Tom Power Commentary: “The ‘Hole-in-the-Ground’ Approach to Local Economic Well-Being”

The very slow recovery of the American economy from the bursting of our nation’s last bubble economy, that built around speculation in housing and obscure but risky financial products, has provided fertile ground for special interests seeking privileged access to public resources. Economic fear mongering has considerable political traction during hard times as special interests try to get us to “give away the store” in terms of the public interest in return for various promised magic economic bullets all of which have the word “job” in their title.
What is particularly brazen and shameless in this context in the American West is that most of the special interest proposals involve another speculative commitment to short-run economic gain. We are urged to hitch our economic future to another temporary bubble that will most certainly burst, leaving our communities disrupted and damaged once again.
Most of these magical cures to what economically ails us involve digging holes in the ground, either a very massive single hole or many, many smaller holes. From these holes, we are told, will come wealth, income, and jobs. Since we in the West have had plenty of experience with this “Hole-in-the-Ground” approach to local economic well-being, one would hope that we would be more than a little skeptical about such proposals.
Consider the boom in the Bakken shale oil fields in eastern Montana and western North Dakota. For natural resource extraction boosters, this boom is not booming as much as it should. We need more drilling, less regulation, and more pipelines to inflate the boom more. Meanwhile the residents of Glendive and Sidney, Montana, watch their towns being overrun by in-migrating and commuting workers from all over the West. Congestion, confusion, and crime dominate as residents worry about the viability of their towns as places to live and raise a family.
This is not a new experience for that area. During the late1970s and early 1980s there was a similar boom as oil jobs exploded, jumping from about 300 to 3,000 in a six-year period. Total employment rose by twice that, about 5,000 jobs. The area added 5,500 new residents. Then the bubble burst and within five years most of the oil jobs had vanished and by 1990 the population was 6,600 below its peak level. Ultimately, the drilling rigs were cut up for scrap metal. Now that region is on the economic roller coaster once again and being promised that “this time it will be different.” That is always the promise, but one that is never fulfilled with the “hole-in-the-ground” approach to local economic well-being.
Or consider the state-wide “jobs” argument for the development of several new very large holes in the ground in eastern Montana: new coal strip-mines that would support the export of coal to China from proposed west-coast coal ports. This coal export activity, we are told, will support jobs across almost the entire width of Montana because of all the additional trains that will be required. Those trains will need additional railroad crews as well as crews to maintain and repair the more heavily used tracks and rolling stock. Jobs…jobs…jobs!
But at the volume of coal exports being discussed by the coal industry, there would be 50 to 60 more trains cutting through almost every major Montana city every single day. With that would come a lot more diesel fumes, coal dust, noise, and blocked roads throughout the day and night and across the year. Our cities would be significantly degraded and disrupted.
The “payoff” that is waved in front of us to get us to accept this degradation of our communities is, of course, jobs. According to one coal industry-funded study, each million tons of coal shipped will directly create one more railroad job. If the coal ports being proposed on the west coast are to be fed with Montana and Wyoming Powder River Basin coal, 140 million tons of coal would have to be shipped. Thus the offer being made to almost every one of Montana’s major cities and a dozen rural counties is about 140 new railroad jobs spread among the 20-county-long southern railroad route, about 7 jobs per county.
Given the disruption, pollution, noise, and industrial grime this activity would impose on our communities, the loss of jobs because these communities would become less attractive places to live, work, and operate a business is bound to be greater than the tiny number of railroad jobs gained. Regardless, what self-respecting community would voluntarily subject its homes and citizens to this degradation for such a paltry, if not negative, payoff?
Does the Hole-in-the-Ground path to economic well-being work? We can look at the mining ghost-towns across Montana for an answer to that. We can ask if Montana’s largest whole in the ground, the Berkley Pit, brought sustained prosperity to the Butte-Anaconda area. We could look west to the Wallace-Kellogg area of Idaho or east to the Lead-Deadwood area of South Dakota or south to the abandoned uranium mining belt of New Mexico or the copper towns of Arizona. Alternatively, we could look at the area of the nation with the most large holes in the ground and where the number of massive holes continues to grow, namely the nation’s oldest coal mining area, Appalachia. How is it that Appalachia, besides being synonymous with coal mining, is also synonymous with persistent poverty that has stretched over most of two centuries?
There is a kid-like glee associated with digging holes in the ground. Those holes can also be engineering marvels. The Berkley Pit has a rugged beauty to it, including the ultra-marine blue of the poisonous stew it contains. But those holes in the ground do not bring with them sustained communities and sustained economic well-being. Quite the opposite, those holes in the ground threaten both.

One thought on “Tom Power Commentary: “The ‘Hole-in-the-Ground’ Approach to Local Economic Well-Being”

  1. Pingback: Tom Power Commentary: “The 'Hole-in-the-Ground' Approach to … « Sell Scrap Lead

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