Obama Caves on Linking Payroll Tax Cut to Keystone Pipeline

On December 7, President Obama said: “Any effort to tie Keystone to the payroll tax cut I will reject. So everybody should be on notice.” More recently, the Obama White House warned against the introduction of “ideological issues into what should be a simple debate about cutting taxes for the middle class.” Senior administration officials later told reporters that was a reference to the pipeline.

On Friday night, December 16, Senate leaders announced a tentative agreement to extend for two months Social Security payroll tax cuts, along with a two-month extension of unemployment benefits. Reportedly, Republicans won their fight to block new federal regulations for light bulb energy, coal dust in mines and clean water permits for construction of timber roads. In return, the White House turned back GOP attempts to block limits on greenhouse gases, mountaintop removal mining and hazardous emissions from utility plants, industrial boilers and cement kilns. It seems to me to be unseemly to trade environmental protections or lack of protections for a tax cut, especially one that will have so little impact.

A crucial part of the deal was that Obama must make a decision in 60 days to authorize the pipeline unless he determines it would not be in the national interest. Since he previously delayed a decision until 2013, he already has determined that its authorization would not be in the nation’s “immediate” interest. Not only has Obama broken a promise not to link the tax cut and the Keystone XL pipeline, but he has put himself in a position where he has to explain why its imminent construction would not be in the national interest. If he does approve the construction of the pipeline, he angers all those people who he told that environmental impacts must be more carefully studied.



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