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Clinton Shows Her Keystone XL Cards

Hillary Clinton, in profile, at the Iowa State Fair
photo by Phil Roeder

So now we know: Hillary Clinton opposes the Keystone XL Pipeline.

In an appearance in Des Moines, Iowa, Clinton fielded a question about the pipeline, similar to those she has been addressing (or ducking) since before her campaign even officially began. But this time, instead of dodging, she said outright, “I oppose it.”

Subsequently, she released a longer discussion of her stance, again calling Keystone XL a “distraction from the real challenges facing our energy sector,” and underscoring her unequivocal opposition to its construction.

This position is a shock to no one. Her main rivals for the Democratic nomination could only criticize it for its delay. The voters to whom Clinton’s position will appeal are crucial in the primaries, but Keystone is apt to be more of a mixed bag in the general election.

Nonetheless, what is a mild surprise is that this famously intransigent candidate seems to have abandoned her hopes of emulating her former boss and avoiding the announcement of a position on the issue - ideally until the last weeks of her planned second term in office.

That strategy fell victim to the reality that primaries are decided by a party’s most committed voters. Most committed Democrats hate Keystone XL or, more accurately, hate the development of Canada’s oil sands. But since they cannot vote in Canada, using Keystone XL as a proxy for their displeasure is the next best thing. The climate movement has used Keystone XL as a symbol for larger concerns about climate change, and opposition to the pipeline has been a rallying cry for years as the Obama administration has let the clock run down.

The fact that we know Clinton’s position is undoubtedly a positive thing. Not that her position is a wise one. With or without Keystone XL, Canada’s reserves will be developed anyway, sooner or later, if world demand for oil supports a high enough price to make it worthwhile. The only people disadvantaged in the long term would be the American construction workers who might have built and maintained the pipeline and the refinery and export terminal workers who might have handled the product for domestic and overseas use.

In the short term, it likely does not matter what a given candidate thinks anyway. As Tracy Johnson of the CBC News pointed out, the United States’ protracted delay on Keystone XL has meant the Canadian industry has already had to look for other ways to get oil to market. Since the demand has been relatively low recently, increased capacity for moving Canadian oil is a conversation about the future, not the present. And Alberta Premier Rachel Notley has said she would prefer more oil be upgraded and refined locally, rather than shipped to U.S. refineries; after she was elected, she promptly said that she would stop promoting Keystone using provincial money.

Even in the unlikely event that the Keystone XL pipeline were approved tomorrow, the loss to environmentalists would be almost entirely a symbolic one. Analysis by both the State Department and independent analysts showed that the pipeline is unlikely to create much long-term impact on the climate. Opponents to fossil fuels would do much better to focus on reducing demand, rather than attempting to restrict supply. But a complicated conversation about a reasonable and realistic energy policy is much harder than simply using a pipeline as a litmus test for a given candidate or official.

If I am wrong and environmentalists are right, and it turns out that nixing Keystone XL will prevent further development of Canada’s oil reserves, the big beneficiary will not be the climate. It will be those do-gooders in Iran and Russia, whose energy reserves will have less competition at market and who will retain their preferred access to China.

But expecting a potential Democratic presidential candidate to support Keystone XL at this point is probably too much to ask. In Clinton’s case, the minor victory is that she recognized that playing coy was a strategy that neither hid her intentions nor impressed her supporters. She seems to have been prodded into the realization that telling voters her policy intentions are none of their business was a quick way to lose goodwill in a campaign that is currently running low on that particular commodity.

This is democracy at work. If the primary campaign forced Clinton off the fence regarding Keystone, score one for the process.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us” and Chapter 4, “The Family Business."

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