On Sept. 9, Maryland’s Democratic governor, Martin O'Malley, announced that Vice President Joe Biden had joined him for an event at the Port of Baltimore. Also present were U.S. Secretary of Transportation Anthony Foxx, Sens. Barbara A. Mikulski and Benjamin L. Cardin, and Reps. John P. Sarbanes, C.A. Dutch Ruppersberger and Elijah E. Cummings, all Democrats. The occasion marked a $10 million grant to the Port of Baltimore so that the port could accommodate the larger vessels that will be transiting the newly widened Panama Canal.
This sounds like a lot of money to most people, but with the federal budget in the neighborhood of $4 trillion, $10 million is “budget dust,” as we used to say around the Senate Appropriations Committee.
Contrast this heavy-hitter rollout with the total silence two days later that greeted the Department of Energy’s conditional grant of a license to export liquefied natural gas from a new facility to be built at Cove Point, Md. Cove Point is to be at least a $3.8 billion project, perhaps the largest private investment in the Mid-Atlantic region. As far as can be discovered, neither Mr. O'Malley nor any other member of the Maryland Democratic establishment present at the Port of Baltimore on Sept 9 has taken notice.
Economists talk of “multipliers” as a dollar coming in salary goes out to the grocery store, which then buys from farmers and pays truckers, and so on. If you use a multiple of six, which is not out of line for a capital project like this, a $3.8 billion project can yield $20 billion or more. Nor does it end there. If the Cove Point project expands, as everyone expects, the true impact could be in excess of, say, $50 billion over the next decade or so.
Cove Point can be thought of as a very large rock dropped in a still pond. It is a local project, a regional project and even a national project if all the consequences are included. There will be a lot of well-paying, blue-collar union jobs in the construction phase in Calvert County, Md. — heavy-equipment operators, welders, drivers and the like. There will also be lots of high-salary white-collar jobs — engineers, surveyors, project managers, information-technology professionals, bankers, accountants, insurance brokers — and lawyers to draw up contracts and leases. The list goes on and on. Upgrades should keep the project generating wages for two decades at least.
Then there will be the suppliers. Some will be local — for example, gravel and electric cable — while others will not. The giant generators and compressors needed to change natural gas from a gas to a liquid will be built out of state. Again, that means more top-wage union jobs and high-salary white-collar professionals.
Other ripples in this economic pond, no doubt, will involve someone buying a $40,000 Ford pickup assembled by the United Auto Workers in Kansas City. Likewise, the city fathers of whatever city gets the generator contract will have smiles on their faces as the money rolls that boosts local commerce and results in more tax revenue for the school system. Calvert County, the state of Maryland, other states and the federal government will all get a cut of the tax booty.
What about the environment? The liquefied natural gas from Cove Point will be exported and, in many cases, will substitute for far more polluting energy sources than natural gas. For example, they are bulldozing rural villages in Eastern Germany to get at the brown soft coal that is all that is left since they have mined all their quality coal. Natural gas produces about half the pollution of the best coal, and there is reason to think research and development will drive natural-gas pollution even lower.
So why has the Maryland Democratic establishment been silent about Cove Point? There was a time when the Democratic Party was the party of good union wages and high salaries for professionals. Now their new master is the liberal donor class that finances their campaigns. If the Maryland Democratic politicians didn’t comment, it’s because they didn’t want to call attention to their illiberal backing of a valuable fossil fuel. Still, the Sierra Club sounded the alarm, claiming that natural-gas drilling caused “record fires, droughts and superstorms like last year’s Sandy.”
Mr. O'Malley is opposed to natural-gas drilling through fracking, as is New York’s Democratic governor, Andrew Cuomo. Both hope to be on the 2016 presidential ticket with Hillary Clinton. The Republicans haven’t yet figured out that 2016 will be fought on energy policy as well as other issues, but the Democrats have.
William C. Triplett II is the former chief Republican counsel to the Senate Foreign Relations Committee.