Many people have voiced support for the approval of a new oil pipeline in northern Minnesota, the Sandpiper, on grounds it would create jobs and free up rail capacity to more effectively import propane and bring crops to market. These arguments are misguided. Careful economic decisions require a broader view of facts and a reassessment of priorities.
First, job creation. Enbridge Energy predicts its $2.6 billion Sandpiper construction project will create 3,000 construction jobs. However, Enbridge only hopes to give half of those jobs, about 1,500 of them, to Minnesota and North Dakota residents - and there is no policy in place to guarantee a single one. More importantly, these are temporary jobs. They never will trigger the additional indirect job creation that typically accompanies longer-term investments, and they will disappear after one year. That’s not economic development.
Consider an alternative strategy of investment in water and sewer infrastructure, systems that actually benefit the people of Minnesota instead of the profits of a Canadian corporation. In 2007, the Environmental Protection Agency estimated Minnesota needs to invest more than $6 billion to improve drinking water systems over the next 20 years. In 2010, the Minnesota Pollution Control Agency estimated Minnesota needs to invest an additional $5.7 billion to improve wastewater systems. A steady investment in these essential services would create an estimated 11,560 jobs for Minnesota’s workers every year for the next 20 years.
Now, rail capacity. It is true the transport of propane and agricultural products in Minnesota has been negatively affected by the North Dakota oil boom and the increased demand the boom has put on rail lines. A recent study sponsored by the Minnesota Department of Agriculture concluded that Minnesota farmers will miss out on hundreds of millions of dollars in 2014 due to the lower prices caused by transportation delays. At least some of this is certainly due to increased crude oil transport, though it is unclear how much. The two major railroad operators, BNSF and CP, report that crude oil represents only
4 percent to 5 percent of their cargo overall. They insist on other explanations.
But it really doesn’t matter. Even if oil transport is indeed the problem, it doesn’t mean we need a new pipeline. It means we need a process for decision-
making about the use of critical infrastructure that prioritizes the well-being of Minnesota’s residents rather than the profits of a foreign corporation.
With billions of dollars in subsidy and investment from governments each year, the U.S. agricultural and oil industries are far from free-market enterprises. So why is it beyond our imaginations to consider legislation that would limit oil transport to reasonable levels in order to ensure that rural households can afford heating fuel for the winter and farmers can get their crops to market?
The Sandpiper proposal is on hold as the Public Utilities Commission explores alternate routes that could reduce its impact on northern Minnesota’s precious lakes and rivers and on the fisheries and wild rice beds indigenous people depend on for survival (and have treaty-
protected rights to harvest). Given that Enbridge has had more than 800 oil spills in the past 15 years, according to a 2012 National Wildlife Federation report, a safer route seems like an exploration worth taking. In the meantime, let’s reassess how much benefit we actually get from being a superhighway for someone else’s oil.
Thane Maxwell is a city and regional planning consultant and a community faculty member in the social science department at Metropolitan State University in St. Paul.
