Friday, March 24, 2006

Rules? In a knife fight?

As promised in the last post, it's time to discuss the rules in a knife fight.

Blogger Ashley raised the idea that New Orleans and Louisiana will have to rely on their own resources in this piece a few weeks back, under the Gaelic name Sinn Fein. Recent developments in Washington reinforce this idea: we are on our own, and must rely on Only Ourselves.

That doesn't mean that full compensation for the negligence of the U.S. Army Corps of Engineers and Category Five levees and coastal restoration are beyond our reach. It just means that we need rely on ourselves, to use our own resources to make it happen. Lets begin by defining our resources.

Oil and gas. The port. Those are the keys. Both are inextricably tied to the collapse of the coast, and both were deliberate acts by the government, made for the benefit of the whole nation at our expense. It's time for the nation to pay the full cost of navigation and flood protection on the Mississippi and for the destruction of our protective wetlands by these activities.

We can ask nicely one last time and explain: the channelization and leveeing of the Mississippi and tributaries is what made the prosperity of the American heartland possible in the nineteenth and twentieth centuries. Oil and gas continued that prosperity in the 21st century. The bill is now due for the costs of these actions. To save the city--and by extension the port and the coastal oil and gas infrastructure--tens of billions of dollars are needed. All we ask is the same deal people like Alaska get--50% of offshore federal revenue, to pay for it

This is a perfectly reasonable and rational request. I expect them to slam the door in our face.

Fine. If they won't act reasonably, then its time to look at what we can do to shut down the port and oil-and-gas exploitation along the coast, until such time as reason once again prevails.

Everyone agrees that the governor's decision to try to block the next offshore oil lease may have helped focus the dear leader's mind on the issue, since the presence or absence of oil seems to play such a large role in their foreign policy deliberations. And let's face it, as his "people down there" comments of his last visit points out, we are in the view of the central government a foreign place.

Let's not stop at blocking future offshore oil leases. I think we must demand that our typically bought-and-paid-for Congressional delegation stand up to the oil companies and tell them their usually reliable votes for things like off shore exploitation of the gulf off Florida and ANWAR are off the table until we get 100% compensation, Cat 5 levees, and coastal restoration.

No Gulf of Mexico drilling. No ANWAR. No nothing. In fact, I think a windfall profits tax on oil would be a splendid way to pay for coastal restoration, since the oil companies have profited so handsomely from the rape of the Louisiana coast. Don't you Mary? (Hint: if you want to be re-elected, do this. Otherwise, maybe you can run for Hillary's seat when she runs for president).

I think the state also has an obligation to look very closely at the safety and environmental soundness of every inch of pipe and every Christmas tree and pumping station along the coast. Those are are not up to snuff should be shut down. There's a name for this in union disputes. It's called working to the rule. Lets look at the rules we have, see if we need more, and start enforcing them relentlessly.

No money, no oil. Capiche, George?

But why stop there?

River pilotage fees are set by the state of Louisiana. Six thousand ships a year land at the Port of New Orleans and the Port of South Louisiana (above the city to Baton Rouge). I think it's time to re-evaluate those fees. I'm thinking, say, $1 million per vessel sounds about right. That could net us $6 billion a year, enough for Cat 5 levees all through the state, substantial coastal restoration, and full and just compensation for our losses from the criminal negligence of the U.S. Army Corps of Engineers.

Of course, I don't think anyone would pay those fees. Ships would try to divert elsewhere. And there would be an immediate rush of Congressional action and federal court rulings to try and stop us. Still, I think we could temporarily shut down the offshore oil port--cutting of 25% of the nation's oil imports--and could push oil to $100. Which would be a good thing for Louisiana's economy.

The real impact would be to the heartland's economy. There simply isn't enough rail capacity to carry all of the agricultural and other bulk exports to other ports. Hell, there are never enough rail cars to go around right now. And even in normal times the cost of rail over barge transport is almost five times as much. People will say "but you'll ruin the port". The simple fact is bulk trade (the kind of business we do in the lower Mississippi) has no other place to go. I think we could cause a significant panic that would make it clear to the heartland what the loss of the port would mean.

I say we give Levees.org and Women of of the Storm one last chance to ask nicely, our elected officials one last chance to prove they put Louisiana first, and the government one last chance to respond reasonably and responsibly and give us the same deal inland states have for oil and gas lease revenue, so that we can rebuild.

Then we give them a swift one where they'll feel it.


Comments:
Markus,

This is the kind of knife fight we will have to play to get our part of the state truly up-and-running whilst at the same time rebuilding the Coast.

Here in this part of the state, tourism, oil/gas, and the Port are all that we currently have. Can't screw with the tourism, but we can mess with shipping fees and with the rigs.

We also need to develope our Bio-Med complex and restart our universities.

My vision for the city is to become the Boston of the New South: education, research, a good port, and the added feature of the energy supplies fueling the entire process.

We have cultures of all kinds... history. The tourists will still come.

This is one reason that I support Virgina Boulet for Mayor: her plans and concepts make perfect sense, and they are a viable possibilty considering the infrastructure currently located in SE LA.

(And I still call for Reparations to all of us in the City for the levee failures!)
 
Hate to say it, but your knife fight analogy might be a little naive. I'd call it a war, with one or two fifth columnists. Didn't see an individual link for the particular Matt Drudge Jr. post, scroll down to Feb. 9. No, I'm not advocating unquestioning loyalty to our leader in a time of war--I'm not really a Blanco fan, I just hate some of her critics.
 
To clarify, I still think all the violent analogies are a little off. I still La.'s position is analagous to that of a public sector union in a tough contract negotiation. That's why I like the no more leases threat, it uses leverage and it should win over public support. Some of the other proposals use leverage, but seem more like bullying than a demand for fairness, not good when you need the public on your side.
 
Can't help but thinking of a line from Warren Zevon's song Poisonous Lookalike.

Poisonous Lookalike,
Little miss gun-to-a-knife-fight


That's how we're going to have to fight this knife fight. With a gun in our holster that we are not afraid to use. And that may mean some political sacrifice down the road, but I say we do what it takes, right friggin' now, to get respect.
 
I am reminded of that saying "desperate times call for desperate measures". But, you know what? The state of LA has an inheirent RIGHT to those royalties. Shame on us for not demanding them sooner!
 
It's beyond time that we ran our business right and the rigs play a big part in that.

But if you think a "windfall profits tax" is the way to go I have to disagree. For one thing, they'll just pick up and move to Houston. For another, it was tried in the '80s and the income generated was a fraction of what was anticipated. These kinds of taxes chase business away.

I understand the desire to get revenge on big oil, but remember, you get more flies with honey. Suck 'em in with incentives and tax breaks and the resulting profits to the state will be enormous.

Go Tigers!
 
I have to agree with LSU1992. It's time for a change but I think we can do it without making such high demands as $1 million dollar fees for ships unloading, etc. LA can't afford to loose this business during it's rebuilding. It is imperative that we need look at developing a more diverse energy supply.
 
A windfall profits tax on oil companies would only restrict their ability to invest in development in the Gulf region. Why cut off our mouths to spite our faces?
 
The purpose is the threat. I don't think that at a windfall profits tax will help. I want the oil companies and their friends in Congress to shit their pants thinking about the Louisiana delegation co-sponsoring the legislation. I want them to call Dick Chenney and tell him to make it stop. I want the opportunity for everyone in Louisiana to explain how to make it stop: 50% of offshore revenues, and full compensation for losses.
 
Threats can work but they can also backfire. I think the right approach is to work together on this. This issue is on everyones mind and we need to keep it front and center. We need to let our government know that we are informed and that we want change. We don't need to create subsidies for foreign oil companies that will reduce our domestic companies ability to compete in the market. We need to keep our domestic companies strong so they can make substantial investments and develop new technologies necessary to provide us with access to more diverse energy options.
 
I agree...subsidizing foreign oil companies just doesn't make sense to me. This would be giving them an unfair advantage over our own oil companies, thus making us even more dependent on foreign oil sources. Hopefully our elected representatives will work with us to prevent this!
 
Markus - I hate to burst your bubble but the suits in Congress don't scare easily, if at all/ever. They know they're in the driver's seat and if anyone should be scared it's us!

We're going to have to grow our way out of this, like it or not. And that means enticing the oil comnpanies to not only stay but maybe even grow their presence here. If you can figure out a way to get the enviro lobby to let us build a new refinery or two please let me know!
 
i agree with sunlover...a WPT hurts American oil companies and helps foreign oil companies--many of which are state-owned.
 
LSU, the suits in Congress scare very easily, if what they're scared of is their constitutents. I know because I spent the better part of a decade on the hill.

Whether you're using honey or vinegar, that's the way to get a Congresscritter's attention.

I've tried arguing forcefully with people that Katrina wasn't even the Big One, but rather a catastrophe resulting from the failure of the levees, and that the real big one could take out 25% of the nation's oil supply (production and import) indefinitely, or cause a crevasse or washout in the lower river that could effectively close navigation , primarily agricultural exports.

I am just proposing a little demonstration. I do not, repeat not think that a windfall profits tax will help our situation, regardless of the merits or demerits of such a tax.
 
Thanks for the insight, markus, you make some good points.

I spent a little time on the hill myself and you're right, individual members jump when constituents call and write to complain. But only if there's a hot topic coming up for a vote and the constituents do it in a civil tone and in large numbers. If it's just a few people complaining about an issue that isn't coming up for vote then they go to the back of the line.

Whatever it is, we do need to get their attention. And I hope you're wrong about the big one yet to come!
 
I'm not the only one who's pissed. From the 3/31 TP:

"If you say you aren't going to protect lower Plaquemines, what's next? Lower Terrebonne? Lower Lafourche? And then what, the middle parts?" asked a visibly angry Sen. Mary Landrieu, D-La., as she walked out of the meeting with Powell and Lt. Gen. Carl Strock, commander of the corps. "Seven months after Katrina, they still don't realize they have a bill to pay. They don't want to pay it."

http://www.nola.com/news/t-p/frontpage/index.ssf?/base/news-5/1143789426269270.xml
 
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