Tales from the Trail

Washington Extra – The Keystone cudgel

President Obama had until the end of February to make a decision on the Keystone oil sands pipeline, but he made his move today. And, predictably, he rejected the $7 billion project. That keeps him in good standing with his environmental base for November 2012 but creates new tensions with his Republican foes.

Republicans had forced Obama to make a decision in 60 days as part of the deal for the two-month payroll tax cut extension. House Speaker John Boehner quickly reacted to the rejection by saying “all options are on the table” to craft a bill to fight for the pipeline.

But Boehner may not have many options. If the Republicans push for a bill to get approval for Keystone, the president can veto it. If they choose to make it a bargaining chip in talks for a full-year extension of the payroll tax cuts, they will likely meet fierce resistance from Democrats. We are hearing Boehner just wants to seal the payroll tax cut extension and move on after his painful capitulation in the December deal.

Perhaps Republicans should just be content to wield the Keystone cudgel on the campaign trail rather than in Congress. Mitt Romney showed how to use it pretty effectively today, blasting Obama for “his lack of seriousness” by putting electoral considerations before national interests.

Here are our top stories from Washington…

Obama Administration rejects Keystone oil pipeline
The Obama administration rejected the Keystone crude oil pipeline project, a decision welcomed by environmental groups but blasted by the domestic energy industry. Obama said TransCanada’s application was denied because the State Department did not have enough time to complete the review process. Lawmakers that support the project forced a decision by attaching a measure to a tax-cut law passed at the end of last year.

Washington Extra – Theater of the absurd

No one said extending the payroll tax cut in Congress by December 31 would be a walk in the park. But did we really expect it to turn into another marathon with multiple detours?

After a rare display of bipartisanship on Monday on a spending bill to keep the government running through 2012, Tuesday gave way to another day of bitter back and forth, in which Democrats and Republicans aimed to out-maneuver and out-smart each other.

The Republicans managed to pass their payroll tax cut bill in the House with the controversial measure to speed up the decision on green-lighting the Keystone oil pipeline. It almost certainly won’t make it through the Senate and the White House made clear today that President Obama will veto it if it does. He’s decided the Keystone pipeline has to wait until after the elections and won’t be dragged into this debacle.