Thomas Mulcair is headed for Alberta “soon”, and his maiden visit to the Fort McMurray, ahem, “oilsands.” He would be well-advised to keep his ears open and his head down.
The New Democratic Party leader hit a nerve in Western Canada recently when he complained that Alberta’s oil wealth is costing manufacturing jobs in Ontario and Quebec — a local variant of what is known as “Dutch disease.” (Ontario Premier Dalton McGuinty elicited the same reaction, and was forced to retreat, when he complained about the nefarious effects of the “petrodollar.”)
This familiar, if provocative, analysis is based on the collapse of manufacturing in the Netherlands, after a 1959 North Sea gas discovery inflated the value of the Dutch currency and made the country’s exports prohibitively expensive.
The analogy doesn’t apply perfectly, because, as Mulcair quickly acknowledged, manufacturing in Central Canada has been in decline for decades, partly because of competition from China and other low-wage countries, and partly because of the relative weakness of the U.S. economy. (Still, University of Ottawa economist Serge Coulombe has estimated, in a comprehensive study, that the petrodollar was responsible for 42 per cent of manufacturing jobs lost in Ontario between 2002-07.)
But whatever the economic nuances, Mulcair’s comments were political dynamite. It sounded, to some — including Saskatchewan Premier Brad Wall — that Mulcair was blaming Alberta’s relative good fortune for Central Canada’s decline.
“If (Mulcair) thinks a strong resource sector is a ‘disease’, what is his cure?” Wall tweeted. “Higher resource taxes? NDP needs to explain.”
Mulcair has been trying to do just that. His basic argument is that Canada’s natural resources must be developed “sustainably”, that polluting industries should pay to clean up their own messes and that consumers have to bear some costs through unspecified “user fees.” So yes, sustainability is going to cost although Mulcair is coy on details.
And, he insists, more of those raw resources should be processed here, not shipped offshore to create jobs elsewhere.
“This isn’t just a question of the oilsands. This is equally applicable with regard to the export of raw logs. We have this sad tendency in Canada not to add value here,” he says.
Will this be enough? Mulcair, a former Quebec environment minister, is (along with Elizabeth May), the greenest federal leader since Stéphane Dion, and a much better communicator. He opposes federal subsidies to profitable oil companies, has favoured cap-and-trade as a way of pricing carbon, and worries about leaving a “massive ecological, economic and social debt” to future generations. In short, he’s no wishy-washy Liberal.
But he does appear willing to tailor his message to western sensitivities (he no longer says “tarsands”, for instance). He also faces a different political landscape from Dion and a different Alberta from Pierre Trudeau.
The new Alberta premier takes climate change, and the oilsands’ international critics, seriously. Interestingly, it was Brad Wall, not Alison Redford, who first rebuked Mulcair for his Dutch disease comments — although Alberta environment minister Diana McQueen accused the NDP leader of “old-style politics; trying to pit one part of the country against another.” (Just before she invited him to visit.)
For some time, influential Albertans — from Peter Lougheed, to the Parkland Institute, to the province’s vigorous green advocates — have been making the case for slowing oilsands development, for economic as well as environmental reasons. And some Calgary energy executives continue to press governments for clear regulations, and carbon pricing, in the interests of financial certainty.
There are still suspicions and sensitivities between east and west, Alberta and the rest, over resources, but there is also growing common ground and new leadership on both sides.
Meanwhile, Prime Minister Stephen Harper has been unusually quiet about his new rival — apart from an amateurish website criticizing Mulcair’s team.
Eventually, however, the Conservative war room will strike, and Mulcair’s environmentalism will be a prime target. He will be portrayed as an agent of foreign green radicals, an enemy of the west, a job-killer from hell.
Surviving the onslaught, persuading Canadians that he doesn’t want to win power without the support of Alberta and Saskatchewan — although, at the moment, he could — will be a test of Mulcair’s diplomacy and adroitness.
The renewed debate over resources will also be a test of the country’s mood.
Is Harper’s invective is losing force, along with novelty? Are we ready to leapfrog old resentments and support leaders who focus on what most Canadians want: responsible development of a resource that, like it or not, is fuelling prosperity?
Maybe it isn’t Dutch disease, but Canadian disease, that is the problem: a tendency to endlessly replay wrenching national unity feuds while real problems fester.
Original Article
Source: ottawa citizen
Author: Susan Riley
The New Democratic Party leader hit a nerve in Western Canada recently when he complained that Alberta’s oil wealth is costing manufacturing jobs in Ontario and Quebec — a local variant of what is known as “Dutch disease.” (Ontario Premier Dalton McGuinty elicited the same reaction, and was forced to retreat, when he complained about the nefarious effects of the “petrodollar.”)
This familiar, if provocative, analysis is based on the collapse of manufacturing in the Netherlands, after a 1959 North Sea gas discovery inflated the value of the Dutch currency and made the country’s exports prohibitively expensive.
The analogy doesn’t apply perfectly, because, as Mulcair quickly acknowledged, manufacturing in Central Canada has been in decline for decades, partly because of competition from China and other low-wage countries, and partly because of the relative weakness of the U.S. economy. (Still, University of Ottawa economist Serge Coulombe has estimated, in a comprehensive study, that the petrodollar was responsible for 42 per cent of manufacturing jobs lost in Ontario between 2002-07.)
But whatever the economic nuances, Mulcair’s comments were political dynamite. It sounded, to some — including Saskatchewan Premier Brad Wall — that Mulcair was blaming Alberta’s relative good fortune for Central Canada’s decline.
“If (Mulcair) thinks a strong resource sector is a ‘disease’, what is his cure?” Wall tweeted. “Higher resource taxes? NDP needs to explain.”
Mulcair has been trying to do just that. His basic argument is that Canada’s natural resources must be developed “sustainably”, that polluting industries should pay to clean up their own messes and that consumers have to bear some costs through unspecified “user fees.” So yes, sustainability is going to cost although Mulcair is coy on details.
And, he insists, more of those raw resources should be processed here, not shipped offshore to create jobs elsewhere.
“This isn’t just a question of the oilsands. This is equally applicable with regard to the export of raw logs. We have this sad tendency in Canada not to add value here,” he says.
Will this be enough? Mulcair, a former Quebec environment minister, is (along with Elizabeth May), the greenest federal leader since Stéphane Dion, and a much better communicator. He opposes federal subsidies to profitable oil companies, has favoured cap-and-trade as a way of pricing carbon, and worries about leaving a “massive ecological, economic and social debt” to future generations. In short, he’s no wishy-washy Liberal.
But he does appear willing to tailor his message to western sensitivities (he no longer says “tarsands”, for instance). He also faces a different political landscape from Dion and a different Alberta from Pierre Trudeau.
The new Alberta premier takes climate change, and the oilsands’ international critics, seriously. Interestingly, it was Brad Wall, not Alison Redford, who first rebuked Mulcair for his Dutch disease comments — although Alberta environment minister Diana McQueen accused the NDP leader of “old-style politics; trying to pit one part of the country against another.” (Just before she invited him to visit.)
For some time, influential Albertans — from Peter Lougheed, to the Parkland Institute, to the province’s vigorous green advocates — have been making the case for slowing oilsands development, for economic as well as environmental reasons. And some Calgary energy executives continue to press governments for clear regulations, and carbon pricing, in the interests of financial certainty.
There are still suspicions and sensitivities between east and west, Alberta and the rest, over resources, but there is also growing common ground and new leadership on both sides.
Meanwhile, Prime Minister Stephen Harper has been unusually quiet about his new rival — apart from an amateurish website criticizing Mulcair’s team.
Eventually, however, the Conservative war room will strike, and Mulcair’s environmentalism will be a prime target. He will be portrayed as an agent of foreign green radicals, an enemy of the west, a job-killer from hell.
Surviving the onslaught, persuading Canadians that he doesn’t want to win power without the support of Alberta and Saskatchewan — although, at the moment, he could — will be a test of Mulcair’s diplomacy and adroitness.
The renewed debate over resources will also be a test of the country’s mood.
Is Harper’s invective is losing force, along with novelty? Are we ready to leapfrog old resentments and support leaders who focus on what most Canadians want: responsible development of a resource that, like it or not, is fuelling prosperity?
Maybe it isn’t Dutch disease, but Canadian disease, that is the problem: a tendency to endlessly replay wrenching national unity feuds while real problems fester.
Original Article
Source: ottawa citizen
Author: Susan Riley
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