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Keystone Foe Added to Obama Inner Circle With Podesta

Photographer: Andrew Harrer/Bloomberg

John Podesta, chairman of the Center for American Progress, speaks at the Brookings Institution's Hamilton Project economic forum on taxes in Washington, D.C., on May 3, 2012. Close

John Podesta, chairman of the Center for American Progress, speaks at the Brookings... Read More

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Photographer: Andrew Harrer/Bloomberg

John Podesta, chairman of the Center for American Progress, speaks at the Brookings Institution's Hamilton Project economic forum on taxes in Washington, D.C., on May 3, 2012.

John Podesta’s return to the White House, aimed at bolstering President Barack Obama, places an opponent of the Keystone XL pipeline within his circle just as the administration weighs whether to approve the project.

The Democratic veteran, who previously served as President Bill Clinton’s chief of staff, joins the administration as Obama’s approval ratings have fallen to all-time lows after the fumbled rollout of the Patient Protection and Affordable Care Act. White House spokesman Jay Carney said Podesta, 64, will advise on a range of issues, “with a particular focus on issues of energy and climate change.”

Environmental groups heralded Podesta’s return to the White House, noting his advocacy for addressing the risks of climate change. In 2003, Podesta established the Center for American Progress, whose advocacy arm last week co-sponsored a conference where Keystone opponents argued that it would violate a climate-change standard that Obama set in June.

“When it comes to Keystone, there’s no question John is an opponent,” Daniel J. Weiss, director of climate strategy at the Center for American Progress, which is aligned with the Democratic Party, said in an interview. “But he’s going to be an honest broker. He’s going to make sure that the president hears both sides of the debate.”

Uncertain Role

The White House didn’t immediately respond to questions on Podesta’s potential role in judging the Keystone pipeline. He is the second addition in a week to a West Wing trying to regroup from the Obamacare setbacks. Phil Schiliro, Obama’s former congressional liaison and a onetime Democratic aide in the U.S. House, is returning to oversee implementation of the health-care law.

Podesta will also counsel Obama on White House organization and how to leverage his executive authority to get legislation passed during the three years remaining in his presidency.

New to Obama’s White House, Podesta has been an outside adviser since before the president took office. He led Obama’s transition team after the 2008 election and as chairman of the Center for American Progress had close ties to the White House.

He is a frequent critic of fossil fuels. In a June 23, 2010, speech, Podesta called the extraction of the oil sands “polluting, destructive, expensive, and energy intensive.”

Quicker Transition

“We need to reduce fossil-fuel use and accelerate the transition to cleaner technologies, in the transportation sector and elsewhere,” Podesta said, according to a text of the speech on the American Progress website.

Podesta “knows the danger of our reliance on dirty fuels like tar sands and recognizes climate disruption as one of the most pressing challenges of our time,” Michael Brune, executive director of the Sierra Club, a San Francisco-based environmental group, said in a statement in response to Podesta’s return to the White House.

A spokesman for TransCanada Corp. (TRP), the Calgary-based company that is proposing to build the $5.4 billion link between Alberta’s oil sands and refineries on the U.S. Gulf of Mexico, declined to say what Podesta’s new post might mean for Keystone.

“It’s not our place to comment on potential staff changes at the White House, but as a company, we remain focused on the regulatory process that the U.S. Department of State has been overseeing for more than five years,” Shawn Howard, the spokesman, said in an e-mailed statement.

Energy Co-Author

Podesta co-wrote a January 2012 guest editorial critical of Keystone in the Wall Street Journal with Tom Steyer, a billionaire who has bankrolled opposition to Keystone.

In the piece, the two criticized conservatives for pushing the pipeline to “import more foreign oil and deepen U.S. dependence,” when the nation’s own energy resources, including natural gas production and renewables like wind and solar power, were on the rise.

In an e-mail today, Steyer called Podesta “an outstanding advocate for our environment, as well as one of the smartest and most dedicated people I have had the pleasure of working with.” The statement didn’t specifically mention Keystone.

The U.S. State Department is overseeing an environmental analysis of the Keystone XL project that will say whether it exacerbates climate-change risks.

A draft report released in March said that Keystone wouldn’t significantly raise the risks of global warming because the oil sands would be developed even if it were rejected, delivered to market by other pipelines and by rail. Environmental groups have criticized that finding, calling Keystone a “linchpin” to development.

Carbon Issue

Obama said in a June speech on climate change at Georgetown University that he wouldn’t approve Keystone if it was found to significantly worsen carbon pollution.

“The net effects of the pipeline’s impact on our climate will be absolutely critical to determining whether this project is allowed to go forward,” Obama said. “It’s relevant.”

Extraction and refining of oil sands releases more carbon dioxide emissions than other forms of crude oil. Supporters say Keystone will create thousands of jobs and improve U.S. energy security. Backers also argue that Keystone won’t increase climate risks because it will replace heavy crude oil from Mexico and Venezuela that has a similar carbon footprint.

John Podesta is a hugely skilled operative,” Michael McKenna, a Republican strategist and president of MWR Strategies Inc., a Midlothian, Virginia-based lobbying firm, said in an interview. “Whatever Obama ultimately gives as an excuse to reject Keystone, Podesta is going to help him sell it.”

Podesta has been an outside adviser to Obama since before the president took office. He led Obama’s transition team after the 2008 election.

Both Podesta’s and Schiliro’s positions are temporary and don’t require Senate confirmation. Podesta, who will begin in early January, has agreed to serve for a year. Schiliro, who is only returning to the White House for a couple of months, was Obama’s chief envoy to Capitol Hill when the health-care law was passed in 2010.

To contact the reporters on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net; Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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