From today’s Globe & Mail.
The Conservative government won’t subsidize the proposed Mackenzie Valley natural gas pipeline, but Ottawa’s top negotiator said taking an equity stake in the struggling project is possible.
“In the past … governments have participated in private sector projects of various kinds, in various guises, as equity partners,” said Andrei Sulzenko, the federal government’s chief representative for the Mackenzie project. “In those circumstances, those are commercial terms. There’s an investment [and] because of the risk, there’s a return to the taxpayer. I don’t see that as a subsidy.”
I would assume that Mr. Sulzenko is a reasonably smart fellow. If it wasn’t a subsidy, why is government investment even needed?
The bottom line is that in this higher risk, large capital investments, the private sector wants the public sector to investment to – drum roll please – lower their risk. Hence, a subsidy.
But let’s not get caught up in semantics.
If large scale investment in risky projects that the private sector won’t take on by itself is not considered a ‘subsidy’ by the federal government, I’m okay with that.
So, when Nova Scotia asks the Feds to invest $500 million to do very risky exploration of offshore oil & gas, I’m sure Mr. Sulzenko will oblige. After all, that’s not a subsidy, that’s an investment.
And of course don’t forget about the Technology Partnerships Canada program which made $3 billion in ‘investments’ into companies in mostly Quebec and Ontario.
Not subsidies, investments. Let’s just change the terms.
Fine. I want the Feds to ‘invest’ in economic development and help the province attract large scale, anchor companies.