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Keystone XL Does Long-Term Damage to U.S. Economy

The Senate Energy and Natural Resources Committee holds another show vote tomorrow to boost the Keystone XL pipeline. Big Oil and friends are thus cranking out a little extra Keystone XL baloney.

Prairie Business offers up the American Petroleum Institute's laughable claim that building TransCanada's pipeline across the Great Plains will create 42,100 jobs. This claim is old news, based on fuzzy math that assumes those construction workers spending a month or two in each county along the construction route will create a booming demand for ballet dancers and speech therapists at the man camps.

Alas, Big Labor is on board with Big Oil's Keystone XL snake oil:

[President of AFL-CIO’s building and construction trades department Steve] McGarvey said the project also would bring $3.1 billion in construction contracts, support and materials to his industry.

“I think there comes a time when as a country you circle wagons and get behind what’s gonna be in our best long-term interest,” he said [Katherine Lymn, "American Petroleum Institute: Approve Keystone XL for the Jobs," Prairie Business, 2014.06.17].

Long-term interest? Let's see, when Keystone XL clears the glut at Cushing, closes the price gap between North American and offshore oil, and raises our gasoline prices 20 to 40 cents per gallon, it will shackle our economy with an ongoing drag. Just a 20-cent rise knocks $22 billion out of the economy, swamping the $3.1-billion temporary pipeline infusion McGarvey cites. More expensive gasoline reduces the amount consumers can spend on other goods and services.

A $20 increase in the price of a barrel of oil increases unemployment by 0.1% in one year. One tenth of one percentage point of the current U.S. workforce is about 150,000 jobs. If Keystone XL raised the price of oil on this continent just $6, we'd lose about 50,000 jobs, more than enough to wipe out even the indirect, induced, magic-math jobs the API and other pipeline dreamers want you to think Keystone XL will bring. So even if API were telling the truth, we'd see 42,100 jobs come and go for the few months it takes to build the pipeline, then sandbag ourselves thousands more jobs long-term.

North Dakota Senator John Hoeven and Canadian Ambassador Gary Doer now say TransCanada will get the green light to build Keystone XL by next spring. Even if that happens, we should thank Keystone XL opponents for getting the President to at least delay the pipeline's long-term economic damage for another year.

Related Reading: TransCanada's permit to build Keystone XL in South Dakota expires June 29. When they resubmit their application, we could boost the economy by bringing a thousand Keystone XL opponents to Pierre to testify, protest, and buy sandwiches.

But don't wait for the hearing—protest now! Dakota Rural Action is among the participants in a Day of Unity and Action against Keystone XL on Saturday at the Pte Ospaye Spiritual Camp in Bridger, the Wiconi Un Tipi Camp in Lower Brule, and the Oyate Wahacanka Woecun Camp in Ideal.


  1. Stan Gibilisco 2014.06.17

    Well, I guess my reactionary friends are wrong when they say Obama wants to destroy our economy.

    If he did, he'd approve Keystone XL and even encourage it.

    Or does he think it would prove an economic benefit?

    In any case it will bring environmental disaster.

  2. Jerry 2014.06.17

    Tesla has a battery charging station in Murdo and is working with the competition to put more electric cars on the road. Who needs the sludge from Canada anyway? The Chinese seem to be the only ones. Lets move on.

  3. mike from iowa 2014.06.17

    I'm guessing it's time to circle the wagons and call these fecking liars out for the fecking liars they be. Put 'em under oath and make them swear that their estimates are accurate and true,under penalty of massive fines and death. They'll be singing a far different tune.

  4. Paul Seamans 2014.06.17

    The Day of Unity on Saturday at the spiritual camps starts at 12:00, noon. All three camps were set up as a protest to the KXL pipeline. A noon meal is planned with meat provided, bring a side dish if you wish. Everyone is invited to visit these camps in a show of solidarity with our native friends in our mutual opposition to the KXL. Dakota Rural Action members are planning to visit each camp on that day. Contact if you are interested.

  5. mike from iowa 2014.06.18

    For every illegal Canadian immigrant valedesctorian,there are a hundred others with calves the size of Mt Rushmore from carrying 75 barrels of tar sands goop on their backs across the border. We either need to close our Northern border or get speechwriters that have some concept of reality. Your obstinate servant-"Cantaloupe Calves" King,wingnut of iowa.

  6. mike from iowa 2014.06.18

    JeniW-I'm sure wingnuts are ready to sacrifice someone else's kids to stop Canada from stealing all those by-god 'murrican pipeline jobs along with our tar sands under their soil. War drums are beating.

  7. Daniel Buresh 2014.06.18

    ND is going to be for it for obvious reasons. KXL could ultimately cause their production to double or triple. As soon as eastern ND and western MN rail lines are freed up, along with other smaller pipelines being built, 2 new refineries, and a possible connection to KXL......they are looking at huge job growth. How many jobs do you think will be created when wells go from pumping 4-5 days a month to everyday? 40k jobs...they'll see more jobs than that in ND alone.

  8. Taunia 2014.06.18

    Wages and jobs aren't union's only approach to this.
    Versus rail, they say KXL will save many lives over 10 years.

    "It initially found that the uptick in rail transit that would result from a rejection of the pipeline could cause 700 injuries and 92 deaths over 10 years.

    Last week it increased those numbers substantially. Without Keystone, the State Department said, crude transportation could cause accidents resulting in 2,947 injuries and 434 deaths over the same period."

    Continental Resources had stake in the pipeline but bailed on the pipeline in favor of rail because of the lengthy delays in pipeline approval. I'm guessing unions are trying like hell to keep other pipeline stakeholders from ditching it also.

  9. Jerry 2014.06.18

    I wonder how many deaths would occur if the pipeline fractured and destroyed the aquifer with the poison in its mixture. Probably 15,000 or so and the sickness that would come from that would be unimaginable. The loss of crops and livestock would cost untold billions of dollars. Then, the aquifer would not be usable ever again.

  10. JeniW 2014.06.19

    Like gold mining that went belly-up in the Black Hills, and in California when it stopped being as profitable, what was left behind is the ugly/spoils, the same thing will happen when the pipeline does not generate enough profits.

    Just as people who mined for gold are long dead, and no longer care about the ugly/spoils left behind for the future generations, we will all be dead when the pipeline shuts down, and will not care about the ugly/spoils left behind for the future generations to look at and/or deal with.

  11. mike from iowa 2014.06.19

    Crud by rail increased to get Bakken Shale crud to Eastern and Western refineries,to make up for declines from Alaska and foreign imports. Can't imagine mixing light sweet,crud with tar sands crud in the same pipeline unless it is all destined for China.

  12. caheidelberger Post author | 2014.06.19

    Taunia, the problem with the union's "rail bad" argument is that they are assuming we must transport the oil. They forget Option #3: don't move tar sands oil. Don't buy it. Don't mine it. Leave it in the ground, consume less energy, and use alternative fuels. The derailment, leakage, explosion, and death rates for conservation are zero.

  13. larry kurtz 2014.06.19

    Thanks, Jerry. T: good to read you.

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