Keystone’s Lobbying Slugfest Compared to Big Banking Bill
The fight over the Keystone XL pipeline enters its sixth year this week with no signs of slowing down, making it one of Washington’s most protracted and pricey lobbying campaigns.
In all, lobbyists representing more than 50 groups are engaged on the issue and about $1 million has been spent in television ads in 2013 alone, following expenditures of almost $16 million during last year’s election season.
“It’s the equivalent of old banking legislation that sent some lobbyists’ kids to private school for 10 years, and then to college for four more,” said Burdett Loomis, a political science professor at the University of Kansas in Lawrence who studies lobbying. “It was the ‘Lobbyist Support Act.’”
On one side are boosters, including labor leaders, who say the $5.3 billion project, to link Canada’s oil sands with refineries on the U.S. Gulf coast, would create jobs and promote north American energy independence. On the other are environmentalists who warn it is an especially dirty type of fuel that will exacerbate global warming by increasing greenhouse-gas emissions.
The swarm of lobbyists are targeting a small group of policy makers at the U.S. State Department -- and ultimately President Barack Obama, who will make the decision in the coming months.
TransCanada Corp. (TRP) of Calgary applied on Sept. 19, 2008, for a permit to build the pipeline. The State Department, which has to sign off because the project crosses the international boundary, is completing a second environmental-impact review after Obama rejected an initial assessment in 2011.
To mark the five-year milestone, the House Energy and Commerce Committee has scheduled a hearing to examine delays.
In the lobbying drive, there are no signs of fatigue.
Billionaire investor Tom Steyer said he would spend $1 million on a four-part ad campaign against the pipeline that started last week. The American Petroleum Institute countered by saying it could spend millions of dollars on new ads backing the pipeline. The environmental group 350.org is lining up 160 events in 45 states on Sept. 21 to rally opposition.
At the end of June, 54 companies and interest groups reported lobbying on the project, including TransCanada, Exxon Mobil Corp. (XOM), the League of Conservation Voters and Laborers’ International Union of North America, according to disclosure reports filed with the U.S. Senate. That’s up slightly from 50 at the end of March.
Supporters and opponents have held meetings with State Department officials this year. Through the six months ending June 30, 25 corporations and outside groups reported contacts with the State Department, including BP America Inc., Chevron Corp. (CVX), the League of Conservation Voters and TransCanada Pipelines Ltd. Last year, 26 such contacts were reported in disclosure reports.
Steyer’s announcement about his ad campaign revived the on-air efforts, which had slowed. Advertising related to Keystone reached an estimated $15.8 million in the 2012 presidential election year, according to Kantar Media’s CMAG, a New York-based firm that tracks ad spending. CMAG tracks national network, cable and local broadcast TV advertising.
The API and TransCanada were the only active TV advertisers in the debate this year through Sept. 3, spending a combined $881,487, according to CMAG.
The API spent about 80 percent of the total, airing the same ad almost 1,000 times in Washington and seven markets that include Albuquerque, New Mexico, Columbia, Missouri and Harrisburg, Pennsylvania. The ad stresses bipartisan backing for the pipeline, including from former Presidents George W. Bush and Bill Clinton, labor unions and business groups and lawmakers in both parties in Congress.
Meanwhile, the Natural Resources Defense Council this week announced a web-based media campaign that features blog posts and online ads opposing the project by actor Robert Redford, actress Julia Louis-Dreyfus and others.
“If you ask me, tar sands oil is exactly the type of dirty oil we can no longer afford,” Redford said in a blog post yesterday. “It may be great for oil companies, but it is killing our planet.”
Holding a policy debate through advertising echoes the fight between Boeing Co. (BA) and the European Aeronautic, Defence and Space Co. to win congressional and administration support in 2011 as the Air Force awarded a multi-year contract worth as much as $51 billion for the KC-46 refueling tanker, said Melanie Sloan, executive director of the watchdog group Citizens for Responsibility and Ethics in Washington.
“You see a real emphasis on public affairs campaigns,” Sloan said. “They’re trying to create an environment where it seems like an inevitable decision, and a lot of money is being spent to get there.”
A new wild card in the process is a State Department inspector general investigation of allegations that ERM Group Inc., the consultant conducting the environmental-impact assessment, failed to disclose financial ties to TransCanada and other oil companies.
A conclusion could trigger a new round of lobbying, said Daniel J. Weiss, director of climate strategy at the Center for American Progress, a Washington-based group that counts former administration aides on its staff. At best, a final decision on the pipeline permit may be issued early in 2014, he said.
“If the inspector general exonerates the contractor, then I think you will have a rapid escalation in the media and lobbying around this issue,” Weiss said.
Public opinion surveys show the pipeline has broad support. A March 13-17 Pew Research Center poll, the most recent national survey, found that 66 percent of Americans favor the project, while 23 percent oppose it. The poll of 1,501 adults had a margin of error of plus or minus 2.9 percentage points.
Steyer said that beyond his $1 million campaign, which highlights his view that Keystone oil will be exported, he is financing development of Internet-based videos in a series called “People in the Path.” The project shares stories of landowners who would be harmed by the pipeline.
“For a long time, this was a one-sided argument,” said Steyer, founder of the hedge fund Farallon Capital Management LLC. “Part of what we’re trying to say is, ‘No, we’re going to bring out more facts.’”
Shawn Howard, a spokesman for TransCanada, said the company will roll out more TV ads, although its efforts focus on top executives giving the State Department and White House information about the pipeline’s environmental and economic impact. The company hasn’t determined how much it will spend on the campaign.
API President Jack Gerard said his group plans additional ads and will use social media to urge “hundreds of thousands” of people to contact the White House and State Department urging project approval. He said his group is in touch with 15 million people using Facebook and Twitter.
The API also is stepping up its outreach in Congress, distributing to lawmakers and aides jumbo-sized silver pencils embellished with a slogan: “KXL delay: 5 years and counting.” An attached card features a picture of a construction worker asking, “When will I work?”
“It’s unfortunate it’s gone on so long,” Gerard said today at a Bloomberg Government breakfast in Washington. “This is the largest infrastructure job creation opportunity in the country today. From our standpoint there’s no excuse not to move the project forward.”
Environmental groups will make their case using grassroots efforts, including the Sept. 21 rallies. Daniel Kessler, a spokesman for 350.org, said those anti-pipeline rallies will be followed in November with events in Canada, Europe and the U.S.
“We’re really going to be expanding this fight into Canada over the next couple of months,” Kessler said.
Opponents such as Bold Nebraska, a group that helped persuade the state to push for a route that avoided crossing a drinking water supply, plans a commercial in November that will challenge oil industry claims the project will create many jobs.
Bold Nebraska also is painting 50 billboards along the route with anti-pipeline messages, said Jane Kleeb, executive director of the group.
“Lobbying is most effective when it’s a small, discrete, understood issue that doesn’t involve a lot of different stakeholders,” said Michael McKenna, president of MWR Strategies Inc., a Midlothian, Virginia-based public policy and communications firm. “Unfortunately, Keystone has become large, diverse, political and totemic. And that’s why it becomes harder to sway public officials’ mindset on it.”
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