When a new year dawns, it's time to contemplate what lies ahead. So Hair Balls called UH professor Peter Bishop to talk about the future. Bishop specializes in long-term forecasting and planning. "What happens next year is already baked in the cake," he says.
Bishop says that if you read, you know that Houston has "a cushion because of the oil industry and the medical center. It's not recession-proof, but it's recession-resistant...It's my experience that our recessions happen to be shallower than in the rest of the country - unless it's driven by oil."
For that reason, when he looks into the distant future, he sees Houston's fate as dependent upon diversification. "We don't want to be the Detroit of the 21st century," he says. "Not to say that we have to rush out right now and close all the refineries...but I think Houston will someday have to face up to how it's going to make a living in the 21st century."
Bishop points to oil industry experts like Matt Simmons, who thinks peak oil is already upon us. "The oil industry might go flat in the teens," Bishop notes.
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And while demand will increase in developing countries and Houston will benefit from the resulting higher prices, "that may lead to a kind of complacency," says Bishop, "just like with the auto industry, which was making tons of money on low-mileage vehicles, not realizing that was going to come to a screeching halt. Nobody wants to see that happen in Houston."
Oh well, maybe somebody will bail us out.
- Cathy Matusow