Last week I began to touch on the subject of the recently proposed Keystone pipeline. In this post I would like to discuss more of how the economy will be affected by this new project and what it would mean for everyday Americans.
In terms of jobs supplied by the pipeline’s construction and active use, the only independent study, conducted by Cornell University’s Global Labor Institute, concludes that it may generate 6-7,000 temporary jobs, but no more than 50 permanent jobs when the work is done. This means that most of the new jobs would wear out by the end of construction as usual for large building projects. The permanent jobs are mainly plant hands and engineers that control the flow of the line. Now one may ask what about the lines maintenance? Well since TransCanada is a Canadian Company they have the choice to hire which ever contractor they wish, which will likely be Canadian. So is the large construction project worth the short term economic spike? Well it would help Americans in the area for a few years and provide jobs, however; it provides a false short term since of security for the families. The main idea for the new addition to the pipeline is to get to the refineries in the south of Texas. What many do not know is that after the product is finished and refined TransCanada plans to sell the oil to the world market not the American citizen. This does provide more production in the United States, but does it really grow the economy? Now I am definitely no economist so is this a great idea I don’t know the argument makes sense either way to me. There is one simple concept of economics that I do understand, every time quantity supplied is increased prices fall.
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