Boom and Bust, Again: Wyoming in the 1970s

 

          Nothing so dramatically illustrated the fact that Wyoming’s economy remained dependent on natural resources, specifically energy resources, as the mid-1970s energy boom and the ensuing bust in the 1980s. The severance tax on minerals had been imposed just in time, not only to help cushion the immediate impact of another minerals boom, but to try to mitigate the inevitable huge swings in economic fortune accompanying such events.

          Some Wyomingites reveled in the sudden prosperity in the period, while others were alarmed by the influx of more people, the pressures on wildlife and the environment, and the social problems associated with boomtown conditions. Some towns were practically overwhelmed with the impact of the swelling population. The problems in some places were so great that State government stepped in. 

          In the previous two decades, Wyoming political and business leaders tried to reassure Wyomingites that the economy was becoming too diversified to be dependent on a single industry. Minerals, agriculture (primarily livestock raising) and tourism seemed to be steady partners in the state’s economy. No one of them seemed dominant in 1970. Employment in minerals, substantial in the days of coal-fired locomotives, had fallen after World War II, even though occasional oil and gas booms brought temporary workers to various towns during the period.

Casper, the “oil capital of the Rockies” during the early part of the 20th century, continued as a significant refining center in the years after World War II. Huge refineries, operated by Standard Oil and Texaco, processed millions of barrels of oil. The city continued to house regional offices of most of the major oil companies.

Elsewhere in the state, refineries by smaller independent companies continued to produce gasoline and petroleum byproducts for a mostly regional market.  Cody’s Husky Oil Company refinery augmented the town’s summer tourism businesses. Empire State Oil Company ran a small refinery in Thermopolis while refineries in places as varied as Newcastle and Greybull added to local economies.  Cheyenne’s Frontier Refinery and the Sinclair facility east of the town named for the company provided steady employment for hundreds of Wyoming workers in the post-war years.

In most sectors of the industry, however, the oil exploration and drilling companies, many independently owned and operated, employed mostly temporary workers. Oil production continued to grow in Wyoming until 1970 when it began a steady decline. As petroleum production fell and oil companies turned increasing attention to huge new fields in the Middle East, South America and the North Slope of Alaska, Wyoming refineries closed. By the end of the century, only four refineries remained. (Natural gas, constricted by the lack of adequate interstate pipeline capacity in the 1970s and 1980s, was to become significant in the new century).

          Tourism, centered around the national parks, paid low wages and remained distinctly seasonal. Tourist businesses knew they had to make good on the three months of summer.  Ski resorts still had merely local appeal and snowmobiling was in its infancy. Yellowstone National Park essentially closed for the winter.

          Crop agriculture, never a significant factor in employment, competed with the burgeoning corporate farms in California and elsewhere. Ranch consolidation continued as family ranchers increasingly found it difficult to compete against large cattle-raising operations. Drought in the early 1950s retarded agricultural growth in much of eastern Wyoming.

          By the 1970s, agriculture accounted for less than five percent of the employment in the state. Despite the decreasing significance of their industry to the economic mix, ranchers continued to hold inordinate political power in the Wyoming legislature into the 1970s.  It wasn’t until the last two decades of the century that most people were disabused of the myth that Wyoming was a state highly dependent on agriculture.

         

          In the late 1960s and early 1970s, nationally, the Vietnam War still dominated political debate. In Wyoming, the various positions on the war remained set. One of the most vocal supporters of the war, Sen. Gale McGee, was re-elected to his third term in 1970. At the same time, Wyoming voters elected Teno Roncalio, also a Democrat, as Wyoming's sole member of the U. S. House of Representatives. Unlike McGee, Roncalio was firmly opposed to American involvement in Vietnam and had opposed the war very early on, even before his political ally and friend Sen. Robert Kennedy had come out against the war.

          Statewide, however, the primary issue in the closing days of Gov. Stan Hathaway's administration was the potential for another energy boom. During the 1960s and the first two years of the 1970s, the Wyoming economy was in malaise. Hathaway, like  his immediate predecessors dating back to the end of World War II, continued the quest for economic diversification. Hathaway encouraged promotion tours to lure new business and state agencies initiated media campaigns to attract tourists. The state's economy remained static.

          State income was more assured with the passage of the severance tax on minerals, but the energy industry was only staying stable with oil prices at less than $10 per barrel. Just one open-pit coal mine in Campbell County, providing fuel to a small power plant nearby, utilized the vast resource potential in the Powder River Basin. Elsewhere in Wyoming, the "bust" in coal brought about by conversion from coal-fired steam locomotives to diesels was still firmly in place. Rock Springs, Hanna, and the coal towns in Sheridan County recorded high unemployment and declines in population during the 1950s and 1960s. The once-powerful railroad brotherhoods and coal miner unions, never robust after passage of the so-called "right-to-work" law passed in the 1963 Wyoming legislature, watched their memberships continue to fall. 

          Young people, including UW graduates, left the state in high numbers because of the absence of good-paying jobs.  For many male high school graduates in the late 1960s, if they did not go on to college, military service was the only option. Many enlisted, but when the Vietnam War heated up in 1967, Selective Service boards around the state starting drafting from the pool of young men from 18-25 years of age.

                The Democratic Party, never as cohesive in the state as the Republicans, was badly split over the Vietnam issue. McGee, a Democratic “hawk” on the Vietnam War, won reelection in 1970, only with a sizeable vote from Republicans who also favored the war. Anti-war Democrat Teno Roncalio, personal popular among Wyomingites, narrowly was returned to the U. S. House of Representatives. 

          Nonetheless, the 1974 election showed that the Republicans, too, could fragment and, therefore, lose an open-seat election. Nationally, the “Watergate scandal” brought about President Richard Nixon’s resignation in August. The new President, Gerald R. Ford, had Wyoming connections, his natural grandfather having been a pioneer Casper merchant and banker.

          After two terms of governor during which local and federal demands brought about huge growth in state agencies, Stan Hathaway did not seek reelection in 1974. Four well-known Republicans sought the gubernatorial nomination, representing the various interests within the party. Dick Jones, a legislator and trucking executive from Park County, won the nomination. He was the most conservative of the Republican candidates and, consequently, with the help of Republican disarray nationally, the Democratic nominee, Ed Herschler, was able to gain substantial independent and Republican support.

          Hathaway completed his second term and, soon after, accepted appointment as President Ford’s Secretary of the Interior. Hathaway found the confirmation process to be brutal and, even though he gained Senate confirmation by a vote of 60-36, he resigned after six weeks, citing frustration with the bureaucracy and health problems.

When the Arab oil embargo began in December 1973 and continued into 1974, the price shocks (gasoline rising in price from 25 cents per gallon to more than double in a year) brought some oil exploration back to the state. As the industrial economy endured the oil price shocks, Wyoming’s energy-based industries began to grow rapidly once again. The Overthrust belt in southwestern Wyoming gained the attention of many multi-nationals, bringing boom times back to the quiet towns of Evanston and Kemmerer.  High prices brought production back in some older fields.

Even more significant, however, coal became an important fuel source once again, not for locomotion, but for fueling electric power plants. Mines along the Union Pacific line across southern Wyoming, closed after diesels replaced coal-fired locomotives in the 1950s, returned to production. Clean air standards and increasing emphasis on coal also made the lower BTU Powder River Basin coal suddenly competitive with higher grades of coal mined in such places as West Virginia and Illinois that contained more air-fouling sulfur. 

The thick seams of coal lying only a few feet below the ground allowed for strip-mining to become the preferred method of coal extraction. Gigantic draglines removed the overburden and huge electric-powered shovels loaded hauling trucks carrying up to 50 tons of coal. In some mines, long conveyor belts carried the coal to tipples for loading onto 120-car unit trains, each car specially designed to be loaded and dumped efficiently.

By the end of the decade, Wyoming strip mines produced sufficient coal to put Wyoming among the leading states in coal production. In 1985, more coal was mined in Wyoming than any other state and that ranking continued into the 21st century.

Even though strip mines required far fewer workers than conventional underground mining, the numbers of new mines and the construction activities required to put them into production brought huge population increases to many Wyoming towns. Mining activities centered around Gillette, Rock Springs and Rawlins, but smaller towns in the coal fields also grew rapidly. Sweetwater County grew to 41,723 in 1980 from just 18,391 ten years earlier. Carbon, Uinta and Converse registered similar eye-popping population jumps, all due to energy production. Campbell County, with a population of 12, 957 in 1970, nearly doubled to 24,367 in the 1980 U. S. Census.  To accommodate their workers, ARCO built an entire town—Wright, dedicated in July 1976—south of Gillette that grew to a population of more than 1,200 in the next decade.

Power-plant construction brought boom times to other Wyoming towns. The Laramie River Power Plant, built over the course of nearly a decade, changed Wheatland from a sleepy agricultural town to the home of a huge crew of construction workers. Similar construction projects in Lincoln and Sweetwater counties added both temporary workers to local payrolls as well as a smaller, but well-paid permanent contingent to run the plants. The main building at the Jim Bridger Power Plant east of Rock Springs became the tallest structure in the state at some 24 stories.

Prior to 1974, many towns had experienced booms (and the ensuing busts).  Few, however, were prepared for the onslaught of miners, construction workers and employees for support companies that descended on Wyoming in a brief period of time. Long-abandoned coal mines in Carbon and Sweetwater counties reopened with investments in new underground and strip-mining equipment. Unemployment, chronic in the mining towns in the 1950s, shrank to nearly zero. Mines competed for skilled workers and thousands descended on the state after hearing about the potential jobs when industrial employment in the Midwest and East was flat or decreasing.

Coal wasn’t the only energy mineral to gain attention in the period. As early as the late 1950s, uranium regained competitive advantage in power plant use in the 1970s. With these new non-weapon demands, industry expanded mines and built new processing mills in several Wyoming locations.

The Green River Basin in southwestern Wyoming held one-quarter of the world’s naturally-occurring supply of trona, a mineral important for manufacture of glass, detergents and environmental equipment.  Trona was discovered there in the late 1930s by an oil-drilling crew. The first trona mine opened in 1948. By 1970, more than 1,000 people worked in the industry. Peak employment came in 1981 when nearly 4,000 workers were employed by five mines operating in the area. 

          This energy boom period lasted from 1974 to about 1983. Secondary booms, caused by businesses expanding or new service businesses opening to accommodate the needs of the newly arrived energy workers, fueled local population growth.

          Housing, if it was available, became spectacularly expensive in the boom towns. Reports told of workers renting beds in local motels in eight-hour shifts. Most towns had no zoning ordinances. Contractors rushed completion of an-camps and barracks. Entire neighborhoods went up within months of their platting. By the end of the decade, mobile homes accounted for almost 20 percent of housing units in the state.

          Many Wyomingites became prosperous during those years, but there were contradictions of “prosperity.” Older residents, living off of Social Security or other fixed income, watched property prices spiral upward and, with the rising assessments, the tax bills on their already-paid-for homes. Small business operators, accustomed to hire employees at the minimum wage, suddenly faced competition for laborers from the much better paying mines. Employees in non-mining industries paid increasing prices for food and other staples. 

          Restaurants and bars were crowded around the clock.  Promoters of local festivals, initially aimed at bringing in tourists but also enjoyed by town residents, found little interest among the newcomers in participating. For those working in the mines, they were too busy making money to volunteer for parts in local fairs.

          With the increasing population moving into the community, many with families, local schools were stretched to the limit. Some districts were forced to hold double-sessions as new, often modular, units were put up to accommodate the incoming students. Teachers, facing the same inflation as other non-miners in town, demanded higher wages or turned to moonlighting in second jobs. Some left education altogether and took jobs in mining or became land developers. High schools reported increasing incidents of students dropping out before graduation in order to take jobs paying $40-$50 per hour in the mines.  

          Town councils were overwhelmed with demands for water and sewer taps for housing developments. Indeed, had not severance taxes been initiated in the late 1960s, state government would have been in no position to help. Without state assistance in the form of loans from the State Farm Loan Board or state housing authority, cities and towns would not have been able to provide water, sewer, and streets for new residents. The State helped with funds for law enforcement and provided an increasingly greater proportion of public assistance, once the province of the cities and counties.

          The hard-working and hard-living population brought increasing demands on social service agencies. Child and spousal abuse cases increased dramatically. Law enforcement officers, accustomed to dealing with traffic matters or an occasional shop-lifting complaint, were besieged with calls involving assaults and other more serious felonies.

          A University of Wyoming sociologist, after studying boom conditions in Gillette, referred to the social impact of boom-town living as leading to the “Gillette syndrome.” He defined it to a Wall Street Journal reporter as the toll on humans of having to live in isolated towns with few civic amenities, in overcrowded, substandard housing and with scant options for entertainment beyond gambling, drinking and vice. Such conditions, he asserted, led to spousal and child abuse, public drunkenness, drug dependency, assaults, and other anti-social behavior.