OWENS: Keystone Kops energy policy

Obama oil-pipeline rejection undermines State of the Union promises

By Mackubin Thomas Owens

The Washington Times

Wednesday, January 25, 2012

Illustration by Linas Garsys for The Washington Times

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In his State of the Union speech, President Obama had barely cleared his throat when he outlined his vision for an American “future where we’re in control of our own energy, and our security and prosperity aren’t so tied to unstable parts of the world.” Just days before, he had delivered a crippling blow to his own plan.

Mr. Obama’s decision to kill the Keystone XL pipeline, which would carry oil from Alberta, Canada, to refineries on the U.S. Gulf Coast, is one more example of his administration’s ongoing war on fossil fuels - and the most recent example of how the president promises the exact opposite of what he is delivering. What better way to sever our dependence on those “unstable parts of the world” than to switch a major portion of our oil imports from dictatorships to a stable democratic neighbor, starting now?

Instead, the administration continues to squander taxpayer funds on “green energy” debacles such as Solyndra and the entire renewables/electric-car agenda - which, even in Mr. Obama’s plan, will only yield significant benefits in the far future.

Of course, when he made the pipe-line decision, the president blamed congressional Republicans for forcing a snap decision. But the fact is that he has had three years to make a decision. It’s not as though the project was not vetted by the usual bureaucratic suspects. In a letter to the president on Oct. 19, 22 House Democrats observed that “the Department of State’s Final Environmental-Impact Statement reaffirmed the findings of the two previous environmental-impact statements; namely, that the Keystone XL Pipeline will have no significant impact on the environment.”

Indeed, some of the sharpest criticism of the Keystone decision has come from congressional Democrats. For instance, Sen. Joe Manchin III of West Virginia said that “President Obama’s decision on the Keystone XL pipeline is a major setback for the American economy, American workers and America’s energy independence.” One of the Democratic Party’s key constituencies, organized labor, is not happy, either.

Just a day before the decision, the president’s own jobs council argued in favor of not only more oil, natural gas and coal production, but also energy-infrastructure projects such as the Keystone XL. Once completed, the pipeline would carry more than 700,000 barrels of oil per day and directly create 20,000 truly “shovel-ready” jobs. The least that can be said is that the Keystone decision flies in the face of Mr. Obama’s rhetoric about creating jobs.

Astoundingly, on its website, the White House argues that the loan-guarantee program of the Department of Energy and the Environmental Protection Agency’s Mercury and Air Toxics Standards will create more jobs than construction of the Keystone XL. But the loans provide government subsidies to inefficient companies that are unable to compete in the market, e.g. Solyndra. The EPA rule will contribute to the shutting down of a large percentage of domestic coal-fired power plants, America’s largest source of electricity. How will that reduce unemployment among any groups other than lawyers and government bureaucrats?

Unsurprisingly, the main resistance to the Keystone XL has come from environmentalists, who claim that the pipeline endangers water resources and the like. However, the State Department, which had jurisdiction since the pipeline crosses an international border, conducted a three-year study addressing risk to soil, wetlands, water resources, vegetation, fish, wildlife and endangered species, concluding that building the pipeline would pose minimal environmental risk. In addition, the area the Keystone XL would traverse is already a web of pipelines.

Ironically, not constructing the Keystone pipeline has the potential to increase environmental risk. The Keystone XL route foreclosed, the Canadians will build a pipeline to their Pacific coast and ship crude oil to China by tanker. Tanker spills are more frequent and destructive than pipeline leaks. Indeed, although the long-term trend in spills from all sources is sharply down, the spill rate from shipping oil by tanker is about six times higher than spills from offshore oil rigs or pipelines.

At a time when unemployment remains high in the United States and unrest in the Middle East threatens Western access to oil in that region, the president’s decision is absurd. It is only part of an energy policy worthy of the Keystone Kops.

Mackubin Thomas Owens is professor of national security affairs at the Naval War College and editor of Orbis, the journal of the Foreign Policy Research Institute.