Moratorium on Offshore Drilling

The oil spill is a massive crisis, there is no doubt about that.  We can empathize with an entire fishing and tourism industry that has been crushed by the effects of the spill.  However, the moratorium on offshore oil drilling is a typical government overreaction that has also had significant economic consequences that dwarf the impact of the fishing and tourism industry. 

According to Louisiana Mid-Continent Oil and Gas Association, the impact of halting work on 33 exploratory wells will be devastating.

• Rigs: $250,000 to $500,000 a day means losses of up to $16,500,000 per day in costs for idle rigs.
• Supply boats: $30,000 per day for 33 rigs will cost about $1,000,000 a day.
• Employees: Up to 140 per shift at $1,804 a week could add to $330,000,000 a month in lost wages.  

The fact remains that the people on the Gulf Coast rely much more heavily on the oil and gas industry than on the farming, forestry, or fishery industries.  According to the U.S. Commerce Department, Louisianans earn $13 from mining and related activities for every dollar they get from fishing.  In 2007, the last year for which we have data, the total compensation paid to people in Louisiana working in forestry, fishing, and related activities came to just $310.0 million.  the figure for mining and support activities was $4.1 billion, with nearly all of it related to oil and gas. 

It shows the complete lack of understanding to even suggest that BP foot the bill for the government's position.

Consider Jesse Jackson's proposed boycott of BP stations.  Sure sounds good - let's make BP pay!  He obviously didn't understand that 10,000 BP stations in this country are independently owned and it costs $250,000 to buy a franchise.  Might help some of these guys to actually understand before they talk.