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Keeping history in mind as a nation

“A nation that forgets its past has no future.” — said Winston Churchill. To put it another way, “Doing the same thing and expecting a different result is insanity.” I have heard this many times. The message is, we need to learn from our history and not repeat past mistakes. This is true for us as individuals and for our nation.

We all should now understand the danger of depending on nations overseas like China for critical products like PPE for healthcare workers (gowns, masks, gloves and face shields) and critical medical equipment like ventilators. I still visualize nurses wearing black trash bags for protection against COVID-19 because they couldn’t get gowns. I’m sensitive to this because my wife is a nurse. How many front-line doctors and nurses lost their lives because we didn’t have sufficient PPE?

The movement of manufacturing out of the U.S. began in the 1970s when we lost our energy and feedstock advantage to OPEC. Our Region was the manufacturing and petrochemical hub of the U.S. We were in the petrochemical business when the Gulf Coast was still running cattle. The Shale Crescent USA had water, workforce, proximity to most of the U.S. market and economic energy and feedstock.

The first ethane cracker was built by Union Carbide in Clendenin, West Virginia in 1920. Charleston became the Chemical Valley and a target during the Cold War. A number of companies had their Tech Centers in the Charleston area. I have been told over 400 chemical industry PhDs have retired there. I was at a wedding recently and got to talking to a former Union Carbide PhD. I asked a few questions and then listened to him for over 30 minutes. He was fascinating even if I didn’t understand all the chemical engineering.

The Gulf Coast petrochemical industry began to expand in the 1960s. They were closer to the Texas oil fields and offshore Gulf Coast production. They were also closer to OPEC oil than the Ohio Valley. Companies began to leave the Ohio and Kanawha Valley for the Gulf Coast or other parts of the world like Asia where there was cheap labor. With Asian and U.S. companies, both getting oil from OPEC, Asia’s cheap labor became a reason for U.S. companies to move manufacturing to Asia.

We convinced ourselves being an information or service economy would replace manufacturing. We let the rest of the world do the “dirty” manufacturing. We bought the cheap products made by American companies overseas. The manufacturing jobs to make those products and their wages stayed overseas. China became a manufacturing powerhouse. We even began selling China American oil and gas.

All was well until COVID-19. We suddenly realized how dependent we were on other countries especially China for basic products like PPE, ventilators, pharmaceuticals and a lot of other products we probably don’t even realize yet. Based on radio Shale Crescent USA has done across the country, all Americans regardless of political party or location agree on the need to bring manufacturing back to the U.S. Our abundant natural gas combined with advanced manufacturing methods make the Shale Crescent USA one of the most profitable places on earth for companies selling into the large U.S. market.

Environmental groups and even some political candidates promote keeping fossil fuels in the ground and using renewables. We have been told this will create a lot of jobs. Most of those jobs are installation type jobs. Renewables make one product, electricity and can’t guarantee to do that 24/7. Renewables can’t make a ventilator or a mask. We need petrochemical feed stocks for that. If windmills and solar panels are going to create good jobs, we need to demand they be manufactured in the U.S. like other critical products. This requires fossil fuels and petrochemicals. We need gas and oil wells. They all require fracking. We need petrochemical plants and ethane crackers to turn oil and gas into the feed stocks to make PPE, medical equipment, components for renewable energy and many other household products.

Americans don’t want to be dependent on places like China for medical PPE and other critical items. Independence requires a strong oil and gas industry and a strong petrochemical industry to provide feedstock for the hundreds of manufacturers already here making products. These same companies can expand to manufacture critical products currently being made in places like China. Plastic product manufacturers are already seeing cheap plastic feedstock prices. This will change as the economy recovers. We can’t allow our local manufacturers to be dependent on overseas ethane crackers.

We can create the world’s first sustainable petrochemical hub. Plants built here will be the cleanest and most efficient in the world. We are working with companies who want to come to Shale Crescent USA and turn plastic waste into feedstock. We can have high wage jobs, the critical products we need and a clean environment. The renewable solutions we hear about for Europe and the U.S. don’t do anything to stop increasing Chinese CO2 emissions, that undo all of these efforts. One solution is to manufacture in Shale Crescent USA. We will have one of the lowest carbon footprints in the world when crackers are built here on top of the feedstock and in the middle of their customers instead of shipping energy to China and sending Chinese products here.

We lost high wage manufacturing jobs when we lost our energy advantage. Our advantage is back because of shale gas. We are beginning to see the reshoring of manufacturing. We can’t allow history to repeat itself and drive manufacturing back to China. When the next virus comes we can’t allow our front-line health care heroes to be defenseless hoping China will send us some PPE.

Thoughts to ponder.

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Greg Kozera, gkozera@shalecrescentusa.com is the Director of Marketing and Sales for Shale Crescent USA. He is a professional engineer with a Masters in Environmental Engineering who has over 40 years’ experience in the energy industry. Greg is a leadership expert and the author of four books and numerous published articles.

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