Conflict-of-interest issue for Rice on Keystone XL project?

The odds of Susan Rice getting the nomination to replace Hillary Clinton may have just gotten longer, perhaps even longer than the proposed length of the Keystone XL pipeline project.  That’s not an accidental analogy either, as the embattled UN Ambassador’s finances have begun attracting some interest.  Rice’s wealth includes a substantial investment in TransCanada, the firm that wants to build the pipeline — and the next Secretary of State will make the official decision on whether it proceeds:

Susan Rice, the U.S. Ambassador to the United Nations whose name has been floated as a possible secretary of state nominee, may soon face opposition from the environmental lobby over what the Natural Resources Defense Council (NRDC) called a potential financial conflict of interest on Wednesday.

According to her May 2012 financial disclosure, Rice has an investment in TransCanada Corporation worth between $300,000 and $600,000. TransCanada is angling for the State Department’s permission to build the final portion of the Keystone XL pipeline — a 1,700-mile conduit for crude oil between Canadian deposits and Texas refineries.

If she were confirmed as secretary of state, Rice would have final authority to green-light the large section of the pipeline project still languishing in regulatory purgatory.

Rice and her husband, a producer at ABC News, have a net worth between $26 million and $39 million, making Rice one of the wealthiest members of Obama’s Cabinet.  There is nothing wrong with that, of course, and the overall wealth shows that this investment is a very small part of Rice’s portfolio.  However, that may not matter to those who oppose Rice’s nomination, nor to those who oppose the Keystone XL pipeline, two very different constituencies that might have a common cause if Obama sends her name in nomination to the Senate.

The Washington Post reports that chances of that happening appear to be dimming somewhat, although not entirely extinguished.  Democrats are publicly supportive of Rice, but privately wondering whether this is a fight worth having:

The choice of a successor to Hillary Rodham Clinton as secretary of state has turned into an unexpectedly nasty political fight that could cost the White House valuable goodwill with Republicans.

Republican opposition to presumptive front-runner Susan E. Rice did not fade after the election, as White House officials and her supporters had predicted. Rice, the U.S. ambassador to the United Nations, did not win any public GOP support after meeting with two Republican senators Wednesday, her second day of unusual face-to-face sessions intended to blunt critiques of her role in explaining the fatal Sept. 11 terrorist attack in Libya. …

A White House official and Democratic aides said they think that Rice could win Senate confirmation for the top diplomatic job if Obama nominated her.

But with lawmakers potentially facing difficult votes on taxes or entitlements, confirmation could come at a high political cost for Obama and vulnerable Democrats facing reelection in 2014.

The Post also picked up on the conflict-of-interest story late this morning.  They report on more connections between Rice and players in the pipeline effort, and a new effort by environmentalists to oppose her appointment:

If Susan E. Rice becomes Secretary of State, she might have to recuse herself from one of the first and most controversial decisions she would face: the Keystone XL oil pipeline permit.

The reason: Rice and her husband are major shareholders in the pipeline company as well as a variety of Canadian companies that are involved in exploiting the oil sands region of Alberta, which would feed the Keystone XL and benefit from a new outlet. …

Rice and her husband also own shares of major Canadian banks that are expected to provide financing for the Keystone XL project. They own between $50,000 and $100,000 of shares in Suncor, another oil sands company, and more than $1.25 million of shares in Transalta, the Alberta’s electric power producer.

Rice, who is the U.S. ambassador to the United Nations and considered the leading candidate to become President Obama’s nominee for State, listed the holdings in her most recent disclosure statement, covering the 2011 calendar year. The information was highlighted in an article published on the Web site of the Natural Resources Defense Council’s OnEarth magazine. The NRDC is opposed to the construction of the $7 billion pipeline. …

At a time when Obama is fighting Republicans opposed to Rice, the financial disclosure form is likely to draw scrutiny from Democrats and environmental activists who have been among the president’s most reliable supporters.

Jennifer Rubin argued yesterday that the results of Rice’s charm offensive on Capitol Hill this week should disqualify her anyway, especially after flopping with Republican moderates Susan Collins and Bob Corker:

Collins is no wide-eyed right-winger and, moreover, is privy to materials reviewed in the Homeland Security Committee’s investigation of the Benghazi, Libya, scandal. Her opposition would likely mean unanimous Republican opposition to the nomination (45 votes, more than enough for a filibuster).

Likewise, Corker, known as a moderate deal-maker on the Hill, practically begged the president not to nominate her: “I am asking the president to step back away from all that’s happened and take a deep breath and to nominate the person that he really believes is the very best person to be secretary of State for our country, regardless of relationship.”

Indeed, it remains a bit of a puzzle why Rice, whose belly-flop on Capitol Hill doesn’t speak well of her diplomatic skills, is still in the hopper for State. There are more qualified candidates with less baggage who would sail through the Senate.

I suspect that Rice will end up staying where she is, and John Kerry will get a phone call in the next couple of months.

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