The Perfect Storm, Part 3 - More bad stuff

Some Final Remarks on our Shite Situation

Alberta, if you believe the news, is now going through its worst recession since the Second World War. Our unemployment rate is not the highest in the nation, but it continues to rise while the insolvency rate goes up. Before I get to the things I see that give me hope, I need a last post to bitch and complain some more. Enjoy.

To review this recession was largely the result of two things: the fossil fuel industry going bust, and (piss)poor government policy.

Regarding the first, the collapse in world oil prices has hurt, but probably the worst thing to happen to us was our losing the USA as a customer thanks to fracking. In China we lost as a potential customer not because of Aboriginal people holding up the Northern Gateway (though it helped), but because international isolation forced Russia to sell itself out to them. The low oil prices might hurt greatest long term because they've made the Energy East pipeline irrelevant, or rather, a complete waste of money. In a laissez-faire economic system, the rest of Canada will simply buy what's better - and that isn't our oil, it's the better quality stuff from overseas.

There certainly is not much consideration, in the news, or even in more reputable places, about the effects any of these international events or their results have on the province. Years ago, prior to the recession, I asked a fairly well-connected fellow who worked downtown about the effect fracking in the USA would have on the Albertan economy. He simply replied that "the Americans wouldn't do that to us." I left the conversation at that and moved on, but I still wonder incredulously how he could have been ignorant that the USA was becoming self sufficient, but also that self-sufficiency in energy has been an American goal since Nixon was president. The Americans had only fought a pile of wars for oil. And then the Americans stopped buying it from us. Big surprise.

Thanks to our piss-poor media, there is no public discussion of the international events that shape the price and future of the oil industry. Its importance has been continuously betrayed by a negligence to actually report outside of a purely domestic lens what shapes the industry. This media "blackout" is all the more reckless, lazy and damaging once you consider there is probably no oil-producing territory on Earth more in tune with international events than the province of Alberta. Practically every single oil company is foreign owned at this point, and usually by national governments. Hell, the People's Republic of China was probably the single largest "private employer" in Alberta back in 2013; it probably still is. Therefore, the national policies of countries that own our resource should perhaps be granted the smallest importance. As just one example, Albertans should probably know that their largest employer is the world's leading investor in renewable energy; that should have people worried, I would think. Instread, tens of thousands of Albertans are so ignorant as to blame the NDP for what has happened to oil. They are no more responsible for what happened than the Liberal Party is for the oil strike in Turner Valley 100 years ago; probably less.

Albertans require a pretty broad understanding of international politics, new technology, and basic science (sorry Climate Change is real and all), but all these three are blatantly lacking. When the epitaph of the Albertan Oil industry is written, it will surely say that we blundered from one accident to the next. Hopefully we didn't piss it all away.

But of course there is also the problems caused by poor government policy. My God, there are simply so many I couldn't even fit half of them in the previous post.

Take the free-market philosophy that has guided Canada going back to the 1980s now. I feel bad telling students that the USA is more "market" than Canada, because in some cases we sure as hell beat them, usually to our detriment. The privatization of oil companies has to be a high ranking blunder. If it was such a good idea, why is it almost no other country on Earth even allows it? I do realize the Canadian oil industry is capital intensive; but so is Norway's, and it is a smaller country with less money than us; well, not anymore. Now Statoil owns a part of the oil sands, while Canada and Alberta sold off their shares years ago for now other reason than "public ownership is bad." Yet it's not private Canadian citizens who own the companies; it's foreign governments. Way to get colonized. Our oil companies were for many years the most profitable in Canada, and we taxed them a pittance (if we enforced it at all), and where did all the money go, exactly? It sure as hell didn't stay here.

I'm hardly a "nationalize everything" kind of guy, but there is a damn good reason countries don't let private interests own their oil supplies - it's too damn important. If you realize the Americans blew trillions of dollars (not mention probably killed over a million people) just to secure supplies in the Middle East, you'd think we'd have treated the world's single most strategic resource with a bit more respect and awe. Maybe the Americans would have spent more if we hadn't sold out to everyone so readily.

Anyway, I can't keep going on about the government's (Federal and provincial) ignorance and mismanagement of our resource. If you would like a good read (since you won't find it here), I recommend reading Jeff Rubin's "The Carbon Bubble." Yeah, he screwed up with peak oil (mostly), but he logically dismantles the former Prime Minister's "energy superpower" ambitions.

Thanks for reading.