‘All of the party was over’: How the last oil bust changed Texas

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Office buildings in downtown Midland and elsewhere were short on tenants during the 1987 oil bust. Bob Daemmrich/BDP, Inc.

When Kathy Whitmire ran for Houston mayor in 1981, helicopters were among the top sources of municipal strife. Residents of the Memorial neighborhood were irate over the daily noise of west Houston businesspeople who opted to fly over the gridlocked freeways for their morning commutes.

That's just how over the top the Texas economy had become as oil prices skyrocketed in the 1970s and into the early 1980s.

Whitmire won the race. But a plunge in oil prices effectively resolved the noise complaints. And about about a year into office, her problems became bigger and more unexpected.

"All of the party was over," Whitmire said in a recent interview with The Texas Tribune. "At first, I thought this would be temporary."

Instead, the oil bust engulfed the decade.

She and other leaders across the state confronted an economic crisis for the ages, at least until the current oil bust and the COVID-19 pandemic ravaged the Texas economy this spring. The fallout forever changed Texas, but it also offers warnings and lessons for the anticipated trouble ahead.

It all started in 1973, when oil in the United States cost $3.89 per barrel. The state's image was already rooted in oil produced-wealth. But for the most part, oil was a bargain for most Americans.