A pitch to Alberta’s Premier to do something big
First a disclaimer, because I can hear it already: There is a strong case to be made that governments should leave industry to sort things out for themselves, that picking winners and general meddling is the antithesis of what the free allocation of capital can accomplish. To suggest that governments should get involved is guaranteed to bring two responses from the spectrum’s ends – pure free marketers don’t want governments involved at all, and socialistic types jump all over business media for proposing more government policy in the midst of blasting government policy (and, in the words of a legendary prairie comedian, dat’s I am).
Well, to hell with all of them. Here’s a suggestion for Alberta’s government that has to come from a place with the wherewithal and regulatory power to make it happen.
After World War II, Germany had to do some renovations. Someone had rearranged the furniture a little too much. One of the biggest new appliances installed in the postwar period, so to speak, was the creation of an industrial city at Ludwigshafen, built around a monolithic natural gas import pipeline. Ludwigshafen is an industrial powerhouse of a place, home to BASF and a manufacturing hub of global might. Out of its chemical plants come the building blocks for almost everything in our consumer landscape (per BASF: Agriculture, Automotive/Transportation, Chemicals, Construction, Electronics/Electric, Energy & Resources, Furniture & Wood, Home Care and Industrial/Institutional Cleaning Solutions, Nutrition, Packaging & Print, Paints & Coatings, Personal Care/Hygiene, Pharmaceuticals, Plastics & Rubber, Pulp & Paper, and, finally, Textiles, Leather & Footwear).
Ludwigshafen accomplishes this magnificent industrial output by consuming roughly the same amount of natural gas as Switzerland, or about 0.3 bcf/d.
Hmm. Western Canada produces more than 18 bcf/d. We shove much of it into pipelines and export it to the US or eastern Canada. Soon we will put it on boats and send it to the world.
Those aren’t bad things, but…what if we adopted a Ludwigshafen-style strategy for right here at home, except, ok, maybe with a simpler name? What could we accomplish with the resources we have here?
Not just the natural gas. We have a massive petrochemical industry, the same first-level of industrialization as does Ludwigshafen. We are a magnet for young talent that wants to succeed and get ahead; it’s almost cruel to the rest of Canada how a disproportionate number of entrepreneurial types are drawn out west. We have capital if governments step out of the way.
As always happens when an idea like this is proposed, cat-callers will say “Haha, they hated Trudeau senior’s National Energy Program now they want another policy”. Well, this is not the same thing at all. The NEP attacked one part of the country to benefit another. A Ludwigs- ah forget it, I’m too old to be typing that over and over – an L-style industrial zone could be encouraged by the government via incentives and tax holidays (economists may argue otherwise, but for anyone that builds things, a 10 year tax break is not at all the same as a ‘government expenditure’; one encourages wealth to be built, the other confiscates wealth to distribute).
Around every petrochemical facility should be a mini-Ludwig. It should include many square miles of 3D printers and other value-added industries.
I don’t know how to make it happen, but then I didn’t run for office. You want to go down in history? Do something great.
It’s a vision. We need visionaries. We can be great.
Toyota Schools the Auto World
Fascinating stuff is happening in the auto world. First on the agenda is the case of Toyota, the global behemoth that pioneered large-scale successful production of a hybrid vehicle with the offensively ugly original Prius (sorry devout owner-friend – it’s true). While the western world’s governments declared that the future would be 100 percent battery electric vehicle, Toyota sat back and said, “We’ll get back to you on that.” The automaker was pilloried by the western press for not advancing the EV revolution fast enough, and, even worse, not joining the cheerleading. Instead, Toyota thoughtfully released documents outlining grown-up thought, such as their 1:6:90 model which laid out for dealers how there was not going to be enough critical metals and minerals to achieve what western governments said was going to happen, and that hybrids made far more sense in every rational way. Including emissions, the 1:6:90 model showed that “The amount of raw materials in one long-range battery electric vehicle could instead be used to make 6 plug-in hybrid electric vehicles or 90 hybrid electric vehicles.” Those 90 hybrids, over their lifetimes, would achieve carbo reductions of a staggering 37 times that of a single EV.
But clear thinking is not part of that revolution (EV fanzine CleanTechnica howled in a headline: “A Tale of Two Toyotas: Doing more to Electrify America Than Anyone While Slowing Electrification”. The author goes on with the sort of hypnotized thousand-yard-stare reciting of a mantra, “This means if and when Toyota finally figures out EVs are what people want, it will be easier to make the transition.” The presupposition embedded, that EVs are what people really want and that Toyota is just too thick to understand this, can only live in a certain mental petri-dish that isn’t good for growing any other cultures.)
It turns out people don’t really want EVs, they want hybrids, and Toyota’s sales are soaring and they look like geniuses. Other automakers are following suit, alternating announcements of staggering EV-segment quarterly losses with pledges to beef up the hybrid range (Ford being the best example). And to rub salt in the wound, Toyota has even finally made the new Prius a very pleasant thing to look at.
Almost all automakers are now faced with the dilemma of bringing a plethora of new EV models to an uncaring market, after years of development, a dilemma that will no doubt be mollified by governments shovelling yet more money their way, the opposite kind of policy of a Ludwigshafen – governments will throw huge money at programs that add nothing, as opposed to utilizing the momentum of industry to help create what people truly do want – to see governments do the wise thing, just once in our freaking lives.
Meanwhile, despite every third word in the auto news being ‘battery’, out in the real/ interesting world some truly cool automotive developments are happening. In California, a company called Czinger Vehicles has developed an incredible looking car with a 3D printed chassis and infrastructure. The whole thing is assembled by laser guided robotics. It really works, and works very quickly indeed, setting track records at multiple US racetracks. The founder (go ahead, guess what his surname is) confirms that the company is in talks with major auto manufacturers.
Somewhere in there is the most likely future of automobiles; various forms of hybrid technology together with highly advanced manufacturing technologies. Before the 2 percent gets agitated and eye-twitchy, yes of course there is a large market for EVs, in regions and industries where they make a lot sense. But the world is a big place, 8 billion people is a lot, and, once common sense prevails, we will see multiple powertrains across the spectrum, just as we see China leading the world in both solar installations and new coal fired power plants.
Just for comedy, because at the end of the day who really gives a #%$& about anything else, also from the US comes news of the new Dodge Ram pickup truck. In the past, here on these pages have been celebrations of the glorious inanity of auto manufacturers’ marketing departments, who one-up each other with dumb name after dumb name and apparently no supervision whatsoever, but the Ram team takes the cake. The new truck is available in no less than six main trim levels, obviously designed to appeal to the very weakest parts of the brain through some weird imagined presumed sense of affiliation. Thus we have the Dodge Ram Tradesman, Big Horn, Laramie, Rebel, Limited, and Tungsten, designed to appeal to, respectively, plumbers, some sort of wildlife enthusiasts, cowboys, anarchists, snobs, and chemists. Missing from the lineup are upcoming electrical variants the Rev (which is utterly incoherent as it is internal combustion engines associated with revving, not electric motors, but whatever) and the Ramcharger (a weird name which in theory could be a clever reference to the ‘ram-air’ intake systems that can increase power, but who are we kidding, the little marketing apes simply saw the name Ram in the word).
If these models rack up any kind of sales at all, in 2026 look for the Ram Junkie, Secret Agent, Pacifist, and Proctologist. Coulda had a bestselling hybrid, but this is what they choose.
Pick up this Amazon bestseller, in one of their 400,000 subcategories, at various points in time. You most assuredly will blow your money on worse things in your life. I imagine. Available at Amazon.ca, Indigo.ca, or Amazon.com.
Read more insightful analysis from Terry Etam here, or email Terry here.