Oil from Canada offers the United States energy security into the indefinite future.
The proposed Keystone XL pipeline from Alberta to refineries on the Gulf of Mexico coast offered the immediate promise of 20,000 American construction jobs and many more jobs in oil refining and distribution.
Yet this week, the Obama administration delayed approval of the Keystone pipeline into 2013 -- a delay that may well kill the project altogether, at great financial loss.
Why? One theory credits local opposition in the state of Nebraska, by Nebraskans who worry that a fractured pipeline might spill oil and contaminate the state's aquifer. Nebraska is one of two states that splits its electoral votes, and in 2008 Nebraska contributed one to Barack Obama's 365 electoral-vote landslide. Supposedly, Obama is eager to protect that single vote.
However, this Nebraska theory does not seem a very plausible explanation of the administration action. Even a very close election won't turn on one electoral vote -- especially since safety concerns can be assuaged by hardening and doublecasing the pipeline.
The true locus of opposition to the pipeline is not Nebraska, but California, where big liberal environmentalist donors have seized on the pipeline as a talismanic cause. These California environmentalists do not want to redirect the pipeline. They want to stop it altogether, so as to leverage an end to further Canadian oilsands development.
What will curtailing oilsands accomplish for the environment? Nothing. This is a big planet full of oil, and if the United States does not buy its oil from Canada, it will buy its oil from somebody else.
So long as demand runs high, oil will be imported and burned. And it's not like pumping the oil from the Gulf of Mexico, or transporting oil from the Middle East in tankers, is exactly environmentally risk-free.
Getting off oil means changing the way Americans use oil. That change requires a change in incentives: A permanently higher oil price that will encourage Americans to live closer to work, to build their cities denser, to prefer more fuel-efficient vehicles, to convert their bus and truck fleets to natural gas, and so on.
Price incentives work. The oil shocks of the 1970s cut American oil use dramatically. As late as 1995, Americans were still using less oil than they did in 1978 -- even as they drove many more miles.
High prices persuaded homeowners to switch to gas heat. High prices and well-timed deregulation shifted U.S. freight transportation from truck to rail. High prices jolted U.S. utilities to stop burning heavy oil to power electrical generators.
But after 1996, low prices ended this conservation era. Oil use surged for the next decade.
Yet markets continue to work. Higher prices since 2006 have again changed behaviour. Americans are driving fewer miles. They are retiring more cars than they buy. They are opting again for smaller, fuel-efficient vehicles. They are buying smaller homes, with a new emphasis on central city living. The recession has of course intensified all these trends.
They won't become ingrained, however, until and unless Americans accept that oil prices will remain high indefinitely. Which, in turn, means until and unless the United States adopts some system of standby energy taxes or carbon taxes.
Putting a price on carbon, however, is a concept the Obama administration and the Democrats in Congress indefinitely postponed all the way back in 2009. Such a step would have imposed costs on voters, and in bad economic times, the politicians flinched.
And hey, flinching from adding costs in bad times is a pardonable reflex -- if you are a politician. What is unpardonable is the willingness of environmentalists to accede to the political imperatives of their Democratic chums, and to join with the Obama administration in pretending that the United States can move off oil at zero cost. You see, it's only "big oil" that craves cheap gasoline -- the actual voters are the victims of the machinations of sinister corporations selling products that people want at prices that people can afford.
There are serious carbon tax proposals that would mitigate the costs upon non-affluent voters by rebating the proceeds in one or another kind of tax cut. But if you want to use less oil, then you must ensure that oil costs more. Ad hoc gestures like the Keystone cancellation change nothing -- except to sustain the status quo, with its dependence on oil drilled and carried from across the ocean.
Environmentalists have become adept at stopping things. A greener future requires the advanced countries to build things -- including pipelines.
This originally appeared in the National Post.
Follow David Frum on Twitter: www.twitter.com/@davidfrum
Top 5 at 5: Your comments on Keystone pipeline, Occupy NS
Advocates of Keystone Pipeline Try to Co-opt OWS
Obama Administration May Put Off Keystone Pipeline Decision With New ...
The few jobs that will be created by the pipelines construction are only temporary but if a spill occurred as the spill in Alaska by the Valdez and the spill in the gulf show us the damage to the ecosystems flora and fauna is often permanent changing the system forever.
Not to mention that the Great Plains Ogalala Aquifer overlaps the Colorado River watershed which runs through 7 states going as far west as California that is already experiencing water shortages and supply problems from human interference a spill contaminating the Ogalala Aquifer could have a devastating impact for much of the mid and western half of the United States.
What Mr Frum also fails to mention is that it really doesn't matter where oil is recovered from since all petroleum is now traded on the global market and would not be sold specifically here in the United States rather it is bought and sold on the global market by speculators that often times never even take possession of the futures contract but rather just store the contract and then turn the contract over to keep the price of petroleum artificial high.
Bull. It will mean less risk to the environment. You're only trying to drum something else into people's heads because you have an agenda to carry out.
"This is a big planet full of oil, and if the United States does not buy its oil from Canada, it will buy its oil from somebody else."
No, it can produce its own oil. It doesn't have to buy it from anybody. They just don't want to destroy their own environment. They prefer we Canadians do it to ourselves.
What we need to worry even more about is how they are exploiting us for our water. Water is the new oil.
the right and the oil companies are trying to wring as much money out of us as they can before the inevitable starts happening. We can't allow them to get away with it.
Gee, maybe we should just dig a big ditch all way to Texas and let it flow like a river, then, hmmm?
Until Washington decides to repeal the Commodities Futures Modernization Act of 2000 and ban Goldman Sachs and Morgan Stanley as well as hedge funds from bidding on oil for profit and undertake an isolationist economic policy with respect to the extraction and refinement and sale of petroleum products for use in energy where oil comes from is insignificant and will have no effect on the globally set market price. It's all a big lie that the right wing Republicans and Democrats who support big oil throw out there to enrich themselves through there investments and pay to play obligations resulting from campaign donations.
Forcing people to pay more only justifies the hyperinflation in oil prices due to come because of Ben Bernanke 0% bailout policy for market spculators.
Changing to Green Energy is great, but energy is not the major source of oil consumption. It is the production of plastics, polymers, fertilizers and other aspects that oil is used in that will continue to keep demand high.
The other aspect people fail to look at is the global population. The world just hit 7 Billion people this fall, that’s 7 Billion people consuming resources that largely are derived from oil. As the world population continues to grow so will the demand for oil. If you want to talk about reducing the demand of oil, then you need to talk about reducing the world’s population to address the cause of the demand.
Lastly- it is not the fear of the oil itself might be an ecological disaster- it is the solvents that must be added to what is in essence, asphalt, to allow it to flow in the pipeline. In the event of a breakage in the pipeline, the heavy asphalt components of the flow will be localized, but the solvents (which Keystone assures us are perfectly safe, but won't disclose what they are) will move into the aquifer, just as MBTE additives to gasoline (which the oil companies assured us were perfectly safe) has polluted aquifers in California. MBTE was used to avoid the cost of adding ethanol as an oxygenator to gasoline since ethanol was not produced by oil companies and MBTE was.