranch to January 6
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Denver7 ([link removed]) | Washington Post ([link removed]) | NPR News ([link removed]) | Southern Poverty Law Center ([link removed])


** A law was supposed to turn former prisoners into firefighters—but no one's applied
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Colorado Sun ([link removed])


** Bipartisan wildlife bill could be headed to Biden's desk
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Washington Post ([link removed])


** State oil and gas revenues spike while economies lag
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Capital & Main ([link removed]) | Pew Stateline ([link removed])


** Landslide risk on the rise thanks to climate change
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High Country News ([link removed])
Quote of the day
” This is an expensive thing to build. Where is that money going to come from? There is a real concern that they will start building this and not finish it. Or it gets built and then doesn’t get used.”
—Deeda Seed, Center for Biological Diversity, to the Colorado Sun ([link removed]) , on the proposed Uinta Basin oil rail line from Utah to Colorado
Picture this


** @usfws ([link removed])
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Bees, especially bumblebees, love lavender. 🐝💜

This particular bumblebee, photographed while feeding on a lavender stalk with about half of its purple flowers still blooming, was captured in Jackson County of southwest Oregon.

Approximately 500 bee species live in Oregon, helping to pollinate a wide range of native plants and crops.

Photo: Mark Heatherington

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