Plummeting oil prices rattles energy state politics

In the midst of the 2008 financial crash and recession, Democratic presidential nominee Barack Obama won Indiana and North Carolina, two long Republican states in presidential politics, on his way to his blowout White House victory.

Oil prices are now taking a dramatic tumble, and voters in energy-rich states are bracing for economic pain. And, like recession politics a dozen years ago, the political ramifications of the coronavirus-induced financial hardship are an open question.

And the fast-churning situation opens itself up to new political possibilities, including Texas, long a ruby-red bastion in presidential races, which, due to population growth and changing demographics, is becoming more competitive for Democrats.

Texas, one of the world’s largest producers of oil and natural gas, will be hurt by the sector’s softer than expected performance, including Republican Gov. Greg Abbott’s state government through lower tax revenue, according to Lone Star Project’s Matt Angle.

“Many middle and lower-income Texans count on energy-related jobs to pay their bills, and many upper-income Texans, many of them Democrats, have their wealth tied to the energy industry,” the Democratic strategist told the Washington Examiner.

Yet, while Angle said “there is no question” Texas Republicans will be pressed on their COVID-19 virus response, Democrats “don’t have resources” to counter Abbott or the GOP statewide, an electoral problem exacerbated by long-term Republican incumbency and expensive media markets.

Forgoing the marque U.S. Senate race to replace Republican Sen. John Cornyn in the next Congress, Angle advised Texas Democrats to focus on statehouse contests in an effort to claw back some power in the legislature.

“Operating at the statehouse-district level shrinks the playing field so that delivering messages and creating contrast with Republicans can be done much more cost-effectively than trying to do so statewide,” he said.

For fellow Texas Democrat Chris Lippincott of Hound’s Creek Consulting, any gains his party may have made in a state where President Trump’s popularity is waning and Democratic turnout is higher in a presidential election year could be wiped out by opposition to vote-by-mail initiatives.

“The candidates will deal with the impacts of Republican leadership in the state. They may rise, or they may fall because we don’t know how badly damaged the economy will be, we don’t know whether we will be required to return home with another shelter-in-place or stay-at-home order, and again, we don’t know what ballot access is going to look like, those are the known unknowns,” Lippincott said.

Montana, another energy state, is hosting competitive gubernatorial and senatorial races this cycle, both of which hinge on Democratic Gov. Steve Bullock’s management of the virus-related public health and economic crises with a Republican-controlled legislature. Bullock, whose term is up in January, is challenging GOP Sen. Steve Daines, first elected in 2014. Bullock’s performance, however, will also likely decide whether a Democrat succeeds him as the state’s executive.

Bozeman, Montana, Mayor Chris Mehl said the state’s coal-heavy economy, though a key line in the budget, only dominates a handful of counties that lean red and are unlikely to flip blue. Instead, the COVID-19 virus had caused more issues for the tourism and healthcare industries.

“Energy will be very important in very specific communities, but these other things are systemic for the state,” he told the Washington Examiner. “Because [Bullock is] a sitting governor, his success probably entirely goes on how well the state goes, rather than a specific sector.”

Former Kansas Republican Rep. Tim Huelskamp said although the virus had “decimated” his home state’s oil and gas economy, the politics were more complicated given Democratic Gov. Laura Kelly was working with a GOP statehouse as well. Like Abbott, Kelly won’t face reelection until 2022.

The ex-congressman, elected to the House in 2010 amid the Great Recession, emphasized the energy sector had been hit before, and it “hasn’t been quite this low for sure, but it will eventually recover.”

“I think you could have economic recovery much more quickly in red states than you could have in blue states or more recovery in rural states, which are generally more red, versus urban areas of the country,” he said of a pattern emerging where Republican strongholds were easing mitigation measures before Democratic ones. “That’s really a self-inflicted wound.”

Trying economic times are almost always tough for incumbents and incumbent parties, according to Marquette Law School Poll Director Charles Franklin. Franklin listed Jimmy Carter in 1980, George H.W. Bush in 1992, and Republicans up and down the ballot in 2008, as examples.

“Trend could matter though. If we are getting better in the fall, even if still high unemployment, that could look more positive,” Franklin said.

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