It has been a week since President Obama made his shocking announcement delaying the Keystone XL pipeline decision until after the presidential election. The news has been met with cries of victory and sighs of disappointment, but the tactic shouldn’t have surprised anyone as it fits in totally with his ideology.
Additionally, TransCanada, the company behind the pipeline, handed the environmentalists a win.
First, we all know that the President is fundamentally opposed to all carbon-based fuels (think Solyndra, et al)—so the pipeline’s approval was a longshot. But it would have created thousands of true shovel-ready jobs without a dollar of taxpayer money. Many of those jobs would have been union jobs.
The pipeline’s approval would have made the unions happy. while angering the environmentalists. Two of his solid funders were in conflict—one shouting in one ear, the other in the other ear. Waiting for the decision, watchers wondered which base held more sway.
The delay announcement, however, is a fundraising coup.
In August, when the Environmental Impact Statement on the pipeline “reaffirmed the environmental integrity of the project,” environmental groups threatened to pull their support for President Obama in the upcoming election if he approved the project—some calling his environmental record disappointing and dismal. Because they have no place else to go, Obama expects them to stick with him.
Not only will environmentalists likely stick with the president, his apparent quandary invites their input—only this time, not in his ear, in his pocket.
We all know that President Obama is not immune to the influence of donors on his decisions. With less than twelve months until the 2012 election, both the unions and the environmentalists will be buying—oops, I mean vying for—his favor. While some are calling his punt indecisive or a debacle, it could be the most brilliant fundraising tactic as both sides over-donate in support of their positions.
We also know that the Obama administration supports higher gas prices. The Keystone XL pipeline would have provided more stability in oil supply and pricing. The supplies of crude oil from Mexico and Venezuela are declining, and the pipeline would have provided refiners in the Gulf region with a secure supply—and a supply from a friendly source. Less supply means higher prices. Without the XL pipeline on the horizon, prices will increase as they’ve done since the delay announcement came out. Higher oil prices translate to higher prices at the pump. With the cover of environmental concerns as the cause, President Obama could put the pipeline off and raise gas prices without the average person realizing his responsibility for the increasing costs. With higher gasoline prices, the Government Motors Chevy Volt becomes more attractive—giving the president a win/win.
So President Obama chose to appease the environmental base and raise gas prices rather than to support the jobs that he claims to want. Additionally, the pipeline would have brought foreign money into the United States through increased exports of refined gasoline and provided a strong signal to the world markets that America is putting a long-term sustained strategy for expanding the domestic oil supplies we will need for decades to come. Once again, he has made a decision as America’s campaigner-in-chief rather that America’s chief champion.
While the President’s mind may have been made up regarding the Keystone XL pipeline on January 20, 2009, TransCanada made it easy for him.
TransCanada expected that the pipeline would be easily approved—all previous cross-border pipeline requests have been granted. They went through all the open houses and public meetings, did the environmental impact studies, and endured the most exhaustive and detailed review ever conducted for a crude oil pipeline. Nebraska, and most of the United States, is already a maze of pipelines. However, they chose the cheapest route for the Keystone XL pipeline—which took it through the environmentally sensitive area of Nebraska’s Sand Hills. By choosing the short route, rather than adding about 250 miles of pipeline, they gave the environmentalists an unlikely alliance: Republican lawmakers and traditionally conservative farmers. Because even the Republicans opposed the pipeline, it gave Obama additional cover—after all, even the locals didn’t want it. Had they been willing to move the pipeline to parallel the existing Keystone pipeline, avoiding the Sand Hills, it likely would have gone through without the local opposition.
One month before President Obama made his delay announcement, the TransCanada Vice President who would be in charge of the pipeline met with Nebraska state senators. He told them: “We understand that the best solution from your perspective is to move the route. We don't believe that is an option for us.” However, once the delay announcement was made, TransCanada has quickly agreed to re-rerouting as proposed by the Nebraska state legislature. Now they are pushing for an expedited review of the alternate route—which could allow the project to begin before the 2012 elections.
Environmentalists, angry over President Obama’s perceived weakness regarding his loosening of proposed EPA regulations, demonstrated at the White House for months to push their point—with the Center for Biological Diversity promising to keep up the public pressure. Previously, public and industry pressure made President Obama withdraw the EPA Ozone regulations. Note: public pressure works.
As America is in an economic war, we need what the Keystone XL pipeline has to offer. Keep the pressure on President Obama. Now that TransCanada has agreed to rerouting, they’ve called his bluff. Call the White House and tell President Obama to expedite the review and approve the Keystone XL pipeline.