Foreign Policy

Bumped from 1 September - with an update you have to see to believe.

One knock against (relative) political newcomers Barack Obama and Sarah Palin has been their lack of economic and foreign policy experience. That's valid - compared to guys like Biden and McCain they don't have much of a resume. But there are points of comparison between the two younger members of the opposing tickets - here's a hopefully unbiased look at one somewhat direct point of comparison.

Ladies first - Governor Palin recently approved a deal with a Canadian corporation for a gas pipeline under the Alaska Gasline Inducement Act (AGIA). Here's the press release from her office:

Palin Signs AGIA License Bill Start Development on Natural Gas Pipeline

August 27, 2008, Anchorage, Alaska – Governor Sarah Palin today signed House Bill 3001, authorizing the state to award an AGIA license allowing TransCanada Alaska to start developing a 1,715-mile natural gas pipeline from a treatment plant at Prudhoe Bay to the Alberta Hub in Canada. The Governor signed the bill at the Alaska AFL-CIO’s biennial convention.

“After dreaming of a natural gas pipeline for more than 30 years, Alaskans have now created the framework for the project to advance,” Governor Palin said. “This legislation brings us closer than we’ve ever been to building a gas pipeline and finally accessing our gas that has been languishing for so many decades on the North Slope.”

With that kind of money on the line, one might expect (ahem) competition. According to the Canada-based Financial Post, one would be right:

With Alaskan oil production on the decline, natural gas would keep the state's coffers flush. Jobs and cheaper fuel for Alaskans would be part of the package.

More important, there is enough gas trapped under the tundra here to help the United States fend off an energy crisis that politicians have called one of the greatest threats to their country. Sarah Palin, Alaska's governor and, as of yesterday, the Republican vice-presidential nominee, wants to get it out of the ground as soon as possible.

But before that can happen, Alaska must resolve a $30-billion battle that pits Ms. Palin against energy giants BP PLC and ConocoPhillips Inc., two pillars of the state's economy. Calgary-based TransCanada Corp., Canada's largest pipeline company, is caught in the middle, enjoying legislative and some financial support from the state to build the 2,670-kilometre-long line that would ship four billion cubic feet of gas a day beginning in 2018.

But TransCanada is up against a rival pipeline project that would be built by BP and Conoco, the very oil companies TransCanada needs as its customers. Exxon Mobil Corp., the world's largest corporation, potentially holds the power to crown a winner by virtue of its sizeable gas production, but it has not yet picked a side.

It is a political poker game, and even though all the major parties say they are willing to work with one another, there is a plethora of ways they could stonewall the process.

"This project is important to Americans, important to the market, important to the economy, to our domestic energy independence," says Mr. Gibson.

Like Mr. Gibson, Sarah Palin is a fierce champion of the gas line and its role in the big energy picture. "We're taking steps towards dealing with an energy crisis that affects Alaska and the entire North American continent," she says, sitting in her Anchorage office, ordained with a large bearskin rug, the head propped up and claws attached resting on a chesterfield, the animal shot by her father. "Alaska finally can be in a position of producing and contributing to a solution here."

Ms. Palin gets a daily reminder about the sector's impact on the state. From her Anchorage office she has a full-on view of the ConocoPhillips building and its red, white and black logo. Moreover, her husband, Todd, works for BP in a "blue-collar union" job on the North Slope. (She denies this puts her in any conflict position). The governor is adamant about the role of the new pipeline in the state's future.

Ms. Palin has her own weapon in her arsenal should a stalemate emerge. Exxon, Conoco and BP hold the majority of natural gas leases on the North Slope, but the state has the power to cancel them if the producers do not get the resources out of the ground when it is "reasonably economic" to do so. It's a weapon the state used as recently as this month when it cancelled all of Exxon's leases in the Port Thomson oil and gas field, save for a 15-acre unit, for failing to develop the zone. Exxon and the state are now fighting in court, and on Thursday it said it moved equipment into area.

Mr. Palmer notes the massive project is not just good for Alaska. About 1,550 kilo-metres, or almost 60%, of the pipeline will run through Canada, generating "large" income tax and property tax benefits to the federal government, provinces, territories and First Nations, Mr. Palmer says. "In addition, there will be a very large reduction in tolls projected for Western Canadian producers because Alaskan gas should refill partially empty Western Canadian pipes. Our estimate has been that in the first 15 years, that's a toll reduction of some $10-billion."

Both TransCanada and Denali said Ms. Palin's race to the White House will have no effect their plans. Mr. Palmer, however, noted governors or legislatures can always pass new laws, but "this summer, the administration, as well as the legislation, ratified AGIA and strongly supported it after a very significant review period. We're confident the state of Alaska will remain supportive."

Obama faces tough questions on NAFTA, integrity

SAN ANTONIO, Texas - On the eve of contests he hopes will force Hillary Rodham Clinton from the presidential race, Barack Obama faced a barrage of attacks yesterday about his integrity, foremost among them whether he engaged in double-speak about his opposition to the North American Free Trade Agreement.

Much of the criticism was initiated by Clinton. But it assumed a life of its own as Obama struggled to explain why a Canadian government memo quoted one of his aides as saying Obama's opposition to NAFTA was for political show.

He also fended off accusations he has withheld information about his relationship with real estate developer Antoin Rezko, who went on trial in Chicago yesterday charged with federal corruption.

Obama has made honesty and transparency a cornerstone of his campaign to change "politics as usual" in Washington.

Both Obama and Clinton have said they would seek to unilaterally end NAFTA if Canada and Mexico did not agree to renegotiate portions seen as unfavorable to U.S. workers. Obama has repeatedly taken Clinton to task for initially supporting the trilateral pact, which her husband signed as president.

But on Sunday, the Associated Press released a leaked memo from a Canadian Consulate official in Chicago saying that in a Feb. 8 meeting, Obama's senior economic policy adviser told him Obama's tough NAFTA stance was "more about political posturing than a clear articulation of policy plans."

Economically depressed Ohio, a state where Obama dramatically reduced Clinton's lead, opposes NAFTA.

In a news conference here, Obama insisted the memo was inaccurate and noted the aide did not "reach out" to the consulate but was invited there.

Obama is on board with the natural gas pipeline

Presidential candidate Barack Obama is touting the Alaska natural gas pipeline.

Obama included the project in the energy plan he announced this week, calling for working "with the Canadian government to finally build the Alaska natural gas pipeline, delivering clean natural gas and creating good jobs in the process."

That brought the Democrat kudos from Gov. Sarah Palin, who some pundits are pushing as a possible vice presidential running mate for Republican John McCain.

Two of Obama's top advisers repeated the theme in a teleconference with Alaska reporters Wednesday. They said Obama would encourage a federal partnership with Alaska to further the project and try to prevent Exxon Mobil from having a "disproportionate influence over the timetable over the construction of this pipeline,"

More: What the hell, "triple heh" from the same story. How will the "federal partnership" work? Obama doesn't know - he'd let Palin figure that part out:

They were vague about how the partnership would work and how Exxon's influence might be blunted, saying that would have to be worked out with the governor.

2008-09-01 14:11:37