While tens of millions of Americans are wringing their hands and wondering whether or not their jobs are ever going to come back, Joe Biden is promising to eliminate the employment prospects of tens of thousands of additional people. How? By “killing” the Keystone XL pipeline. Assuming such a feat is even possible without risking the government losing a very expensive lawsuit, the downstream impact of such a decision would produce plenty of totally avoidable disasters for people in multiple states. And at the same time, at least under current conditions in the oil market, it would have almost no impact whatsoever on fossil fuel consumption. So why do it? To pander to the environmentalist left in an election year, of course. (Free Beacon)
Joe Biden will kill the Keystone XL pipeline project if elected, his campaign said Monday, a move that would likely cost thousands of jobs and millions in local tax revenue.
That termination would cost tens of thousands of jobs, which would result in billions of dollars in lost wages, according to estimates published last year by the State Department. Those reductions would in turn cost state and local governments millions in tax revenue, up to 10 percent of annual property tax revenues in 17 counties across three states.
Biden’s announcement is just his latest move to shore up credibility among the Democratic party’s environmentalist base, which has vocally opposed the pipeline since the project was first started in 2010. Doing so, however, will likely further alienate the top Democrat from voters in oil-rich swing states like Pennsylvania—while, one expert told the Washington Free Beacon, likely having little actual impact on fossil fuel consumption.
A senior fellow in energy policy at the R Street Institute is quoted in the linked report, describing Biden’s promise as “a pander.” But it’s a pander without much meaning given the current state of the oil and gas industry. The Keystone pipeline is intended to bring complex oil down to the United States from Canada’s “tar sands” (actually bitumen) fields.
The problem is that digging up that bitumen and preparing it for shipping is an expensive process. It basically has to be melted down and mixed with lighter diesel fuel, allowing it to remain in liquid form suitable for running through the pipeline. It’s estimated that it costs roughly $60 per barrel to produce and the global oil market is currently tanking. Oil prices are, on the best days, running between 30 and 35 dollars per barrel. There’s no incentive to go after that oil until the markets recover significantly.
The real impact of killing off the project would be the loss of jobs. One estimate from the State Department predicted that two years of construction along the pipeline would produce 42,100 jobs directly or indirectly. Kill off the project and those jobs go away. That also translates into a huge cut in tax revenue for the affected states. What a brilliant idea!
It’s still unclear at this point if Biden could actually get away with pulling the plug. The developers of the pipeline jumped through all of the government hoops for years before finally getting approval to move forward in 2017. Having been given that approval and investing all of the required resources to move forward, only to have the government turn around and rescind the approval would represent a massive financial hardship for the developers. They would have a respectable chance of finding a judge to issue an injunction preventing a hypothetical Biden administration from shutting them down.
Of course, Joe Biden may forget about this before he gets into office, assuming he manages to win the election. He’s currently just saying what the thinks the people in the far-left base of the Democratic Party want to hear.
