Rpn Wyden

The Senate just voted down two highway bill amendments on the Keystone XL Pipeline: the Hoeven amendment to permit the pipeline (56-42) and the Wyden amendment prohibiting exports of Keystone crude and petroleum products made from it (34-64). Both amendments required 60 votes for passage. Hoeven’s amendment missed by four votes, Wyden’s by 26.

Eleven Democrats voted for Hoeven’s amendment: Kay Hagan (N.C.), Joe Manchin (W.Va.), Mary Landrieu (La.), Jim Webb (Va.), Claire McCaskill (Mo.), Mark Pryor (Ark.), Jon Tester (Mont.), Mark Begich (Alaska), Bob Casey (Pa.), Kent Conrad (N.D.) and Max Baucus (Mont.). Bottom line: There is now clear majority support in both the House and Senate for expeditious approval of the Keystone XL Pipeline.

As this blog has argued previously, proposals like Wyden’s to ban exports of U.S. petroleum products would violate U.S. treaty obligations under the General Agreement on Tariffs and Trade (GATT) and the North American Free Trade Agreement (NAFTA).

Wyden claims an export ban would increase domestic supplies of gasoline and diesel fuel and, thus, lower prices, benefiting consumers. But the ban would likely backfire, increasing pain at the pump. It would drive refining-related investment, production, and jobs out of the USA, curbing production at home while making higher-priced foreign imports more competitive.

Banning petroleum product exports is also just plain dumb if you’re one of those people — like Wyden — who deplore America’s trade deficit with China. Well, okay, what Wyden deplores most (or only) is America’s trade deficit in “environmental goods” like solar panels. If you don’t understand the economic logic behind this selective indignation, it’s because there is none.

Gross self-contradiction is not uncommon in politics, but the angst and handwringing over Keystone XL as an “export pipeline” by many self-styled trade hawks is material suitable for a Monty Python skit. In the meantime, sober commentary will have to do. ExxonMobil’s Ken Cohen hit the key points in a recent post.   [click to continue…]