Last year, when oil prices shot up to $140 per barrel, it sparked a drilling frenzy across the United States—by the end of the summer, there were nearly 2,400 oil and natural-gas rigs in place nationwide, ready to pump to the last drop. But now, of course, the global economy's imploded, demand has collapsed, and oil and gas prices have fallen by two-thirds. All those rigs are sitting unused. Investments in drilling and exploration have fallen way back. In some places, it's not even worth it for companies to pump gas or oil from drills already used.

What's noteworthy about all this—that is, on top of all the thousands of oil and gas workers who have been laid off—is that the drop in investment means the economic recovery, when it comes, will actually be fairly painful, as this New York Times piece by Clifford Krause explains. Once the recession ends and worldwide demand picks up here and in places like China, oil and gas demand bolt back up—and oil and gas companies, here and abroad, won't be able to act quickly enough to meet the sudden surge in demand. One gas executive told the Times that if the current slump lasts for too long, then once it ends it will take 18 to 24 months to reassemble rig crews. That could mean another sudden spike in prices, bludgeoning the recovery before it gets too far.

Now, there are a couple ways to look at this. One is that, right now, we ought to be investing in making the economy more energy-efficient, so that it's more resilient to these wild swings in fossil-fuel prices. The other point is that people always complain that any sort of climate bill to promote alternatives to oil and gas, like a cap-and-trade regime, will raise the price of fossil fuels and hurt the economy. The former is obviously true (that's the whole point of a carbon cap!) while the latter is doubtful—most studies show a minor overall impact from cap and trade. But it's also worth asking—hurt our economy compared to what? It's not like lashing our fortunes to rapidly seesawing oil and gas prices is some super-desirable model without any downsides (and that's before even getting into the considerable costs of rapid and drastic climate change).

--Bradford Plumer