FROM “IN DEFENSE OF RURAL AMERICA”
by Ron Ewart, President, NARLO, ©2014
As we said in the article, we are not taking a position on the 911 Conspiracy Theory. The questions we ask in that article would seem to render the theory unsupportable.
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There is a great deal of confusion, misinformation, propaganda and outright lies flooding the Internet and the airways about the Keystone XL pipeline. Most people aren’t aware that three phases of the pipeline are already built and operating. It is the fourth phase that is creating all of the hot air and acrid smoke among the competing parties and the mostly uninformed public. There are many competing parties, most at odds with each other.
First, there is Canada, which wants to sell a huge valuable resource to the market. Eventually, that resource will reach the market; it is only a question of who and when. Energy-hungry countries would beg, borrow and steal the resource if it was economically feasible. All Canada has to do is to make a right turn and run the pipeline to its West Coast to load up oil tankers and send them to the Far East.
Since crude oil was discovered in the middle 19th century, it smacks and smells of big money. John D. Rockefeller (1839-1937), the founder of Standard Oil, reaped unbelievable profits from the sale of oil products and gasoline to create a wealthy, powerful, politically influential empire. By the early 1880’s Standard Oil controlled some 90% of the oil refineries and pipelines. Standard Oil no longer exists today, having been broken up into 33 different companies by a 1911 Supreme Court decision upholding the Sherman Anti-Trust Act. New Jersey Standard, one of the 33 companies, eventually became Exxon.
Today, worldwide oil is driven by five major oil companies; BP, Chevron, Exxon, Shell and Conoco/Phillips. When crude oil and natural gas are explored, fracked, transported, or refined, one or more of these five companies has its hand in the pie. With their immense international wealth, they are powerful and politically influential. Which of these companies has its hand in the Keystone XL pipeline project under the name of the Transcanada Corporation is unknown to this author, but that is of no consequence to what we wish to portray here.
Then there are the environmentalists, radical and moderate. Environmentalists hate oil of any kind, and we have discussed the why of this hate in previous articles. They would and will do anything to stop any project that has the remotest possibility of promoting petroleum products of any kind. They too are wealthy, powerful and politically influential and have the ear of the President, all of the Democrats and most of academia and the print and electronic news media. Nevertheless, from our perspective, the environmental impact of the Keystone XL pipeline is negligible no matter what the environmentalists say. Environmentalists are against just about any human endeavor, except maybe inefficient ethanol from corn, or expensive and inefficient wind and solar power.
There is another competing player in this battle over the Keystone pipeline, and that is the railroads. Right now the railroads are transporting most of the oil that would be carried by the new XL fourth phase. It has been estimated that the railroads are making around $30.00 per barrel of crude oil being carried to the refineries. With the new pipeline in operation the cost drops to about one third. Berkshire Hathaway owns most of the railroad companies. Warren Buffett owns Berkshire Hathaway. Warren Buffett is a great and true, loyal friend of Barack Hussein Obama. Ole Mr. Buffet stands to lose millions when the fourth phase of the pipeline is competed. So whose water is the President carrying by not approving the fourth phase of the pipeline project, the environmentalists, or his friend Warren Buffett, or both? This whole project reeks of government corruption and duplicity.
But there is one victim of the Keystone XL pipeline that no one talks about, and that is the rural landowner through which the new XL pipeline will run. The new pipeline path transverses the states of Montana, South Dakota, Nebraska and Kansas. The pipeline consortium, Transcanada, will confiscate the rural landowners’ land under the government power of eminent domain.
Most of us in this field know that government’s power of eminent domain is regularly and flagrantly abused. The landowner either takes what the consortium is offering or challenges the consortium in court. Most individual landowners don’t have the “bread” to challenge a commercial giant in America’s corrupt judicial system. The consortium will use their own appraisal experts to come up with a low value as “just compensation” and the courts usually uphold those values, leaving the individual landowner with no other recourse but to take the hit. The rural landowner becomes victim to an alleged national interest and the profits of the oil and pipeline companies. But then the rural landowner has been taking the abuse for several decades now by draconian land use and environmental regulations, local, state and federal.
We receive at least one call or email per week from landowners all over America being threatened with the “gun” of eminent domain. Their stories are heartbreaking when they are forced to sell at a low price that has been determined by a corrupt government or private entity and upheld by the courts. The stories of eminent domain abuse by government abound. The U.S. Supreme Court decision in Kelo vs. New London, CT only muddied the waters of eminent domain law.
One property owner we know personally fought a transit company for years in court over the taking of their commercial property under eminent domain. What the transit company offered was far, far less than similar property adjacent to or across the street from their property. They spent over $500,000 on attorney’s fees, court costs and expert witnesses in their court fight. The judge finally agreed with the transit company’s value and awarded the landowner around $500,000, leaving the landowner netting essentially zero for his audacity to challenge Goliath.
This same transit company then purchased a building and commercial property in an adjoining city but they only needed a small portion of the property for their use. The transit company then turned around and sold the property they didn’t need for a healthy profit. The property owner had no recourse and could not participate in those profits he would have received if he had sold the property to a ready, willing and able buyer himself.
Government uses every legal trick in the book to lower the value of the land they seek under eminent domain. One of their tricks is to down-zone the property. Another is to wait out the landowner with legal maneuverings until he has exhausted his savings and anything he can borrow. The landowner then is forced to sell at a lower price just to recoup his savings, or pay off his loans as best he can. In many cases the landowner is left with a huge debt for the privilege of fighting the all-powerful and corrupt government.
Fortunately, the little guy doesn’t always lose under eminent domain. In a well-known Texas eminent domain case against the XL Keystone pipeline, landowner Julia Trigg Crawford won a Texas State Supreme Court ruling in her favor against Transcanada, a foreign corporation, trying to exercise eminent domain proceedings in the U.S. From a recent article in ECO Watch:
“We’re thrilled, because the Supreme Court has finally ruled in favor of us—the little guys—and against a foreign oil giant,” Julia Trigg Crawford continued. Basically, TransCanada said that it wanted a waiver from responding to our petition, and the Supreme Court said, ‘No, you must respond’.”
Hopefully, this case may set a precedent for all other cases along the XL Keystone proposed right-of-way.
Boon or Boon Doggle: The question is, who does the XL Keystone pipeline benefit? Sure, there will be some much-needed construction jobs, but when the pipeline is completed, those jobs will fade away, leaving only maintenance crews manning the line. But if all of the tar sand crude oil from Canada is shipped to Texas for refining and the refined products are shipped offshore to foreign ports, only the oil producers, oil companies and ocean shippers will reap the rewards. Meanwhile, the rural landowners who were savaged by the taking of their land under eminent domain and paid little for it will be faced with bifurcated property, along with maintenance crews trespassing on their land to get to the pipeline. Then there is the risk of pipeline explosions, although rare as they may be.
We know that pipelines and electric transmission lines are a fact of life. Unfortunately, it is the rural landowner who must pay the price so that big cities will have electric power and oil companies will be able to ship their raw product to refineries and then to market. The problem is, the rural landowner, who must lose part of his or her land to the pipeline right-of-way, should reap some of the benefits by participating in the profits from the crude oil or electric power being transported across their land instead of receiving a one-time price. If we were rural landowners facing the taking of our land for a pipe or transmission line, we would negotiate a per-barrel or per-kilowatt price for any oil product or electricity transported across our land. After all, landowners of oil-rich or natural gas resources receive a royalty for the resources taken from their land. It is an idea long overdue.
NOTE: The foregoing article represents the opinion of the author and is not necessarily shared by the owners, employees, representatives, or agents of the publisher.
Ron Ewart, a nationally known author and speaker on freedom and property rights issues and author of this weekly column, “In Defense of Rural America,” is the president of the National Association of Rural Landowners (NARLO) (http://www.narlo.org), a non-profit corporation headquartered in Washington State, an advocate and consultant for urban and rural landowners. He can be reached for comment at email@example.com.