New Hampshirites, many of whom are no doubt deeply concerned about Russian interference in U.S. elections (notably one that occurred in 2016), probably did not mean to send a New Year’s gift to Vladimir Putin.
But that was the effect when utilities in Massachusetts had to import liquefied natural gas from Russia to keep their lights on and their homes heated during a cold snap at the start of this year. The regional power grid couldn’t generate enough electricity, and the existing pipeline network couldn’t deliver enough of America’s abundant natural gas supply. Oh, and we couldn’t move liquefied American gas from Gulf Coast ports to Boston Harbor because, you know, the Jones Act. We needed foreign ships and foreign crews, which are only allowed to deliver foreign gas.
We can’t blame New Englanders, or the Northeast in general, for the travesty that is the Jones Act. But the rest of the region’s energy problems are entirely of its own making, as is its overall economic decline relative to the rest of the country. The Northeast – including six New England states plus New York, and to lesser degrees other states as you move further south and west – has made a complete 180-degree turn from the philosophy that originally made it the nation’s commercial center, with a strong industrial base, in the 19th and early to middle 20th centuries. The can-do ethic of New England industriousness has been replaced with a “can’t-do” spirit.
You can’t build a power line to carry clean Canadian power to Massachusetts, because New Hampshire says so. The Wall Street Journal reported that after Massachusetts gave the green light to a 192-mile transmission line carrying hydroelectric power across the border, New Hampshire rejected the plan, throwing its future into doubt. The Northern Pass project has already generated years of controversy despite the region’s ongoing struggles to provide sufficient power to residents. Eversource Energy, the company that originally proposed Northern Pass, plans to appeal New Hampshire’s decision; Massachusetts has said it will not yet abandon the plan outright, but it is looking at an alternative route through Maine in the meantime.
You also can’t build more gas pipelines to deliver fuel to the region, because New York is doing its best to block such transit routes. The Federal Energy Regulatory Commission overruled one such rejection last year, but in January it allowed another one to stand. New York is not just picking on New England; the state has punished its own upstate residents too, by banning them from allowing natural gas development using hydraulic fracturing on their private land, depriving many rural families the ability to capitalize on what is likely to be their most valuable asset.
As Jude Clemente observed in a column for Forbes, obstructing gas pipelines is not only terrible news for the budgets of individual Northeast residents. Higher electricity prices hurt businesses. “Overly high costs are just one reason why six of the 10 ‘worst states for business’ as ranked by Chief Executive magazine are in the Northeast,” Clemente pointed out. Electricity costs in New England are already 56 percent higher than the national average, and actions like New Hampshire’s and New York’s are not poised to bring them down.
You don’t hollow out a prosperous rural and small-town economy overnight. It has taken decades of excessive costs, punitive taxes, onerous permitting and land-use restrictions, and educational neglect to get the job done. Today, the mission is pretty much accomplished. New York state is a virtual economic wasteland once you get past the counties that have commuter rail links to Manhattan. Connecticut has followed Rhode Island into statewide economic decline. As it considers the site of its much-touted second headquarters, Amazon will no doubt pay close attention to Boston’s struggles to stay lit and heated in its harsh winters.
For the most part, financiers, university professors and unionized public workers are not suffering unduly from this economic balkanization. It’s the region’s less affluent, less educated, less mobile population that is denied opportunities to work in construction, extractive and related service industries. And ultimately it is the smaller communities of the Northeast that will continue to suffer the drain of working-age talent while the old and the sick are left behind. Northeastern winters can be brutal in a lot of ways, and the cold is only one of them.
Opponents of one project after another talk about “the process,” as though the process of getting permission to do something is ultimately more important than getting something done. That attitude is most attractive when the lights are on and the temperature is comfortable. As New Hampshire Gov. Chris Sununu pointed out, “You can’t just say no to everything.”
Those of us who live in warmer and more sensible places might just wash our hands of the situation and conclude that the Northeast’s losses are our gains. That option is tempting, and certainly less aggravating than confronting Northeastern NIMBYism (which may well be reflected in the comments that soon appear below this post). But it is ultimately no more sensible or humane than turning our backs on poverty and privation in the Deep South or Appalachia or inland California.
In fact, when you move away from the financial and cultural centers of New York City and Boston, the Northeast’s can’t-do spirit threatens to turn much of the region into an extension of Appalachia. The opioid crisis gripping much of the small-town Northeast is a warning sign that this process is already well underway.
The Constitution gives Congress the power, and also the responsibility, to regulate interstate commerce. There is hardly anything more interstate than moving essential utilities from one part of the country to another. If Northeastern states cannot provide reasonably efficient and workable siting and permitting processes, they are inviting federal pre-emption. Preferably before the next severe cold snap or heat wave makes the place uninhabitable.
Posted by Larry M. Elkin, CPA, CFP®
photo by Steve Snodgrass
New Hampshirites, many of whom are no doubt deeply concerned about Russian interference in U.S. elections (notably one that occurred in 2016), probably did not mean to send a New Year’s gift to Vladimir Putin.
But that was the effect when utilities in Massachusetts had to import liquefied natural gas from Russia to keep their lights on and their homes heated during a cold snap at the start of this year. The regional power grid couldn’t generate enough electricity, and the existing pipeline network couldn’t deliver enough of America’s abundant natural gas supply. Oh, and we couldn’t move liquefied American gas from Gulf Coast ports to Boston Harbor because, you know, the Jones Act. We needed foreign ships and foreign crews, which are only allowed to deliver foreign gas.
We can’t blame New Englanders, or the Northeast in general, for the travesty that is the Jones Act. But the rest of the region’s energy problems are entirely of its own making, as is its overall economic decline relative to the rest of the country. The Northeast – including six New England states plus New York, and to lesser degrees other states as you move further south and west – has made a complete 180-degree turn from the philosophy that originally made it the nation’s commercial center, with a strong industrial base, in the 19th and early to middle 20th centuries. The can-do ethic of New England industriousness has been replaced with a “can’t-do” spirit.
You can’t build a power line to carry clean Canadian power to Massachusetts, because New Hampshire says so. The Wall Street Journal reported that after Massachusetts gave the green light to a 192-mile transmission line carrying hydroelectric power across the border, New Hampshire rejected the plan, throwing its future into doubt. The Northern Pass project has already generated years of controversy despite the region’s ongoing struggles to provide sufficient power to residents. Eversource Energy, the company that originally proposed Northern Pass, plans to appeal New Hampshire’s decision; Massachusetts has said it will not yet abandon the plan outright, but it is looking at an alternative route through Maine in the meantime.
You also can’t build more gas pipelines to deliver fuel to the region, because New York is doing its best to block such transit routes. The Federal Energy Regulatory Commission overruled one such rejection last year, but in January it allowed another one to stand. New York is not just picking on New England; the state has punished its own upstate residents too, by banning them from allowing natural gas development using hydraulic fracturing on their private land, depriving many rural families the ability to capitalize on what is likely to be their most valuable asset.
As Jude Clemente observed in a column for Forbes, obstructing gas pipelines is not only terrible news for the budgets of individual Northeast residents. Higher electricity prices hurt businesses. “Overly high costs are just one reason why six of the 10 ‘worst states for business’ as ranked by Chief Executive magazine are in the Northeast,” Clemente pointed out. Electricity costs in New England are already 56 percent higher than the national average, and actions like New Hampshire’s and New York’s are not poised to bring them down.
You don’t hollow out a prosperous rural and small-town economy overnight. It has taken decades of excessive costs, punitive taxes, onerous permitting and land-use restrictions, and educational neglect to get the job done. Today, the mission is pretty much accomplished. New York state is a virtual economic wasteland once you get past the counties that have commuter rail links to Manhattan. Connecticut has followed Rhode Island into statewide economic decline. As it considers the site of its much-touted second headquarters, Amazon will no doubt pay close attention to Boston’s struggles to stay lit and heated in its harsh winters.
For the most part, financiers, university professors and unionized public workers are not suffering unduly from this economic balkanization. It’s the region’s less affluent, less educated, less mobile population that is denied opportunities to work in construction, extractive and related service industries. And ultimately it is the smaller communities of the Northeast that will continue to suffer the drain of working-age talent while the old and the sick are left behind. Northeastern winters can be brutal in a lot of ways, and the cold is only one of them.
Opponents of one project after another talk about “the process,” as though the process of getting permission to do something is ultimately more important than getting something done. That attitude is most attractive when the lights are on and the temperature is comfortable. As New Hampshire Gov. Chris Sununu pointed out, “You can’t just say no to everything.”
Those of us who live in warmer and more sensible places might just wash our hands of the situation and conclude that the Northeast’s losses are our gains. That option is tempting, and certainly less aggravating than confronting Northeastern NIMBYism (which may well be reflected in the comments that soon appear below this post). But it is ultimately no more sensible or humane than turning our backs on poverty and privation in the Deep South or Appalachia or inland California.
In fact, when you move away from the financial and cultural centers of New York City and Boston, the Northeast’s can’t-do spirit threatens to turn much of the region into an extension of Appalachia. The opioid crisis gripping much of the small-town Northeast is a warning sign that this process is already well underway.
The Constitution gives Congress the power, and also the responsibility, to regulate interstate commerce. There is hardly anything more interstate than moving essential utilities from one part of the country to another. If Northeastern states cannot provide reasonably efficient and workable siting and permitting processes, they are inviting federal pre-emption. Preferably before the next severe cold snap or heat wave makes the place uninhabitable.
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