It’s up to the U.S. President to decide whether the cross-border leg of the Keystone XL pipeline is in the national interest of his country. Ultimately, his criteria are less scientific than political. Does he stand to lose more by alienating those who support or oppose the project?
With midterm elections coming up in November, Obama doesn’t have time to worry about Canada’s hurt feelings. Our economy, environment and opinion are very low on his list of priorities.
But the strongest pro-Keystone arguments on the American side raise an uncomfortable question: if the pipeline is approved, who benefits a little bit — and who benefits a lot? In other words, who gets the short end of the stick?
Houston-based Forbes contributor Loren Steffy lays out the business logic behind Keystone XL with a clarity you’d be hard-pressed to find on our side of the border:
“[In 2011], for the first time in six decades, the U.S. exported more gasoline and diesel than it imported. The bulk of the exports went to Mexico, Canada and Brazil. Mexico and Canada, even without Keystone, are two of our biggest suppliers of crude (Canada is No. 1; Mexico is No. 4 behind Saudi Arabia and Venezuela). Gasoline, of course, is more expensive than crude, so we are in effect importing raw materials, adding value, and selling it back at a higher price – and maintaining U.S. jobs in the process.”
Catch that? It sounds a lot like the old story about exporting logs and buying back the furniture. Our domestic politicians tell us we’re an “energy superpower,” but to hear U.S. analysts describe it, we’re more of a convenient resource colony.