There is a lot being said about the unexpected rout of the long-ruling Progressive Conservative government in the oil-rich Canadian province of Alberta by the socialist New Democrats. Some of it (on the left) is euphoric and over the top — which is understandable given the seemingly helpless state of the left across much of North America. But the implications of this shakeup in the northern heart of the oil industry are worth pondering.
Among the NDP’s campaign promises were raising the corporate tax rate from 10% to 12%, carrying out an oil-royalty review, increasing income taxes on the top 10% of earners, raising the minimum wage to C$15 an hour, funneling any new energy-royalty revenue to a savings fund, banning corporate (and union) political party donations, and withdrawing provincial support from the controversial Northern Gateway pipeline project.
Here are some thoughts on what this political shake-up means for the environment and the left.
Writing for The Tyee, one of Canada’s best independent leftish online magazines, Mitchell Anderson sees the NDP victory as a defeat for the “politics of fear”:
“Alberta kept a mere $4.38 per barrel of oil in 2013. That same year, our neighbours in Alaska managed around $38 while Norway raked in over $80. Why has Alberta given away this resource so cheaply? Because we have been led to believe that this is best we can do.” […]
“Canada remains the second richest country in the world based on per capita resource wealth — yet for some reason we can’t afford postal delivery. The root of this endemic Canadian problem is fear. Fear that companies will pack up their capital and go elsewhere if we drive a harder bargain, or claim more control over this incredible endowment.” […]
“[Prime Minister] Harper himself has made fear a defining feature of his government, stoking terror about everything from terrorism to a carbon tax. But what if Canadians stopped being scared? What if Canada — as Norway has so profitably done — called the bluff of extractive industries that have feasted on our resources? It would have been hard to imagine just a month ago, but Alberta may be the pivot point in this national transformation.”
Writing on Facebook, a green activist friend of mine adds that “The great thing is that the voters ignored the warnings of big business and the endorsement of the PCs from all four major newspapers.” (Add to that list the national Globe and Mail, which with its social liberalism and fiscal conservatism aims to represent the pragmatic center of Canada’s ruling elite. Except that national newspapers don’t typically have much influence in Alberta.)
Vice columnist Drew Brown provides some historical context to support his argument that this shift was not sudden, but that Albertans were simply waiting for a reasonable alternative to appear:
“The longstanding conventional wisdom is that Albertans are so deeply, inherently right wing that the only party that could replace the Progressive Conservatives would be some straight-up regressive ones.
“But the fact that so many people came to [former PC leader Alison] Redford’s defense in 2012 [against the right-wing opposition Wildrose Alliance Party] shows that most of contemporary Alberta doesn’t actually want to live in a redneck libertarian nightmare world. People have been looking for an out from the Tories for a while, and suddenly the NDP have provided one. It helps that Rachel Notley is terrifyingly sensible compared to her competitors…”
Writing in the New Republic, anti-poverty activist and one-time Calgary NDP candidate Dan Meades writes:
“A year of plummeting oil prices and the layoffs they wrought showed many Albertans how flimsy the economic plan was in the province, predicated as it was on a presumption of endless abundance. Falling oil prices led to an austerity budget from the sitting Progressive Conservative government. We were told that as long as we gave oil sands companies total control, we would reap the economic rewards. Once that was proven to be untrue, the larger conservative narrative crumbled.” […]
“This election has the potential to fundamentally change the nature of the energy industry in North America, and to challenge the largely unproven claims that left cannot steward the economy and the environment simultaneously.”
That is reason enough why greens should not only wish them luck, but do all we can to support the grassroots activists who can pressure this new government to do what it says it will do, and to do it well. It’s Alberta, with not much of a grassroots left, let alone a green one, so it will be hard work, with inevitable compromises and disappointments along the way. And with a party of political rookies — nurses, union stewards, school board trustees, and a sociology student, among others — ideals can go a certain distance, but when countered by pragmatic realities, they may quickly fade.
Energy policy analyst Andrew Leach argues in Canada’s leading newsweekly Macleans that the changes the NDP might impose are hardly revolutionary — probably just a moderate shift in how the energy industry is managed. Summarizing his analysis, he writes,
“[T]he first take-away is that there’s not a lot of meat on the bones of some of the positions put forward by the NDP. They’ll call a commission on royalties, assess whether or not to stimulate refineries, be a leader on greenhouse-gas emissions, and save more of our resource revenues.
“The next steps—what royalty changes they’re prepared to consider, and how they’ll trade off royalties versus pace of development; what policies will be used to stimulate refining if the commission determines we’re not doing enough of it; what types of greenhouse-gas-emissions policies the NDP would enact to achieve its objectives; or how a larger Heritage Fund would be managed—are not fully fleshed out.
“Perhaps that’s what we should expect from a party that has not had the benefit of a large bureaucracy testing potential policies. Overall, it’s hard to find clear motivation for fear or for comfort; those who believe the NDP will do crazy things have more than enough room to make those assumptions, while those who believe they won’t will find comfort from these answers, as well.”
The stakes for success in a moderate change in the management of Alberta’s oil-centered economy are nevertheless high. If the NDP could succeed in reining in the “extreme oil” bubble of recent years and present a viable model to satisfy Albertans’ social and economic needs, it will be significant and could prompt the federal NDP — Canada’s official opposition party in Ottawa — to revive its own (somewhat dormant) left-green ideals.
Which could shake up the continent.
would be a welcome shift if TransCanada would leave our aquifer alone.
http://boldnebraska.org/
Let’s have a look at these suggestions: ” … [a] raising the corporate tax rate from 10% to 12%, [b] carrying out an oil-royalty review, [c] increasing income taxes on the top 10% of earners, [d] raising the minimum wage to C$15 an hour, [e] funneling any new energy-royalty revenue to a savings fund, [f] banning corporate (and union) political party donations, …”. a) will have the effect, since taxes are nothing but costs in an end product, to raise the prices of products or else making so-called marginal producers, who cannot raise prices, insolvent. Hm. b is certainly worthwhile. Some royalties may be too low due to typical cronyism. However, these costs will also spill over into end products. So if these consumers are out of state, it is a winning proposition, otherwise it’s neutral, at best. c) As for a) taxes are costs that in the end are paid by consumers. There is no other instance that could pay them in the longer run. But it’s good to get the popular vote. d), the minimum wage, will make labor in certain areas more expensive. Rising prices usually, all other things being equal, will lower demand. So less tax payers and less contributors to social security. Hm. e) – a savings fund. Great idea. As long as … the province has enough money (overall) to put away. If not, then more bonds will be issued and the compounded savings rate then would be zero or less (because all measures cause friction, i.e. bureaucratic overhead). f – I’m all for it.
alas…
http://www.theglobeandmail.com/news/national/ottawa-commits-to-30-per-cent-cut-in-emissions-but-not-for-oil-sands/article24453757/
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