Gulf Oil Spill Job Losses Could Total 1 MILLION Over Next 5 Years: David Kotok

One Wall Street analyst has a very dire projection about the economic effects of the BP oil spill. David Kotok, the co-founder and chief investment officer of Cumberland Advisors, a Sarasota, Florida-based investment advistory firm, has projected that the spill will cost 1 million permanent jobs in the next five years. (Hat tip to Politico's Morning Money.)

The price of real estate properties around the Gulf of Mexico has been projected to fall up to 10 percent -- erasing some $4.3 billion in value -- Bloomberg noted recently.

According to a recent USA Today/Gallup poll, 8 in 10 Americans think that the Gulf oil spill will damage the economy and push up commodity prices.

Here's Kotok's take (emphasis ours):

Five states are now suffering because of the BP spill. Florida, Alabama, Louisiana, and Mississippi are hit by oil slicks that are devastating their fisheries and tourism. Texas is a casualty along with the others because the drilling moratorium that was poorly designed by Obama's team was created out of a political response.

The moratorium payback will be the loss of thousands of jobs.

We now add the Alaska pipeline as a possible casualty, because of insufficient throughput due to the shutdown of existing drilling thousands of miles from the Gulf. The pipeline is built for 2 million barrels a day capacity. It currently carries about 700,000 which is near the minimum necessary to operate. It is supplied by oil drilled offshore. If it doesn't maintain sufficient volume of warm oil the oil will cool and congeal. Five existing offshore wells that would keep the volume sufficient are now affected by the Obama moratorium.

We estimate that an extended moratorium, which we now expect to continue because of Obama political calculus, will cost up to 200,000 higher-paying jobs in the oil drilling and oil service business and that the employment multiplier of 4.7 will put the total job loss at nearly 1 million permanent employment shrinkage occurring over the next few years. Five states have a regional recession/depression development underway. Alaska could become the sixth state on the damaged list.

Comments

[JoeBlough]

01:07 PM on 06/23/2010

Damage is the endgame of the Bush/Cheney 2001 Energy policy that made this happen. They created the damage, we can only live with it. But if you vote back in the Party of Bush/Cheney, you will see further devastation.

[DevonTexas]

10:53 AM on 06/23/2010

and then, those "thousands" who will be out of work if we stop drilling? So it's more beneficial if we spill. baby. spill? tragic!

[graffitijoe]

07:46 AM on 06/22/2010

It's all part of the plan:

http://newsbusters.org/blogs/p-j-gladnick/2008/11/02/hidden-audio-obama-tells-sf-chronicle-he-will-bankrupt-coal-industry

[graffitijoe]

07:29 AM on 06/22/2010

Obama doesn't care because they are all red states anyway.

Perhaps since he figrures (rightly) he will lose in 2012, he is simply trying to damage the country he despises.

[bleubunny]

04:05 AM on 06/23/2010

Obama isn't the one who drilled without safety precautions in place. It's BP.

Why do you feel the need to blame Obama for everything that goes wrong? Maybe if you dumb Republicans wouldn't have tried to deregulate everything this wouldn't have happened.

Republicans are the ones destroying this country!

[JoeBlough]

01:05 PM on 06/23/2010

Damage is the endgame of the Bush/Cheney 2001 Energy policy that made this happen. They created the damage, we can only live with it. But if you vote back in the Party of Bush/Cheney, you will see further devastation.

[WAY2MCCOOL]

05:08 AM on 06/22/2010

www.collapsemovie.com its coming people, so just be ready.

[toxicbrainpoison]

01:28 AM on 06/22/2010

Its a dying natural resource, theyre going to lose jobs anyway.

[lvdragonlady]

11:05 PM on 06/21/2010

I wonder how many of those will BP employees?

[graffitijoe]

07:30 AM on 06/22/2010

BP has 20,000 US employees.

[binksmom85]

08:35 PM on 06/21/2010

even with the banks not lending, there is a way to employ people and end the federal deficit entirely:

get the dvd at secretofoz.org or just read all the essays at monetary.org ; also see newdeal20.org and Soros's new baby at ineteconomics.org and pass these on, we have to take our country back from the banksters

[nexxtep54]

10:35 PM on 06/21/2010

or build a thousand of http://www.youtube.com/watch?v=UP8iN4ZX1JU&feature=channel

[ConvictMedia]

07:21 PM on 06/21/2010

For you guys poo-pooing about oil maratoriums, - Maybe now they will build those sidewalks getting to down town (or along side the highways) so we can start biking to work.

IN addition, if that oil does freeze up in the pipes, then that will take people and jobs to clean up.

Replace those pipes (and run broadband or smart grid electrical wire) so we can then install solar panels in alaska's round the close sunshine to generate electricity.

We can start scrapping those oil rigs too - that will create jobs, just think o f all the recycled metals that can be salvaged (how many rigs were their thousands?) How long will it take to dismantle a rig - lots of work, and jobs for people to convert black to green.

I suppose the one's loosing their jobs will be stock - brokers, and dividend check cashers, maybe they (how many - which isn't alot) can now trade places with us in the unemployment lines and get a taste of what they've been putting out.

[bleubunny]

04:08 AM on 06/23/2010

Do you really think all the people who are losing jobs right now want to go clean up BP's mess? I'm a web designer who has already lost about $5,000 from a contract no longer needed. There's no way I would ever go wade in BP's muck.

[polishlogician]

07:19 PM on 06/21/2010

The moratorium only applies to 33 wells, none of which is producing oil; according to article, that comes to 6060 employees per well, before the multiplier is even used...so I guess a great deal of inflated intellectual currency is found in the word "extended" in his analysis...

"We estimate that an extended moratorium, which we now expect to continue because of Obama political calculus, will cost up to 200,000 higher-paying jobs in the oil drilling and oil service business and that the employment multiplier of 4.7 will put the total job loss at nearly 1 million permanent employment shrinkage occurring over the next few years"

[Bitsko]

05:37 PM on 06/21/2010

Shouldn't the headline read "investment Officer Predicts 1 Million Jobs Loss"? Since you only quote one person, ya know.

[ResearchtheFacts]

05:11 PM on 06/21/2010

And, your president is golfing. Hey, why worry about it until it happens which seems to be the pattern.

[Bitsko]

05:59 PM on 06/21/2010

Research Eisenhower.

[Trogenhorse]

07:19 PM on 06/21/2010

Right, because 2 hours on the golf course at one of the most tech progressive air bases means he could not handle an emergency. Really, do you think we are that stupid? Let the man have an hour or two. As long as he is not flying down to a ranch in an out of the way spot where he can't get back to the WH in case of emergency I grant him 2 hours a week.

[indy100]

05:05 PM on 06/21/2010

"Texas is a casualty along with the others because the drilling moratorium that was poorly designed by Obama's team was created out of a political response." Oh, so the President should have just allowed shoddy business practices in deep water drilling by the oil companies to continue so that we could have yet another environmental and economic disaster? Trust a Wall Street analyst, a person who does NO ACTUAL WORK, to want to continue with the status quo and the expense of the entire nation.

[coolaid8]

07:09 PM on 06/21/2010

Don't trust any of them. Let the people who live in the states that will be impacted by both the spill and the job losses to vote on the moratorium and see how they feel about it.

[Trogenhorse]

07:21 PM on 06/21/2010

As long as those same people don't complain and ask for the rest of the country and the president to put everything on hold to help them maintain a way of life. Come on you can't have it both ways. Either you want the president engaged and doing everything possible to fix things or you want the oil companies to do it.

[ConvictMedia]

07:24 PM on 06/21/2010

What is that analogy - you've got to break some eggs to make an omelette. Ha ha.

When converting to green energy, those lost jobs (who used to be addicted to the oil company for their income) will then join us in the unemployment lines.

But wait, because we converted to green, those who were unemployed, now work for the green company's .


So that means, we flip flop those who are working and not working, and this will be because of a positive conscience decision by the people, not because of a corporation's negligence, or desire to move their operations overseas.

[peteRed]

05:03 PM on 06/21/2010

this is a very good collection of blogs on the issue with a single very powerful image...worth a look!

http://www.nakedcapitalism.com/2010/06/guest-post-oil-coating-seafloor-and-killing-fish-crabs-and-the-american-dream.html

[hypnotoad72]

04:55 PM on 06/21/2010

Fire BP's CEO but DON'T give him a golden parachute to live on for crying out loud.

And don't blame Americans, either.

http://worldblog.msnbc.msn.com/_news/2010/06/10/4490597-brits-blame-obama-as-bp-linked-pensions-plummet