Newt Gingrich, Keystone XL, and Republicans' Failing Energy Policy


You would think that by this point in the endless 2012 presidential campaign I'd be immune from the wild things that come out of Newt Gingrich's mouth, but even by Newtonian standards, this one was a whopper. Last Thursday, the Republican presidential candidate described President Barack Obama's call to fast-track the construction of a segment of the controversial Keystone XL pipeline that will run from Cushing, Oklahoma, to the Gulf of Mexico coast in Texas as “the pipeline to nowhere.”

This only shows that Newt, once again, has no idea what the hell he's talking about. Cushing is the home to the single most important junction of oil pipelines in the country and massive storage tanks that hold tens of millions of barrels of crude oil — two factors that make Cushing the delivery point for the New York Mercantile Exchange's (NYMEX) West Texas Intermediate (WTI) oil futures contract, itself a vital benchmark for global oil prices. At the other end are the refineries and import/export terminals huddled along the Gulf Coast in Texas, arguably the densest concentration of petroleum facilities in the country. In short, it is the very opposite of a pipeline to nowhere.

But it is unfair to single out Newt when his fellow candidates have been almost as bad when they talk about energy. Their standard stump speech on energy typically includes a variant on Sarah Palin's “drill, baby, drill” mantra and a charge that Barack Obama is solely responsible for high gas prices (a point which has been debunked by several commentators here at PolicyMic, myself included). Backstopping the GOP candidates are high-profile advocacy campaigns by groups like and, both incidentally funded by the American Petroleum Institute. Listen to their pitch and you walk away with the idea that the United States is an energy pauper dependent on handouts from unsavory nations, a condition that wouldn't exist if only we could just drill for oil and natural gas!

The reality is quite different. We are drilling, and drilling quite a lot. Crude oil production in the U.S. hit a 13-year high last year; projections are that an additional 500,000 barrels of oil will be added to that total next year from the Bakken oil fields in North Dakota alone. Last year the United States also became a net exporter of refined petroleum products for the first time since World War II. 

And then there's natural gas. Love it or hate it, hydrofracking has been a game changer in the natural gas industry. There is so much natural gas on the market that wholesale prices have been driven down to historic lows, natural gas companies are holding off on the production of some new gas fields because market prices are so low it would not cover their extraction costs.

This cheap gas is having a knock-on effect in the energy industry. Some utility companies are closing down coal-fired electricity generators in favor of natural gas plants; others are reconsidering the billions of dollars of capital required to build new nuclear plants in this era of cheap natural gas. Similar decisions are being made with some large-scale wind and solar power installations. This points to the need for a comprehensive, far-reaching energy strategy for the United States — but one based on fact, customer need, and market dynamics rather than on campaign spin. 

The United States is a large and diverse country, while the energy marketplace is incredibly dynamic; coming up with a workable strategy that ensures economic growth and meets customer demand while respecting the environment will be a challenge. Barack Obama at least has the spirit of the mission right with his “all of the above” approach — invest in renewables while also promoting the use of natural gas, oil, nuclear, etc.  Our energy supply is too vital to our countries future to let the discussion be dominated by people who frankly have no idea what they're talking about (looking at you Newt).