In the beginning of the Obama Administration, there was a retreat from what Sarah Palin called “that hopey-changing thing” into a continuation and expansion of Bush era policies and norms. Bush's extraordinary rendition became Obama's normal drone strike, a weekly chore done on “Terror Tuesday.” As the revolving door spins at the entrance to the Oval office, Obama's tenure set the cornerstone of Trump's energy and economic policy.
Obama was slow to intervene in the Dakota Access Pipeline battle, while his now defeated chosen successor referred to it as a “federal infrastructure project.” This ecological catastrophe in the making and human rights obscenity is not just a $3 billion display project for the concept of the public private partnership, it is a key foundation block of Trump's new America First economy. The blueprints were drawn long ago, and the changes to American energy production during the Obama Administration made their execution a possibility under Trump.
Forbes ran a recent article detailing a key new protectionist tax law slithering it's way through the halls of the capital as America is distracted by the pomp less circumstances of a lying room only inauguration. The bill would tax imports but not exports, allegedly helping American business. The article, penned by Steve Forbes himself, outlined the details in part while decrying it's effects on a consumer driven economy.
“Importers will no longer be allowed to deduct an item as a business expense. To simplify things, let's say a store imports a pair of sneakers for $40 and then sells them for $50, making a $10 profit on which it would owe taxes. Under the Republican plan, however, the retailer wouldn't be able to deduct the $40 it paid for the sneakers. In fact, it would owe taxes on the entire $50”
Forbes notes briefly how the import side of this translates into the energy sector of the economy for the consumer and the small transport business:
“Many oil refiners import crude oil to turn into gasoline. This new tax will sharply raise their costs, which will spell pain when you fill up your tank.”
On the export side, things are different:
“Let's say a corporation sells a piece of machinery to Iran for $5 million, which cost only $4 million to produce. That means $1 million in taxable profit. Under the new Republican scheme, however, that $5 million received from the mullahs wouldn’t be taxable. Instead of a $1 million profit, the corporation, for tax purposes, would have a $4 million loss. “
How exactly does this relate to the Dakota Access and Keystone XL pipelines? American gas and petroleum exports rose 1000% during the Obama's second term. The pipelines ultimate destinations are barges down the Mississippi, and refineries in West Virginia, Texas and Louisiana. The energy resources are for export which is why nearly half the funding has come in the form of low interest loans from Western European Banks.
Trump today signed executive orders pushing forward the Dakota Access Pipeline and the stalled and near dead Keystone XL pipeline after Obama ran out the campaign clock with “dialogue” and hundreds have been beaten, imprisoned and tortured. People are not being brutalized to meet the energy needs of “America First” or reduce American dependency on foreign oil. They are being gassed and shot with rubber bullets and missile systems have been deployed for a tax break on a government subsidized “federal infrastructure project.”
These pipelines, which Trump and his new Secretary of State, former Exxon Mobil CEO Rex Tillerson, have a direct financial interest in, will be producing tax-free revenue at the expense of the environment and at tremendous human cost. Former Secretary of State Clinton was happy to take money from the same banks that financed it. Former President Obama was able to use his typical “lean in” and dialogue delaying tactic to buy time until the end of his second term.
Two administrations and two candidates worked together with Congress to create this state of affairs. This takes long term planning and coordination over a decades time. The actual legal work involved the five most powerful politicians in two parties who are all in a deep political rivalry with each other. This is what elite consensus looks like.
Infrastructure had to be proposed and created and production systems built way ahead of pipelines and legal tax breaks. Steve Forbes's hand wringing over the consumer cost and the trickle down of increased transportation expenses built into the costs of all commodities belies the fact the elites benefit from this long term planning. But again, fracking based fossil fuel exploitation hits the American public in the wallet and the actual face literally both coming and going.