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The Economic Benefits of the Keystone XL Pipeline
So, lets look at these numbers in depth to see what they really mean. Maybe the impact would not matter? Isn't the economy starting to do better?
There would be little to no cost to the federal government to allow the Keystone XL pipeline to be built. Therefore, there would beat most a very nominal cost for 42,000 jobs. By this standard building the pipeline is a no-brainer, and the president should authorize it right away.
There ,however, are not just monetary costs to be considered. What about the environmental cost you say? Well look at these numbers. It cost 2.5 billion to clean up the Exxon Valdez oil spill. Using these numbers and projecting a possible disaster of this sort the 42,000 jobs created would come at a possible cost of $59,523.80 each. This of course is very cynical but it is 300k cheaper per job created than the ARRA even using these statistics. The cost to clean up the Deepwater Horizon spill was just under 5 billion, still a much lower "COST" than the 2009 Stimulus.
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We will now examine the benefit on the state level.
Employees will earn $2.1 billion overall and $405 million in the project area of Montana, South Dakota, Nebraska and Kansas. The 405 million in salaries in the project area will go directly into those economies. The added income from new jobs will serve to have a trickle down effect and create need for other new jobs in retail stores, movie theatres, etc.
In addition, the increase in tax revenues from the pipeline will allow the governments of Montana, South Dakota and Nebraska to increase services to their citizens.
Another additional point is that there is no negative monetary impact from the construction of the keystone pipeline. The CBO states that the ARRA of 2009 will actually increase the budget deficit by $831 billion over the ten year period from 2009-2019.
Many of the stimulus dollars were delivered as conditional grants with mandates. That is, they had strings attached. The new construction projects, ( shovel ready), built with federal funds had federal Davis-Bacon wage requirements. Those wage requirements raise state building costs by forcing contractors to pay inflated union salaries.
Other conditions-of-aid were set as well. One such condition Congress imposed were so called "maintenance of effort" spending requirements on states. These rules disallowed cutting spending on 15 different programs ranging from welfare benefits to road construction if the state received a single penny from the stimulus for these reasons. This served to hamstring states as times were tough and they needed to trim budgets.
Since the money being infused to the economies effected by the pipeline comes from the private sector, no such rules or conditions exist. This means there is no limit on constraints on the money coming in.