Could a decision to move forward with the Keystone XL pipeline hamper the United States' ability to negotiate on climate policy, both at home and internationally? During today's OnPoint, Tom Steyer, founder of the Steyer-Taylor Center for Energy Policy and Finance at Stanford University, explains why he believes the Keystone XL decision is symbolic and could have wide-ranging consequences for President Obama if approved.
Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Tom Steyer, founder of the Steyer-Taylor Center for Energy Policy and Finance at Stanford University, among many other affiliations. Tom, it's wonderful to have you on the show.
Tom Steyer: Thank you very much for having me, Monica.
Monica Trauzzi: Tom, speaking in Germany this week, the president commented on climate change, saying that on emissions, the U.S. will do more. He's already indicated that some form of a climate policy will be released in July. How likely do you believe that the Keystone Pipeline will be approved at the same time or shortly after the climate move?
Tom Steyer: My understanding is that that's not gonna happen. I have no inside information, but I think the talk of a trade, where the administration would move forward on regulating existing power plants through the Clean Air Act would be coupled with an approval of the pipeline, I think, from what I can tell, and, again, I have no inside information, is several months old and no longer relevant.
Monica Trauzzi: So you don't think that there's a strategy there for making a broader point and to sort of appease both sides, disprove critics and still move forward on climate?
Tom Steyer: Well, I don't want to speak for the administration, but from an outside vantage point, that doesn't make any sense, because I think the president has done an unrecognized good job in energy and climate in the first term in terms of substance. There was the change in, the raise in the CAFE standards for cars. There was the EPA regulations of new power plants, and what's being signaled for the middle of July is both a very strong statement to continue what was said in the second inaugural and in the State of the Union but also some more details about what's going to happen about the regulation of existing power plants.
Monica Trauzzi: So, NSPS? Do you think they'll move forward with NSPS?
Tom Steyer: Yeah, but I think that at the same time the president is trying to stake out a global leadership position on climate. And to couple that with approving a pipeline, which his strongest supporters vehemently oppose, doesn't really make sense politically.
Monica Trauzzi: So, then, is the ability to negotiate on climate lost if the Keystone Pipeline is approved, both here in the United States and internationally?
Tom Steyer: Well, let me say this. From what I can tell, people around the world are watching what the president will do on the Keystone pipeline like hawks, and when my friends call me from Australia, they're aware of it. They're all over it, and it's going to impact how they behave, not only in terms of how they behave towards the United States but also the kinds of decisions that they make in their own country. Like it or not, and I think it's an incredible opportunity for the president of the United States. We're in a leadership position here, and people are going to take our lead. So, I think it's a big decision and I think the president, it's a perfect chance for him to be a hero.
Monica Trauzzi: But isn't it a bit narrow to make the fight over Keystone so symbolic? I mean, aren't there other issues at play here, alternative fuels, energy efficiency, that play into the debate a lot more than a single pipeline?
Tom Steyer: Well, this isn't just a single pipeline, so, first of all, the tar sands in Canada are the second-biggest oil deposit in the world after Saudi Arabia. They are extremely dirty, and once we've permitted a pipeline to go to the Gulf of Mexico and therefore to the whole world, they will be supplying that very dirty energy for decades to come. So, from a substance point of view, it is substantially important, but, secondly, when you talk about alternatives, yes, this is an absolute chance for us to say we need to think differently about energy. It's time for us to say we need an American-based technology-innovation, advanced-energy-generation-and-use economy, and that is easily within our grasp if we decide to do it, and so we need to make a turn, not a secret turn, not a minimalist turn but an open and obvious turn to say we have the ability to lead on this. We have the technology. We've got the finance. We've got the political leadership. Let's do it and let's be richer for it. Let's put millions of people to work doing it. And, by the way, it's going to be healthier for everybody else.
Monica Trauzzi: Let's talk about the letter you wrote recently to Russ Gerling, who heads up TransCanada. Got a lot of press. The company had tried to undercut you and your opposition to the project. You wrote this letter. Is this debate personal for you?
Tom Steyer: No, not at all. From my point of view, look, I've been a professional investor and a businessman for 30 years. I am very sympathetic to businesspeople, and they see their responsibility as a fiduciary responsibility to the people who own their company, and their job is to make an argument why whatever is best for the owners of their company from a profit standpoint as the best policy. So, I view that as they see that as their charge. There's no point in confusing that with having an objective view of policy. They are advocates for their bottom line, and that's fine, but don't ever confuse that with the interests of the American people. So, it isn't personal. I completely accept that. I also take everything that the CEO of a company says about policy related to their company with a gigantic grain of salt and an appropriate grain of salt.
Monica Trauzzi: So, what is the U.S. public interest here, because in the letter you do say that we can't necessarily trust a foreign oil company to protect the U.S. public interest, but ...
Tom Steyer: Does that seem fair to you?
Monica Trauzzi: That's all fine and well, but what is the public interest? Is it jobs? Is it energy? Is it maintaining a relationship with Canada? What is the public interest?
Tom Steyer: Look, the American public interest here is to have an energy policy, where we produce clean, safe, secure energy and have an economy that can grow and we can be prosperous in a sustainable way. That is our interest, and any time that we get away from that interest, we're missing what counts for the American people. So, we absolutely need to have a policy that takes into account the, not just the environment, but of course we have to be sitting here thinking about our economy. And at a time when jobs are at a premium, we need to ask ourselves, where are the new jobs coming from? If you look at this pipeline, this is being described as a jobs program. That is not true. In the filings in Canada, they're talking about 2 years of construction jobs, 6,500 jobs a year for two years, and then 35 jobs, permanent jobs, one more than 34, one less than 36. This is not a jobs program. They're going to be making billions of dollars and we're going to get 35 jobs. From the United States' point of view, it's not a question of whether we build this pipeline; it's a question of how do we generate and use energy. And if we do it in the way that I'm saying, which is based on research, based on innovation, based on new technique, all the things that Americans are great at, we're going to put millions of people to work, not 35 people.
Monica Trauzzi: And the jobs numbers have been debated. We've debated them on this show. What kind of backlash do you believe the president might face if he actually does go through with the pipeline?
Tom Steyer: If he approves the pipe ...
Monica Trauzzi: If he approves it, yeah.
Tom Steyer: I don't see it in those terms, to be honest, Monica. What I see this as and the reason that I'm trying to get in touch with other supporters of his is I think this an incredible opportunity for the president to lead. I think it's an incredible opportunity for the president to present a vision. I think it's a great opportunity for the president, honestly, to be a hero. So, if he, in fact, were to approve, which I don't think he will, 'cause I think he's a very smart guy who knows everything we're talking about backwards and forwards, if he were to approve it, I would view it as a self-inflicted wound. I wouldn't be worried about the backlash. I would be worried about he has now made a decision that's a bad decision for him, and I would worry about that. I think that would be, the decision itself would be the punishment.
Monica Trauzzi: All right, Tom. We're going to end it right there. Pleasure to have you on the show. Thank you.
Tom Steyer: Thank you, Monica.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
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