
WASHINGTON — When Congress extended the payroll tax credit in December, it included a provision requiring a sped-up review process for the Keystone XL pipeline, a 1,700-mile oil pipeline running from the tar sands of Canada to the Gulf Coast.
Since then, Republicans have fired up a countdown clock and the party’s presidential candidates have used the issue to attack President Obama, who can delay the project before the Feb. 21 deadline for its approval. Pipeline backers say Keystone is a jobs machine, while many environmental groups have warned the pipeline instead brings high environmental risk and little economic reward. While the state’s congressional delegation is done dealing with the project (for now), many Minnesotans are trying to inject themselves into the political battle surrounding it.
Update: White House officials have told the New York Times that the State Department is expected to announce this afternoon that it cannot recommend going forward with the pipeline within the deadline set by Congress, putting the project on hold indefinitely. "The action for now means the permit for the pipeline is rejected although the pipeline company will be allowed to submit a new proposal with an altered route," the Times reported. The Washington Post has similar details, writing that "the administration will allow TransCanada to reapply after it develops an alternate route around the sensitive habitat of Nebraska’s Sandhills. Deputy Secretary of State William J. Burns will make the announcement." The Post story also said, "The effect of the administration’s move will probably be to delay the politically sensitive pipeline decision until after the presidential election ...."
Republicans have made the pipeline a jobs issue first and foremost saying it could create up to 20,000 new jobs. They’ve used the pipeline to harass Obama, releasing daily updates warning that there are, as of this morning, only “34 days left as Obama continues to block Keystone jobs.” They see it as the one winning argument to come out of December’s payroll tax cut fight, when Democrats painted the Republicans as obstructionists unwilling to extend a popular middle-class tax cut while protecting those for the wealthy.
The Democratic Party, meanwhile, is largely quiet on the matter, even as some of the constituencies that usually fall under its banner bicker over the pipeline. Environmental groups are pushing back, insisting Obama reject the pipeline as a needlessly risky environmental project that threatens natural resources along the line. They’re also hitting the so-called benefits of the plan, arguing it won’t create as many jobs as proponents say.
But any new job is needed, according to some labor unions that have publically backed the plan, including the Teamsters and several AFL-CIO affiliates (though the AFL-CIO itself hasn't taken a position, either nationally or in Minnesota).
“It will create an abundance of jobs in the pipeline industry,” said Ed Reynoso, the political director for the Teamsters Joint Council 32, which represents Minnesota. “It will create jobs and spur our economy a little bit. Any addition of new jobs to our economy is fantastic.”
Lawmakers have been caught in the political crossfire, especially when Congress was deliberating the issue late last year. In December, the National Republican Congressional Committee released an ad and phone call campaign against Reps. Collin Peterson and Tim Walz, the two Minnesota Democrats they consider vulnerable in 2012, urging them to support the project (both do, to certain extents). Environmental groups, meanwhile, protested against the project outside Sen. Amy Klobuchar’s district office in December and are planning a second wave of protests next week.
Faye, the coordinator of the climate advocacy group Minnesota 350, said the issue transcends the typical bounds of environmental activism. Anti-Keystone protesters are also taking aim at the power of the big oil lobby and the influence of money in politics.
“Environmentalists and farmers and businesspeople and communities, we can all come together and find a reason why we should be passionate about this issue,” said Kate Faye, an environmental activist opposed to the project. “It’s the little people fighting against the big guns of big oil.”
Other Minnesota groups have gotten in on the game, as well: the Minnesota and Minneapolis Regional Chambers of Commerce signed on to a letter urging Obama to approve the project, and the unions have met with Minnesota’s congressional delegation urging support for it, Reynoso said.
Republicans rally around pipeline
Congress hasn't taken an up-or-down vote on the Keystone project alone, but it was a cog in the two-month payroll tax cut compromise passed in December. That bill included a provision requiring the State Department to rule on the project before Feb. 21 and gave Obama the authority to quash the project single-handedly.
The move was a strategic one by Republicans, forcing Democrats to accept a quick review of the Keystone project in exchange for the popular payroll tax cut. Giving Obama veto authority also puts significant political pressure on him in an election year: If he put the kibosh on the pipeline, Republicans could say he rejected a major jobs program during a time of weak economic recovery, but if he allowed it to go forward, they could declare victory.
Naturally, Republicans at all levels have been taking advantage of the message whenever they can. For the cast of Republicans looking to win their party’s presidential nomination, Keystone is red meat frequently thrown to a hungry electorate.
“President Obama is guided by his hardened ideology, and he’s repelled any prospect for economic recovery as he routinely places his own political fortunes and his own re-election plans above the interests of the American people,” Rep. Michele Bachmann said the night before she dropped out of the presidential race. “Look no further than his denial of building the Keystone pipeline. That was all about his re-election, and had nothing to do with energy independence for the American people.”

But even down-ticket candidates and back-bench lawmakers have taken up Keystone’s mantle. On Tuesday afternoon, for example, Minnesota Rep. Chip Cravaack tweeted: “144 days have passed since the State Dept. said building #Keystone was the ‘preferred’ option.”
The Obama administration’s official line has been that the pipeline is a State Department issue. The State Department already said the Keystone route would pose no significant risk to the environment, but the route still has little support in Nebraska, and a state law signed in November requires a more rigorous environmental review that can’t be completed by the Feb. 21 deadline.
Previewing Obama’s possible rejection of the plan, White House spokesman Jay Carney said Tuesday: A “political effort to short-circuit that process for ideological reasons would be counterproductive because a proper review that weighed all the important issues in this case could not be achieved in 60 days. …
“It is a fallacy to suggest that the President should sign into law something when there isn’t even an alternate route identified in Nebraska … there was an attempt to short-circuit the review process in a way that does not allow the kind of careful consideration of all the competing criteria here that needs to be done.”
Other Democrats backed this line of thinking. In a statement, Sen. Al Franken said: "The administration should have been given the opportunity to complete a full analysis of the project before making its decision. This kind of brinksmanship isn't the way to get things done in Washington."
Republicans in Congress could look for other ways to advance the plan, such as moving the approval authority to a different government body. But without the payroll tax cut attached to such a measure, it would be highly unlikely to Congress and be signed into law.
Faye and Reynoso used the same word to describe their hopes for the project’s ultimate approval or rejection: hopeful. They’re on opposite sides of the issue, of course, but Reynoso said it shouldn’t be one easily classified by the conservative or liberal labels so often employed in Washington.
“It’s not about being Democrat or Republican or any particular party when it comes to creating jobs,” he said. “I don’t care what party they are, we’re going to work with them.”
Devin Henry can be reached at dhenry@minnpost.com. Follow him on Twitter: @dhenry
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Comments (18)
If murder-for-hire were legalized, it would create a lot of jobs.
[Kate] Faye said, “It’s the little people fighting against the big guns of big oil.”
Has Ms. Faye bought a tank of gas lately? It's selling for $3.35 this morning in my neighborhood. It's more like the "little people" fighting against the environmentalist wackos. Projections are that gas will be over $5 by election day, yet Obama is throwing the Teamsters and everyone who buys gasoline under the bus so he can be assured that the environmentalists will man the GOTV phone banks for him.
And Franken's just clueless. The last I looked the State Department is part of the administration and they announced their decision almost four months ago that the pipeline should go through.
This pipeline is not just about jobs, it's about increasing supply, which would bring down the price for Faye's "little people" and reduce our dependancy on foreign imports, which is a national security issue.
We expect the anti-capitalists like Ms. Faye to be unconcerned about national security, but we should expect our U.S. senators and the president to be concerned about it, but apparently they're not.
The 20,000 jobs figure has been debunked; it is more like 5,000 FTE positions. The State Department's statement was made by an employee with ties to the Canadian company that wants to build the pipeline. The environmental damage in Canada is irreparable and that to the U.S. from a pipeline that will most likely leak could do great harm here, too.
The unions are wrong to push for this monstrous plan and supporters in the Congress are very wrong to claim that we will benefit from this oil. It very likely will be exported from Texas after being refined there.
The president should NOT wait another minute before denying approval of this project, but is perhaps afraid of losing votes if he doesn't hold out the possibility of approval later.
@#2
It would be maybe worth considering if it actually was about supply. There's no guarantee that the oil wouldn't be sold to China, making it worthless in keeping the cost of a tank of gas down. It's not like this is a domestic oil supply, either. Keystone is designed to carry oil from Canada to refineries in the US.
In addition, even the shorter version of the pipeline is prone to significant spills. 14 annually (as opposed to the 2 annually that were predicted before the initial go-ahead).
But...let's let the numbers do the talking:
US oil consumption is nearly 20 million barrels a day. (http://www.eia.gov/energyexplained/index.cfm?page=oil_home#tab2) The current pipeline's capacity is about 0.5 million barrels a day (CAPACITY, not actual usage). The expansion would add 0.5 million barrels a day. (http://www.downstreamtoday.com/news/article.aspx?a_id=11890&AspxAutoDete...)
Thus, $7 billion expansion would, at most, add another 2.5% to our oil supply (and that doesn't count the cost of purchasing the oil, itself). If you think that's going to decrease the cost of gasoline significantly, you need some lessons in math. The current bottleneck for gasoline is in refining. Getting the oil here will only increase our crude supply, not refined supply.
We export about 2 million barrels a day (4X the amount expected to be added by building the pipeline extension). (http://www.eia.gov/energyexplained/index.cfm?page=oil_home#tab2) If we have 2 million barrels a day extra, why would we need to import another half million?
The total world oil production is about 86 million barrels a day and consumption is about 85 million barrels a day. (http://www.eia.gov/energyexplained/index.cfm?page=oil_home#tab2) A half million barrel pipeline is about as effective as spitting into the wind.
This may all be a moot point since the Canadian oil minister has said he's tired of screwing around with U.S. politicians and plans to just build the pipeline out to Vancouver and ship it directly to China.
Way to go, Obama.
@#5
Not a huge loss. See post #4. China will get the oil if they're willing to pay the highest price. Alternatively, we will get the oil if we're willing to pay the highest price. It's not like Canada's giving us the oil if we build a pipeline.
Mr Tester (#2): Many of us, including the military and intelligence establishments, consider climate change to be THE national security issue before any other. National security is served not by reducing our dependance on foreign oil, but by reducing our dependance on oil. And contrary to the dictums of the establishment media, we'd become alot more prosperous in doing so. But the interests that own our politicians, from Mr Obama to those you prefer, will make sure that doesn't happen.
As to the price of gas, I'd just like it to internalize its externalities so that it doesn't distort our individual and collective consumer choices. This would put gas well above $10/gallon (not even counting the military costs to maintain access to oil and, in this case, the extreme release of entropy involved in getting oil from tar sands). In short, I'm an orthodox free market guy. By your terms, I'm also an anti-capitalist. I guess I'll have to figure that one out.
The biggest threat we face as a nation and as a global community is unchecked global warming. The best thing that could happen is what Chuck Holtman is proposing---- that the price of gas incorporate all of the external costs, including all the wars, the 11 US aircraft carriers patrolling the sea lanes, all the subsidies to the fossil fuel industry, all of the environmental impacts, including the cost of climate change and the impacts on agriculture, health, acidification of the ocean, migrations of billions of people who live near.
That would put the cost of a gallon of gas at somewhere $15 to $20 dollars per gallon, and rising. It would get more and more expensive with each gallon we pumped!
The days of our vicious fossil fuel empire are over..... let's get on with building the clean energy world as quickly as humanly possible so that the world can be habitable for our children and grandchildren.
The irony of all this is that the pipeline is not nearly as important as either its defenders or critics make it out to be. On the one hand, America already imports plenty of oil from the tar sands. The impact on the environment of pressing ahead (and on energy security, for that matter) would be marginal at best. On the other hand, the economic boost from building the pipeline would be marginal too. Most of the jobs it would create would be temporary ones, in construction. The states across which the pipeline will run already have the lowest unemployment rates in the nation. And none of them is likely to support Obama in next year’s election—making the local politics marginal too.
Mr. Holtman, with most of the products being used in this society made of petroleum or petroleum derivatives, it'll be a while before we're able to function without oil.
And your cavalier belief that $10/gallon gasoline would just fine with you only illustrates one of the most disturbing traits amongst anti-capitalists - their total ambivalence towards the working poor.
I guess people who have to put gas in their ten year-old car to get to work every day can't afford to be environmental elitists.
I am not too sure why the federal govt needs to be involved.
why cant business simply do business in America.
I can not believe this recent govt decission to again shut down business in america.
come on wake up america
the pipeline didnt cause Canada to become a ecological wasteland
why dont we simply turn off all the lights in america and move to somewhere free
govt get out of the way and let america go back to work
#5 says, "This may all be a moot point since the Canadian oil minister has said he's tired of screwing around with U.S. politicians and plans to just build the pipeline out to Vancouver and ship it directly to China"
I'll be interested to see how his pipeline works going over the Rockies.
The only advantage, to me, of this Keystone project is the few thousand jobs it will temporarily create. The disadvantages: (1)China gets the oil(from Texas Gulf of Mexico refineries), (2)Canada gets the permanent jobs, (3)The U.S. gets the oil spills, and (4)the World gets warmer.
Mr. Tester (#10): My attitude isn't in the slightest cavalier, and your contentless name-calling is tiresome. Are you now a critic of market pricing? The way to address the impact of properly priced gas on the working poor (and the nonworking poor) is by targeted supports, not by grossly underpricing gas for everyone. In the long term, the way to address the impact is to correct the present gross maldistribution of wealth so that the proportion of folks that fall into the category of (working & nonworking) poor declines substantially.
@#10 and #11
First, you've completely ignored the numbers. Completely. Is this intentional?
Second, if government didn't subsidize the oil industry in various ways, gas would be more expensive than it is now. Plus, there is little denying that demand has increased, which should (in a "free market") cause prices to rise anyway, so why would you expect it to go down? If we were to add 2.5% to our supply, and demand increases 1.5% per year (historically appropriate), the benefit would be felt for less than 2 years, at most. Plus, as gas prices go down, gas demand goes up, so I would guess that any drop in price would result in a shorter price benefit from increasing supply. Spending $7 billion for a pipeline (plus the actual cost of the oil, itself) that has less than 2 years theoretical benefit seems grossly expensive.
I guess taking a true capitalist view of real prices is anti-capitalist.
And I guess fiscal responsibility is disposable when convenient for the right side of the political spectrum.
The price of a barrel of oil is a function of the bidding on the world oil market by companies who intend to refine that oil, regardless of which government they live under.
The cost of refining a gallon of gasoline is relatively stable and only varies based on the number and types of blends mandated by the government.
The cost of gasoline at the pump is based on the wholesale price of gasoline plus the tax placed on it by government, state and federal.
The REAL price of gasoline, Ms. Kahler, that is paid by the working people who would use it to get to work, if they had jobs, is made MORE expensive, not less, because of government's inordinate "take," not government's subsidy.
I appreciate the attempts by some to discuss this rationally, rather than from entrenched positions on the right and left, as at least one poster would have it.
The real fight here, it seems to me, is that some with short and long term economic interests are opposed by those with a more global environmental agenda. For the former, construction of the line is the entire war, while for the latter, it's simply one skirmish in a much longer conflict.
I disagree with those who oppose the pipeline on the grounds that it simply facilitates business as usual, including continuing reliance on oil-based energy and related environmental impacts. Direct environmental effects of the pipeline should be addressed, but the horse is out of the barn on the use of tar sands. The oil will be used somewhere and it will be transported in some way. Let's focus on making sure that it's produced and transported as safely as possible, while continuing efforts to conserve, to develop alternative technologies, and to develop appropriate alternative fuels for those activities which cannot be served by electrical energy, no matter how produced. Pricing energy so as to include more of its external costs is certainly one way to promote that end.
As a member of MN350 and the climate movement in Minnesota, I want to convey a concern around this article and debate. MN350 is a growing group of Minnesotans who are working to educate and inspire Minnesotans to rise to the challenge of the climate crisis.
The creation of jobs is a top priority for those of us who are concerned about climate change: long term, sustainable and healthy jobs that will truly benefit Americans while at the same time creating a long term viable solution to the energy and climate crisis.
It is distressing and misleading to continue pitting labor and environmental concerns against each other when they are in actuality inseparable. Climate change is hurting our economy, and if unchecked will prove economically devastating.
Let's work together for investment in a clean energy economy that can employ vastly more people in sustainable, long term jobs. Why do we need a loser? Let’s all win, together.
@#15
...
You were getting somewhere until you got to the last paragraph.
You are IGNORING THE NUMBERS. A 2.5% increase in crude supply WILL NOT decrease the cost of gasoline very much or very long, if at all. The argument that this pipeline is needed to keep the price of gasoline (or any refined fuel) down is a complete and utter LIE.
Why is it Republicans would claim that the sky is falling if we were to suggest spending $7 billion on a variety of infrastructure improvements, but if we suggest spending $7 billion on a pipe the politicians will flicker their forked tongues and tell us poor souls that it will help us get to work cheaper (but you're SOL if you lost your job and want to keep your house)? Could it be related to who might profit?
To state the obvious, I wholly believe that spending $7 billion on an oil pipeline should take back seat to spending $7 on infrastructure improvements. Did you know that gas was only about $2.80 a gallon when all those people were dropped into the Mississippi River on August 1, 2007?