When it comes to Texas’ budget deficit, nobody is quite sure where the state stands. The comptroller does not release official figures until January. And with the energy industry resilient as ever, there has been much talk by Governor Rick Perry about how well Texas has held up. Oil prices are high and new plays – mainly the Eagle Ford, with its oil and natural gas liquids – and enhanced oil recovery on old fields, are producing strong returns.
But, as big as the energy industry is in Texas, it cannot carry the state alone. There are signs the deficit is going to be a doozy. John Reynolds, a Texas budget expert with the Quorum Report, which reports on Texas politics, crunches the numbers for us.
In addressing the recent oil slick in the Gulf of Mexico, the US government has swung into action, mobilising the military and high-level officials for months on end. But roughly 350 miles east, the slow-motion environmental disaster above Houston continues unabated.
Because air pollution is not only invisible, but its impact on health and the environment is not immediate, it provokes little outrage; there are no images of oil-soaked birds or devastated fishermen to provoke media ire and political action.
In Houston, the energy capital of the world, there are 497 industrial facilities with a total of 27,463 flares, boilers and the like, emitting chemicals that have been linked with everything from nervous system damage to cancer. And yet environmentalists have been fighting a tough battle bringing attention to this cause.
Robert Sanborn, president of Children at Risk, a think-tank dedicated to improving the lives of Houston’s chilldren, explains:
In Texas, we do put business first. This is a good case of David and Goliath, and the state pays attention to Goliath. It’s a reality of Texas. The oil industry is the lifeblood of Houston. It’s the lifeblood of Texas industry.
The oil industry is taking its lobbying to the streets on September 1, when it will stage rallies in three Texas cities – Houston, Port Arthur and Corpus Christi.
The American Petroleum Institute, a key organiser, says more than 5,000 people - and more likely 7,000 considering RSVPs from oil and gas companies, supporting agricultural and other companies – are expected to show up.
The last time the industry held a rally it did fill the venue as companies urged their staff to attend in hope of drumming up support for the industry.
The oil industry is the lifeblood of Texas. The API, the industry’s national trade organisation, estimates the oil and natural gas industry supports more than 1.7m jobs in Texas and accounts for almost 25 per cent of the state’s economy.