Oh, Canada. A wildly blessed nation, with resources most countries can only dream about, and we have been thoroughly outwitted and outplayed by global economic forces and unelected rulers. How did we get here? How can our resources be landlocked when we have, by far, the most coastline of any nation?
Regarding a lack of market access, the problem did develop a while ago, when historically anomalous commodity prices drove extremely rapid development. The price of oil shot up faster than anyone imagined, and the oil sands developed at the same pace. Natural gas production exploded with the fracking boom. Both of these events came to dominate before pipelines could be built, and when the industry was ready/needed pipelines, it was no longer able to construct them.
The same problem befell the US of course, but the difference in that country is remarkable. If Canada’s production growth was big, the US’s was off the charts. The Marcellus/Utica region went from near zero production to 30 billion cubic feet per day in dozen years. In fact, just more than a dozen years ago the US was preparing to import natural gas, with many LNG import facilities on the drawing board. The American adaptation to this growth has been remarkable, but necessary. Why? Because the country understands the importance of their energy sector. We may sneer at “America First” up here, but that is how the world works.
Canada’s bizarre global situation was recently made clear by Saudi Arabia, of all places. Consider Canada’s recent antics/actions. Canada has recently been lashing out at Saudi Arabia for ill-treatment of human rights activists. Objectively that’s not unreasonable, as the habit of killing critics isn’t a particularly wholesome one, but a great many countries do similar without having to endure Canada’s limp-wristed lecture that is so obviously just posturing. While this was happening, Canada continued to import Saudi oil into the country because, for some unfathomable reason, a refinery on the east coast seems to be the single point in Canada’s entire energy complex that is deemed to run best under market forces.
Meanwhile, look at how Trump played his hand. It is not pretty, but this isn’t kindergarten. A US citizen and vocal critic of Saudi Arabia was murdered by Saudi officials in Turkey. Saudi Arabia admitted to the killing, and vowed to punish those involved. Trump could have pursued Saudi Arabia further and made a big stink, but he probably realized that that would be pointless. To try to pin the murder on the head of state would be nearly impossible, so he appeared to do what every effective national leader in history has done – play his hand to the best of his ability.
What Trump did was to use the situation for maximum leverage. His economic recovery plan was being threatened by rising oil prices, which are like a tax on consumers and industry. A return to triple digit oil prices would have undone all his efforts to get the US economy roaring.
So what did Trump do in response? It appears that in exchange for backing off on the Saudis in what was an unwinnable scrap, he leaned on Saudi Arabia relentlessly to raise oil production. Lo and behold, Saudi Arabia cranked oil production up to the highest level in their history, which pushed WTI from $70 per barrel to $50. Problem solved.
Make no bones about it, that is bare knuckle politics. But look at the global powers in the energy world – Middle Eastern countries, the USA, Russia, China…those are the combatants. All are ferocious competitors who play to their national strengths. This is a pack of wolves.
Meanwhile, out in the pasture is a docile cow named Canada, lacking even the most basic of survival instincts. It is led around on a rope by foreign influences that report to no one, and the poor bovine is oblivious that it is being led to the slaughterhouse.
Canada’s political elite is sacrificing our country in a Monty Python-esque crusade to solve the world’s problems. The federal government has a very clear objective to do whatever it takes to make the United Nations happy regardless of cost or benefit. That is, all cost to Canada with no benefit to the environment.
Oh sure, we see the government’s dismay and discomfort when, say, three thousand jobs are lost in the auto sector; we see the evidence in a blizzard of tweets from the likes of Gerald Butts, Trudeau’s lifelong friend, political strategist, and global glad-hander. Neither of these guys is particularly interested in resource problems; these guys want to hang out in Paris or London with Bono or Elon Musk. They would fight like cornered badgers to prevent being photographed with any petroleum leader. We know this, because their dismay at the lost Oshawa jobs exceeds that at the hundred thousand petroleum jobs lost in Alberta by an incalculable amount. You can’t divide by zero.
The evidence of their disdain, like most things political, does not come out of their mouth directly, but in an endless wave of insinuation, inaction, and aloofness. Have a look at Butts’ Twitter feed. Over the past few weeks, he has tweeted: a steady stream of climate change messages, a brief blizzard of commentary on the Oshawa GM plant closure, bizarre statistics on how well Canada is doing economically, and a single tweet documenting the big visit to Calgary. This last one perfectly crystallizes Ottawa’s current view of the petroleum business: Butts tweeted a photo of Calgary and the mountains from his plane, with the utterly dismissive accompanying text: “Calgary. #YYC”.
Trudeau’s day in Calgary, one that was of major importance for the oil patch, is willfully ignored, and Butts offers instead two posts, one in French and one in English, of Trudeau getting a flu shot. To make sure he pounds the point home that the Calgary visit was not important, Butts sent a tweet two days after Trudeau left Calgary, a link to a story about some random “climate denier” with the admonishment “the groups fighting to impede progress are well-financed organized to serve their narrow self-interest. Here’s a good primer on the $ behind climate denial.” The story to which he linked is from February 2015, so not newsworthy in any sense of the word; it appears to have been timed precisely to counterbalance Trudeau’s message that he “heard” the voices in Calgary. The tweet is simply a clear message to the world from a master political strategist that Canada is 100 percent behind everything that is not fossil fuels.
I despise spending a single minute on politics, but it is clear that Canada’s fate rests on the arrival of a populist blow-back to clear all this madness away, as is happening here and there around the world. It will be better for everyone; we can get back to running a country, and Trudeau and Butts and all the rest can cavort in Europe with the global elite who share their worldview and care not a whit for the machinery that keeps us all alive. It is coming; there is blissful evidence that the country’s population is tiring of being the world’s sacrificial lamb for no good reason. A recent Globe and Mail opinion piece, outlining why Canada needs to shut down the oil and gas industry, was mercifully met by several hundred comments of howling indignation, and almost no support. Five years ago the comments would have been overwhelmingly critical of the oil patch, but no longer. Change is coming, from the ground up.
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