John Fund‘s latest column at National Review Online offers the president one good suggestion as he pursues ways to boost the American economy.
President Obama won’t release his own budget till April, but he has a golden opportunity to improve on the Senate budget and create real jobs. All he has to do is end his four-year delay in approving the Keystone XL pipeline, which would bring crude oil produced from Canada’s oil sands to refineries on the Gulf Coast. It is already “shovel-ready” — portions of it are already under construction. And because it’s being built by private-sector companies, any new pipeline jobs would come at zero cost to the taxpayers and the economic activity created would provide significant tax revenues.
Keystone has been completely scrubbed environmentally. Four government reports have been issued on its impact, all with essentially the same conclusion. The latest came this month, from the U.S. Department of State. It raised no major objections and concluded, as AP notes, “Other options to get the oil from Canada to U.S. Gulf Coast refineries are worse for climate change.” Nor will all the piped oil be Canadian: Keystone will provide a safe, reliable method of transporting 250,000 barrels of oil a day from the Bakken fields of North Dakota to refineries.
A key finding of State’s report is that the Canadian oil fields are so big — the world’s third-largest reservoir of oil — that they will almost certainly be developed. The question becomes whether the oil will be sent south to the U.S. by our friendly Canadian neighbor or shipped west to China and other Asian powers. Estimates show that for every dollar of oil that North America imports, we receive only 10 percent of the economic benefit — the economic activity the oil is used for. The rest of the money stays with the Venezuelans, Nigerians, and Saudis who pumped the oil. In contrast, when you add up oil-production costs, sales, and downstream jobs created by oil production, the domestic benefit from oil pumped from North American sources is roughly 80 to 90 cents of every dollar of oil revenue.
