Obamas Mysterious Keystone Pipeline Opposition Policy Last week, we discussed the flimsy Keystone Pipeline vote that Harry Reid was planning. It was largely an effort to bolster Senator Mary Landrieu of Louisiana as she embarks on a tough re-election campaign. We knew Reid wanted a non-binding resolution so the president could ignore it. We knew we were looking at a vote in support of the Keystone Pipeline with no implementation or ensuing action. According to The Hill, Senate Republicans on Monday blocked bipartisan-energy efficiency legislation and derailed a promised vote on the Keystone XL pipeline . . . It went on to say... Reid said Republicans constantly changed their demands. He said they initially expressed a willingness to vote on the bipartisan bill without amending it. They then requested a vote on a non-binding resolution urging President Obama to approve Keystone before asking for a vote on legislation approving the pipelines construction, Reid said. You and I already know that without the President committed to action for this pipeline, this vote wasnt going to mean anything. Today, Scott S. Powell, a senior fellow at the Discovery Institute in Seattle explains in detail why President Obamas opposition to the pipeline is so harmful to our economy (and the whole world). Powells analysis is excellent. Here it is... With memories of OPECs oil embargo and the cartels ongoing ability to manipulate markets, it should be cause for celebration that the U.S. is on the cusp of energy independence and lower prices. So it is puzzling that President Obama chooses to hold up Keystone XL pipeline construction, which is one of the three legs of U.S. energy independence. Because energy independence is so laudable with bipartisan support, Americans need to know why their president is blocking Keystone. First, some background. The primary purpose of the Keystone XL pipeline is to transport thick crude oil from the oil tar sands of Alberta, Canadas Athabasca region to refineries on the Gulf Coast in Texas and Louisiana that are specifically designed to process and refine heavy crude into by-products—like gasoline, diesel and jet fuel. Radical environmentalists may have heightened opposition to so-called dirty oil from tar sands, but the end products are essentially the same as those refined from light sweet crude. And with 94% of Americas electric power coming from legacy sources—largely fossil fuels—and only 4% provided by solar and wind (only made possible by huge tax subsidies), it makes enormous sense to reduce dependence on OPEC. Regardless of environmentalists opposition, Canada made the decision years ago to develop this remarkable oil sands resource. Like accessing oil from shale rock formations, the harvesting of oil sands was only made economically possible by technological breakthrough from the human capital of the scientific-engineering mind. What had no value for thousands of years now has enormous value. If the U.S. does not take full advantage of the Canadian oil sands resource, China certainly will to a greater and greater extent. In February 2013, the Chinese National Oil company, CNOOC, closed the $15 billion acquisition of Canadas Nexen Oil Company—a company with a significant stake in the Alberta oil sands. Most environmentalists think globally and must realize that delaying Keystone only gives China more clout in securing a larger portion of the oil sands. And then who wins? Certainly not Mother Earth, given Chinas horrid environmental record. Then there is the current Venezuelan regime which benefits from limiting the flow of oil from Canada. Most of the capacity of the refineries in Texas and Louisiana, which would be the destinations for Keystone pipeline output, is currently taken up by heavy oil from Venezuela. Should those refineries shift to processing Canadian oil, the Venezuelan people might finally succeed in meaningful regime change that would likely embrace more free market solutions. People also need to follow the money and understand who benefits. Opposing the Keystone XL pipeline is a cash cow for the Democratic Party. Environmentalists among the 1%—notably Tom Steyer—have pledged $100 million to fight Keystone and fossil fuels. Oh, and then there is billionaire Democrat Warren Buffet, whose Burlington Northern Santa Fe railroad capitalizes on transporting the oil that would otherwise flow more safely and economically through the Keystone pipeline. Its also important to follow the power and ask who benefits. Neither American workers nor consumers benefit from Obamas opposition to the Keystone pipeline. Internationally, Obamas position weakens U.S. relations with Canada—an immediate neighbor, longstanding friend and ally, while it helps China and Venezuela—two repressive regimes that are often hostile to the United States. Finally, delaying Keystone shows American weakness and indecision at a time when Russias Putin is flexing his muscles, threatening Ukraine and other neighbors with energy blackmail. Obama declared that the U.S. would lead from behind in dealing with the upheavals of oil-rich countries like Libya. Now, at home hes leading from behind on energy independence and security. Scott Powell is senior fellow at the Discovery Institute in Seattle. Reach him at [email protected]
Posted on: Fri, 16 May 2014 03:03:56 +0000
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