I was scanning through news articles the other day, trying to make sense of the apparent insanity of governance in jurisdictions that rely on petroleum products for employment and royalties. A quote, which I have been unable to find since, caught my eye. It referred to the dangers brought about by men who seek to profit by reaping that which they do not sow.
With the B.C. government’s headlong jump into promoting of hydraulic fracturing, or fracking, to recover gas and oil in northern B.C., I couldn’t help but wonder if the province is about to be become yet another petro-state, one that becomes so closely tied to the petroleum industry that lines between business and politics blur. Citizens become so reliant on the high-paying jobs (petroleum is the highest paying industry in the world, apparently) and governments become so dependent on the taxes that it becomes almost unthinkable that anyone might even point out the inherent dangers.
The rest of the world has watched in awe as Alberta throws precious water resources into the oilsands development, endangering the environment and the province’s very future, all in an effort to mine sludge so thick that it has to have compounds added before it will flow through a pipeline. And now, with growing concerns about what fracking does not only to the enormous amounts of water it requires, but to the stability of the geology not far below ground, B.C. is about to go down a similar path.
The promise of riches is being used to sell the idea, but it has been set up by a mantra that has been used by conservative politicians for three decades: “You pay too much in taxes.” They have driven down tax rates, especially for high earners and corporations, and then thrown up their hands in despair at their self-imposed inability to provide services demanded by constituents who don’t funnel huge sums of money into their campaign funds. Christy Clark might be the most invisible premier in recent history, but it isn’t hard to recall her saying that her government will only be able to “invest” in things like education, the environment and social programs as it “grows the economy.” So if we don’t like the idea of causing untold damage that this type of petroleum development creates, it means we don’t want to send our kids to better schools or breathe cleaner air or look after our more unfortunate neighbours.
There is a cautionary tale, or many, actually, to be found in Alberta, which has had the same government for more than 40 years, a conservative government that replaced another conservative government after a similarly lengthy, and unhealthy, period in power. Imagine, if you can, a province re-electing a government that in a booming economy can’t even balance a budget. It boasts, as it always has, about its commitment to having no sales tax, and its low personal and corporate tax rates. It can find money to build highways and hockey arenas, but really has nothing world class to boast about when it comes to things like education, health care or social services. Savings for the future are negligible, certainly if compared to Norway, a rare petro-state that actually doesn’t give away its resources and also doesn’t fritter away its share.
The problem with petro-states is that they tend to operate on the assumption that economic benefits should only accrue to those who are around when resource is exploited. There is an odd assumption that future generations aren’t entitled to benefit, either financially from a share of the resource sales, or from a healthier environment that might come from a slower, more thoughtful development plan.
It was, ironically, Peter Lougheed that came up with the latter scheme several years before he died. The same Peter Lougheed who led the Progressive Conservatives to power more than four decades ago.
It was an idea doomed to failure. How to tell a large portion of your population that you are going to slow down development and endanger their lucrative jobs? How to walk away from large chunks of easy money that rolls in, even from royalties and taxes that are too low? How to tell global corporations who pour money into your campaign coffers that their investments and profits are going to be limited? And how to make a decision that might affect your own political longevity, your own shot to fly around the world in mostly empty planes, the perk that caused the downfall of Allison Redford? I used to joke with Albertans who defended Ralph Klein’s massive incompetence. “You do know that Ralph didn’t actually put that oil into the ground?” I often asked.
We are headed down a slippery slope when we buy into the promise of petroleum riches, one that you and I are unlikely to get much benefit from. But by doing so we will create a much dimmer future for those who follow.
Lorne Eckersley is the publisher of the Creston Valley Advance.