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The Impact of Tar Sands Pipeline Spills on Employment and the Economy

By Lara Skinner and Sean Sweeney - Cornell University Global Labor Institute, March 2012

In debates over proposed tar sands pipelines such as the TransCanada corporation’s Keystone XL, little attention has been given to the potentially negative impacts of pipeline spills on employment and the economy. The proposed route for the 1,700-mile Keystone XL pipeline cuts through America’s agricultural heartland, where farming, ranching, and tourism are major employers and economic engines. Ground or surface water contamination from a tar sands oil spill in this region could inflict significant economic damage, causing workers to lose jobs, businesses to close, and residents to relocate. Such a spill could also negatively impact the health of residents and their communities.

A Closer Look at Keystone XL’s Threat to Existing Jobs and Economic Sectors:

» The negative impacts on employment and the economy of tar sands pipelines like the Keystone XL have largely been ignored. To date, a comprehensive risk assessment for the proposed Keystone XL pipeline oil spill has not been conducted. Such an assessment would provide an independent review of the risk of spills and their economic consequences. Since the first Keystone pipeline began operation in June 2010, at least 35 spills have occurred in the U.S. and Canada. In its first year, the spill frequency for Keystone’s U.S. segment was 100 times higher than TransCanada forecast.

» The Keystone XL pipeline would cut through America’s breadbasket. Agricultural land and rangeland comprise 79 percent of the land that would be affected by the proposed Keystone XL pipeline. It would cross more than 1,700 bodies of water, including the Missouri and Yellowstone rivers and the Ogallala and Carrizo-Wilcox aquifers. The Ogallala Aquifer alone supplies 30 percent of the groundwater used for irrigation in the U.S. It also supplies two million people with drinking water.

» Farming, ranching, and tourism are major sources of employment along the Keystone XL pipeline’s proposed route. Water contamination resulting from a Keystone XL spill, or the cumulative effect of spills over the lifetime of the pipeline, would have significant economic costs and could result in job loss in these sectors. Approximately 571,000 workers are directly employed in the agricultural sector in the six states along the Keystone XL corridor. Total agricultural output for these states is about $76 billion annually.

» Many of the land areas and bodies of water that Keystone XL will cross provide recreational opportunities vital to the tourism industry. Keystone XL would traverse 90.5 miles of recreation and special interest areas, including federal public lands, state
parks and forests, and national historic trails. About 780,000 workers are employed in the tourism sector in the states along the Keystone XL pipeline. Tourism spending in these states totaled more than $67 billion in 2009.

» Recent experience has demonstrated that tar sands spills pose additional dangers to the public and present special challenges in terms of clean up. There is strong evidence that tar sands pipeline spills occur more frequently than spills from pipelines carrying conventional crude oil because of the diluted bitumen’s toxic, corrosive, and heavy composition. Tar sands oil spills have the potential to be more damaging than conventional crude oil spills because they are more difficult and more costly to clean up, and because they have the potential to pose more serious health risks. Therefore both the frequency and particular nature of the spills have negative economic implications.

» The Kalamazoo River tar sands spill affected the health of hundreds of residents, displaced residents, hurt businesses, and caused a loss of jobs. The largest tar sands oil spill in the U.S. occurred on the Kalamazoo River in Michigan in 2010. This spill is the most expensive tar sands pipeline oil spill in U.S. history, with overall costs estimated at $725 million.

» The public debate around Keystone XL has focused almost exclusively on job creation from the project, yet existing jobs and economic sectors could suffer significantly from one or more spills from Keystone XL. According to the U.S. State Department, the six states along the pipeline route are expected to gain a total of 20 permanent pipeline operation jobs. Meanwhile, the agricultural and tourism sectors are already a major employer in these states. Potential job losses to these sectors resulting from one or more spills from Keystone XL could be considerable.

» Renewable energy provides a safer route to creating new jobs and a sustainable environment. The U.S. is leading the world in renewable energy investments, and employment in this sector has expanded in recent years. For every $1 million invested in renewable and clean energy, 16.7 jobs are created. By contrast, $1 million invested in fossil fuels generates 5.3 jobs.

Read the report (PDF).

Towards a Greener Economy: The Social Dimensions

By International Institute for Labour Studies - International Labour Organization, November 16, 2011

The European Commission and the International Labour Organization have combined efforts in reaction to the deep crisis that hit the global economy in 2008. The aim of this joint project is to examine policies that will lead not only to a quicker recovery but also to a more sustainable, environmentally friendly and equitable global economy. This is particularly relevant given the uneven and fragile nature of the recovery process across and within countries. These efforts have culminated in the publication of two Synthesis Reports. The first report examines the origins of the crisis and provides an overview of immediate policy responses across both developed and developing economies; the second discusses green policies and labour market issues related to this necessary long-term economic transformation. Both reports are based on a series of technical discussion papers.

This second report aims to promote a clearer understanding of the nature of the green economy and its implications for labour markets, especially the reallocation of jobs from high- to low-polluting sectors. It shows that a double dividend in terms of increased decent work opportunities and a greener economy is possible, provided that complementarities between environmental, economic and social policies are adequately exploited. The report discusses the green policy measures that EU countries are currently undertaking, with a view to identifying any gaps in the policy mix. It also presents model estimates on the likely transmission mechanisms arising from these measures.

Read the report (Link).

Untapped Wealth: Offshore Wind Can Deliver Cleaner, More Affordable Energy and More Jobs Than Offshore Oil

By staff - Oceana, September 2010

In Oceana’s report Untapped Wealth: Offshore Wind Can Deliver Cleaner, More Affordable Energy and More Jobs Than Offshore Oil, our comprehensive analysis shows that focusing our investments on clean energy like offshore wind would be cost effective, more beneficial to job creation, and better for the environment and ocean in a variety of ways than offshore oil and gas exploration and development.

On the Atlantic coast, an area targeted for expansion of oil and gas activities, offshore wind can generate nearly 30% more electricity than offshore oil and gas resources combined. In addition, wind development would cost about $36 billion less than offshore oil and gas production combined, while creating about three times as many jobs per dollar invested than fossil fuel production.

Based on conservative assumptions for offshore wind and generous assumptions for offshore oil and natural gas, this study found that by investing in offshore wind on the East Coast, rather than offshore oil and gas, Americans would get more energy for less money while protecting our oceans.

Read the report (PDF).

Making the Transition: Helping Workers and Communities Retool for the Clean Energy Economy

By Elena Foshay, et. al. - Apollo Alliance and Cornell Global Labor Institute, August 11, 2020

We stand at a critical moment in American history. We face a choice: do we continue with business as usual, ignoring the climate implications of current energy, environmental, and economic policy? Or do we move forward with a new set of priorities aimed at promoting climate stability, energy security, and economic prosperity?

Towards a Just and Sustainable Solar Energy Industry

Towards a Just and Sustainable Solar Energy Industry - A Silicon Valley Toxics Coalition White Paper, January 14, 2009.

Every hour, enough solar energy reaches the Earth to meet human energy needs for an entire year. Solar photovoltaic (PV) technology is widely seen as a “win-win” solution that can harness this “free energy” to address global warming, reduce U.S. dependence on energy imports, create “green jobs,” and help revitalize the U.S. economy.

Solar energy will play an essential role in meeting these challenges, but as the solar PV sector expands, little attention is being paid to the potential environmental and health costs of that rapid expansion. The most widely used solar PV panels are based on materials and processes from the microelectronics industry and have the potential to create a huge new wave of electronic waste (e-waste) at the end of their useful lives, which is estimated to be 20 to 25 years. New solar PV technologies are increasing cell efficiency and lowering costs, but many of these use extremely toxic materials or materials with unknown health and environmental risks (including new nanomaterials and processes).

With the solar PV sector still emerging, we have a limited window of opportunity to ensure that this extremely important industry is truly “clean and green,” from its supply chains through product manufacturing, use, and end-of-life disposal. The solar industry has taken a leadership role in addressing the world’s pressing energy and environmental challenges and will serve as a model for how other innovative “green” industries address the lifecycle impacts of their products.

In this white paper, the Silicon Valley Toxics Coalition (SVTC) provides an overview of the health and safety issues faced by the solar PV industry, including the toxic materials used in manufacturing and the potential end-of-life disposal hazards of solar PV products. The report also lays out recommendations to immediately address these problems to build a safe, sustainable, and just solar energy industry. These recommendations include:

  • Reduce and eventually eliminate the use of toxic materials and develop environmentally sustainable practices.
  • Ensure that solar PV manufacturers are responsible for the lifecycle impacts of their products through Extended
    Producer Responsibility (EPR).
  • Ensure proper testing of new and emerging materials and processes based on a precautionary approach.
  • Expand recycling technology and design products for easy recycling.
  • Promote high-quality “green jobs” that protect worker health and safety and provide a living wage throughout the
    global PV industry, including supply chains and end-of-life recycling.
  • Protect community health and safety throughout the global PV industry, including supply chains and recycling.

Read the report (PDF)

Enron Played Central Role in California Energy Crisis

Greg Palast and Robert Bryce interviewed by Amy Goodman - Democracy Now, May 16, 2006

[in 2001] California was plunged into an unprecedented energy crisis. Rolling blackouts shut down parts of the state. Power bills soared. It turned out that at the center of the crisis was Enron — although the company’s role wasn’t fully understood at the time. We play excerpts of audiotapes that proved Enron asked power companies to take plants offline at the height of the California energy crisis–in order to make more money.

AMY GOODMAN: In California, the state’s former governor Gray Davis praised the jury for convicting Ken Lay and Jeffrey Skilling. David said, quote, "Given the way Enron ripped off California, I think the jury did an excellent job. I take some solace in the fact that Lay and Skilling be will send some time in prison," he said. Six years ago, California was plunged into an unprecedented energy crisis, rolling blackouts shut down parts of the state, power bills soared. It turned out that at the center of the crisis was Enron, although the company’s role wasn’t fully understood at the time. Two years ago, lawyers involved in a lawsuit in Washington state obtained audio tapes that proved Enron asked power companies to take plants offline at the height of the California energy crisis, in order to make more money. In one taped phone call, an Enron employee celebrated the fact that a massive forest fire had shut down a transmission line carrying energy into California, causing the price of energy to rise.

How to Turn the "Red" States Deep Green

By Steve Ongerth - Truthout, November 6, 2004

The following piece was written in reaction to the results of the 2004 US Presidential Election. Originals of this article seem to have disappeared from their websites (Truthout, ZMag, and Indybay), so this piece is copied from Resilience (the links at the end of the article have been deleted, since many are defunct now, though many new organizations have taken their place in much greater ways. The graphic, right, shows that the predictions made in this article have indeed partially come true. The predicted political transformation is still taking shape.

I am no fan of electoral politics. I think casting a ballot is one of the weakest forms of democratic, libertarian, collective actions that people can use in a functional democracy. America, however, is not a functional democracy. It would take more time than I have at the moment to explain why in great detail. It is sufficient to point out that the powers that be, rich corporations and the US Government use the results of national elections to claim a mandate on their privilege to wage wars for oil and continue to concentrate wealth in the hands of the very rich whether they actually have one or not. Elections merely represent a one-dimensional snap shot of the minds of those casting ballots at best.

That said, there is no denying that the powers that be will (and have) read the results of the 2004 Presidential election as a legitimization of George W. Bush and his neo-conservative imperialist puppet masters. They will spin this "election" as a positive referendum on the so-called war on terror and the Iraq invasion even as the latter continues to grow increasingly untenable for the American occupation. And, the already out-of-control American Taliban, the Christian Right will take the results of this election as a sign that their tactics work and they will continue to turn back the clock on social progress, social justice, and rational thought. During the second Bush term we may well see the beginning steps of a full-fledged theocracy in America. This is very scary to think about.

Forget for a minute that this election may well have been stolen as well as the 2000 election. In fact, the signs are that the theft of the 2004 election were worse than the 2000 fraud. Even if we succeed in proving it, it's not likely to result in a special election, because, to my knowledge, that would require an act of Congress, and seeing as how the Congress is controlled by the Republicans, I don't foresee them voiding the results (though we should continue to fight that fight of course).

I think we need to look at the future. I think the left needs to be completely honest with itself. Even if Kerry did win the presidency, he is not a leftist nor would he do much (if anything) to fundamentally alter the course that Bush and his clowns have set for us. The only positive thing that could be said of John Kerry is that he probably couldn't have done any worse than Bush.

How do we embrace the future?

Renewable Energy Technologies in the Socialist and Communist Societies Envisioned by William Morris and August Bebel

By Dennis Bartels - Material Cultural Review, Spring 2003

1 The nineteenth-century English designer, writer, and political activist, William Morris (1834-1896), saw "state socialism" as evolving after the revolutionary overthrow of capitalism. He hoped that state socialism would be followed by the sort of "higher" communist society that he sketched in his Utopian novel, News from Nowhere ([1890] 1970). Morris's contemporary, the German socialist leader, August Bebel (1840-1913) also envisioned a socialist society that would succeed capitalism, and outlined its major features in his influential book, Woman in the Past, Present and Future ([1883] 1988), abridged by Progress Publishers in Moscow (1971) under the title, Society of the Future. In this research note, Morris and Bebel's views on the role of eco-friendly and renewable energy technologies in socialist and communist societies will be compared. Differences between their visions of future technology and actual technological developments in the former USSR and in contemporary capitalist society will be briefly explored.

2 A major theme in the political writing and lecturing of Morris was that the quest for short-term profit inevitably brings environmental degradation. In his 1878 lecture, "The Lesser Arts," he said, "Is money to be gathered? Cut down the pleasant trees among the houses, pull down ancient and venerable buildings for the money that a few square yards of London dirt will fetch, blacken rivers, hide the sun and poison the air with smoke and worse, and it's nobody's business to see it or mend it — that is all that modern commerce, the counting-house, forgetful of the workshop, will do for us herein" ([1878] 1962:102-3).

3 Morris also believed that, in a capitalist society, science and technology would not be used to remediate environmental degradation: "I fear that she [science] is so much in the pay of the counting-house... and the drill sergeant, that she is too busy... [to teach] Manchester how to consume its own smoke, or Leeds how to get rid of its superfluous black dye without turning it into the river" ([1878] 1962: 85).

4 Morris suggested that in the phase of state socialism, working people, represented by the state, would take over "all the means of production: that is, credit, railways, mines, factories, shipping, land [and] machinery..." ([1887] 1910-1915: 232). He hoped that a socialist state would allocate resources for environmental restoration, and ensure that productive technology was eco-friendly. In, "A Factory As It Might Be," published in 1884, he wrote, "... our factory must make no sordid litter, befoul no water, nor poison the air with smoke" (1884b: 2). In, "Why Not?", Morris wrote, "It seems probable that the development of electricity as a motive power will make it easier to undo the evils brought upon us by capitalist tyranny... but even it if turns out that we must still be dependent on coal and steam for force, much could still be done toward making life pleasant if universal co-operation were to take the place of our present competitive anarchy" (1884c: 2).

5 Morris saw the productive technology of socialist society as a legacy of capitalism, and expected that rapid technological development in the "lower stage" of communism — that is, state socialism — would greatly shorten the work day. In, "Work In A Factory As It Might Be," he wrote, "...machines of the most ingenious and best approved kinds will be used when necessary, but will be used simply to save human labour... it follows that much less labour will be necessary for each workman; all the more as we are going to get rid of all non-workers and busy idle people; so that the working time of each member of our factory will be very short, say, to much within the mark, four hours a day" (1884a: 2). Bebel expected that the work day might be less than three hours in a socialist society ([1883] 1988:193).

6 After the development of a state socialist leisure society, Morris envisaged a spontaneous movement toward communal, physical labour that integrated the decorative arts. This transition to communism would not, however, involve a wholesale rejection of industrial technology. Even though people in Morris's Utopian society, Nowhere, prefer to ride horses and to harvest hay with scythes, heavy loads are hauled on canals by "force barges" powered by engines which do not burn fossil fuels ([1890] 1970:140).

California's Energy Crisis: Structural adjustment - American style

California's Energy Crisis: Power to the People?

By Jessie Muldoon and Todd Chretien - International Socialist Review, February-March 2001

THE LIGHTS are out in California. Rolling blackouts have cut electricity to millions. Only this time, it's not the San Andreas Fault that's to blame. It's the free market.

A year ago, electricity cost roughly 3.5 cents per kilowatt-hour on the wholesale market. Today, that same amount costs upward of 40 cents. Why? Back in 1996, energy companies and big businesses showered millions of dollars on California politicians, convincing them to vote unanimously to "deregulate" the publicly owned and managed state electrical utility system. The state would no longer set prices and supervise the industry. In exchange, the energy companies promised Californians lower prices and cleaner power brought on by free-market competition.

Instead, a handful of energy profiteers have made a killing, while millions of Californians suffer higher rates and the harmful effects of power outages. The results of the power crunch have been devastating to ordinary people. Nathaniel Goodwin, who is 73, has emphysema and needs an electrical oxygen concentrator to breathe. As rolling blackouts spread across California, he stocked up on crackers and peanut butter, arranged for a battery-powered backup, and hoped for the best. "I live by myself and I've got to have my oxygen," he told a reporter.1

"We've got elderly folks with arthritis who have to have heat. Many of them have medical devices they need to live and no one knows what will happen when the electricity is turned off," said Marie Harrison, a community leader in the Bay View Hunters Point district of San Francisco, which is predominantly Black.2

The utility companies claim that hospitals and fire stations will not be affected by the blackouts, but two hospitals--Valley Convalescent Hospital in Watsonville and Community Medical Centers in Fresno--suffered outages. Across the state, workers are paying the price for deregulation. California Steel Industries of Fontana, the largest steel plant on the West Coast, sent 400 workers home without pay because of skyrocketing electrical costs. The Miller Brewing Company plant in Irwindale laid off its whole workforce for a week without pay.3

Schools have lost power or have been forced to cut back on heat, leaving tens of thousands of children shivering in the dark. Contrary to popular belief, temperatures during California winters often hover between 40 and 50 degrees, and few buildings have proper insulation. Meanwhile, the crisis shut down some of California's biggest oil refineries, which could quickly lead to a substantial hike in prices at the pumps. A dairy farmer put it this way: "This problem has the potential to be substantially more devastating than any earthquake we've seen."4

One economist estimated that the state lost $1.7 billion in wages, sales, and productivity in just one week of blackouts.5 And there is no end in sight. The Independent System Operator (ISO), the state-appointed agency that controls the California power grid, warned that Californians should get used to rolling blackouts for at least the next two years.6

This article explores how deregulation and the free market are behind the crisis, and why we should fight for public power as a solution.

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