President Barack Obama faces growing pressure from Democratic donors to reject the Keystone XL pipeline amid signs that the project is headed for approval.
Donors and party activists are seeking to influence Obama through personal pleas and by pumping money into elections. Their goal: to demonstrate that turning down TransCanada Corp.’s petition to build the $5.3 billion pipeline to carry tar-sands oil from Canada to U.S. refineries can be a political winner.
“The way we can make a difference on this is to show that there’s public support for our position,” said Tom Steyer, the founder of hedge fund Farallon Capital Management LLC and a Keystone foe who has pledged to spend millions on elections such as this month’s Democratic Senate primary in Massachusetts.
That’s an increasingly hard case to make. The American people overwhelmingly favor the project, the oil industry, U.S. Chamber of Commerce and the Canadians are lobbying hard for it, and a State Department review found the pipeline would have a negligible effect on climate change.
Still, should Obama sign off on the pipeline, he would risk blowback from many supporters he’s counting on to help finance next year’s congressional races. That’s led some administration allies to suggest that the president may back the project while either modifying it or offering new measures to reduce carbon pollution in a bid to mollify environmental activists.
The White House is playing down the decision, arguing to both supporters and critics that Keystone’s impact on the environment and the economy will be less than activists argue.
“There have been thousands of miles of pipelines that have been built while President Obama has been in office, and I think the point is that it hasn’t necessarily had a significant impact one way or the other on addressing climate change,” White House spokesman Josh Earnest said last month.
Earnest told reporters the administration’s new fuel- economy standards, which will double vehicle mileage by 2025, will have far greater consequences in curbing oil demand than Keystone would in promoting it.
Daniel J. Weiss, director of climate strategy at the Center for American Progress, a Washington policy institute with ties to the administration, said Keystone opponents are pessimistic because the White House has offered no signals that it will turn down the permit.
To assuage critics, he said, the administration can approve the project with modifications that would offset increased emissions. Or, more likely, he said, the officials can “aggressively reduce other sources of carbon pollution before they approve the pipeline.”