Could US energy create 4 million jobs?

It's within geological reach, but it isn't within political reach.

By Jim Cramer Oct 5, 2012 8:40AM
TheStreet.com logoKevin Burke, CorbisCould Mitt Romney realistically create 4 million jobs from exploiting our nation's newfound energy sources, as the GOP candidate claimed in the debate Wednesday night?

 

Journalists are all about fact checking these debate statements, looking for the hype and the false promise, so I indulged in a similar test last night in speaking with Al Monaco, the new chief executive officer of Enbridge (EEP), which builds and manages the largest pipeline system in North America.


Here's a country within a company, currently slated to build $30 billion worth of pipelines in the next five years, of which $18 billion are funded and the rest are most likely going to have little problem being funded ,given Enbridge's amazing track record.

 

Monaco's answer? A definitive yes. Apparently we have so much oil and gas in the wrong spots in the country that in order to get them to where they are needed, we will need millions of people to be hired, typically in higher-priced jobs, in order to get them there.

How does he know? Because of the prices.

 

We have dramatic differences in the price of oil all over this country as the finds in Eagle Ford, Texas; Utica, Ohio; the Marcellus in Pennsylvania; and the Bakken in North Dakota are found and exploited through new technology. We could lower the price of energy dramatically and make our continent energy-self-sufficient if we could drill and transport what's available for us. But Monaco wonders whether we have the will to do so.

 

The forces against this exploitation are the strongest he's ever seen -- he said so in an analyst meeting earlier this week -- and unless the president gets behind it, the jobs are unlikely to be created in the numbers that could make a difference to the employment rate.

 

The combination of fossil fuel haters and those who would like gasoline to go much higher to force conservation are, indeed, that powerful, and they will stop this exploitation if they can.

I know it is taken as gospel among some politicians that the way to energy independence is through renewable energy, wind and solar always being the poster boys for this trend. Rarely mentioned is the fact that it's not realistic for the chief burner of fossil fuel, namely surface vehicles. You can quickly rebut that by simply saying if everyone drove an electric car or truck than we could simply plug in and end this fossil fuel madness, even though you would be plugging in to a largely coal-based system.

 

But the biggest users of fossil fuels are trucks using dirty diesel. Those imports could be reversed simply by having Enbridge pipelines linked from the sources of natural gas liquids and natural gas to the pump. That's where the millions of jobs would be created.

 

Right now neither candidate will commit point blank to trying to get us off diesel, even though that's where the most clear intersection between OPEC jobs and US jobs is. That's where the North American energy independence would come from. It's in geological reach, it just isn't in political reach.

 

But it is important to point out that the man who would be doing the bulk of the initial hiring -- the man who is going to make his five-year double-digit compounded rate of return with or without the support of government -- knows it is a reality. But he doesn't have the votes and, alas, is powerless to put the infrastructure jobs in place. So we keep the employment rolls below our nation's demands, we keep the skies dirty, we stay dependent upon OPEC, and we just keep the ridiculous status quo.

 

Jim Cramer, theStreet.com

 

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and has no positions in the stocks mentioned.

 

 


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159Comments
Oct 5, 2012 10:38AM
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I'm confused.....when oil prices were $150 per barrel gas prices were $4

when oil is at $90 dollars the gas prices are $4

 

also confused.....when does adding 114,000 become a reason to celebrate??

 

 

KOOLADE!!!

Oct 5, 2012 10:38AM
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VOTE OBAMA AND LEFT WING DEMOS OUT OF OFFICE!

CUT REGULATIONS AND TAXES! STOP WASTEFUL SPENDING!

CUT BIG OVERBLOATED GOVT OVER PAID JOBS! GET RID OF

UNIONS! VOTE ROMNEY AND RYAN! YEAH THE JOB NUMBERS

ARE DOWN? WHAT A BUNCH OF CROCK! MORE OBAMA LIES!

Oct 5, 2012 1:14PM
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Just wait till the Sequestration budget cuts kick in and 250,000 (low estimate) former military members and government contractor hits this job market. Wonder if someone in the government can wave another magic wand, but then the election will be over so there will be no need.  114,000 new jobs are not even enough to cover the new entries entering the workforce, this is insane, as has been said several times “the numbers just don’t add up”. Rigging the numbers for public consumption for a large part of the under informed portion of our society before an election is almost criminal. I am so tired of being lied to by both sides. Can I please get honest news without all the spin and cheerleading from both the left and the right

Oct 5, 2012 10:38AM
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Been in the oil and gas industry for 42 years.  Yes, Romney is correct.  Natural Gas is the fuel of the future and we need to exploit our oil to become independent of foreign oil.

Natural gas is 50 cents cheaper than wind power to creat a kilowatt hour of electricity.

There are a lot of jobs in this indusrty now but way to many people in this country who are lazy or have just given up looking for a while.  While many businesses are failing the oil and gas industry is not.  Oh, and by the way.  The people in the oil and gas industry are exceptional hard working fun loving people.  That's why I have stayed in this industry through the good times and the bad.

 

When Governor Romney is elected things "WILL" get better!

Oct 5, 2012 12:47PM
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Unemployment numbers down? What? Google is downsizing at Motorola. B of A is laying of tens of thousands of employees. Sears, J.C. Penny, Best Buy, Martha Stewart Omnimedia, the New York Times . . .  all these companies either having serious problems or are going away (along with the jobs), and unemployment is down? Your unemployed must go some place different from our unemployed.

Oct 5, 2012 12:11PM
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Jobless numbers down?  UH...been hearing about more massive layoffs happening including government contractors.  Who else thinks that the numbers are being fugged for Obama.

Oct 5, 2012 10:34AM
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James,

Stop the liberal gibberish. It wasn't the republicans that killed the ridiculous jobs bills, that was a bipartisan decision. Even the most liberal in congress recognize that when it cost the tax payer $75-$80,000 to create a temporary job that pays the worker $15,000 by the time all the government waste eats up most of it on administrative, duplicate permitting, legal, and duplicate inspection fees, it's not worth adding that much to the deficit to create so few low paying jobs.

Oct 5, 2012 10:36AM
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I said last month we would get the number under 8, just before the election.
This was done by estimating that 800,000 people started a home business, so they are now employed.

The number will drop again as XMAS jobs will be added over the next month or 2.


Oct 5, 2012 11:35AM
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Hey Pete,

The shiz hasn't hit the fan yet. You are just too stupid to see that this manipulated, pumped up, no growth approach is like taking out a third mortgage and going on an elaborate vacation. It feels great when your in it, but when you come back to reality you've lost everything. We should be adding 350,000 good paying jobs at this point, and the looming shadow inventory the banks are holding off the market still needs to be dealt with.

Oct 5, 2012 1:19PM
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Defense contractors coerced into deferring layoff notices until after the election. All smoke and mirrors. There hasn't been, and will not be, a sound sustainable recovery under the Obama administration's policies.
Oct 5, 2012 10:55AM
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More proof that when you look deeper into the true picture of labor, it is butt ugly. The labor participation data was released and it barely inched up a mere .1% before revisions. The reduction in the unemployment rate from 8.1 to 7.8% is largely due to workers remaining unemployed beyond 99 weeks of benefits at which point they are not considered unemployed by the government. Another factor in the decrease was an increase in mostly part time low skill seasonal employment by retailers for the holidays. Revisions will most likely reflect a more dismal picture in the coming weeks.

The more important labor participation rate 2008-present:‎

2008 66.2 66.0 66.1 65.9 66.1 66.1 66.1 66.1 65.9 66.0 65.8 65.8
2009 65.7 65.8 65.6 65.6 65.7 65.7 65.5 65.4 65.1 65.0 65.0 64.6
2010 64.8 64.9 64.9 65.1 64.9 64.6 64.6 64.7 64.6 64.4 64.5 64.3
2011 64.2 64.2 64.2 64.2 64.2 64.1 64.0 64.1 64.1 64.1 64.0 64.0
2012 63.7 63.9 63.8 63.6 63.8 63.8 63.7 63.5 63.6

Oct 5, 2012 3:51PM
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Can't even have a friendly debate with the lib's.  They sure are mean, hateful little things!  Must be because their noses are getting a little long!
Oct 5, 2012 10:54AM
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If it's illegal to lie then why isn't obama in prison?
Oct 5, 2012 2:16PM
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Diesel gets more miles per gallon than gasoline emitting less greenhouse gases per mile driven. However, diesel smells terrible leading people to believe that it is dirty to the environment!!
Oct 5, 2012 11:15AM
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Natural gas is safer than gasoline or diesel as a transportation fuel, no spills  and virtually impenetrable tank technology unlike conventional fuel tanks.
Oct 5, 2012 11:01AM
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I completely agree with Cramer in regards to Natural Gas.  We would reduce carbon emissions, our dependence on oil (and the Middle East), and would create hundreds of thousands of jobs were we to switch our transportation fuel of choice to natural gas.  It's cheaper to extract and transport and we have enormous reserves.
Oct 5, 2012 12:18PM
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FB has 1 billion active users.......

Unemployment down to 7.8%.....

So I am guessing the same people calculate the numbers for both and have "interesting" definitions of both "active users" and "employed".

Honest numbers would be a welcome change regardless if you are on the left or right.

Oct 5, 2012 3:24PM
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We all agree that we need energy and we all agree we need more employment in the U.S..

 

It is also necessary that we look for new sources of energy- but we also have a huge reserve of something that is obtainable in this present day.

 

It is imperitive to have money allotted for new energy sources- but it is also intelligent to start drilling the reserves that we already have- for every reason 1.  The reserves are right in front of us.  2.  It will put many people back to work now. 3. It will help bring our country back up to the living standards that we used to have- before 1997.

 

Lets look for new energy for our future now- but lets also drill now so the future can be brighter for everyone in the U.S. and some of the reserve money could be used to find new energy sources.

 

Good article Jim Cramer

 

 

Oct 5, 2012 1:10PM
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well they sure ain't here in America now are they, heh you can set your watch to the bullshiiiit that cometh our way from the marxist osama regime, unemployment down?? curious, so close to the end of obama's regime, translation: even more people dropped outta the workforce, and basically have given up looking in the first place, than before hence the drop in unemployment, cuz there's no jobs to look for!!! how predictable is this insane marxist regime
Oct 5, 2012 10:57AM
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You lib's that think you have east coast earthquakes need to do your homework on oilfield technology.  There are a lot more things to worry about, one being obama!
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