Thereâs cynicism, and then thereâs Congress.
In the latest example of dysfunctional Congressional gridlock, the Democratic-led Senate is certain to reject a House of Representatives-passed Republican bill, House Resolution 3630, the 369-page ââMiddle Class Tax Relief and Job Creation Act of 2011,ââ to extend the payroll tax cut.
The sticking (sticky) point?
Oil - specifically, dirty Canadian oil derived from Albertaâs oil sands, and the Keystone XL pipeline cutting across Middle America to deliver it to Gulf Coast refineries. On 10 November, four days after 12,000 pipeline protestors encircled the White House, President Obama announced "the decision on the (Keystone XL) pipeline permit would be delayed until at least 2013, pending further environmental review.â
As a fillip to the hard pressed American working class, the Republican House of Representatives proposed legislation would extend the payroll tax cut for 160 million workers for another year as well as extending long-term unemployment benefits. Approved 234 to 193, the legislation would extend a one-year break in the payroll tax due to expire at the end of the month, continuing the current payroll tax rate of 4.2 percent instead of allowing it to lapse and revert to its previous 6.2 percent level, a $1,000 difference for a family making $50,000.
Even better, the legislation would also renew expiring extra benefits for long-term jobless people and temporarily sidetrack a proposed cut in doctors' Medicare reimbursements, which could prompt some physicians to stop seeing elderly patients utilizing the program.
Sound great, right? Why arenât Democrats reaching hands across the bipartisan divide to embrace the initiative?
Because, in a gesture of cynicism unusual even for Washington, the House Republicans have added to the legislation a provision to force work to begin again on the proposed 1,700-mile-long TransCanada Corp.'s $7 billion Keystone XL pipeline, which would transit up to 830,000 barrels of oil sands hydrocarbons per day from Hardisty, Alberta to U.S. refineries on the Gulf Coast.
House Resolution 3630, Section 1002 states, ââ¦ not later than 60 days after the date of enactment of this Act, the President, acting through the Secretary of State, shall grant a permit under Executive Order 13 13337 (3 U.S.C. 301 note; relating to issuance of permits with respect to certain energy-related facilities and land transportation crossings on the international boundaries of the United States) for the Keystone XL pipeline project application filed on September 19, 2008 (including amendments).â
Cynically adopting the guise of job creators, Republican House members maintain that work on the Keystone XL pipeline would create 20,000 or more jobs, with critics maintaining that the real level of employment for the period needed to construct the pipeline is closer to 3,500.
The Republican House of Representatives bill would give President Obama 60 days to act or the needed work permit would be automatically granted.
Given its onerous attachments, it is unlikely that the Republican House of Representatives bill will pass in the Democrat-dominated Senate, and even on the unlikely chance that it passes, President Obama has already promised to veto the legislation. Democrats have proposed their own version of the bill to extend the payroll tax cut, but the Republicans oppose its plan to pay for it with higher taxes on people making more than $1 million a year, the âone percentâ that has come under increasing criticism this year as the U.S. recession continues.
The âdirtyâ secret about the Keystone XL pipelineâs oil sands hydrocarbons, which no amount of K Street PR can spin away, is that the oil has a higher carbon content than that from traditional fossil fuels, anywhere from 8 to 14 percent more, depending on which scientific report you read. Accordingly, the EU has already banned their import, much to Ottawaâs annoyance. Much to the consternation of Transcanada and the pipelineâs Republican boosters in Washington, environmental groups in such stalwart Republican states as Nebraska went up in arms over the Keystone XL proposal, fearing that a leak from the underground pipeline would irrevocably pollute the Ogallala Aquifer, source of much of the Great Plains' agricultural water.
Which must cause all thoughtful Americans to ask â why are Congressional Republicans lumbering the ââMiddle Class Tax Relief and Job Creation Act of 2011ââ with the Keystone XL energy albatross?
Who do they truly believe are their constituency, the millions of working and middle class Americans seeking âtax relief,â or â big oil? The GOP obstructionists may get their ignored constituentsâ response next November.
In the meantime, Washingtonâs Solons have more important issues to consider.
Congressional leaders had hoped to adjourn for the year on Friday, but gridlock could force lawmakers to remain in Washington into next week.
Hardship, thy name is Congressional service, a fact Leona Helmsleyâs âlittle peopleâ only dimly appreciate.
By. John C.K. Daly of Oilprice.com