Part 1 of a series on saving refinery jobs and getting America working again
For the tens of thousands whose livelihoods depend on the Sunoco and
ConocoPhillips oil refineries in Philadelphia, Marcus Hook and Trainer,
the Grinch arrived early this Christmas, announcing that all three
facilities would be closing in the near future.
But unlike the Grinch who delighted in causing misery for the sake of misery, the oil
companies seemed to have no choice. Their hand was forced by a
combination of market forces that saw them losing millions every single
day.
And now, short of the companies finding buyers, those
workers will be thrown out into the cold, unemployed in an America that
is plunging farther into the abyss. An America that doesn’t make a
bloody thing anymore. An America with the highest corporate taxes in the
world. And an America with trade policies that sell out its own
citizens.
Making matters worse, most of the workers will be
seeking new jobs in Pennsylvania, one of the least competitive states in
the nation when it comes to attracting new companies.
Doom and
gloom? No, just the hard truth. And here’s another one. Short of packing
up and moving to refinery-laden Louisiana, most of the laid off workers
will never find a job in this region close to the pay scale and skill
level that they are leaving.
Welcome to The New America, one that
too often puts the interests of its competitors – and even its
adversaries – ahead of its own citizens.
Compounding the problem
even further (if that’s possible) is the unwanted involvement of those
who caused our economic mess in the first place – the politicians. And,
as they continue to demonstrate, they don’t have the slightest clue as
to how to right the ship.
Politicians need to be taken out of the equation. Pandering for votes by holding pointless meetings with
refinery and union officials isn’t solving anything. It only gives false
hope (while providing them with 30-second sound bites).
But
here’s the good news. There is hope, more than can be imagined. Those
refinery workers could not be sitting on a better spot on Earth to reap
the rewards of a massive opportunity – the correct utilization of the
Marcellus Shale natural gas bonanza. If the politicians do their most
important job – and the only one they should be doing – of cutting
bureaucratic red tape and slashing stifling regulations, the free market
will take hold, creating jobs and wealth of unprecedented proportions.
But that’s a tall order.
Former
Gov. Ed Rendell, while certainly an affable chap, was never mistaken
for a genius, especially when it came to getting Pennsylvanians working
again. His mentality was that a paternalistic government knows best,
derived no doubt from the fact that he virtually never held a private
sector job in his life. Thus, he was wholly incapable of understanding
the difficult decisions that businesses must make to maintain
profitability.
So it was no surprise when, in 2009, Rendell
inserted his nose where it didn’t belong, publicly excoriating Sunoco
for its decision to lay off some of its salaried workforce. Sunoco
officials had stated the move was geared toward remaining competitive,
as the company was anticipating a “more difficult economic reality”
moving forward.
Taking his criticism even further, Rendell flatly
rejected the decision-making of Sunoco’s Chairman and CEO Lynn
Elsenhans, arrogantly saying he couldn’t take her at her word.
Incredibly, he went so far as to state the “real” reason for the
layoffs: “They are solely intended to make a profitable company more
profitable and helping pad the dividends paid to shareholders.”
So
if Ed was correct (which is always the case – just ask him), Sunoco’s
recent decision to shut down its refineries – permanently – must be
because it’s just making too much money.
Or…
Maybe the
folks at Sunoco had a slightly better idea than Ed Rendell of the
deteriorating market conditions coming down the pike, and maneuvered
accordingly to keep their head above water. Despite their best efforts
though, Sunoco did not meet with success, as the closures clearly
indicate.
Now the big questions loom – can the refineries be
saved, will a buyer be found, can they be converted to refine natural
gas, and, of course, what will be the fate of the thousands of families
whose livelihoods depend on the refineries?
While Rendell is out of the picture, the involvement of other elected officials still leaves a lot to be desired.
Earlier
this week, members of Congress emerged, extremely frustrated, from a
meeting with refinery officials, complaining that the company wouldn’t
reveal details about highly confidential strategic negotiations with
potential buyers.
Earth to Congress: Have We Met? Who
do these guys think they are that Sunoco owes them an explanation for
anything, let alone sharing privileged information of the highest
magnitude? And do we even have to mention that Congress hasn’t been able
to keep anything secret in 200 years?
And last month, a
bipartisan congressional delegation called on the U.S. Energy
Information Administration (along with the U.S. Department of Energy and
the Federal Energy Regulatory Commission) to conduct an impact analysis
on the potential of the refineries’ closure.
Uh, here’s a not-so-humble message to each member of that delegation: your proctologist called. He found your head.
Are they serious? Another Blue-Ribbon study to tell us what any sixth-grader already knows?
It
will be bad. Very, very bad. Jobs will be lost, families thrown into
chaos, houses foreclosed, businesses shuttered. The refining capacity
for the East Coast will suffer tremendously (not helped, of course, by
the fact that we haven’t built a new refinery in America since 1976).
Prices will increase. Volatility will spike. And America will, yet
again, find itself bent over the barrel, spending billions more petro
dollars buying oil from hostile nations because we (READ: Congress) will
not do the obvious – implement a policy of energy independence.
So
let’s save the tens of millions of taxpayer dollars on an absolutely
meaningless study, and do something novel: solve the problem!
And
to reiterate Step One, the politicians woefully short on private sector
experience and who lack the necessary vision to turn an unfortunate
situation into a positive one need to get out of the way and let
business-savvy entrepreneurs do what they do best: Create opportunity.
Energy
is the single most important industry in getting America back on her
feet again. And retooling the refineries here in our backyard – the
right way, for the right product, to fulfill the right vision – is the
blueprint to make that a reality.
And what a Christmas present that would be!