Pipelines and politics, or “Flow my tears, but not in a pipeline crossing U.S. borders because we’ll never get the permit approved at the State Department”

Michael Giberson

A few days ago, Geoffrey Styles was assessing the potential role of energy issues in the 2012 U.S. presidential election:

Even though $4 gasoline was still fresh in the minds of voters, energy played only a minor role in the outcome of the 2008 election, overshadowed by two wars and a crippling financial crisis. Will that be the case again in 2012, or will energy loom larger, propelled by its close connection with the economy? Several Republican candidates have already raised energy as a campaign issue, and the administration has repeatedly emphasized the linkages between energy, jobs and taxes. Whether any of those arguments gains traction in a race that at this point seems likely to be dominated by unemployment and deficits could depend on how deftly the administration handles decisions such as the Keystone XL Pipeline permit, as well as the degree to which voters become interested in the details of the country’s shifting energy balances. (Emphasis added.)

And then yesterday, this story: “Administration delaying Keystone XL decision until after 2012 election“:

The Obama administration said Thursday it will consider alternative routes for the Keystone XL oil pipeline to avoid ecologically sensitive areas of America’s heartland — a move that delays a final decision on the controversial project until after the 2012 election.

The move solves a political dilemma for President Barack Obama, who risked alienating key voting blocs no matter what decision he made on the pipeline that would carry Canadian oil sands crude from Alberta to Port Arthur, Texas. The project pitted environmentalists against some labor unions and the oil industry, and Obama would have been delivering a verdict before an election that could turn on who can do the most to turn around the nation’s ailing economy. (Emphasis added.)

Shall we think this point through a bit? According to the article, the election may turn on “who can do the most to turn around the … economy,” and so the Obama administration is using the State Deparment’s Washington, D.C. focused regulatory processes to imposes a politically convenient (to Obama)  delay on a decision until after an election even though this politically convenient (to Obama) delay will produce significant collateral damage to the economy.

And isn’t it a bit curious that the State Department’s review is getting hung up on domestic environmental concerns raised by Nebraskans? Via the NewsHour:

RAY SUAREZ: It’s unusual to have the U.S. State Department making pronouncements on Nebraska, isn’t it? Why is the State Department ruling on a pipeline that runs for almost its entire length through the United States?

JULIET EILPERIN: Interestingly, the reason they have jurisdiction is simply because it’s a pipeline that crosses the U.S.-Canada border. That makes it something that comes under the purview of the State Department, and not other agencies, like the Department of Transportation, which has an agency which traditionally looks at pipelines and how they are handled and constructed.

RAY SUAREZ: Does redrawing the path of the pipeline mean, in effect, starting from scratch, really going back to the drawing board on this?

JULIET EILPERIN: It doesn’t mean starting from scratch, but it certainly raises questions about the economic viability of a project that’s been under scrutiny for more than three years, and now we’re adding at least 15 months to this decision.

The regulatory process has been cranking on the project for more than three years (i.e. since the last months of the G. W. Bush administration and for all of the Obama administration), and now for the political convenience of the President the State Department is using the regulatory process to further delay the decision on a permit.

If nothing else, the action is testament to the President’s stand on the economy.

(The cynic in me thinks this is just an effort by the “committee to re-elect the president” to hold the attention of environmental and business and labor groups through the campaign, and by “hold the attention of” of course I mean “shake down for campaign contributions.” And the GOP candidates are likely delighted because continued politicization of the issue will help them “hold the attention of” potential campaign supporters as well.)

HT to CS.

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