ECONorthwest founder and principal Dr. Ed Whitelaw provided testimony in a joint hearing of the Louisiana House and Senate committees on Natural Resources. Whitelaw described ECONorthwest's findings that there were multiple errors in a recently released economic report on the effects of so-called "legacy lawsuits" on oil and gas drilling in Louisiana.
Whitelaw, founder of ECONorthwest, a Portland, Ore., company that provides financial analysis for businesses and governments, said Dismukes’ widely quoted analysis has several major flaws.
“Understand that these errors, and there are three or four big ones, any one of which is enough to render his analysis nonsense,” Whitelaw said. “These are rookie errors.”
For instance, Whitelaw said, the analysis omits a relevant variable. Dismukes included data from 2005 and 2006, when the Louisiana energy industry was battered by two hurricanes, and stops his analysis in 2007.
“He fails to mention Hurricane Katrina or Hurricane Rita anywhere in the report,” Whitelaw said.
“In our opinion, the Dismukes document fails to meet any of these professional standards. And this failure matters to the degree that the Dismukes document is fatally flawed, both theoretically and empirically. Nowhere does Dr. Dismukes present a coherent economic model linking legacy lawsuits and decisions to drill in Louisiana,” the ECONorthwest report states.
Dr. Ed Whitelaw is the founder of ECONorthwest. He specializes in urban and regional economics, natural resource and environmental economics, and the economic consequences of policy decisions. As an expert witness, he has testified in litigation cases in state and federal trials and dozens of administrative, legislative, congressional, and judicial bodies on a variety of economic issues.