January 10, 2012 2:20 pm ET - by Emilee Pierce
The American Petroleum Institute (API), a political advocacy organization representing nearly 500 oil and gas companies, has launched a new campaign to promote its policy agenda in advance of the November elections. The campaign — Vote 4 Energy — is running in several swing states and will feature prominently during tonight's coverage of the New Hampshire GOP primary.
"Vote 4 Energy" purports to showcase the "opinions" of real Americans who support API's policy priorities — increasing drilling on protected federal lands, rolling back regulatory safeguards, constructing the Keystone XL pipeline, and preserving tax breaks and subsidies for fossil fuel production — and who are tired of watching overzealous regulators stifle the economy.
But the campaign is broadly misleading and loaded with false facts.
First, the campaign does not reflect the "opinions "of "real Americans". Instead, it reflects a carefully controlled script written by API.
Second, the campaign relies on a misleading "vision of economic prosperity" that grossly exaggerates the oil and gas industry's impact on employment.
Finally, the campaign centers on the false premise that oil and gas drilling is meaningfully constrained by regulation. In reality, U.S. oil drilling is at its highest level since 1987 and the fossil fuel industry is churning out enormous profits — while sitting on a host of unused drilling permits and land leases.
Let's take a closer look.
Opinions Scripted By API
In a speech announcing the campaign, API President Jack Gerard claimed that "Vote 4 Energy" is not "an advertising campaign," but rather "a conversation" intended to educate Americans about energy issues and encourage them to integrate those issues into their voting positions. Introducing the campaign, he said:
What we say here in Washington is important because it is here, after all, that policy that affects all Americans is made. But there are millions of other voices across the country, and what happens here should be a reflection of what Americans are saying. [...] I would like to share with you a few of the voices we heard as we prepared for today's State of American Energy.
The problem is that the ads aren't a "reflection of what Americans are saying" — instead they are a word-for-word reflection of a carefully controlled script written by API. As reported by the Washington Post and confirmed in audio recordings from the API auditions, participants were fed lines and any deviation from the script was refused.
A Rosy Vision Based On False Facts
In his speech, Gerard said that the campaign is "based on our knowledge that [the oil and gas] industry is a tremendous catalyst for growth," adding that the industry currently "supports 9.2 million jobs," and could support "an additional 1.4 million jobs by 2030" if certain regulatory priorities were realized.
There are three problems here.
First, the implication that the oil and gas industry adds jobs as it grows more profitable isn't supported by facts. A report prepared by House Natural Resources Committee Democrats found that between 2005 and 2010, four major oil companies have shed U.S. employees, even as they reported enormous profits. According to the report:
Despite generating $546 billion in profits between 2005 and 2010, ExxonMobil, Chevron, Shell, and BP combined to reduce their U.S. workforce by 11,200 employees over that time.
Second, Gerard's claim that the U.S. oil and natural gas industry employs 9.2 million workers is dubious, at best. The projection is drawn from a widely criticized report commissioned by API, which takes credit for 2.2 million "direct" (oil and gas industry) jobs, as well as 7 million "indirect and induced" jobs. Indirect jobs are a seldom-used, murky category that API says covers everything from valets to day-care providers, from librarians to rocket scientists.
But that's not all. API also inflates the number of "direct" jobs by including employees of its financial partners. According to the Washington Post:
Drilling further into the API numbers of existing petroleum industry jobs shows just how murky these numbers and definitions can be.
According to the [Bureau of Labor Statistics], the number of people in the United States drilling wells, extracting oil and gas, refining petroleum and manning gasoline stations is about 1.1 million. If sole proprietors and business partners are included, the number rises to about 2 million, according to the Commerce Department's Bureau of Economic Analysis. [...] API used the higher figure.
Third, the idea that pursuing API's priorities will create 1.4 million jobs is unrealistic. According to Michael Levi, an energy expert at the Council on Foreign Relations, that figure is based on "reversing deeply anti-industry Obama policies that don't actually exist." Further, those estimates "ignore real constraints at the state level, and don't fully account for market dynamics." Levi writes in The Atlantic:
Six hundred thousand is a pretty hard upper limit for the number of jobs that a new policy might create by 2030, of which fewer than two hundred thousand might actually be in oil and gas. Taking into account market dynamics would lower those numbers further, quite likely much further; more generous assumptions about Obama administration energy policy would too.
Energy economist Philip Verleger agrees, adding that "the API is the best there is at lying with statistics."
A Host Of Unused Drilling Permits
Gerard also decries a vision of "restrained oil and gas development that keeps American resources beyond reach" and argues that the "onslaught of regulations from a host of federal agencies ... threatens to impose unnecessary costs on businesses struggling to survive."
But Gerard ignores the fact that crude oil production has risen significantly over the last few years. As Climate Progress reports:
For the first time in over a decade, the U.S. produces more than half of its oil — imports are below 50 percent. Last year, API reported that the number of new drilling rigs increased by 28 percent. The Wall Street Journal reported in late August a staggering jump in total U.S. drill rigs since Obama took office. They noted a "huge surge in U.S. oil drilling, up nearly 60% in the past year and the highest total since at least 1987, when oil services company Baker Hughes Inc. began keeping track."
Further, the oil and gas industry is sitting on thousands of unused drilling permits — undermining the notion that America must open protected federal lands to drilling. According to Bureau of Land Management data obtained by Greenwire, "the oil and gas industry has nearly 7,200 permits to drill on public lands that it has yet to use." From Greenwire:
The unused permits, known as "applications for permit to drill," or APDs, numbered 7,196 as of mid-March and could include permits issued as far back as March 2007, BLM said. The APDs cost $6,500 each and are good for an initial term of two years, which can be extended once for an additional two years at an operator's request.
So, what does this all mean?
"Vote 4 Energy" is not about Americans, their jobs, or the economy. It's about Big Oil and Big Gas.
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