Warren Buffett, whom President Obama likes to cite as a fair-minded billionaire while arguing for higher taxes on the wealthy, stands to benefit from the president’s decision to reject the Keystone XL oil pipeline permit.
Mr. Buffett’s Berkshire Hathaway Inc. owns Burlington Northern Santa Fe LLC, which is among the railroads that would transport oil produced in western Canada if the pipeline isn’t built.
“Whatever people bring to us, we’re ready to haul,” Krista York-Wooley, a spokeswoman for Burlington Northern, a unit of Buffett’s Omaha, Neb.-based Berkshire Hathaway Inc., told Bloomberg News. If Keystone XL “doesn’t happen, we’re here to haul,” she said.
The Obama administration rejected TransCanada’s request for a permit on Jan. 18, saying there was not enough time to review the proposal by Feb. 21, the deadline imposed by congressional Republicans eager to see the pipeline built. The decision came from the State Department, although Mr. Obama said he agreed with it.
TransCanada said it plans to submit another proposal that would avoid an environmentally sensitive route through Nebraska. The State Department had been reviewing the pipeline project tor three years when it rejected the permit.
If completed, the $7 billion Keystone XL would deliver 700,000 barrels a day of crude from oil sands in Canada to Texas refineries on the coast of the Gulf of Mexico. It would traverse about 1,600 miles.
The State Department’s review of the project said shipping oil via rail is more costly than delivering it to refineries by pipeline.
Mr. Obama often cites Mr. Buffett as an example of a civic-minded billionaire because the entrepreneur has said he should pay a higher tax rate than his secretary. Mr. Buffett and the president like to tell the story of how Mr. Buffett pays a 15 percent effective tax rate, while his secretary pays a higher rate even though she earns only a fraction of what he does.
The president has called his push for higher taxes on the wealthy the “Buffett rule.”
The secretary, Debbie Bosanek, will sit with first lady Michelle Obama in her box in the House gallery at Tuesday night’s State of the Union speech.
Republicans, labor unions and even some Democrats have criticized the administration’s rejection of the pipeline permit, saying it would create up to 20,000 jobs. Critics accuse the president of buckling to pressure from environmentalists who oppose the project and are important to Mr. Obama’s re-election effort.