Barron’s editorial page editor explores the Keystone impasse

Thomas Donlan‘s latest editorial commentary for Barron’s details the Canadian government’s Washington, D.C., ad campaign designed to encourage action on the long-delayed Keystone XL pipeline. Then Donlan reminds readers why ads are unlikely to work.

Canadian Prime Minister Stephen Harper is annoyed by the reluctance of the U.S. government to approve the Keystone XL pipeline, which would carry crude oil from Alberta to refineries in Texas and Louisiana.

The Obama administration has been dragging its feet for years, and Harper is well justified in turning up the heat. After all, this is a government of grass in the wind, which bends when pressured.

Unfortunately, polite, positive ads don’t apply the same level of pressure as the clamorous activists concerned about greenhouse gases and global warming. Opponents focus on the fact that producing gasoline and diesel from Alberta’s tar-sand mines generates more carbon dioxide than exploitation of other sources of oil. To fight this issue, however, they ignore more important sources of carbon dioxide — other fuels and other countries. Most of the opponents also reject every possible substitute, such as natural gas and nuclear power. Their hearts belong to wind and solar power, which are decades if not centuries away from being the world’s primary sources of energy.

As the U.S. State Department concluded last year, demand for oil is still holding prices high, so Alberta’s tar sands will be mined, transported, refined, and sold somewhere and somehow. It doesn’t make any difference whether the U.S. is the chief customer or not. Thus, there won’t be any additional carbon dioxide generated if the U.S. follows its clear economic and geopolitical interests and allows the pipeline to be built.

The State Department’s delay in issuing this report was sufficient to push the issue past the 2012 election. More recently, on April 18, President Barack Obama ordered still more study. People who are used to the way Washington works understood that the president had ordered the pipeline decision to be delayed past the 2014 election, as well. Cynics correctly doubt that anything will be decided until after Election Day 2016.

Obama and other Democratic politicians are caught between Scylla and Charybdis. They would like to appease the labor unions that support the pipeline as a construction project for the jobs. They would also like appease the energetic environmentalists who have decided that the pipeline will contribute to a variety of environmental disasters involving water, air, and climate change.

Very few of the people with power over energy would like to appease the American people by raising the supply of oil and lowering its price. Only an election can change their policies.

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