Elsewhere in this issue, we’ve told you about the stories we think will make news in Acadiana in the year that begins with great promise today. We’re a local newspaper, so those stories focus on events that happen here at home. Now and again, it’s also good to think about the way that news from beyond the borders of Louisiana and the even beyond the United States could come home:
» Oil prices. While Louisiana’s economy has diversified over the 30 years since the 1980s oil glut, many of our jobs and a substantial piece of state revenue continue to rely on how much a barrel of petroleum brings. We’ve seen how horizontal drilling and hydraulic fracturing have greatly increased domestic natural gas production, and how the price has been pushed down to levels near $3. Now that Gulf deepwater exploration is recovering and the new techniques are opening new inland areas to crude production, could the same thing happen to the price of oil? Don Briggs of the Louisiana Oil & Gas Association doesn’t think so. Briggs makes the point that while domestic natural gas goes largely for domestic consumption, the price of oil is set by a world market. And that means U.S. energy companies can increase their production substantially without cutting their own throats.
» The presidential election. Today’s story mention’s the probability that Louisiana will go against President Barack Obama. Nationally, things aren’t as clear. Despite continuing high unemployment and sub-50 approval ratings for Obama, the Republicans have yet to settle on a presidential candidate or a clear message. The leading contenders, Mitt Romney and Newt Gingrich, have each been spurned by their party in the past. The outcome of the election seems destined to make a big impact on health care, energy regulation, tax policy and more.
» China’s economy. Officials in the Chinese government are warning of a slowdown in economic growth that has been like a wildfire for 30 years. The weakness has been linked to shifts in demographics and shifts in labor supply. That could be bad news for Louisiana, which ranks seventh among U.S. states in exports ($27.4 billion), and for which China has been the leading export market this year ($4 billion through the third quarter, up 45 percent over 2010). It would be worse if China’s economy drags down regional partners and competitors such as Japan ($2.8 billion from Louisiana through three quarters), Singapore ($1.7 billion) and Korea ($1.6 billion).
» European debt. There is still fear that massive debt problems in Greece, Italy and other members of the European market could dampen growth in the rest of the industrialized world, perhaps even pushing the United States back into recession.
» The Arab spring. For the first time since the rise of Nasser after World War II, there is at least a chance of widespread reform in the Middle East. Solutions to longstanding problems there could make it less likely that thousands of Louisiana troops could again be called to action in wars in western or central Asia.