North Dakota: A Study in How the Free Market Works

By:  Bob Adelmann
03/13/2012
       
North Dakota: A Study in How the Free Market Works

The continuing boom in North Dakota seemingly has no end. Last June oil production from the Bakken Formation exceeded 11 million barrels a month. In February it reached 16 million with estimates that by late spring North Dakota could be producing more oil than either California or Alaska. That’s more than double what the state produced just two years ago.

The continuing boom in North Dakota seemingly has no end. Last June oil production from the Bakken Formation exceeded 11 million barrels a month. In February it reached 16 million with estimates that by late spring North Dakota could be producing more oil than either California or Alaska. That’s more than double what the state produced just two years ago.

The population boom in Williston and elsewhere continues to set records. The oil industry employs more than 30,000 people and could exceed 100,000 if production rises as expected to a million barrels a day. There are so many job openings that the state is sponsoring trade fairs across the country and has to deal with — are you ready? — budget surpluses!
 
Comparisons between North Dakota and other states struggling with deficits and high unemployment abound. Steve Moore wrote about it in the Wall Street Journal, noting that North Dakota has a budget surplus of $1 billion out of a $3.5 billion budget and it has already cut income taxes and is considering further reductions. Complete funding for the state’s pension plan is accomplished every year and the state is building “infrastructure” projects: roads, bridges, railroads and pipelines.
 
Moore compares this to the issues facing California: five straight years of budget deficits with the current fiscal year’s shortfall expected to exceed $6 billion. Brian Calle wrote in California’s City Journal:

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Photo: In this July 26, 2011 photo, Ben Shaw hangs from an oil derrick outside Williston, N.D.

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