Economy
A Fair Deal Includes Energy Security
This article contributed by Josh Andrus, Executive Director of Project Confederation
Energy security.
It’s a concept that has been ignored by many – including our federal government in Ottawa – for far too long.
Russia’s invasion of Ukraine has suddenly helped the world realize what’s been obvious to many Albertans for a long time – we still need oil and gas!
The same parade of politicians who crusaded to save the world from the threat of “catastrophic” climate change are now coming to the realization that there is a fundamental flaw in the Green New Deal / Leave It In The Ground / Build Back Better strategy.
Energy is the industry that powers every other industry – and as such, a safe supply of affordable, reliable energy is not only good for the domestic economy but also a crucial tool in an increasingly volatile international geopolitical landscape.
Earlier this week, after a big push by our friends at the Alberta Institute, and many other political and non-profit groups, the federal government finally announced that they would ban the importation of Russian oil.
Russia’s aggressive actions, and the related uncertainty, have now driven the price of crude oil over the $115/bbl benchmark.
[Editor’s note: we had to increase that price four times while writing this piece!]
Thankfully, Alberta has a large supply of energy resources, resources that could displace the loss of Russian imports and help keep energy affordable for Canadians.
Of course, it would have been better if our calls had been listened to years ago, and we had the infrastructure in place already!
But, as the saying goes:
The best time to build a pipeline was 20 years ago.
The second-best time is now!
If our politicians had any sense, Keystone XL and Energy East would have been given emergency approval the moment war broke out.
Yet, here we are, a week into a European war, and there’s been nary a whisper from the White House or Rideau Cottage.
If Alberta can’t convince Canada to build a pipeline in the middle of a war in Europe, we’ll surely never get one.
To make matters worse, the pipeline issues aren’t even the only possible problem on the horizon.
In past years, $100+ oil was good for Alberta.
Economic growth explodes, jobs are plentiful, and the pay is phenomenal.
Some of that will surely happen in the coming months, but with this current boom coinciding with major inflationary pressures, there are risks for Alberta too.
High energy prices and the ensuing increase in the cost of living will hurt the rest of the country.
The Rest of Canada will complain that Alberta has it so good, while they struggle to pay their hydro bills.
Will the Rest of Canada decide to start extracting their own plentiful natural resources, currently kept in the ground for nonsensical environmental concerns?
Of course not.
Ottawa will, undoubtedly, devise yet another means of wealth redistribution instead.
Once again, they’ll figure out a way to make Alberta pay for their poor policy choices.
They probably won’t have the gall to call it a “National Energy Program”.
But they might.
Remember, the major issues driving Western alienation are structural deficiencies in Confederation, deficiencies that have only gotten worse in recent decades, not better.
The West is underrepresented in Parliament, the Senate is unelected and ineffective at protecting Provincial rights, the very concept of fairness is undermined in our Constitution via equalization, and the Supreme Court screws the West and protects the rest.
At Project Confederation, our mission is clear:
To build a movement that will reform Confederation and achieve a fairer deal, in whatever legal configuration that may require.
I suspect we’re going to have a lot of work to do in the coming months!
If you’d like to help us with that work, please reach out to us to get involved, or consider making a donation to help fund our efforts.
Regards,
Josh Andrus
Executive Director
Project Confederation
Economy
Ottawa’s new ‘climate disclosures’ another investment killer
From the Fraser Institute
By Matthew Lau
The Trudeau government has demonstrated consistently that its policies—including higher capital gains taxes and a hostile regulatory environment—are entirely at odds with what investors want to see. Corporate head offices are fleeing Canada and business investment has declined significantly since the Trudeau Liberals came to power.
According to the Trudeau government’s emissions reduction plan, “putting a price on pollution is widely recognized as the most efficient means to reduce greenhouse gas emissions.” Fair enough, but a reasonable person might wonder why the same politicians who insist a price mechanism (i.e. carbon tax) is the most efficient policy recently announced relatively inefficient measures such “sustainable investment guidelines” and “mandatory climate disclosures” for large private companies.
The government claims that imposing mandatory climate disclosures will “attract more private capital into Canada’s largest corporations and ensure Canadian businesses can continue to effectively compete as the world races towards net-zero.” That is nonsense. How would politicians Ottawa know better than business owners about how their businesses should attract capital? If making climate disclosures were a good way to help businesses attract capital, the businesses that want to attract capital would make such disclosures voluntarily. There would be no need for a government mandate.
The government has not yet launched the regulatory process for the climate disclosures, so we don’t know exactly how onerous it will be, but one thing is for sure—the disclosures will be expensive and unnecessary, imposing useless costs onto businesses and investors without any measurable benefit, further discouraging investment in Canada. Again, if the disclosures were useful and worthwhile to investors, businesses seeking to attract investment would make them voluntarily.
Even the government’s own announcement casts doubt that increasing business investment is the likely outcome of mandatory climate disclosures. While the government says it’s “sending a clear signal to corporate boards and shareholders, at home and around the world, that Canada is their trusted partner for putting private capital to work in the race to net-zero,” most investors are not looking to put private capital to work to combat climate change. Most investors want to put their capital to work to earn a good financial return, after adjusting for the risk of the investment.
This latest announcement should come as no surprise. The Trudeau government has demonstrated consistently that its policies—including higher capital gains taxes and a hostile regulatory environment—are entirely at odds with what investors want to see. Corporate head offices are fleeing Canada and business investment has declined significantly since the Trudeau Liberals came to power. Capital per worker in Canada is declining due to weak business investment since 2015, and new capital per-Canadian worker in 2024 is barely half of what it is in the United States.
It’s also fair to ask, in the face of these onerous polices—where are the environmental benefits? The government says its climate disclosures are needed for Canada to progress to net-zero emissions and “uphold the Paris climate target of limiting global warming to 1.5°C above pre-industrial levels,” but its net-zero targets are neither feasible nor realistic and the economics literature does not support the 1.5 degrees target.
Finally, when announcing the new climate disclosures, Trudeau Environment Minister Steven Guilbeault said they are an important stepping stone to a cleaner economy, which is a “major economic opportunity.” Yet even the Canada Energy Regulator (a federal agency) projects net-zero policies would reduce real GDP per capita, increase inflation of consumer prices and reduce residential space (in other words, reduce living standards).
A major economic opportunity that will increase business investment? Surely not—mandatory climate disclosures will only further reduce our standard of living and impose useless costs onto business and investors, with the sure effect of reducing investment.
Author:
Business
Premiers fight to lower gas taxes as Trudeau hikes pump costs
From the Canadian Taxpayers Federation
By Jay Goldberg
Thirty-nine hundred dollars – that’s how much the typical two-car Ontario family is spending on gas taxes at the pump this year.
You read that right. That’s not the overall fuel bill. That’s just taxes.
Prime Minister Justin Trudeau keeps increasing your gas bill, while Premier Doug Ford is lowering it.
Ford’s latest gas tax cut extension is music to taxpayers’ ears. Ford’s 6.4 cent per litre gas tax cut, temporarily introduced in July 2022, is here to stay until at least next June.
Because of the cut, a two-car family has saved more than $1,000 so far. And that’s welcome news for Ontario taxpayers, because Trudeau is planning yet another carbon tax hike next April.
Trudeau has raised the overall tax burden at the pumps every April for the past five years. Next spring, he plans to raise gas taxes by another three cents per litre, bringing the overall gas tax burden for Ontarians to almost 60 cents per litre.
While Trudeau keeps hiking costs for taxpayers at the pumps, premiers of all stripes have been stepping up to the plate to blunt the impact of his punitive carbon tax.
Obviously, Ford has stepped up to the plate and has lowered gas taxes. But he’s not alone.
In Manitoba, NDP Premier Wab Kinew fully suspended the province’s 14 cent per litre gas tax for a year. And in Newfoundland, Liberal Premier Andrew Furey cut the gas tax by 8.05 cents per litre for nearly two-and-a-half years.
It’s a tale of two approaches: the Trudeau government keeps making life more expensive at the pumps, while premiers of all stripes are fighting to get costs down.
Families still have to get to work, get the kids to school and make it to hockey practice. And they can’t afford increasingly high gas taxes. Common sense premiers seem to get it, while Ottawa has its head in the clouds.
When Ford announced his gas tax cut extension, he took aim at the Liberal carbon tax mandated by the Trudeau government in Ottawa.
Ford noted the carbon tax is set to rise to 20.9 cents per litre next April, “bumping up the cost of everything once again and it’s absolutely ridiculous.”
“Our government will always fight against it,” Ford said.
But there’s some good news for taxpayers: reprieve may be on the horizon.
Federal Conservative leader Pierre Poilievre’s promises to axe the carbon tax as soon as he takes office.
With a federal election scheduled for next fall, the federal carbon tax’s days may very well be numbered.
Scrapping the carbon tax would make a huge difference in the lives of everyday Canadians.
Right now, the carbon tax costs 17.6 cents per litre. For a family filling up two cars once a week, that’s nearly $24 a week in carbon taxes at the pump.
Scrapping the carbon tax could save families more than $1,200 a year at the pumps. Plus, there would be savings on the cost of home heating, food, and virtually everything else.
While the Trudeau government likes to argue that the carbon tax rebates make up for all these additional costs, the Parliamentary Budget Officer says it’s not so.
The PBO has shown that the typical Ontario family will lose nearly $400 this year due to the carbon tax, even after the rebates.
That’s why premiers like Ford, Kinew and Furey have stepped up to the plate.
Canadians pay far too much at the pumps in taxes. While Trudeau hikes the carbon tax year after year, provincial leaders like Ford are keeping costs down and delivering meaningful relief for struggling families.
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