The GOP’s Puzzling Obsession with Keystone XL: A Case of Perseveration?

Republicans remain focused on a project that no longer makes much sense.

Perseveration is a psychological syndrome where you can’t stop doing something even if the original reason for doing it has vanished.  I’m beginning to wonder if the continuing fervor of Republican support for the project reflects an institutional equivalent of this syndrome.  The economic and political case for the project is fading, but Republicans just can’t seem to let go.

Admittedly, if you put aside the environmental issues, the project was appealing when oil was expensive and consumers were worried about high gas prices.  But today, U.S. oil production is booming, oil is cheap, and gas prices are falling. Yet, Mitch McConnell swears that his first act as Senate majority leader will be to pass a bill approving the Keystone XL pipeline.  It seems like an odd priority given the declining economic and political benefits of the project.

Indeed, there seems to be a good chance that the project won’t be built even if it gets federal approval. As the LA Times reports:

Even at the Manhattan Institute, a free market-oriented think tank with little patience for the arguments made by pipeline opponents, questions are emerging about whether Keystone still deserves star billing in the energy debate.

“I’m for cheap, abundant, reliable energy. Period,” said Robert Bryce, a senior fellow at the conservative group. “This is not ideological. This is about what the economics say.… The project is clearly very challenged right now.”

Some estimates show that the pipeline is already below the breakeven point. The investors bravely say they won’t abandon the project because the price of oil will eventually go up enough to make it worthwhile.  But it doesn’t look like that’s going to happen soon, given that the Saudis are refusing to cut production.  Unconventional oil has brought world prices way down, to the dismay of Vladimir Putin.  Just about the most expensive of the new oil sources comes from oil sands — reportedly about $90 for new projects,  $55 for existing ones.  The price of light sweet crude is now around $55.  So the pipeline looks increasingly dicey in economic terms.  The economically smart decision would probably be to delay the project in order to get a better sense of how prices will shake out.  So don’t be surprised if there’s a substantial delay before construction begins, even assuming it gets congressional approval.

McConnell presumably hopes to get a quick win against the President with this issue in order to build morale. On the other hand, for the same reason, he may have more trouble picking up Democratic Senators for a veto-override. Even if he’s successful, he’s losing the chance to use the opportunity to push for something with more policy and political salience at the beginning of the session.  There’s also the risk of looking foolish for making such a big deal about the pipeline if the project is cancelled or delayed past the next election. Overall, it still seems peculiar that Republicans seem to be so fixated on the issue.



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About Dan

Dan Farber has written and taught on environmental and constitutional law as well as about contracts, jurisprudence and legislation. Currently at Berkeley Law, he has al…

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