- REVIEW & OUTLOOK October 3, 2012, 7:15 p.m. ET
New York's Governor favors rich greens over the upstate poor.
A state moratorium has blocked hydraulic fracturing since 2010, but a four-year environmental review was supposed to pay off with new rules to allow drilling this November. The Cuomo Administration has instead announced it will restart the process, with more studies, more hearings and more years of delay.
Put another way, the man who would be President is ducking the premier energy debate of our time. Green elites have made fracking their bête noire, and they've more or less ordered Mr. Cuomo not to move ahead with drilling in even a few upstate counties. The Governor knows this would cost jobs and investment, so he's taken the brave stance of cueing the bureaucrats and deciding not to decide.
This is a giant loss for New York, which holds an estimated 20% of the reserves in the Marcellus Shale formation. A 2011 Manhattan Institute study estimates that the typical Marcellus well generates more than $5 million in economic benefits and $2 million in tax revenue. If fracking were allowed, the study notes New York would already be on its way to creating more than $11 billion in economic output and more than 15,000 jobs by 2020. That's already happening in neighboring Ohio and Pennsylvania.
The shale bonanza is also sparking a surge in manufacturing investment to exploit cheaper energy. Egypt's Orascom Construction announced last month it plans to build a $1.4 billion fertilizer plant in Iowa, while Dow Chemical in April announced a $1.7 billion ethylene production plant in Texas—all thanks to shale gas.
Upstate New York desperately needs this economic jump-start. The New York Department of Labor's September jobs statistics showed that the 52-county upstate region's private jobs growth rate over the past year was less than half (0.9%) the downstate rate (2.3%), and one-third of New York City's (2.9%). Yet Big Apple elites—and apparently Mr. Cuomo—prefer to keep upstate in pastoral poverty for their second homes and antique shops.
Mr. Cuomo says further study will produce better rules to ward off a legal challenge. Yet the Governor knows that the green left will sue to block anything he proposes, and the sooner that process begins, the sooner it ends. Our sources say Mr. Cuomo wants the political cover of a big investment commitment from a big gas driller. Yet New York's first draft regulations, issued earlier this year, were so stringent that many producers doubt they could turn a profit.
Mr. Cuomo could learn from former Pennsylvania Governor Ed Rendell, a Democrat who understood that the economic benefit was worth taking grief from the left. Even President Obama is trying, for re-election purposes, to take credit for the natural gas boom he's had nothing to do with.
Mr. Cuomo has bent to the left on a big tax increase, caved to unions on education reform and pensions, and given cultural liberals their top priority of gay marriage. His fracking delay is a gift to the green lobby, which hopes to forestall drilling long enough to enable a second Obama Administration to complete a federal regulatory takeover that makes fracking far more costly and ends the boom. The question for Mr. Cuomo is what has he done for New York's economy?
If Mr. Cuomo wants to kill fracking, he should kill it. Otherwise, he owes it to his state to give it the opportunity to build a new future with the shale boom. That would at least give Mr. Cuomo the credibility to run as a Democratic jobs candidate in 2016. Right now he's the Democratic nothing candidate.