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Canada exports jobs along with its oil

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Canada is an emerging energy superpower that's the most attractive investment opportunity in the world, Prime Minister Stephen Harper told a London business audience in July 2006.

Today, Canada's dependence on Middle Eastern oil is growing. It is now as large, proportionately, as the Americans' dependence.

Canada not only has no plan to guarantee Canadian oil for Canadians first, its foreign-controlled oil industry intends to spend billions on two giant pipelines carrying millions of barrels of Canadian oil daily to the U.S. Gulf Coast and China.

Canada is also the only country in the 27-member International Energy Agency without strategic petroleum reserves and the only one with no plan to deal with a sudden international oil crisis, "even though one is almost certain to hit soon," says University of Alberta political economist Gordon Laxer.

"Just think about Iran closing the Straits of Hormuz after a U.S. attack," continues Laxer, the founding director and former head of the university's Parkland Institute. "Forty per cent of ocean-bound oil shut in at one blow. Canadians, who face special conditions of long, cold winters, would be immediately impacted. Some could even freeze in the dark...

"If Canada is looking after U.S. oil security and the U.S. is looking after its own oil security, who is looking after Canadians?" Laxer asks.

The IEA requires all of its members to have strategic oil reserves to deal with crises and shortages. Exporters are exempt, because the agency presumes they put their own citizens first. Norway, like Canada, one of the few exporting IEA members, has a strategic reserve. Canada does not.

"Despite its oil abundance, Canada is the most insecure IEA member," Laxer says. "Atlantic Canada imports over 80 per cent of its supply. It may make sense for big corporate oil, but it doesn't make sense for Atlantic Canadians... Ambulances, hospitals and fire trucks don't work without oil. Nor do people who heat their homes with oil, as half of Atlantic Canadians do."

On Jan. 16, CBC-TV anchor Peter Mansbridge asked Harper: "Does it not seem odd that we're moving oil out of Western Canada to either U.S. or... Asia when a good chunk of Canada doesn't have domestic oil?"

Harper replied that "on a certain level, it does seem odd" but "the fundamental basis of our energy policy is market-driven... we're the only supplier that's secure."

Secure for whom? Laxer wonders. Harper is abdicating his responsibilities as prime minister and "talks as if he is the CEO of an oil transnational," he warns. "(His) shirking of responsibility recklessly plays with Canadians' economic and even physical security."

Nor is Harper the only prime minister to put the interests of multinational oil companies and the global market ahead of Canadians. Every prime minister since Brian Mulroney, including Liberals Jean Chrétien and Paul Martin, has bought into the twin pillars of globalization and neo-liberalism.

Globalization and neo-liberalism, Milton Friedman's and Friedrich Hayek's economic theory as implemented in the 1980s by Margaret Thatcher and Ronald Reagan, replaced Keynesianism, the dominant economic theory arising from the Great Depression and the Second World War.

Keynes assumed that spending in predominantly national economies was good. Put purchasing power in the hands of citizens and their spending will stimulate the national economy. Better to ensure the poor rather than the rich have money because they will spend it.

Neo-liberals disagree. Their economic problem is not enough investment, Laxer says

"Put money in the hands of the rich and they will save and invest it -- that's why the one per cent have so much more of the pie these days. Don't redistribute money to the poor because they will spend it, not save and invest. Investment will promote growth."

This theory, now driving the policies of virtually all governments, is why inequality is rising so dramatically, Laxer says. "One problem is that higher profits do not necessarily lead to effective investment. They can and do lead to stupid, speculative endeavours like currency trading, derivatives, futures markets, assset-backed paper, etc."

The reason the New Right favours international trade or a pipeline to another country over stimulating employment at home is they care about profits, not jobs, Laxer continues. In fact, jobs may have to be sacrificed to squeeze out more profits.

"The New Right has to pretend they care about creating jobs, but they don't. Their aim is to raise profit levels because they identify with investors, not workers... There is no democracy and little citizen pressure above the level of countries. Corporations can raise profits at the global level because they can play one set of immobile nationally-bound workers off against another set and drive down wages and benefits."

Frances Russell is a Winnipeg

author and political commentator.

Republished from the Winnipeg Free Press print edition January 25, 2012 A10

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