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Canadian Keystone XL Oil Pipeline: Why the Deception?

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Why are congressional advocates of the Canadian Keystone XL oil pipeline resorting to so many deceptive claims when there is no dispute the project would create American jobs and bring business to our Gulf Coast refineries?

The answer is that there is much more to the story than its face value and it is all about drawbacks. When you get past the Republican hype designed to politically embarrass President Obama for refusing to approve the project's route across the American heartland, you discover the pipeline is not the economic bonanza or environmentally benign entity depicted by its boosters. On the contrary, a strong case can be made that our nation would be better off with no Keystone XL pipeline whatsoever. One needs only examine the proponents' exaggerated claims (including downplaying of environmental risks) to see why.

TransCanada Corp., the corporate sponsor behind Keystone, actually admits that if its tar sands oil is piped down to our Gulf Coast refineries, it would be shipped overseas for a more attractive price than it could garner here. So much for the Keystone supporters' contention that the project would ease our dependency on oil imports from unstable parts of the world. We are talking essentially about a sweetheart deal for TransCanada.

In its application, the company discloses that the pipeline is likely to result in higher rather than the cheaper gasoline prices touted by Keystone backers. That is because the project would allow TransCanada to draw down the reserves it has been storing in the Midwest and that have served to suppress prices at the pump.

The company warns that if we don't reconsider approval of Keystone XL, it will construct the pipeline across Canada to the British Columbia coast and ship the oil to China.

That is an empty threat when you consider that the Keystone oil our refineries would export could easily end up in China anyway. What clearly demonstrates that TransCanada is bluffing is that for all its menacing bluster, the company has said it will resubmit its application to the United States. No small wonder since the company faces considerable opposition from Canada's political minority party, as well as native tribes, farmers and other sundry individuals along the pipeline's prospective right of way. Enough of a ruckus has occurred to prompt Canadian regulators to announce a one year delay while the proposed domestic Keystone route is reviewed. There are environmentalists in Canada too!

What about jobs? Keystone backers' assertion that the pipeline will generate anywhere from twenty thousand to one hundred thousand jobs is wildly inflated. More realistic estimates by our State Department and independent researchers fix the number of jobs at 6,000, with most of them lasting no more than the two years it would take to complete the project. Still, some jobs are better than none, right? Maybe not in this case.

What of the possibility that the pipeline could turn out to be a net job loser? The increase in fuel prices could have a deleterious effect on Midwest employment. If there were a significant oil spill that contaminated the region's water supply, the adverse economic impact on farming and communities in the path of the pollution would be devastating.

By the way, if you think such an outcome is farfetched, TransCanada's oversight record is hardly stellar. Although mostly minor, there were 12 spills during the first year of the company's operation of its existing original Keystone pipeline.

Last but not least, the tar sands product is the dirtiest of oils making it a major pollution threat as it travels over a major aquifer through the heart of our country. Moreover, the pipeline would divert precious time and resources from development and distribution of clean renewable energy alternatives. These alternatives are the core of an effective program to curb global warming, which by extension would bolster the nation's chances for a secure future.

Republican lawmakers seem convinced that President Obama's handling of the Keystone project will fragment the support of his industry, union, and environmental backers and deal him a blow in an election year. But when the dust clears, it may be the lawmakers who are left holding the bag.

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