Budget fights: The gift that keeps on giving

The bill stipulates that the Administration must make an up-or-down decision on the permit for the pipeline within two months of the signing of this act. The State Department has already said that doesn’t leave them enough time to explore the re-routing both they and the state of Nebraska and pipeline owner TransCanada have said they want to consider, to avoid the Ogalalla Sand Hills region, and particularly the aquifer that supplies water to the area. So if faced with a 60-day timeline, the State Department said, they would have to deny the permit. Earlier in the week the White House agreed with them, saying that The House bill simply shortens the review process in a way that virtually guarantees that the pipeline will NOT be approved. So adding this provision kills the pipeline in the short term.

And Republicans, by the way, KNOW this. They want the President to deny the permit. The tell is that Newt Gingrich spoke up about the pipeline in the debate on Thursday night. Republicans want to position Obama as someone destroying US jobs to satisfy environmentalists. They also would like to say that he is stopping the supply of domestic energy production. None of this is true with regards to Keystone XL. The pipeline won’t create jobs, all the energy production in this case comes from Canada, and the President actually has presided over a boom in domestic energy production, although that hasn’t led to a drop in oil prices because we simply don’t have that much oil domestically.

But the likely outcome on Keystone XL fits a narrative for the GOP. So they want to see the President cancel the pipeline to make it a campaign issue. The counter-argument for the Democrats is that the demand by House Republicans to give an answer within 60 days on a pipeline whose route remained in flux killed the permit. So this becomes your run-of-the-mill he-said/she-said, and the pipeline doesn’t get built. My understanding is that it would not impact the possibility of the pipeline being approved after the elections, when more time is given to the environmental impact. So that’s a fight environmentalists will still have to wage. In the short term, within 60 days they will have a President reject the pipeline, and then they can go to their lists and tell everyone how their pressure got it done. But they’ll have to extend a note of gratitude to Republicans, who made it all possible.

There is always the possibility, of course, that the State Department will reverse itself or the administration will reverse the State Department. That is certainly what the Republicans will be taunting the President to do.

But at this point it looks like the Pipeline is dead — at the hands of the GOP. Which is ironic, to say the least.