Obama Rejects Keystone Pipeline, Ending 7-Year Process

Obama Rejects Keystone Pipeline, Ending 7-Year Process
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President Obama ended one of the longest policy deliberations of his presidency, rejecting on Friday a Canadian company’s proposed Keystone XL oil pipeline through the United States, which Republicans argued would deliver crucial construction jobs, even as Nebraska’s courts and the TransCanada pipeline company itself had second thoughts about the project.

Obama, heeding environmental considerations as well as Democratic politics, rendered his administration’s verdict on the same day the Labor Department announced the unemployment rate fell to 5 percent last month and against a world backdrop of cheap oil and gasoline prices. The president turned the rejection into a full-throated defense of American ingenuity and his own determination to embrace changes that move the planet away from emissions tied to global warming. Next month, Obama will join other nations in Paris during an important U.N.-sponsored summit on climate change in which commitments for policy changes from global polluters will be sought.

The president said his administration, following reviews led by then-Secretary of State Hillary Clinton and inherited by her successor, John Kerry, determined “the Keystone XL pipeline would not serve the national interests of the United States. I agree with that decision,” he said in the Roosevelt Room with Kerry and Vice President Biden on either side of him.

Proponents’ economic justifications for new construction and oil refining jobs weakened during the State Department’s seven-year review of the proposed 1,700-mile pipeline from Canada’s tar sands to U.S. ports along the Gulf Coast. As a proxy for partisan divisions on all sides, “Keystone” became a rallying cry as its consideration dragged on for years. The pipeline debate raged as the project bogged down in U.S. courts over TransCanada’s preferred route through America’s heartland. With the courts, American politics, and rising costs in mind, TransCanada last week asked the State Department to put its long review on hold during the remainder of the Obama administration. The department refused.

Obama said Keystone “occupied what I frankly considered an over-inflated role in our political discourse. It became a symbol, too often used as a campaign cudgel by both parties, rather than as a serious policy matter, and all of this obscured the fact that this pipeline would neither be a silver bullet for the economy, as was promised by some, nor the express lane to climate disaster proclaimed by others.”

Obama’s decision follows Clinton’s announced opposition to the pipeline as she seeks to win the Democratic nomination. In rejecting the pipeline in 2015, the president ends suspense over a matter important to his party’s frontrunner as she shores up donors, endorsements and voter support. The announcement, in effect, revives the very political cudgel Obama bemoaned, uniting his party behind energy and climate policies that are meant to contrast sharply with those of the Republican Party.

Polls indicate a majority of Democrats believes climate change is a significant issue, while a minority of Republicans put global warming high on their lists of most important concerns facing the country. The chasm between the parties measured 48 points, according to a Pew Research Center report released Thursday.

The president told GOP majorities in Congress that if lawmakers are serious about creating 30 times the number of construction jobs Keystone might have delivered, they should pass an infrastructure plan to build and repair U.S. roads and bridges. As a net exporter of oil and a nation swiftly moving away from its own reliance on fossil fuels, Obama said it made little sense to help Canada ship “dirtier crude oil” across the United States, to be refined and sold to other countries.

(Lawmakers and the president were sufficiently confident about America’s long-term oil security to agree to sell off 8 percent, or 58 million barrels, of the U.S. Strategic Petroleum Reserve stockpiled in caverns along the Gulf Coast. The bipartisan agreement became a way to deliver up to $3 billion to offset the costs of a two-year budget agreement enacted last week. The crude sales are to occur between 2018 and 2025.)

The president cited no specific data Friday to indicate that the Keystone pipeline would produce significant greenhouse gases associated with global warming, a threshold he injected into the debate in June 2013. During a climate change speech delivered at Georgetown University, Obama said, “Allowing the Keystone pipeline to be built requires a finding that doing so would be in our nation’s interest. And our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution. The net effects of the pipeline’s impact on our climate will be absolutely critical to determining whether this project is allowed to go forward.”

The president’s arguments rejecting Keystone were threefold: the pipeline would be economically insignificant to U.S. national interests; it would have little impact on gasoline prices, already low in the United States; and the pipeline conflicts with U.S. leadership on climate change policies abroad. Obama did not assert the pipeline would “significantly exacerbate the problem of carbon pollution.”

The president said he telephoned newly elected Canadian Prime Minister Justin Trudeau to explain the U.S. decision. Obama emphasized continued strong U.S. ties with Canada and its government.

TransCanada Corporation, in statements following Obama’s announcement, said the company remains committed to the Keystone project and will continue to assess its options. Today, misplaced symbolism was chosen over merit and science – rhetoric won out over reason,” president and CEO Russ Girling said.

Obamas’ decision elicited strong responses from Republicans. Newly installed House Speaker Paul Ryan called it “sickening” if unsurprising. Deploring the loss of “tens of thousands of good-paying jobs,” Ryan added, “If the president wants to spend the rest of his time in office catering to special interests, that’s his choice to make. But it’s just wrong.”

Republican National Committee Chairman Reince Priebus also decried the move, which he said “can only be described as a politically motivated embarrassment and the very reason why we have the largest percentage of Americans out of work since the Carter Administration.”

Alexis Simendinger covers the White House for RealClearPolitics. She can be reached at asimendinger@realclearpolitics.com.  Follow her on Twitter @ASimendinger.

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