The political economy of energy resource development and export is the biggest and most important issue to hit Canadian politics since the fight over Quebec secession and battle over free trade.
Now that Harper has his majority and passed the Omnibus Budget Bill to get unfinished business out of the way, he has taken on the huge and risky task of implementing his Conservative government’s agenda to create a national energy economy. He lost the battle over a national security commission when the Supreme Court of Canada ruled against him but he really did not present a very strong case to the Court. He likely feared winning hands down because it would have forced him to go up against the premiers of Alberta and Quebec, both of whom strongly opposed a national security commission.
To build a robust and effective national energy economy, Harper will be using Ottawa’s constitutional powers under section 91(2), the regulation of trade and commerce clause, and section 121, preventing the taxation of goods across provincial boarders. Under s. 121, British Columbia cannot tax the entrance of the heavy oil but it can, and probably will, impose an export tax on the heavy oil as it leaves the province at Kitimat for export to China and other Asian Markets.
Harper will also expend a great amount of political capital to achieve his goal. It is now becoming clearer that Harper and his government’s intimate connections within the oil and gas industry, and perhaps Ken Boessenkool who now advises Christy Clark, helped him convince the BC premier into making this sudden manoeuvre on the Enbridge Gateway Pipeline project through British Columbia.
Premier Clark’s Liberal (read conservative) government supports the pipeline. But for very good reasons her government wants and needs more money for B.C. citizens. The question is: who is going to cough up more cash? Alberta, Ottawa, the oil industry, or all three?
Clark readily admits that she has been in conversation with Harper over the pipeline issue. Why? Because Clark’s demand for more revenues for B.C. citizens just might help her Liberal Party get re-elected in May 2013, or perhaps this fall – that is if the polls turn quickly in her favour.
One can now reasonably argue that NDP leader Adrian Dix has been outflanked by Clark. Why? Because his overly ideological position of killing off the Enbridge Northern Gateway Pipeline will probably not get him the majority that he so badly needs to become Premier and stop the pipeline.
If, on the other hand, Dix does becomes Premier, one can rest assured that Harper will use the Constitution and enormous political pressure to force the NDP government to allow the pipeline to go through British Columbia. And a weakened Dix may not get as much revenue for B.C. as Clark might have achieved.
One must add that no government is yet talking openly about how to bring the B.C. Aboriginal organizations and communities onside. They are a potential deal breaker of any government and industry agreement. Getting their approval will be very costly. And who will pay? The provinces, Ottawa, or the oil industry? Most likely all three will have to find the cash to arrive at a settlement with the myriad of Aboriginal communities along the pipeline route.
We must keep in mind that a parallel fight is going on between Quebec and Newfoundland/Labrador on another very important energy issue. The latter province, which now reaps benefits from off-shore oil production, wants the right to transmit huge amounts of lucrative Lower Churchill Falls hydraulic power through Quebec to U.S. and Ontario markets.
Until now Premier Charest and his Liberal government have said no to Newfoundland and Labrador. The Charest government will experience strong pressures from the Harper government – that is if Charest’s Liberal Party is re-elected to office this fall – to agree to allow the transmission of Lower Churchill Falls energy through Quebec at a mutually acceptable price. Who builds and maintains the hydro lines? Quebec will do so of course. Newfoundland simply pays an agreed upon transmission cost. This is what is being negotiated.
This is why Harper has visited Mulroney and Charest several times and will do so again and again in order to ensure that the PQ does not take over the province again.
If Charest only gets a minority in the upcoming election he will be pressured into accepting an informal arrangement with François Legault’s Coalition pour l’Avenir du Québéc. Both Harper and Charest will do almost anything to prevent the PQ from taking power and moving forward with a third very disruptive referendum of the secession of Quebec from the federation.
What happens between the Alberta, B.C., and federal governments, not to mention the Aboriginal communities, just might help set an important precedent for Quebec and Newfoundland’s negotiations on Lower Churchill Falls hydro energy.
These are just a few thoughts on Prime Minister Harper’s biggest gambit to date, the creation of a long overdue national energy economy. Every government since John Diefenbaker’s western-based government has failed. If Harper manages to achieve this well worthwhile goal, it will keep the Conservative Party in power for a long time. If Harper mismanages his high-risk gambit he and his government could be defeated by 2019, if not before in 2015.
Original Article
Source: ipolitics
Author: Michael Behiels
Now that Harper has his majority and passed the Omnibus Budget Bill to get unfinished business out of the way, he has taken on the huge and risky task of implementing his Conservative government’s agenda to create a national energy economy. He lost the battle over a national security commission when the Supreme Court of Canada ruled against him but he really did not present a very strong case to the Court. He likely feared winning hands down because it would have forced him to go up against the premiers of Alberta and Quebec, both of whom strongly opposed a national security commission.
To build a robust and effective national energy economy, Harper will be using Ottawa’s constitutional powers under section 91(2), the regulation of trade and commerce clause, and section 121, preventing the taxation of goods across provincial boarders. Under s. 121, British Columbia cannot tax the entrance of the heavy oil but it can, and probably will, impose an export tax on the heavy oil as it leaves the province at Kitimat for export to China and other Asian Markets.
Harper will also expend a great amount of political capital to achieve his goal. It is now becoming clearer that Harper and his government’s intimate connections within the oil and gas industry, and perhaps Ken Boessenkool who now advises Christy Clark, helped him convince the BC premier into making this sudden manoeuvre on the Enbridge Gateway Pipeline project through British Columbia.
Premier Clark’s Liberal (read conservative) government supports the pipeline. But for very good reasons her government wants and needs more money for B.C. citizens. The question is: who is going to cough up more cash? Alberta, Ottawa, the oil industry, or all three?
Clark readily admits that she has been in conversation with Harper over the pipeline issue. Why? Because Clark’s demand for more revenues for B.C. citizens just might help her Liberal Party get re-elected in May 2013, or perhaps this fall – that is if the polls turn quickly in her favour.
One can now reasonably argue that NDP leader Adrian Dix has been outflanked by Clark. Why? Because his overly ideological position of killing off the Enbridge Northern Gateway Pipeline will probably not get him the majority that he so badly needs to become Premier and stop the pipeline.
If, on the other hand, Dix does becomes Premier, one can rest assured that Harper will use the Constitution and enormous political pressure to force the NDP government to allow the pipeline to go through British Columbia. And a weakened Dix may not get as much revenue for B.C. as Clark might have achieved.
One must add that no government is yet talking openly about how to bring the B.C. Aboriginal organizations and communities onside. They are a potential deal breaker of any government and industry agreement. Getting their approval will be very costly. And who will pay? The provinces, Ottawa, or the oil industry? Most likely all three will have to find the cash to arrive at a settlement with the myriad of Aboriginal communities along the pipeline route.
We must keep in mind that a parallel fight is going on between Quebec and Newfoundland/Labrador on another very important energy issue. The latter province, which now reaps benefits from off-shore oil production, wants the right to transmit huge amounts of lucrative Lower Churchill Falls hydraulic power through Quebec to U.S. and Ontario markets.
Until now Premier Charest and his Liberal government have said no to Newfoundland and Labrador. The Charest government will experience strong pressures from the Harper government – that is if Charest’s Liberal Party is re-elected to office this fall – to agree to allow the transmission of Lower Churchill Falls energy through Quebec at a mutually acceptable price. Who builds and maintains the hydro lines? Quebec will do so of course. Newfoundland simply pays an agreed upon transmission cost. This is what is being negotiated.
This is why Harper has visited Mulroney and Charest several times and will do so again and again in order to ensure that the PQ does not take over the province again.
If Charest only gets a minority in the upcoming election he will be pressured into accepting an informal arrangement with François Legault’s Coalition pour l’Avenir du Québéc. Both Harper and Charest will do almost anything to prevent the PQ from taking power and moving forward with a third very disruptive referendum of the secession of Quebec from the federation.
What happens between the Alberta, B.C., and federal governments, not to mention the Aboriginal communities, just might help set an important precedent for Quebec and Newfoundland’s negotiations on Lower Churchill Falls hydro energy.
These are just a few thoughts on Prime Minister Harper’s biggest gambit to date, the creation of a long overdue national energy economy. Every government since John Diefenbaker’s western-based government has failed. If Harper manages to achieve this well worthwhile goal, it will keep the Conservative Party in power for a long time. If Harper mismanages his high-risk gambit he and his government could be defeated by 2019, if not before in 2015.
Original Article
Source: ipolitics
Author: Michael Behiels
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