Raymond J. Keating

In Brussels earlier this month, members of the European Parliament voted to overturn a new drilling moratorium on European oil reserves offshore. And while the U.S. Interior Department has lifted its offshore drilling moratorium too, getting the Gulf Coast back to business is a long way away.

Even by Interior Secretary Ken Salazar’s own admission, it will take weeks to issue new permits under tightened regulations. This political gamesmanship in America is in stark contrast to the EU’s decisive vote for its own energy security.

For the past five months, small business owners, workers and consumers throughout the Gulf region have been unnecessarily punished by the U.S. Interior Department’s extreme response to the BP Deepwater Horizon accident. This moratorium, moreover, ignored American energy companies’ solid track record of employing high safety standards and the world’s best technology.

But our neighbors across the Atlantic were keen to recognize what was (and is) at stake. Perhaps Struan Stevenson, a member of the European Parliament, said it best after he and his colleagues overturned the EU’s drilling ban. Stevenson stated, “We risked sending the global oil industry a terrible signal that would have jeopardized millions, if not billions, of pounds-worth of orders for our state-of-the-art technology. Instead we have said that we will learn the lessons of the Gulf of Mexico disaster without sending our valuable oil industry up in smoke”.

And to make matters worse, pending proposals in Congress to hike energy taxes are having an insidious affect on America’s competitiveness. Key competitors are aggressively moving forward to secure the energy resources that are so vital for economic growth and superiority. For example, Russia is expanding into the Arctic while China continues its aggressive financing of resource acquisitions. These nations recognize the value of developing energy reserves both at home and abroad. Unfortunately, this means America will continue to fall behind in the increasingly competitive energy race. With America penalizing her own energy companies with punitive tax proposals, a host of other countries are happy to fill the vacuum created by U.S. firms that are less able to compete.

A few weeks ago, China’s largest offshore oil operator agreed to buy-in to a significant shale gas project in Texas, marking the country’s first energy acquisition in America. Beijing understands that the global marketplace for oil and natural gas will only become more competitive in the future. Sadly, Washington currently does not.

Raymond J. Keating

Raymond J. Keating is chief economist with the Small Business & Entrepreneurship Council and an adjunct business professor at Dowling College.