Thursday, June 14, 2018

Lex Anteinternet: Issues In the Wyoming Election. A Series. Issue No. 1(b). The Economy again. . . dare we say it. . . Government (shush). And, what's up with Wyoming's GOP hating the Federal Government?

Mother government batting down the hard working forces of free market capitalism from her perch on the economic stool.  Or maybe just a mother teaching and playing with her kittens.

To listen to Wyoming's Republican politicians, the state is being occupied by an enemy army intent on squashing the rights and liberties for hard working free minded folks.

Southern Yeomanry serving as Confederate soldiers, prisoners of war at Gettysburg, 1863. These deluded saps believed the Federal government was their enemy as well when it was their own state's that would in the end deprive them of their traditional rights.  That lesson shouldn't be lost on Wyomingites today.

It's baloney.

The "hate the Federal Government" thing has been around at least since the 1970s. It arose during the Jimmy Carter Administration when certain sectors of Wyoming's economy, most principally agricultural sectors, began to imagine that it was being picked on by the Federal Government.  That sparked the "Sagebrush Rebellion" which, contrary to the way it may be remembered by people elsewhere and its proponents today, was deeply unpopular amongst most Wyomingites. Anti Federal Government feelings in a muted form helped get Malcolm Wallop, a patrician candidate with English aristocratic roots elected to office, but it quickly burned out.  Jim Geringer, the GOP candidate for Governor none the less managed to ride the wave to the state house when the feelings of rank and file Wyomingites ignited and put the rebellion out, largely over the issue of public lands and the ownership of wildlife.  It's been a good thirty years since then, but once again fueled by fiction, the movement in a new form is back.  Once again, it's deeply unpopular amongst average Wyomingites but the GOP is not getting the message. There's a fairly good chance that Wyoming will elect a Republican Governor who will be semi hostile to public lands and the counter revolution will once again have to start.

And it will start.

There's also a fairly good chance that Mary Throne, the only candidate who seems solidly behind the public lands, may end up Governor as a result.  That may very well depend on where she comes down on other issues, but right now, it's Thorne who is most attune to average Wyomingite's views in the Governor's race in regards to this. Next to her, in the race for Congress, it's the eclectic Rod Miller.

So what's up with this nonsense?

It's hard to say, but a blistering lack of knowledge has a lot to do with it.

The common story in Wyoming is that the Federal Government is keeping the economy down, and otherwise picking on people.  It simply isn't true. The entire fable is based on a street level concept that Wyoming's economy has been regulated out of existence when the truth is much more complicated than that and has a lot more to do with the price of a barrel of oil in Saudi Arabia.  The idea is kept current by the drumbeat of those who support this view, even if its a false view of our economy.  And it rarely seems to be the case that people stop to take notice that a deprivation of the Federal Government's role in the state would fall on the residents of the state in a highly unequal fashion.  People with money could buy their way around what that meant.  Most people would leave much poorer lives, in every sense.

Let's start with the basic facts.

It's a popular notion to say that "freedoms die when regulations grow" but in reality freedoms are often preserved by the restraint of unregulated monied interests by regulation.  Now, it is definitely the case that regulations can get to be nuts and very restrictive. The entire wacky set of regulations that pertain, for example, to "comfort animals" is a a really good result.  And there are many others. Add to that there are laws that are definitely unjust on a local level and the courts, a branch of government, can greatly compound that in a way that average people can do nothing about.

But in regards to Wyoming's basic industries, this just isn't happening.

The oil and gas industry is undoubtedly subject to regulation. But few in the industry in Wyoming feel the regulations are excessive and they're fairly readily complied with. They exist, for what it is worth, on the state and local level, so its hardly the case that if the Federal Government were to pack up and go home Wyoming would have a perpetually blissful regulation free existence.  A lawyer is a lot more likely to end up in front of the Wyoming Oil & Gas Commission on a regulatory matter than in front of the Federal Government.  

And truth be known, a lot of the time that a lawyer may be interacting with the WOGC or the State Department of Environmental Quality, it's likely to be for a land owner, probably a rancher, whose land has been impacted by some activity on it.  It's easy to pretend that the extractive industries have no impact on the land, but they do, and this creates a fair amount of the actual agency practice, i.e., landowner v. extractive industry.  Put another way, it's all fine and good to say that regulation is putting the industry down, but I suspect if an oil company was on the Gordon or Hageman place and spilled 300 barrels of oil, neither Hageman or Gordon would want the call to the company to be met, with "well, when regulations grow freedom dies. . .stick that up your wazoo!".  No, they don't.

Again, that doesn't mean every state regulation is great.  But the concept that all regulations are bad, and that they are Federal, isn't exactly wholly accurate.

Anyhow, at least since the Reagan Administration regulations have been pretty balanced in many fields, but certainly not all of them.  Now, some would point toward regulation of the coal industry as an exception, and they may have a point, but those regulations never really came into full effect and the coal industry too an economic dive anyhow.

Which brings me to my next point.  Under the current administration, we're in an environment that's more friendly to industry since any since Reagan. . . assuming that it's not more friendly to any since Calvin Coolidge.  It's impossible to imagine an environment any more friendly to industry than the current one.  We have a Republican administration and two Republican legislative houses at the national level, plus all that at the local level.  So the"the Federal government beat me up in an alley and stole my lunch" just doesn't make much sense right now in terms of the exractive industries.  It might in terms of many other endeavors, but not this one.  And basically they don't pretend that it does.


Bureau of Reclamation land open to the public courtesy of the Federal Government. This land is used for hunting, fishing, recreation, irrigation and power generation.  The state has no role in the projects that lead to this whatsoever.  Pathfinder Dam being built by the State of Wyoming?  Give me a break.

So what's up with all this animosity towards the Federal Government?

I'm not sure what got it rolling, but it seems to be something that really took off during the Obama Administration.  For the most part, the Obama Administration was pretty ineffectual in these regards for about 3/4s of its Administration, but was effective in the final 1/4. Be that as it may, the real animosity towards the Federal Government seems to have really took off right from the point of his election, and it never stopped.  Indeed, perhaps the roots of this go all the way back to the Clinton Administration, which is basically when the Wyoming Democratic Party ceased being a full contender in state elections.  If I'm correct, it seems that the idea alone that President Obama was a radical liberal was sufficient to fuel a counter reaction, and not just in Wyoming, but across the Untied States. We're still living with that in Wyoming even thought almost everything that movement stands for has now really jumped the shark in so far as Wyoming is concerned.

Well. What, you might ask, has the Government done for me lately?

Well, as previously noted here, if you live in Central Wyoming, it may have kept your region from sinking into a depression during the last oil and gas slump, although that would have been a combination of the state and Federal governments that did that.  Massive public funding for construction projects injected huge amounts of money into Wyoming in the last few years, just when the economy needed it most.

Beyond that, Federal money puts millions of dollars into the state in the form of highway money, money for administration of all types of the public lands (a State of Wyoming study commissioned by the legislature determined the state couldn't afford to administer the public lands, which would be likely why they wouldn't try and would shortly just sell it all off), and military money, just to name a few instances.  Towns like Guernsey and Cheyenne benefit from military bucks.  Towns everywhere benefit from highway money.  We have airports because of the FAA.

State money adds to that.  The largest employer in Natrona County is the school district.  Government offices in Natrona and Laramie Counties are major contributors to the economy.  If we expand out to universities, the impact across the state is even larger.

Which gets me to what should perhaps be my next point.  I find few Wyomingites, to include Wyomingites who came here from neighboring states, who really hate the Federal or State government.  A strong element of this thought, although not limited to it, is concentrated in people who brought such attitudes into the state with them.  Some of them have in turn funded this view. Others have just picked it up.  It's fairly significant in the state's GOP right now, even though a logical analysis would hold that if the GOP hates the government it ought to be hating itself, as it controls the government.  It would almost like the Soviets rebelling against the Soviets in 1925.  It's really rather odd.

So if we step back from this all and just consider the facts for what they are, what would we end up with?

Well, in terms of contribution to the local economy, the dirty little truth is that the Federal Government is contributing more than its taking.  At current levels, the State government may be as well. That doesn't mean the level of state government is perfect.  But for that matter, it might be the the current funding model for state government is not realistic at this time either.

 Pathfinder and Alcova Reservoirs, two Federal Bureau of Reclamation projects.

And it might also mean that the level of Federal Government in the state is about right.  Certainly the state has done everything to encourage some Federal funding to increase, such as at Camp Guernsey, of the past three decades.  As the Federal Government must exist, even if we feel the current level to be about right or even a little too big, we might wish to keep on keeping on in getting a share of the pie where we can.  Politicians who argue the contrary ought to demand that institutions like Camp Guernsey or F.E. Warren but shut down and the state take over all  highway funding, for example. That's not going to happen.

And if we take into account that education spending is government spending, we might want to consider that one of the items which is claimed to keep Wyoming's economy down is that we have one four year university, and it doesn't teach every field significant to the state.  Veterinary medicine, which is significant to the state, is not taught there. Nor is medicine.  The University of Wyoming has done an excellent job of bringing four year programs to towns across the state, through association with the community colleges, but at this point we have to wonder why a second or third university doesn't exist. Why doesn't Casper have a four year school with advanced degrees?  It could, it just doesn't, as the state won't fund it. For that matter, what about Gillette, or Rock Springs?

And what about, dare we suggest it, occasional direct intervention in the economy where it is warranted.  We mentioned one such example here yesterday, although we doubt that would occur, and will be mentioning another shortly.  One we'll mention here is the ENDOW studies endorsement of subsidization of air travel, which was passed by the Legislature.  It's easy to decry something like that, but in areas where its necessary for economic development, but where it can't get a start in the market place, it's long been the case that various governments in the US have subsidized things until they were on their way. Subsidizing something in decline is one thing, but as start up seed money, that's quite another.

And the lack of transportation infrastructure is precisely the sort of thing that keeps Wyoming's economy in what is essentially a third world state.  With the regional big cities drawing in business like suns gather planets, individuals, including some individual candidates, who seem to believe that Wyoming's economy wills stabilize through happy thoughts are fighting facts that can't be ignored.  The border of Wyoming is just a line reflecting a public subdivision, not a lien of Everest like mountain peaks.  If looked at realistically in that context, what that means is any major business activity will tend to gravitate towards the big regional cities, Denver, Salt Lake, and Calgary.  Not to Douglas, Sheridan and Casper.  Business that comes in, basically has to, as that's where their work is.  But even at that, they only have to to an extent. 

Marathon Oil provides a good example of this.  It was formed in Ohio and moved to Wyoming due to the Salt Creek oilfield.  It set up its headquarters in Casper.  It later moved them to Cody, where its more productive fields were, in the 1970s.  It bought a headquarters in Houston, and now that's where it is.  It operated its Wyoming fields, when it had them, out of Houston.  So does Anadarko.  So does Conoco.  Others, more regional in nature, operate out of Denver.

This is a fact of our situation.  The ENDOW study noted that a factor in Wyoming's economy was that it had no major cities.  It doesn't, and frankly most Wyomingites are very glad that it doesn't, to include me.  I absolutely hate big cities and I'm glad that we have none.  But in fact it isn't completely true that "we" don't have big cities. We do.  Our big cities, as noted, are Denver, Salt Lake, and Calgary.  Those are the regional big cities.

Anyhow, a factor in all of this is transportation, and that brings the role of the government back in.  As we have a third world economy, based on colonization from the outside when the commodities are advantageous, we have third world transportation. I work all over the state, and I go everywhere by truck.

Yes, truck.

Indeed, I can always tell a recent import lawyer as they'll try to travel the state in the winter in their Metro Geo, or some such vehicle.  Nope, you need a 4x4 to live and work here.  And that is in part because we have no travel infrastructure that's not based on asphalt.

We could, however, and that will require the state to get it rolling, just as government money did the same with rail, highways, and air travel elsewhere.

Well already I can hear the Chuck Gray's of the state denouncing this website as a dangerous Communist inspired propaganda network.

Probably  how some in the GOP are presently imaging the author of this blog.

Nope, I'm just taking a page out of the historical GOP book.

Let's start with the first example, railroads.  

Railroads were started by private enterprise in this country and everywhere else, pretty much.  But it took government intervention to cross the country, in the form of massive public backing during the Abraham Lincoln administration.

Abraham Lincoln.  Dangerous Socialist?

I've gone into the 19th Century government support of the transcontinental railroad before, but the thing to note here is that it happened and was massive and it wouldn't have had, or it would certainly have taken a lot longer, if the Civil War era Congress, freed of Southern Democratic economic views, which strongly resemble quite frankly current Wyoming GOP economic views, went ahead and supported a radical program of gigantic rail expansion.

Maybe Wyoming ought to consider the same thing.

Eh? 

This actually came up in the recent economic forum involving the Gubernatorial candidates in Cheyenne. The topic was whether or not the state should support high speed rail between Cheyenne and Fort Collins, Colorado.  It's a radical idea, and none of the candidates supported it. And I can see why they wouldn't.

But that doesn't mean it doesn't  have some merit. 

Commuter rail is extensive in Denver Colorado, and frankly it's great.  I'm a good example of this.  I used to drive a lot.  Now I rarely do, and only do if I have to.  I take the morning flight to Denver International Airport.  From there, I used to rent a car.  I no longer do if I can avoid it, and I usually can.  I take the A Train downtown.  I haven't had the occasion yet to use a transfer to another part of Denver, but looking into it, I think I fairly readily could.

All of which puts me in the class, I suppose, that has somewhat lost the love of the road. 

Anyhow, soon rail will extend to Fort Collins and thousands who drive from Fort Collins to Denver everyday will take the train. The thought is that Cheyenne could be linked into that. Frankly, not only Cheyenne, but Laramie could be linked into that, and existing rail lines could be used for a lot of that.  Which would sort of freakishly bring us back to the state of things up until the 1950s.

If this is a good idea, the thought that would link Cheyenne and Southeastern Wyoming to the regional business hub of Denver, and making getting back and forth much easier for Wyoming business.  It'd put Cheyenne in the Denver business satellite orbit.  And frankly, not matter what is done with Wyoming's air system, it isn't going to include Cheyenne.

Or it could just make Cheyenne a bedroom community for Denver.  If you listen to your Chamber of Commerce types, that's great but most people don't really think so.  It might work, or it might not, but it is not likely to hurt. 

Except for the state's purse.  It might be pretty darned expensive.

It's not going to happen, however, as none of the candidates like the idea.

Anyhow, the rail line that went from the Union to the Pacific didn't get there due to hopeful wishes and business risk.  The government backed it in various ways so it went in.


As we're going in date order (and we'll circle back to air in a second), let's consider the second example.  The highways.

Highways are such a bad economic bet that in modern Ameican history they'v never been private.  You can find some early examples to the contrary, but by and large, highways are a state subsidy for transportation.  On the state level, some states take a toll of the use of some highways. Colorado does, for example, on the E470.  Federal highways do not take a toll.

I'm not really going to go beyond this except to note that for those who are always opposed to a government role in the economy, highways are essential to the highways, and they're all government all the time.  All of Wyoming's highways were state highways on the state's dime until the Lincoln Highway.  Following that, it was Dwight Eisenhower who brought in the modern Interstate Highway.

Dwight Eisenhower.  Raging Socialist?

I guess I will note that the state's highways are super expensive to the state but nobody seems to notice.  I've been on a lot of lonely stretches of highway that are simply auxiliary highways to towns served by other highways.  For example, Sublette County seems ot have some highways that are duplicative of other state highways.  Nobody ever seems to suggest that these should go.  It's odd.

Anyhow, back to air travel.

Air travel is another thing that came about due to government support. 

Yes, it did.

United Airlines didn't just spring forth from the pockets of Citibank or something.  No, what happened is that  the United States started supporting air travel of the mail through the post office, basically assisted at first by the U.S. Army.

1919 celebration of the first anniversary of air mail, with photograph including the Post Master General and Army officers.

Soon after that, as soon as commercial air travel was available, the Government started contracting with air lines for the delivery of air mail, and it still does.  As this became more viable over time, commercial entities that essentially are air mail services made big roads into that.

The point is that air travel in the United States became viable because the US Government took up air mail as a service, and then supported commercial carriers though the subsidization of contracting for the carrying of the mail.

There's not much difference between that and the state subsidizing local air travel, which its going to do.  But perhaps it should take it up fairly seriously.  If the state provided regular air service to its towns and cities in this fashion, it'd be used.  It might be used enough or the subsidy to eventually be removed.  It'd certainly be a boon to the state, and its a good thing that the state is taking it up.  Indeed, I've been asked by out of state clients about why I drive to places like Evanston rather than fly.  I don't fly, as you can't.

Governor Mead deserves a lot of credit for backing this.  I'm concerned, however, that the next Governor will not.  It's pretty clear, I think, that Throne would keep the service.  Maybe Gordon, Galeotos or Freiss would as well.  I doubt Hageman would as Hageman seems to be of the view that the oil and gas industry is the only industry that matters.

Which circles back to a central point.  Wyoming takes in more Federal dollars than it sends to Washington.  And we benefit a lot from what the Federal Government provides for us in all sorts of ways.  We aren't really being oppressed by Washington D. C..  And that's a Republican Government.

We'd additionally note is that the current era in which every Republican candidate feels compelled to run against Washington, which they also control, is really absurd.  If the GOP has to run against a government it controls, something is deeply amiss with our way of thinking, or our way of acting.

And maybe to some extent we ought to consider those aspects of Wyoming in which the average citizen benefits from the government. A Harriet Hageman flyer was left in the door this past week in which it is asserted that Ms. Hageman sued the EPA, Forest Service, U.S. Fish & Wildlife, and other states "and won".  I don't have any complaints with the Forest Service or the Fish & Wildlife and before I'd regard suing them as a good idea, I'd sure like to know what it is that its claimed they did.  Just a blanket assertion that a lawyer sued them for some client doesn't tell me much. And as most of us work both sides of the fence for pay, although perhaps she does not, I'd really want to know what the cause was before I simply assumed that it was a battle between good and evil like so many seem to assume.
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