The Dakota Access Pipeline Doesn't Make Economic Sense

Piping for the Dakota Access pipeline is lined up near Cannon Ball, North Dakota, on October 10, 2016. (Photo: Ellen Davidson)

 By Mark Paul, Dollar & Sense | News Analysis 

Last month, Donald Trump signed an executive order to advance approval of the Keystone and Dakota Access oil pipelines. This should come as no surprise, as Trump continues to fill his administration with climate deniers, ranging from the negligent choice of Rick Perry as energy secretary to Scott Pruitt as the new head of the Environmental Protection Agency. Pruitt, a man who stated last year that "scientists continue to disagree" on humans role in climate change may very well take the "Protection" out of the EPA, despite a majority of Americans -- including a majority of Republicans -- wanting the EPA's power to be maintained or strengthened.

As environmental economists, my colleague Anders Fremstad and I were concerned. We crunched the numbers on the Dakota Access Pipeline (DAPL). The verdict? Annual emissions associated with the oil pumped through the pipeline will impose a $4.6 billion burden on current and future generations.

First and foremost, the debate about DAPL should be about tribal rights and the right to clean water. Under the Obama administration, that seemed to carry some clout. Caving to pressure from protesters and an unprecedented gathering of more than a hundred tribes, Obama did indeed halt the DAPL, if only for a time. Under Trump and his crony capitalism mentality, the fight over the pipeline appears to be about corporate profits over tribal rights. Following Trump's Executive Order to advance the pipeline, the Army Corps of Engineers has been ordered to approve the final easement to allow Energy Transfer Partners to complete the pipeline. The Standing Rock Sioux have vowed to take legal action against the decision.

While the pipeline was originally scheduled to cross the Missouri River closer to Bismarck, authorities decided there was too much risk associated with locating the pipeline near the capital's drinking water. They decided instead to follow the same rationale used by Lawrence Summers, then the chief economist of the World Bank, elucidated in an infamous memo stating "the economic logic of dumping a load of toxic waste in the lowest-wage country is impeccable and we should face up to that." That same logic holds for the low wage counties and towns in the United States. The link between environmental quality and economic inequality is clear -- corporations pollute on the poor, the weak, and the vulnerable; in other words, those with the least resources to stand up for their right to a clean and safe environment.

In 1994, President Bill Clinton signed Executive Order 12898, which ordered federal agencies to identify and rectify "disproportionately high and adverse human health or environmental effects of its programs, policies, and activities on minority populations and low-income populations." Despite this landmark victory, pollution patterns and health disparities associated with exposure to environmental hazards by race, ethnicity, and income remain prevalent. Researchers at the Political Economy Research Institute (PERI) released a report identifying the toxic 100 top corporate air and water polluters across the country, finding the 'logic' of dumping on the poor and racial and ethnic minorities persists.

We do not accept this logic, and nor should any branch of the US government. As the Federal Water and Pollution Control Act makes clear, water quality should "protect the public health." Period. Clean water and clean air should not be something Americans need to purchase, rather they should be rights guaranteed to all. The Water Protectors know that and are fighting to ensure their right to clean water, a right already enshrined in law, is protected.

The Numbers

The Dakota Access Pipeline is a bad deal for America, and should be resisted. Our findings indicate that the burden of pollution associated with oil passing through the pipeline amounts to $4.6 billion a year -- a number none of us should accept. This was arrived at using conservative estimates, and numbers provided by Energy Transfer Partners and the EPA.

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