Obamanomics: A View From The Ground
As some of the more intense readers of this blog may know, my square job – at least, within the last few months – is as a headhunter. I do recruiting in engineering, construction management, IT and higher-end sales positions (if you’re in South Louisiana and you’re in need of help with either side of the hiring equation, I’m happy to help).
In any event, in this job I see some ground-level conditions which are a direct result of economic policy out of Washington. I’m seeing the human effect of Obamanomics. And it’s not pretty.
In what I do, I don’t talk to folks who are negatively affected by the terrible decision this past summer to raise the minimum wage. My people don’t make the minimum wage or anything near it; they’re the types of folks who our president would call the “rich,” though not to their faces. But the people in this office who do handle the more downscale labor market are noticing a substantial drop in the amount of hours they can find for temp laborers, for example, and we get exposed to the frustrations of folks who are desperate to find jobs at any pay rate which just don’t exist right now.
And this is in Baton Rouge, which is one of the best labor markets in the country. Folks around here are crowing that a recent study rated this the No. 6 market in America for economic performance; we’re a great deal better off than the bombed-out economies of, say, Las Vegas or Detroit. Nationally, you see a youth unemployment rate of 52 percent and you realize how dangerous a situation we’re in. Countries where young males have nothing to do all day are countries where political extremism, crime and social pathologies tend to run rampant.
More than that, though, on a personal level I can see a direct effect of bad policy. After all, I recruit engineers.
The Baton Rouge economy, mind you, is supposed to be a national leader. While that might be true overall, the petrochemical and oil and gas industries and the support industries related to them are struggling in a major way.
Three of the major engineering firms in town – Jacobs Engineering, Wink and Ford, Bacon & Davis – have had several rounds of layoffs in the past 6-9 months. Between those three companies there are some 150-200 engineers who went from six-figure incomes to the unemployment rolls and job boards. A fourth firm which I won’t name has gone from 180 engineers down to less than 10 employees overall and is probably days away from vanishing altogether.
Engineers, mind you, are the kinds of folks you can’t run an economy without. When your engineers are on the streets looking for work, it’s very bad sign.
So why are there so many electrical, mechanical and chemical engineers out of work?
Cap And Trade, that’s why.
I’m not making this up. I talk to plant managers, out-of-work AutoCAD operators, business development folks, HR people and others in the industrial sector in this town and I’m getting the same thing across the board – the large multinational firms who own the petrochemical plants along the Mississippi River have taken one look at that horrible Cap And Trade bill and they’ve decided to shelve basically everything. No turnarounds, no capital improvement projects, no expansions, no maintenance projects of any size – because they know they’re in the crosshairs and they can’t spend money to upgrade facilities which will become unprofitable if and when the Cap And Trade legislation passes.
And with all of that work being on the shelf, the support firms – construction companies, engineering firms, safety consultants and so on – all of a sudden can’t project a budget to support the staff they’ve got. And out the door go talented, productive and hard-working folks our economy needs to be on the job.
Mind you, we’re talking about a vital industry here. If the petrochemical corridor along the Mississippi in South Louisiana were to shut down – and it’s not shutting down right now; it’s just not growing and there are major nerves about its future – we all of a sudden are in a position whereby we’re going to be importing a tremendous volume of products we currently make in America. Gasoline, plastics, pesticides, cosmetics, fertilizers – the list of things the petrochemical industry produces domestically is mind-bending. You damage that industry, you damage the nation’s economy.
I’ve had more than one decision-maker in that industry tell me in the last month that it’s not beyond the possibility for his corporate headquarters to pull the plug on the entire domestic operation and move it overseas to India or Brazil or some other locale where labor costs and/or environmental regulations make it easier and more profitable to operate. No one wants to do this, mind you, but while the corporate PR flacks happily sing non-partisan and happy songs designed to avoid alienating stockholders of every political stripe the fact is these guys are tasked with earning a profit. Not only does our government make their lives more difficult with taxes and regulations which set them at odds with the public, the attitudes of “leaders” like the president and his lickspittles in Congress indicate that they don’t even appreciate the concept of profits. Look at the president’s statement on health insurers, for example:
“There have been reports just over the last couple of days of insurance companies making record profits, right now,” Obama said during a prime-time news conference. “At a time when everybody’s getting hammered, they’re making record profits, and premiums are going up. What’s the constraint on that? … Well, part of the way is to make sure that there’s some competition out there.”
How does this relate to the petrochemical industry and all my out-of-work engineers? Well, petrochem is as much a target of Cap And Trade as health insurance is of Obamacare. And as this chart shows, there’s no more profitability to be found in the oil & gas related industries as there is in health insurance.
Bad policies hurt people. Lack of freedom hurts people. We’re seeing it now. Never allow a leftist to preen about how he cares about people in the face of the evidence to the contrary.
Filed under: Barack Obama, Baton Rouge, Economics, Energy
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