12/17/2011 03:39 pm ET Updated Dec 19, 2011

Obama Aides: Keystone Pipeline Inclusion 'Is Absolutely Not A Blink'

WASHINGTON -- At a press conference on Dec. 7, President Obama warned congressional Republicans not to attach a controversial crude oil pipeline from Canada through the U.S. to a bill extending a year-old break on people's payroll tax.

"Any effort to try to tie Keystone to the payroll tax cut, I will reject," the president said, standing next to his Canadian counterpart, Prime Minister Stephen Harper.

Ten days later, Republicans, with the help of sympathetic Democrats and lawmakers who just wanted to get a deal done, did just that. By a vote of 89 to 10, the Senate voted on Saturday morning to extend the payroll tax cut for two months. Included in the bill was language requiring the State Department to issue a permit within 60 days to proceed with the 1,700-mile oil pipeline.

The inclusion, on its surface, goes directly against the president's veto threat. But the White House has no plans to torpedo the measure. At a briefing with reporters following a short statement by the president, senior administration officials made the case that their position on the pipeline had not been affected.

"It is absolutely not a blink," said one official. "It does not make him do a single thing... All they did was shorten the review process. ... They shortened the review process to 60 days; they are not making the president do anything."

Depending on whom you ask, the bill passed on Saturday does different things with respect to the Keystone XL pipeline. House Republican leadership says that it will mandate that the State Department approve the permit in 60 days time. After that, it would be up to the president to override the approval if, in fact, he wants the pipeline killed.

"It is not as simple as they put it," countered a senior administration official. "I know that will come as a huge shock."

The White House has been slightly cagey with its interpretation of the law, but one official raised questions as to whether it was legal or constitutional for Congress to force the executive branch's hand on this matter. Asked if the president would issue a signing statement nullifying the Keystone language, a senior administration official declined to show the administration's hand, saying, "We are not going to get into that."

As it stands now, Republican lawmakers may have effectively killed the Keystone pipeline by putting it in the payroll tax cut bill. On Dec. 12, the State Department issued a statement that warned Congress it would be "unable to make a determination to issue a permit" for the project if Congress were to "impose an arbitrary deadline." The bill passed Saturday may no longer give officials at State that choice. But the senior administration officials insisted that, should the decision come to the president, he would operate with those same considerations and concerns.

"I don't think the State Department could have been any clearer but Republicans in Congress insisted on pushing forward even though it may result in an outcome that obviously goes against their desires," said one senior administration official.

Another added, "The Republicans are driving toward an outcome that they disagree with. I mean it is pretty remarkable. Sometimes folks play chess and sometimes people play checkers."

The politics of the deal reached Saturday are certainly less than clear. Republicans will have to go through a payroll tax fight once again in two months, something leadership desperately wanted to avoid considering the damage it has done to the GOP's image. At the same time, the president is now forced into a corner: forced to choose between signing off on the pipeline and angering environmentalists or taking a heap of heat from putting off the issue.

"They're making the president kill the pipeline before the election, as opposed to after -- and that's not nothing," tweeted Michael Goldfarb, a Republican operative who served as Sen. John McCain's online communications director during the 2008 campaign.