Diary

Obama Denies Keystone Pipeline: Is This the End?

On Friday Barack Obama announced that he had denied a permit to TransCanada, the builder of the Keystone pipeline.  Many consider this the death knell of the project.  The history of the pipeline is tortuous and began in the Bush administration.  It was punted to the Obama administration which ordered another EPA study.  Surprisingly, the Obama EPA- in a rare case of the application of science- concluded that the environmental impact would be minimal.  The one thing holding up the project was opposition from officials in Nebraska, but when their Republican Governor removed that opposition- after TransCanada made some adjustments to its route.  The Obama administration lost that excuse for holding up the project.

Instead, there were more studies.  Keystone is perhaps the most studied major infrastructure project in the history of this country.  A few facts are in order before discussing Obama’s decision to kill the project.  First, although proponents touted it as a job-creator, that is somewhat misleading.  Most studies indicated that there would be few long-term jobs created.  Once built, the design of the pipeline was so technologically advanced that human monitoring and maintenance would have been minimal.  But, it would have created many construction jobs in the short term.  In my book, “many jobs in the short term” is greater than no jobs at all.  Given the infrastructure requirements and actual construction, it would have been one of the largest domestic, privately-funded projects in history.

Second, Canadian oil enters this country every second of every day on rail cars and through pipelines.  Some of that which enters the country through pipelines is refined at facilities in Illinois and distributed throughout the Upper Midwest.  One study indicated that by diverting that oil to refineries along the Gulf Coast, gas prices in the Upper Midwest would have increased a maximum of 8 cents a gallon.  Most of that oil, however, was not destined for domestic consumption, but was destined for the international market.  The economic benefit to the United States would have to those refineries and storage facilities that received the oil.  More product means more work which means more workers.

Instead, we are left with excuses from the administration that the potential costs (environmental damage, accidents, etc.) outweighed the benefits.  This is a ludicrous argument.  In the years it took to come to this decision, thousands of miles of pipeline have laid in this country safely and in an environmentally friendly manner.  While we have heard of no pipeline ruptures, we have seen pictures of rail cars carrying oil derailing and spilling their product in rivers in West Virginia and elsewhere.  Since that oil is going to be refined Keystone pipeline or not, the Obama administration just increased the chances of a major spill on railways.

And that is the whole crux of this controversy.  The oil from the Alberta tar sands, while perhaps the most “dirty” of crude oils, is going to be extracted, transported and refined whether the pipeline was constructed or not.  Although it may be more expensive to transport it by rail over land to ports on the West or East coast of Canada, it will be transported.  And if not processed in Canadian refineries, it will be shipped to refineries in countries whose leaders see the benefits- China, India, Singapore, etc.  Think about this “carbon foot print” which the Obama administration created: oil is extracted and transported via rail to ports in Vancouver which is then loaded onto tankers which sail across the Pacific Ocean to off-load the oil to outdated, pollution-creating refineries in Singapore after which the refined products are loaded back onto tankers and shipped throughout the world.

This decision is nothing but phony symbolism devoid of commonsense designed to enhance Obama’s credibility with the environmental Left.  In the press, they are slapping themselves on the back on their “victory.”  The back slapping may be short-lived since a presidential decree today can be undone by a presidential decree in the future.  Obama’s Friday afternoon decision as Washington headed out for the weekend and the public’s attention turned to the NFL and college football will become a political liability for Clinton if the electorate uses commonsense judgment.  The Left is not shutting down the extraction of oil from tar sands in Alberta.  The potential for environmental damage has increased as a result of this decision.  Most egregiously, this decision has damaged relations with one of our most stable allies and neighbors.

Once again, Obama has proven that ideology- not commonsense or scientific truth- drives his decision making process.  He has screwed up the Middle East, so why not screw up US-Canadian relations?  The next president’s job has just become that much tougher.