Toxic green madness

Keystone ­versus green Keynesianism

Keystone jobs should matter more to Obama than green theology

By Peter Foster

You’d think that a government with an increasingly severe unemployment problem would be desperate to approve a project that would provide 20,000 ­direct jobs, even if that government does have ­bigger — but related — things on its mind this week.

While the alleged Aug. 2 drop-deadline for raising the U.S. government’s US$14.3-trillion debt ceiling is obsessing Washington, the State Department’s final review of TransCanada Corp.’s $7-billion Keystone XL pipeline, which is due two weeks later, is arguably almost as symbolically significant for the direction of the American economy, at least as long as Barack Obama occupies the White House.

There were certainly no references to energy in President Obama’s address to the U.S. nation on Monday night, save for the ritual swipe at oil company executives. Despite talk of compromise, the President effectively reaffirmed his apparently unshakeable belief that government spending is the route to a better society, and that all that’s holding him back from leading the march is those “millionaires and billionaires” who refuse to shoulder their share of the burden.

Mr. Obama portrayed himself as the defender of senior citizens versus owners of corporate jets, and of secretaries who pay higher tax rates than their hedge-fund-managing bosses (class warfare ammunition supplied by Warren Buffett).

He implied that his opponents want a land without education, new roads or food inspection. Citing slavery, economic justice and Thomas Jefferson, Mr. Obama made that trademark pinch-fingered gesture with which he indicates his grasp of the most minute detail of his own utter rightness.

However, House Speaker John Boehner quickly followed with a brief but devastating deflation of the notion that the President was the Great Compromiser. If there was a crisis, said Mr. Boehner, it was of the President’s own creation. Moreover, he noted, “Balance” in Mr. Obama’s Washington means: “We spend more, you’re taxed more.”

Despite the fact that both tax increases and further Keynesian “stimulus” now appear non-starters, Mr. Obama’s comprehension of where productive jobs originate still seems shaky. This is obvious from his devotion to a globally thermostatic green industrial strategy, which is the main reason for his administration’s foot-dragging over Keystone XL. The line, it is claimed, would not merely entrench the U.S. economy’s dependence on fossil fuels, but its attachment to “dirty” ones at that.

Keystone XL is currently designed to carry 700,000 barrels per day of diluted bitumen from the Alberta oil sands to the refineries of the Gulf coast, thus pushing out oil from less reliable sources, such as Venezuela. The line has been fought every step of the way by well-funded environmental non-governmental organizations, ­ENGOs, who have unleashed a vast campaign of disinformation, and even slapped a fatwa on Alberta tourism. They have been helped by the blanket coverage that recent pipeline spills have received, even though the incidence of such spills has been declining for decades relative to the size of the system. The cost of such spills (the bill for the cleanup of the Enbridge leak in Michigan will be more than US$500-million) is surely more than enough incentive to avoid them. Meanwhile, Keystone XL is the safest and most sophisticated pipeline ever built.

Ultimately, the ENGOs’ target is the oil sands themselves, which the green movement has chosen as a wonderfully anti-photogenic symbol of environmental devastation. The diluted bitumen that would be transported via Keystone XL has been demonized as “toxic sludge” that would eat through steel and pollute the Ogallala aquifer. Such claims are without foundation.

Admittedly, the ENGOs’ job has been made easier by the oil industry’s — not to mention Ottawa’s and Alberta’s — sloth in cranking up their defence, which is still less than stellar. The latest snafu occurred last week, when Canadian Environment Minister Peter Kent announced a new comprehensive environmental monitoring program for the oil sands, but apparently forgot to check who was going to pay for it.

The Harper government is, nevertheless, a stout supporter of Keystone XL, although it is also keen to cut domestic regulatory barriers to projects that would serve other foreign markets for oil-sands oil, such as Enbridge’s proposed Northern Gateway pipeline to the West Coast.

One would imagine that any sensible U.S. administration would be keen to secure as much Canadian oil as possible, even without the promise of pipeline jobs. However, at a time when the U.S. economy is losing the employment battle, the administration is still in thrall to environmental alarmism. Meanwhile, if the U.S. government receives a downgrade from ratings agencies, it will have little or nothing to do with the failure to raise the debt ceiling. Rather, it will be the consequence of an administration devoted to doubly toxic green Keynesianism.