There is indeed every reason to think that the president made the worst of all possible decisions in killing a pipeline that could have cemented America’s relationship with Canada, rationalized production and distribution of oil in the United States, and reduced the risk of pollution by blunting spillage risk from tankers steaming toward China loaded with oil.

That’s all well and good. But recall that there is no evidence whatsoever that suggests that opening the pipeline or increasing domestic oil production, both desirable, will lead to some mythical $2.50 per gallon price at the pump any time soon. Once the right institutional arrangements are made on both of these points, supply should increase, and, on average, prices should decline as consumption increases. But we must never tie government policy to particular price levels. Politicians must set the right institutional arrangements and then let the cost of production and relative demand set prices.