Offshore drilling: Industry propaganda vs reality


The myth of oil exploration coming to the rescue of a failing economy:

For years, Newfoundland and Labrador were known for being net recipients of financial aid from other Canadian provinces. As the fishing industry struggled, they steadily lost population.

That all changed in the early 2000s when companies began drilling in earnest along their coasts. Between 1988-2002, offshore bids brought in $900 million; from 2003-2014, bids yielded $2.4 billion.

That's $2.4 billion accumulated over 12 years. That distinction is important, especially in light of Newfoundland and Labrador's projected $1.1 billion deficit for this fiscal year:

“Newfoundland and Labrador’s economy is facing a double hit of low oil prices and low metal prices, both of which are having a negative impact on business investment and production decisions,” said Marie-Christine Bernard, Associate Director, Provincial Forecast. “The province’s labour and housing markets and retail sales will feel the effects of the weakening economy.”


•Newfoundland and Labrador’s economy is expected to contract by 0.1 per cent in 2015 and 0.2 per cent in 2016.
•With the provincial government projecting a $1.1-billion deficit for this fiscal year, the latest budget includes hikes in the harmonized sales tax and in personal income tax rates.
•Newfoundland and Labrador’s economy shed 4,650 jobs last year, and employment is forecast to decline again this year.

After declining by 2.9 per cent last year, real gross domestic product (GDP) is forecast to contract by a further 0.1 per cent in 2015 and 0.2 per cent in 2016.

Bolding mine. As to the first section highlighted: Oil and gas drilling operations, on land and sea, are notorious for having the "boom and bust" effect on local economies. What seems like a windfall of money encourages rapid growth, very rarely "smart" in nature, creating even more of a public burden when the "bust" phase inevitably occurs. Both sales and income taxes go up, people struggle, and the fossil fuel companies who raked in all the profits do worse than ignore it; they actually lie about the economic crisis to other towns/cities/states who are their next targets for exploitation. Back to the propaganda, keeping in mind the massive 2.9 percent drop in Newfoundland and Labrador's GDP for 2014:

•$12.2 billion (Canadian) in investments in 2014, a tripling compared to 2002
•1 percent increase in weekly earnings in 2014, an increase from roughly $600 in 2002 to nearly $1,000 in 2014
•4 percent growth in retail spending in 2014 alone
•9 percent unemployment, one of the lowest rates in recent history compared with pre-boom rates in excess of 20 percent

St. John’s Mayor Dennis O’Keefe said, “I think it’s fair to say that the feelings of optimism and confidence in what’s happening in the province far outweigh any worry about the price of oil.”

The reality: Newfoundland and Labrador's unemployment rate in April 2015 was 12.6 percent, and that quote from Mayor O'Keefe is from 2013. There are newspapers all over NC that publish the Heritage Foundation's outright lies, including my local (Burlington Times-News). Because they show up in the "opinion" columns, nobody considers fact-checking or due diligence to be necessary. But since most readers have no idea who the Heritage Foundation is or where it gets its money, they just lap this stuff up. There's a war going on, folks, and it's a war of information. When propagandists succeed in fooling the public about things like offshore drilling and fracking, the public votes for the people who promise them they'll make that fantasy happen. And we get an oppressive, power-mad Legislature as a result.