Obama Kills Keystone Pipeline and Thousands of Jobs

Despite an anemic economic recovery and an increasingly antagonistic Iran, President Obama decided to kill the Keystone XL pipeline. Creating thousands of jobs and securing American access to oil, the much-discussed Keystone project would transport crude oil from Alberta, Canada to American refiners in Oklahoma and Texas.



For years the pipeline was an innocuous project slowly making its way through the convoluted federal approval process. After receiving all but one permit, radical environmentalist—feeling affronted two years into the Obama Administration—set their sights on the soon-to-be approved Keystone pipeline. What should have been a non-controversial construction project became anything but. Before becoming the object of environmentalist scorn, the State Department approved and advocated for the nearly identical Canadian-American pipeline in 2009, arguing:
... the addition of crude oil pipeline capacity between Canada and the United States will advance a number of strategic interests of the United States. These included increasing the diversity of available supplies among the United States’ worldwide crude oil sources in a time of considerable political tension in other major oil producing countries and regions; shortening the transportation pathway for crude oil supplies; and increasing crude oil supplies from a major non-Organization of Petroleum Exporting Countries producer.

Canada is a stable and reliable ally and trading partner of the United States, with which we have free trade agreements which augment the security of this energy supply. Approval of the permit sends a positive economic signal, in a difficult economic period, about the future reliability and availability of a portion of United States’ energy imports, and in the immediate term, this shovel-ready project will provide construction jobs for workers in the United States.

Drawing an arbitrary line in the sand, environmentalists threatened to sit out the 2012 election if President Obama approved the pipeline. Organizing daily protests outside the White House, environmentalists effectively turned a non-political issue into one of the most divisive topics of 2011.



Scared to affront his base, President Obama delayed the pipeline until after the 2012 election. Having already passed the bipartisan North American—Made Energy Security Act, which expedited the Keystone approval process, the House again used its leverage to attach a similar measure in the December payroll tax legislation. After weeks of debate, the final version of the Payroll Tax Bill included a provision that would streamline approval of the Keystone pipeline.

Somehow, President Obama determined that the pipeline is not in the interest of our nation, and thus, scrapped the project. Obama is hiding behind the federal behemoth he oversees arguing that the State Department hasn’t had enough time to review the pipeline. Considering the Keystone XL Pipeline has been pending at the State Department since 2008, one would ask how much more time the agency needs. Costing $7 billion, the pipeline would create 20,000 well-paying construction jobs immediately. Midwest construction workers, one of the demographics hit hardest by the economic downturn, desperately need this project. While blue-collar workers would receive many of the direct benefits from Keystone’s construction, thousands of businesses from nearly every state would have reaped indirect business were Obama to simply allow the Keystone project to be built. 2,400 American companies in 49 states are involved in the production of Canadian oil sands. All for not.

This project is all reward and no risk. Fear mongers warn of imminent oil spills and poisoned aquifers. This is nonsense. America is literally covered in oil pipelines. Furthermore, Americans consume 19 million barrels of oil every day which needs to be transported across our nation somehow.

Apart from the consequential economic impact, the pipeline would reassure American energy security. In recent weeks, Iran has threatened to close down the Straight of Hormutz. This choke point is critical because 14 tankers carrying around 15.5 million barrels of crude oil pass through the straight every day. Representing 20% of all oil traded worldwide, sealing off this passage would cause the worldwide price of oil to increase.

While the U.S. does not directly import much oil from Iran, predicted instability in the region has cause gasoline prices to rise to $3.39 a gallon, up around 10 cents since we rang in the New Year. In short, an Iranian crisis would mean less supply and while demand for global oil continues to increase.

The United States has a great opportunity to mitigate the domestic effects of external threats through constructing of the Keystone pipeline and strengthening ties with Canada. Already importing about 2 million barrels of oil a day from Canada, our neighbors to the north are America’s largest foreign supplier of oil. The Keystone pipeline would provide Americans with an additional 800,000 barrels of Canadian oil every day.

Congressional Republicans are examining legislative solutions to the problem Obama created, but the path forward will be difficult. Click here to let Obama know that there are repercussions for his actions and that he should put his country ahead of his political ambitions and approve the Keystone pipeline.

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