North Dakota Oil Boom Profiled In The New York Times
And, true to form, the Times finds a way to spin the boom to the negative citing the fact that there are too many job openings in North Dakota right now (no kidding) and the expanded oil industry is straining infrastructure.
The Times reporter even manages to find the one person in North Dakota who thinks the oil boom is a bad thing, quoting Montrail County Sheriff Ken Halvorson as saying it will bring nothing but “a headache and a heartache.” Which seems like a rather cynical response from someone who simply doesn’t like change to me.
The article goes on to list additional problems from the oil boom like the fact that there isn’t enough pipeline to get all this new oil out of the state, and that the boom might one day dry up as the oil boom of the 1980′s did.
As a North Dakotan, I can’t help but feel that these are good problems to have.
A shortage of workers isn’t going to do anything but drive up wages as businesses compete for employees. And as wages rise, this state’s problem with people leaving to find better pay elsewhere will begin to ease and the population will start growing again.
Infrastructure woes are also easily fixed by government simply getting out of the way of (and even facilitating) the flow of private capital to build that infrastructure (such as pipelines, etc.). Tax-funded infrastructure such as roads and bridges can be funded out of the new tax revenues already being driven by the resurgent oil industry and will be well worth the investment.
As for the oil boom eventually ending, that’s just the nature of the business. If the market changes we certainly can’t expect oil companies to continue operating in North Dakota at a loss, so we’ll have to accept that when and if it comes. Which is exactly why the state should a) be as encouraging and facilitating as possible to the oil industry now while things are booming and b) should not be increasing government spending by massive amounts (see: Governor Hoeven and some of his Republican comrades in the legislature). After all, the tax revenues from the oil industry may not last forever and if we’ve got a bunch of new government spending to pay for when it starts to go away we, as a state, are going to be in a world of hurt.
Update by the Whistler
And c) should not be spending our Permanent Oil Tax Trust Fund. Governor Hoeven has spent over $200,000,000 of the money we will need when the oil industry does draw back from North Dakota.
