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The next American economy can be built around shale gas

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Brooks McCabe Brooks McCabe
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Sen. Brooks McCabe, D-Kanawha, is managing member and broker of West Virginia Commercial LLC. He has been involved in commercial and investment real estate for more than 30 years, and he also is general partner of McCabe Land Co. LP. He has served in the West Virginia Senate since 1998, and is a special project consultant to The State Journal.

Several months ago, Booth Goodwin, the U.S. Attorney for the Southern District of West Virginia, recommended that I read William J. Holstein’s book titled “The Next American Economy*.” It was an eye opener and had a number of relevant points for West Virginia. In many ways, it is a blueprint for West Virginia’s future, especially as it relates to the shale gas industry.

The book was published in 2011 so the opportunities relating to a new energy based economy built around shale gas were not a topic in the book. The themes of the book, however, were right on target. “Technology Clusters” found around major universities such as MIT and Pittsburgh’s transformation from a steel town to educational and medical facilities, as well as a new manufacturing industry focused on advanced robotics, resonated with opportunities available at West Virginia University, Marshall University, MATRIC and the activity around the West Virginia High Tech Consortium. The author also wrote about “Ecosystems of the Future” which included smart energy grids and creating an American export machine. Workforce investment was another ecosystem illustrated by Cleveland’s Cuyahoga Community College. These are all topics central to the creation of West Virginia’s future economy built around the shale gas industry.

Officials from Braskem/Oderbrecht refer to manufacturing clusters as the ultimate key to the success of the ethane crackers, several of which should be coming on line within the next decade. This clustering of midstream and downstream manufacturing facilities is indeed the key to West Virginia’s economic future. But to be successful, the highly skilled workforce needs to be in place, the transportation system, especially the pipelines and multi-model facilities need to be in place, and global market, i.e., the export machine, needs to be in place. These are gargantuan tasks in a state that here to fore has been hesitant to make a full fledge commitment to the global economy. Shale gas affords West Virginia the opportunity to be a major player in the next American economy. In fact, if West Virginia dares to be great, it can become a recognized leader in that economy. For this to occur, West Virginia needs a reset of its values and expectations. Again, Holstein discusses these issues in his book.

The following quote from “The Next American Economy,” though somewhat lengthy, could be considered by some as a good description of the mindset from which West Virginia is trying to recover:

“Too many Americans seem to be just hanging on, fighting over a pie they believe is shrinking, not wanting to take a risk on a three- or four-year investment. For them, pessimism is a disease worse than cancer. If Americans assume their pie is shrinking, the psychology shifts. Everyone tries to hold on to his or hers patch and we beggar our neighbor, engaging in zero-sum behavior. Civic mindedness and the ability to suspend short-term gratification to build wealth-creating alliances fall apart.”

This appears to be a good description of the nonbelievers in West Virginia. We need to raise the bar, believe we can create an expanding economy and do so in a sustainable and environmentally friendly way. Our confidence needs to be rebuilt. We need to set the bar higher and raise our expectations. In so doing we can prepare ourselves for the next American economy.

Holstein also talks about the need to make education more of a “priority even at a time of state budget cuts.” He goes on to say “we need to resist polarization and the ideology of mistrust.” In West Virginia, we spend too much time on divisive issues such as guns and abortion, rather than focus on how we can best participate in the next American economy. As Holstein writes, “The central mission should be to secure the economic base for all Americans so that we can afford the luxury of these culture debates.”

We need to be focusing on the multitude of issues that relate to reestablishing an energy economy in West Virginia. Our goal should be to become a recognized leader in the global economy as it relates to energy and manufacturing. If we can reach these heights, we can have the luxury of spending our time on culture debates. If we would become successful at that level, one might suspect that these cultural issues would become less important in a state that views itself as a central part of an expanding global economy. Diversity and varying opinions are much easier to accept when friends and neighbors are all sharing in a new level of prosperity.

Holstein’s “The Next American Economy” provides a good blueprint for West Virginia as it begins to look toward being a major player in the next American economy. It is encouraging that the U.S. Attorney for the Southern District of West Virginia is reading such books as “The Next American Economy.”

This is indicative of a new self-image that is beginning to be developed in our state. For West Virginia to truly change and adjust to the future before us, we must create a new mindset that is pervasive and all-inclusive. It appears we may well have begun a process of rediscovery, here in West Virginia, that will move us past our zero-sum mentality and into the next American economy.

*William J. Holstein, The Next American Economy, Walker Publishing Company Inc., New York, 2011