Something is seriously wrong in the White House. President Obama’s foreign policy track record has gone from bad to worse with each new mishandled crisis. Appalingly, he has proven unable to take action and stop bloodshed in Syria and has gone against the long-standing US tradition of not negotiating with terrorist states by signing a disastrous deal with Iran. And now our dear leader has chosen to make a mockery out of our closest friend and neighbor, Canada, by stalling the Keystone XL Pipeline against all common sense.
The project, which has been discussed since 2008, received another blow earlier this week when the State Department again postponed its final decision on whether the pipeline should be built or not, citing insufficient proof to support the claim that it is in our national interest. Let there be no doubt, the State Department merely follows the guidelines set by the White House. When Obama unveiled his Climate Action Plan in June 2013, he said that the pipeline would be approved only if it respects the national interest, meaning, for him, only if does not “exacerbate the problem of carbon pollution.”
This is not so much about Canada’s standing with the US as it is about Obama’s disdain when it comes to defending our nation’s energy security. We currently consume 25% of the world’s energy, importing 11 million barrels a day. The need for a steady stream of foreign oil is more acute than ever, especially since most predictions agree that America’s need for oil is unlikely to decrease in the coming decades. The White House seems to be under the spell of environmental groups to such an extent that any sound economic reason fades away from the President’s agenda.
Environmentalists argue that the pipeline would negatively impact the environment because extracting oil from tar sands pollutes more than say extracting it from the desert. Essentially, their argument says that we don’t want to import oil that is produced using unclean methods.
Unfortunately, it seems that the Democrats are oblivious when it comes to the fact that it’s in Canada’s national interest to tap its oil wealth and that it will do so no matter if Keystone XL is built or not. It is therefore the Canadian government’s decision to pollute and the US cannot prevent them from doing so, not even by cancelling the proposed pipeline. Why am I saying this? Well, believe it or not, the US is not Canada’s only export partner.
TransCanada announced in August that it has started building the $12 billion Energy East Pipeline, which will transport oil to Saint John, New Brunswick where a deep-water port is slated for construction. When finished, in 2018, Canada will be among the world’s top five oil producers, rivaling Saudi Arabian and Russian production quotas. Where there is oil, there is demand. And Canada will not sit idly by, waiting for the US market to welcome its exports. It will instead find other interested customers. We can expect a long line of potential partners.
If built, Keystone XL will transport more than 800,000 barrels of oil per day to refineries on the Gulf of Mexico coast, saving US producers over $500 million annually in transport costs. This will in turn lead to lower prices for gas and other consumer staples, directly benefitting consumers. The democratic leadership forgets that Canada is our first trade partner and that every penny invested there will most likely come back to America in other forms.
Apart from enhancing America’s energy security, what else is at stake here? The $7 billion project will create between 80,000 and 179,000 new jobs, according to a study published by the Canadian Energy Research Institute. Another study found that personal income gains from these jobs would add an extra $6,5 billion to the economy, including $2,3 billion in retail sales.
Our government seems to consider that economic growth, job creation and energy security are less in “our national interest” than appeasing environmentalists. Halting the Keystone Pipeline from seeing the light of day will not stop Canada from extracting its resources. Obama’s decision to further postpone the project is not simply a missed opportunity, it’s a disaster any way you look at it. Let’s hope that, for once, the administration will see the error of its ways and prevent yet another blunder from happening on its watch.