Bright but clouded

It doesn’t matter how smart a person is, lots of things can cloud their judgement and application of intellect to the problems of the day (including myself although at a much reduced intellectual level). Take this Mark Milke fellow from the Frontier Centre in Calgary. He works for a think tank. Probably has advanced degrees and such and can still articulate an argument completely devoid of reason. Read his article and tell me what you think. It could be that I have my blinders on (suspect this is the case) but truly, the only question for Milke and everyone else in Alberta that sees red when people talk about their resource revenue is this:

The oil/gas revenue sharing deal in Canada – would lead to a civil war in Iraq. If that country were to divvy up the oil revenues the way Canada does – even through the circuitous Equalization program – it would be civil war.

In fact, I had a little look at this just for fun a few years ago – and in fact Canada system for distributing natural resources revenue is non existent. There is the back door Equalization system but the majority of Albertans even resent that. How about we scrap Equalization and divvy up the resource revenue like Norway.


I think guys like Milke would be far better off a) making their argument against sharing natural resource revenue using historical arguments – this bravado about it isn’t based on reason and b) having a little class when reacting to journalists and others in poor provinces that do not have the luck of the Albertans.

P.S. – Equalization has nothing to do with hydroelectricity. It’s just a very cheap source of electricity and that is why Manitoba can offer it more cheaply than other provinces. Why would they inflate the price and take away the one advantage they have?

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0 Responses to Bright but clouded

  1. Anonymous says:

    Mike should read up a bit on Alberta history. They would not be where they are if Canada had not supported them little over half a century ago.

    Interesting how bold one gets during a period of success.

    I wonder if they will be so brazen when they run out of fresh water and are facing the clean up of an oil-depleted toxic province? All of a sudden it will be ‘a Canadian thing’ to contribute to the expensive solutions needed.

    It takes maturity and wisdom to handle success; this guy might still have a chance to grow up but looks like he lost out on the opportunity for wisdom.

  2. Anonymous says:

    If Alberta paid us and other have-nots for the education and health care monies invested in our youth who leave for the oil patch I don’t think we’d have an issue.

    Instead, we get hit with the double whammy – we lose our investment dollars raising our youth and lose the equalization dollars that disappear with decreases in population.

    Thanks for nothing Alberta!

  3. mikel says:

    Articles like that-remember, the media in Canada is the most concentrated in the western world, is meant to represent only one class of Albertans (that its from the Frontier Centre is a tipoff-they’re almost as crazed as Ezra Lavant).

    We see the exact same thing in Irvings press and other maritime press-and of course in ontario the only time that view will change is when the province actually receives some equalization.

    Those aren’t ‘blinders’, its simply the view of a certain demographic, just like your view doesn’t often include a ‘resource tax’ or an ‘Irving tax’.

    In other words, its propaganda. But like all propaganda it has some truth-Manitoba IS offering subsidized energy to southern states (and not to Saskatchewan or Ontario). And its ironic that in such a case the US isn’t griping that subsidized energy is an infringement on free trade. They LOVE subsidies, when they are helpful.

    But he is right about the ‘counterproductive’ measures of equalization, that became clear with Nova Scotia and Newfoundland, and its interesting he doesn’t mention them. When new investment comes on line, equalization goes down-so a province is still in a lose lose position. He uses Manitoba, but we can just as easily substitute NB and say that the potash deal, the mining giveaway, the forestry giveaway, the LNG deal wouldn’t have happened if NB ‘needed’ that cash (ie. didn’t have equalization).

    Like most bad journalism (which is all too prevalent in Canada) what the author doesn’t do is look at all the variables. If the energy wasn’t ‘subsidized’ then the states could look elsewhere, in other words, the deal wouldn’t happen AT ALL. And of course he doesn’t mention that the reason most of canada recieves equalizatinon is because of all the deals that ‘don’t happen at all’.

    Why equalization has failed is exactly the same as the ‘welfare trap’. Provinces arent’ ‘covered’ when they make risky decisions to ‘get out of poverty’, which makes taking the risk a bad idea. When politics gets involved its even WORSE than the welfare trap, which is a disaster on basic economic grounds. The solution is not to have more welfare, but as said here often-to have MORE INVESTMENT.

    I have no idea what the housing examples are supposed to prove. It actually doesn’t prove much because I read a post at a forum where the author went through and described all the various costs of living out east vs. Toronto, Vancouver, etc. Housing was the ONLY cost that was substancially higher. When you factor in the lower wages, higher cost of utilities, fewer services, higher food prices, higher transportation costs, etc., then it’s actually FAR more expensive to live in the maritimes.

    Finally, the author IS right about a big part of the problem being the feds. It would take a VERY little bit of initiative to get a whole lot of results. YOur gas example is a good one. Here its not an appeal for lower costs or even favours, its just a question of lack of ACCESS. You’ll virtually NEVER hear a mainstream media anywhere in Canada-including the maritimes, talk about the fact that the oil and natural gas pipelines end in Montreal.

    That’s just a basic fact, and of course the reason is that the companies that OWN them see no reason for them, and of course Irving doesn’t want to see that. So do an example, let’s just say the federal government came up with a new NEP. It would have nothing to do with costs or ‘interprovincial barriers’. All it would state is a law saying that IF resource providers want access to population concentrations, they must ALSO supply rural areas and more specifically ‘rural provinces’ -meaning the maritimes.

    That would have universal appeal, especially for the maritimes and in rural areas, but it woudln’t ‘cost’ urban areas any more, and it would ultimately get them more customers. The feds have so much money they could build and run the pipeline themselves, and I’d bet even THAT would get popular support.

    Canadians themselves have extremely similar needs and wants, but at a political level Mr. Milke is right-the feds don’t help.

  4. Anonymous says:

    Mike should read up a bit on Alberta history. They would not be where they are if Canada had not supported them little over half a century ago.

    Yes anon, but that was pre-Trudeau and NEP era. Since then they have not viewed the state or the receivers of the state (central Canada and the east) that favourably. And who can blame them.

  5. Anonymous says:

    I entirely agree with Anonymous 12:21PM. It’s time we stop whining and start working harder. We (all Atlantic Canadians!) can start by getting rid of that ridiculous ‘no Sunday shopping’. At the very least that would send a goodwill sign that we are trying to do something about our situation. And the list would go on and on…

  6. mikel says:

    Well, WE can blame them. Alberta wasn’t built by their provincial government, and they have no jurisdiction on land claims. The feds COULD have followed UN resolutions and disallowed all oil sands development as it was on Lubicon land. Notice how its front page news whenever Israel does anything that robs palestinians of their ‘land rights’, while its completely ignored in Canada-even though its far more pervasive.

    In the end, federal legislation trumps all others. Much like Irving in NB the oil companies (mostly american) are given free reign and heavily subsidized. Readers of this blog may remember about a year ago when Harper was talking about rescinding one tax credit on oil distribution-it turns out that that ONE tax credit is worth more to oil companies than ALL equalization that New Brunswick gets.

    Little of this has to do with ALbertans, that’s like saying YOU are responsible for liberal policy, even though virtually none of it was ever mentioned during the election, and most of the claims made during the election were then rescinded.

    A good percentage of Albertans are not even from Alberta, and if you look at Albertan farm industry, very little of it helps out farmers. Virtually NONE of the mad cow bailout money actually made it to farmers, and farmers in Alberta, like in the maritimes, are struggling to come up with their own meat processing facilities because most processing is american which have their own sources.