On Keystone, Trudeau Folds While Kenney Fights

In the wake of President Joe Biden's executive order killing the Keystone XL pipeline extension, Canadian prime minister Justin Trudeau issue a statement saying that he was "disappointed but acknowledge[s] the President’s decision to fulfil his election campaign promise on Keystone XL.” Which is to say, he folded.

Alberta Premier Jason Kenney, meanwhile, is going on offense, and he's trying to provoke the Prime Minister into following his lead. Kenney has been making the rounds on American television, pointing out that the U.S. and Canada have "the biggest bi-lateral trade relationship in world history," and that "the biggest part of that trade is Canadian energy exports." He continues,

We ship about, nearly $100 billion worth of energy to the U.S. every year. Keystone XL would have been a significant safe, modern increase in that shipment. It is very frustrating that one of the first acts of the new President was, I think, to disrespect America’s closest friend and ally, Canada. And to kill good-paying union jobs on both sides of the border and ultimately to make the United States more dependent on foreign oil imports from OPEC dictatorships. We don't understand it.

Kenney's been hammering away at the official account of this cancelation so that the shapers of Canadian opinion like the CBC can't just settle on a win some/lost some narrative, and then go back to cheering on Biden for not being Trump. For instance, here's Kenney at a press conference after Biden's E. O. was signed:

Let's be clear about what happened today: The leader of our closest ally retroactively vetoed approval for a pipeline that already exists, and which is co-owned by a Canadian government [the province of Alberta], directly attacking by far the largest part of the Canada-U.S. trade relationship, which is our energy industry and exports. The portion of the Keystone XL pipeline that crosses the Canada-U.S. border between Montana and Saskatchewan was installed last summer. It was built following a decade of rigorous environmental analysis and approval.... This decision was made without even giving Canada the opportunity respectfully to make the case for how Keystone XL would strengthen U.S. nation and energy security, how it would bolster both economies, and how our two countries could find a path together on climate and environmental policy.... That's not how you treat a friend and an ally.

Most pointedly, he's called out Trudeau's handling of the whole affair, and couching it not in the language of lazy partisanship we're so familiar with, but in the language of patriotism and duty. He's challenged the PM to do his job and fight for Canada. For an example. this letter Kenney wrote to Trudeau:

By retroactively revoking the permit for this project without taking the time to discuss it with their longest standing ally, the United States is setting a deeply disturbing precedent for any future projects and collaboration between our two nations. The fact that it was a campaign promise makes it no less offensive. Our country has never surrendered our vital economic interests because a foreign government campaigned against them....

We must find a path to a reconsideration of Keystone XL within the context of a broader North American energy and climate agreement.... Should that not happen, the federal government must do more than express disappointment with the decision.... I strongly urge you to ensure that there are proportionate economic consequences in response to these unfair U.S. actions.

Kenney's appeals to Trudeau's patriotism are admirable, but unlikely to hit home. Justin is, ultimately, a post-national man, and so loath to come to blows with the new, respectable Leader of the Free world. He would, no doubt, prefer the economic boost of the pipeline as a boon to his own reputation but not having to make a tough decision which could alienate either Canadian voters or the environmentalist left might be good enough for him. It's certainly in character.

If At First You Don't Secede... Wexit

The idea of secession seems almost inevitably to surface in times of national turmoil, political disarray, ideological and ethnic pillarization and economic resentment. In the wake of the Great Fraud, aka the 2020 American election, there is a whiff of secession in the air.

Rush Limbaugh worries that America is “trending toward secession.” Texas GOP chairman Alan West suggested that law-abiding states should “bond together and form a union of states that will abide by the constitution.” Though he asserted “I never say anything about secession,” the implication was certainly present. Texit is in the wind. Rep. Kyle Biedermann (R-Fredericksburg) said “I am committing to file legislation this session that will allow a referendum to give Texans a vote for the State of Texas to reassert its status as an independent nation.”

Canada has undergone two secession movements originating in the province of Quebec, based on a founding schism between two distinct peoples—which novelist Hugh MacLennan called the “two solitudes” in his book of  that title—culminating in a clash between two legal traditions, Quebec’s Napoleonic civil code and the ROC’s (rest of Canada) common law, and two languages, French and English.

Two referenda were held, in 1980 and 1995, the second defeated by the narrowest of margins, 50.58 percent to 49.42 percent. It is hard to say if separation would have been a “good thing,” whether Quebec would have prospered and Canada grown more coherent. I would hazard that the first prospect would have been enormously improbable, the second at least remotely possible.

Sunrise in Calgary? Or sundown?

The independence movement is alive today, but in another province. Alberta, which is Canada’s energy breadbasket, has suffered egregiously under the rule of Eastern Canada’s Laurentian Elite, beginning in modern times with Prime Minister Pierre Trudeau’s low-pricing, high taxing National Energy Program (NEP) in 1980, which devastated Alberta’s oil industry.

According to the BOE report, “Economic disaster quickly followed. Alberta’s unemployment rate shot from 4% to more than 10%. Bankruptcies soared 150%.” Home values collapsed by 40 percent and the province plunged into debt. The debacle has climaxed with son Justin’s Green-inspired economic destruction and effective shutdown of the province’s energy sector. Unemployment has risen to more than 11 percent, thousands of residents are leaving the province, debt is soaring and cutbacks have severely impacted daily life.

As a result, a potent secession movement, known as "Wexit," has gathered momentum and solidified into a new political party. In addition, the Wildrose Independence Party of Alberta registered as a political party on June 29. Its platform includes asserting the independence of the province, redefining the relationship with Canada, developing natural resources, and creating a Constitution of Alberta.

After having increased the job-killing carbon tax during—of all times!—the COVID pandemic and lockdown that had already pulverized the nation’s economy, prime minister Justin Trudeau has announced he will raise the tax almost sixfold to $170 per tonne by 2030, thus breaking the Liberal government’s promise “not to increase the (carbon) price post-2022.” According to the Toronto Sun, “That will increase the cost of gasoline by about 38 cents per litre, plus the cost of home heating fuels such as natural gas and oil.”

And according to Kris Sims at the Sun, “Based on the average annual use of natural gas in new Canadian homes, it would cost homeowners more than $885 extra in the carbon tax.” Filling up a light duty pickup truck will cost a surplus $45 per tank, and an extra $204 for the big rigs that deliver dry goods and comestibles. But that “won’t be the end of the increased cost the Canadians will face, starting with a $15 billion government investment in other climate change initiatives.” 

All Canadians will be hard hit, but Albertans, who once fueled the engine of Canadian prosperity and who have the resources to do so again, will feel the provocation and injury even more profoundly. As Rex Murphy writes in the National Post, it is “the province that carries most of the weight, bears the most pain and has the least say in this mad enterprise.” The tax, he continues, will “injure the very farmers who have been stocking the supermarket shelves during COVID, put oil workers (at least those who still have jobs) out of work, increase the cost of living for everyone, place additional strain on the most needy and antagonize a large swath of the Canadian public.”  

Kyle Biedermann is on the money when he says that “The federal government is out of control.” This is as true of Canada as it is of the United States, at least with respect to the major agencies of government. For this reason, I support the secession movement in Alberta. The province has no alternative if it is to survive a faltering and repressive Confederation saddled with an out-and-out Marxist prime minister, a de facto alliance with Communist China, an infatuation with an unworkable and unaffordable tax-subsidized Green technological program, a $400 billion deficit, a national debt exploding past the $1 trillion mark, and, in short, nameplate disasters like Trudeau’s A Healthy Environment and a Healthy Economy cabaret. 

Alberta’s survival depends on restoring its energy sector to full capacity and shucking off the federal burden of over-regulation, crushing taxation, Green fantasy-thinking and unpayable debt. Murphy again:

This new carbon tax will throw a spike in the heart of the oil and gas industry. Keep in mind that it is but the most recent in a long string of policies designed to hamstring the industry, block its exports and drive investment out of the province.

For Alberta, it’s leave or die. Other provinces may eventually have to follow the same route as Canada disintegrates under the brazen incompetence and global-socialist doctrines of the current administration, with no relief in sight.

As oil executive Joan Sammon writes, Inexpensive energy is imperative for a thriving economy, manufacturing excellence, economic mobility, job creation and a future of prosperity.” Clearly, there must be citizen pushback against the economy-killing decrees of a myopic and virtue-signaling government. People must put pressure on their elected representatives to resist the deliberate dismantling of the free market that will cost them the life of material abundance and comfort they take for granted. They must rid themselves of their infatuation with leftist memes, policies and hypocrisies.

I have a neighbor, a staunch adherent of our high-taxing, socialist administrations, who drives across the border to the U.S. to fill up her car at around one third the domestic price of fuel. She remains oblivious of the cognitive dissonance that governs her practice. Such thinking and behavior are what qualify as ultimately “unsustainable.” 

It's now or never.

The industry, too, Sammon writes, “needs to take back control from the preaching class and remind them that their lifestyles have been brought to them by the men and woman of the oil and gas industry.” The “green zealotry” that drives their anti-market efforts will destroy Alberta and lead eventually to the economic collapse of the entire country. Alberta, however, is at present the only province with a robust secession movement and, given its resource-rich milieu and the independent character of a large segment of its inhabitants, the only province in a position to save itself.

In any event, the message to Alberta is simple and straightforward. If at first you don’t secede, try and try again. The Overton Window is closing fast.

As Canada Goes Green, Canada Goes Broke

It’s no longer news that the Liberal government of Canada under Justin Trudeau and his “social justice” cronies Gerald Butts and Chrystia Freeland have pulled out the stops in an effort to destroy the major source of Canada’s energy sector, the oil-gas-pipeline industry in the province of Alberta.

The oil sands have effectively become a dead letter. Every pipeline project has been quashed and energy companies have decamped for sunnier climes. The decline in Alberta’s GDP is pegged at 11.3 per cent. Unemployment and under-employment are rampant. The Alberta secession movement has acquired momentum and a political party, Wexit Canada, rebadged as the Maverick Party, has been formed—although the province’s Conservative premier Jason Kenney remains a staunch federalist and majority sentiment remains “loyalist.”

What Canadians do not seem to understand is that as Alberta goes, so goes Canada. For more than 50 years Alberta, Canada’s energy producing breadbasket, has been a major net contributor to the rest of the nation via the Equalization Formula in which “have” provinces subsidize their “have not” counterparts.

As Canada under the Liberal administration has now become a heavily indebted “have not” country, Alberta was its last remaining mainstay—until Alberta itself imploded thanks to the energy crushing policies of the federal government. It is now a “have not” province. 

Indeed, as Canada goes Green, Canada goes broke, forcing it to increase its debt load and enact burdensome domestic programs that will impoverish its citizens and devastate the productive classes. At a steadily approaching inflexion point, Canada will face the spectre of default—a time-honored South American prospect.

In an article for the National Post, former Conservative leadership candidate Leslyn Lewis shows why she would have been a far better choice for the Conservative nomination than the waffly, Andrew Scheer-like Erin O’Toole. Lewis reveals how the new creeping socialism operates, confiscating not our property but our wealth via various levies like a home equity tax, a ubiquitous carbon tax, a new tax on the private sale of homes costing home owners a portion of their retirement savings, and a “perpetual debt scheme reminiscent of Argentina.”

What is taking place, she warns, is “a quiet and bloodless revolution that seeks to control our lives through economic dependency.” Conrad Black believes “the government… has lost its mind”—though more likely it is acting quite deliberately, in full knowledge and intent, cleverly pursuing a soft totalitarian agenda. Meanwhile, most Canadians linger in a condition of blissful oblivion as the country they believe is theirs and continue to be proud of is being insidiously stolen from them before their very eyes.

Regardless, Canadians on the whole believe in big government and continue to vote left, ensuring that Trudeau’s Liberals and the New Democratic Party (NDP) helmed by Jagmeet Singh will likely retain control of parliamentary business and national policy. A recent Angus Reid poll indicates that nearly 60 percent of Canadian women would vote today for either the Liberals or the NDP under these two leaders. Such are the wages of feminism.

Ontario, Quebec and the Maritime provinces—aka the “Laurentian Elite”—trend massively socialist, as do the major conurbations like Halifax, Montreal, Toronto and Vancouver. There can be no doubt that socialism is the name of the game. Trudeau has boasted that China’s “basic dictatorship” is his favorite political system and, as Spencer Fernando writes, is far too week to stand up to Chinese Communist pressure.

Trudeau, we recall, lamented the passing of Cuban dictator Fidel Castro, “join[ing] the people of Cuba in mourning the loss of this remarkable leader.” Similarly, Jagmeet Singh had this to say: “He saw a country wracked by poverty, illiteracy & disease. So he lead [sic] a revolution that uplifted the lives of millions. RIP #Fidel Castro.

Trudeau’s approval rating has taken a hit of late but carrots count in moving the dray electorate forward. A new Angus Reid poll indicates where his strength lies province by province. Many Canadians are happy to allow the government to borrow hundreds of millions to subsidize their idleness with a monetary COVID response package, dubbed CERB (Canada Emergency Response Benefit), recently increased by 20 percent, rendering it difficult for many entrepreneurs and businesses to hire service personnel who relish living off the government dole.

Nevertheless, despite his many false promises, numerous scandals, proroguing of parliament for several months on the pretext of mitigating COVID, fiscal incontinence, 600 million dollar media bribe (sugar-coated as a “bailout”), and overall economic witlessness (“the budget will balance itself”), Trudeau’s carrots to select beneficiaries enable him to retain a considerable voting constituency and markedly improve his chances of re-election.

Indeed, The Liberal Party can count on an ample war chest. A recent special report here at The Pipeline demonstrated that, of the top ten third-party spenders that influenced the previous election, eight of them were leftist groups, outspending their rivals on the right by a factor of over 15 to 1. The CBC poll tracker indicates that the Conservatives are currently trailing the Liberals by 5 percentage points but, as the propaganda arm of the Liberals and favorite son Trudeau, its results should be met with a degree of skepticism.

Nonetheless, the Conservatives are likely no match for the combined electoral clout of the Left in this country. The cash-strapped, media bête noire, the People’s Party of Canada, is the best option for Canada’s (and Alberta’s) future, but it may not garner a single parliamentary seat—as was the case in the last election. This is to be expected. The Liberals may form a minority government once again, but with the NDP hitching a ride it would in any case be tantamount to a majority. Canada’s premier columnist Rex Murphy speculates, with considerable evidence, that Trudeau and Singh have formed “a (silent) concordat.”

Alberta had better get its act together before the Overton window closes. Alea iacta est.

In Canada, Between a Sponge and a Soft Place

Ottawa’s orchestrated vendetta against Canada’s energy sector, located primarily in the province of Alberta, is an instance of sublime indifference to the laws of physics, the math behind energy realities, Canadian living standards and the national welfare. It is part and parcel of the campaign to bring Canada in line with the U.N.’s anti-capitalist, globalist wealth-transfer program advantaging the Third World—in actual fact, benefiting only the ruling class of these nations.

And it is, of course, a scheme for enriching investors and "green" industrialists for whom the Green Technology adventure has become a government-fed cash cow, abetted by public gullibility and self-righteousness. Conservative Alberta is now at risk of bankruptcy. 

(Wikipedia).

Canada’s great conservative thinker, George Grant, wrote in Lament for a Nation that "Canada was predicated on the rights of nations as well as on the rights of individuals.” He might also have written “the rights of provinces.” The book’s subtitle, The Defeat of Canadian Nationalism, bespeaks Grant’s abiding fear that the country had forgotten its conservative origin in communal solidarity and had sold its future to a managerial elite wedded to the notion of unmitigated “progress.”

A devout traditionalist, Grant was skeptical of unrestrained capital markets and of what he called, in Technology & Justice, “technological ontology.” Liberals—and some Conservatives—consider him out of touch with modernity, a throwback to a pre-modern age. But his emphasis on individual responsibility and commitment to the values of truth and justice remain the core of conservative thinking. In the “Afterword” to Lament, his widow recalls one of Grant’s “simplest statements: ‘It always matters what each of us does.’”

Modern Canadian conservatism owes much to Alberta-born Preston Manning, founder of the Reform Party, which was succeeded by the Canadian Alliance and ultimately by the Conservative Party of Canada. As articulated in his The New Canada, Manning believed in fiscal prudence, the need to control the deficit and to live within our means, in doing away with redistributive economics and progressive taxation and relying instead on market forces and job creation. He believed in the reduction of federal power and in the provincial management of political and economic responsibilities. For advocating such ideas, Manning said, “We were called everything under the sun, from fascists to traitors to racists.” How such a sensible and mature platform can be condemned as “far right,” extremist, or as some sort of nascent fascism boggles the mind. 

Preston Manning (Wikipedia).

Manning understands energy and its crucial importance to priming the engine of prosperity, facilitating job creation and strengthening the Canadian economy across the board. He urges provincial cooperation to “put enormous pressure on the Federal government to get pipeline rights of way to both the Pacific and the Atlantic.” In his new book Do Something!: 365 Ways You Can Strengthen Canada Manning writes: “[W]e need unobstructed transportation corridors to the Atlantic, Pacific and the Arctic to move our resources to tidewater and world markets. We need a federal government that’s supportive of these kinds of measures rather than one that obstructs.”

Manning is also deeply concerned about the corrosive prospect of growing Western alienation. “The problems with the energy sector,” which he lays at Ottawa’s door, “and the inability to get resources to tidewater and world markets are all fueling Western alienation.” He is right. Wexit is picking up momentum and Wexit Canada is now an official political party.

Former Conservative PM Stephen Harper (aka “Harperman,” as the socialist rabble and environmental scientist Tony Turner maligned him) was often tarred as “far right” for his fiscal prudence (which steered us through the 2008 financial meltdown) when, to be accurate, he was a “conservative centrist” some of whose policies—maintaining high immigration rates from Muslim countries, or refusing to re-open the abortion debate—consorted with Liberal positions. Some have criticized him, too, as being somewhat ambivalent on the oil patch, neglecting to build a sufficient pipeline distribution network. Harper did not govern as effectively as he could have, but as a trained economist he understood the industry that contributed massively to the country’s prosperity.

Prime Minister Justin Trudeau, who is leading Canada to an Argentinian-type default and economic collapse, setting his sights on net-zero in more ways than one, is no friend of George Grant, Preston Manning or Stephen Harper; he is much closer to his father’s socialist influence Harold Laski, who was Pierre Trudeau’s mentor at the London School of Economics. Laski held that capitalism inevitably led to internal contradictions, economic crashes and depressions, and proposed the socialist control of natural resources and property to be shared by all of society’s stakeholders.

Harold Laski (1893 - 1950), circa 1940.

The predictable irony, of course, endemic to all socialist regimes, is the splintering of society into warring interest groups, the eventual imposition of top-down single party rule, and the disintegration of a common culture once based on historical precedent and loyalty to one’s neighbor. As we see in the Western world today—Canada is no exception—the sense of unity has been replaced by entitlement categories like ethnicity, race, gender, creed, class and selective political persuasion.

Indeed, in opposition to Grant’s sense of national unity, which inspired both Manning and Harper, Trudeau has stated that Canada is a “post-national state” that has no “core identity.” A country that has no core identity is not a country preoccupied with issues of national unity and the economic foundation on which it rests. Trudeau is not interested in the oil patch but in the national patchwork. He is an outright socialist—perhaps Marxist is a better term—and an aspiring globalist who lusts for a seat in the United Nations’ bloated hierarchy

Notwithstanding his sentimental effusions about the country he leads, Trudeau is, to put it bluntly, anti-Canadian, and his animus against the energy sector and the economic stability it provides is par for the course. Like a good Marxist, he is busy steering the nation into monumental debt and abject penury. Tex Leugner, one of the lay leaders of the Wexit movement and editor of the ActionAlberta newsletter, is very clear on this. “Each day,” he writes, “Canada loses between $80 and $100 million because of the failure of our Federal Government to allow pipelines to be built. At this rate, over the next 12 months that amount could balloon to as much as $36.5 billion lost to the Canadian economy! As this money is lost, our Federal debt continues to increase.” And that’s only for starters. Statistics Canada reveals that the “poverty gap” under Trudeau has grown—in figures for 2018, two years before he had a chance to do even more damage. 

The question now, following the election of the waffly Erin O’Toole to the Conservative Party leadership, is whether the Conservatives can be counted on to pursue a sane, nation-restoring agenda. O’Toole is committed to net-zero emission by 2050; if he ran an online journal, it might be called The Pipedream. Indeed, he has just signed on to the Paris Climate Agreement in a doomed attempt to out-Trudeau Trudeau. Considering that there is no hard scientific evidence that the globe is warming, that the U.S. as major signatory has pulled out of the Accord, and that, in any case, China and India, the world’s largest polluters, have no intention of reducing emissions, the Agreement is not worth the paper it is written on, though it will cost its adherents dearly. O’Toole is merely virtue-signaling for electoral purposes. 

The only leadership candidate reliably true to the tradition of Grant and Manning was Derek Sloan, who may find himself cast into outer darkness for, among other things, voicing justifiable suspicion of Canada’s chief health minister Theresa Tam’s loyalties. Hong Kong-born Tam was all over the map in her COVID recommendations, hewing closely to the China-inspired line of the World Health Organization while sitting on one of its prestigious boards.  

Justin & son.

The fact that she happens to be Chinese was (and is) irrelevant, but it was enough to generate accusations of racism from the Asian community and from Conservative MPs Gordon Chong and Pam Demoff. “[T]he Conservative Party that I know does not stand for this kind of garbage,” Chong blustered. Demoff for her part accused Sloan of “racism, misogyny, and bigotry.” The attempt to “cancel” Sloan and destroy his political career is evidence, once again, of how easily people can be duped into taking offence at reasonable skepticism—or how cynical they can be in trying to score political points. I have indicated in a previous article for The Pipeline that Tam’s behavior was highly dubious, lying about the mode of viral transmission and even removing vital information from airport message screens regarding flights from China into the country. O’Toole has not come to the defense of Sloan and is cannily playing the popularity game, which seems to make him, at best, a Diet Conservative. 

Clearly, the Conservative Party has some trouble aligning itself with true-blue conservatism represented by a genuinely conservative politician like Sloan, an upholder of traditional usages and institutions, a stringent anti-socialist, a Canadian patriot, and a vigorous supporter of the energy industry. Alberta is where the country’s energy resides. Sloan is where the Party’s energy lies. It is by no means surprising that both have come under the shadow of repudiation. 

Erin O'Toole (left).

There can be no doubt that a mushy O’Toole would make a better Prime Minister than a spongy Trudeau, but this does not change the fact that Canada’s two major energy fields have been suffering catastrophically and, barring a miracle, will likely continue to do so. One field is obviously the oil/gas/pipeline sector, which is in process of being phased out. The other is Canada’s political energy zone, presumably a national endowment, which has been going increasingly woke. With these two sources of revivifying energy—generated power and political intelligence-and-integrity—seemingly moribund, Canada would have little future to speak of.

Dance with the One That Brung Ya

As John O'Sullivan has mentioned, the Conservative Party of Canada has just selected a new leader: Durham, Ontario M. P. Erin O'Toole. O'Toole succeeded in edging past former Progressive Conservative leader Peter MacKay, as well as the more right-wing candidates, Leslyn Lewis and Derek Sloan.

O'Toole himself ran as essentially the "Buckley Rule" candidate, referring to the founder of National Review's mid-'60s proclamation that his magazine would support "the rightwardmost viable candidate" in a given election. Despite his not-particularly-conservative voting record, O'Toole leaned hard on his military service during the campaign to sell himself as "True Blue O'Toole," manly patriot, not like progressive pretty boy like MacKay (who was famously named 'Canada's Sexiest Male MP' by The Hill Times in the early oughts, a fact which should have disqualified him from the start), who can actually hold Justin Trudeau to account in opposition (unlike Lewis, who doesn't yet have a seat in parliament) but is moderate enough (unlike, according to some, Sloan) to win a general election.

There's a lot of balancing going on in that pitch, one that sticks close to the political consultants' standard playbook: right-wing enough to win out west, centrist enough to pick up a few more seats in Ontario and then form a government.

That is, of course, a tenuous balance. That playbook also advises conservatives to go all-in on green initiatives to win in the Greater Toronto Area, and offer Western Canada... well, nothing. Except not being Trudeau that is. But western Canadians have a fiercely independent streak, and they've acted on it before, breaking off from the Progressive Conservative Party in the '80s (in rebellion against a Tory leader who they felt was unresponsive to their interests) to form the Reform Party, which supplanted the the P. C. Party within five years.

The "unite the right" movement of the early 2000s healed that divide and led to the creation of the modern Conservative Party, but it would be foolish for O'Toole to assume that's the end of the story. Consequently, O'Toole made it a point to launch his leadership campaign in Calgary, and he's racked up western endorsements, including from Alberta Premier Jason Kenney, who proclaimed that O'Toole is "committed to a fair deal for the West and a strong future for our resource industries."

Only time will tell whether that is an accurate assessment. O'Toole has been all over the place on the resource sector, initially calling for an end to fossil-fuel subsidies -- a questionable description of industry-specific tax deductions for one of the largest contributors to Canada's economy, especially since the so-called renewable energy industry against which it is competing wouldn't exist without massive government subsidies -- before backing away from that pledge. He's also advocated repealing the Liberal's carbon tax, which he pledged to replace with "a national industrial regulatory and pricing regime," essentially a carbon tax by another name.

Alberta's support was definitive in O'Toole's beating out MacKay, and as much as he's likely being told to break left right now to appeal to the Toronto suburbs, he should heed the advice of a fellow Ontarian, and "dance with the one that brought" him. Because Alberta's economy has been hit harder by Covid-19 and the lockdowns than any other, and western discontentment have the potential to tear the party and the country apart.

Fitch Downgrades Canada's Credit Rating

Fitch Ratings, one of the big three global credit rating agencies, has announced it's downgrading Canada's credit rating from AAA to AA+. This is due to the tremendous debt -- roughly a quarter of a trillion dollars -- the Canadian government took on to prop up the economy during the COVID-19 lockdowns.

Though the Trudeau government was quick to argue that Canada's economy remains strong and that the country in an ideal position to turn things around, this does have the potential to significantly increase the cost of government borrowing and of doing business. That danger, moreover, will be amplified if, as some think, there are further downgrades to come:

David Rosenberg... has been predicting a downgrade on Canada’s sovereign debt since late April and thinks this won’t be the last. “The real question is: What took so long?’ .... Canada’s excessively leveraged national balance sheet has looked a lot like China, Italy and Greece for quite a while.” While Ottawa may appear to be in “solid” financial shape to some, this has “masked bloated debt ratios” in households, business sectors, and most of the provinces, he said. “This won’t be the last ratings cut, I can assure you,” said Rosenberg.

Now, it is true that governments worldwide have responded to the pandemic by racking up what would normally be unthinkable amounts of debt. Consequently, it is likely that Canada won't be the only country to have its rating downgraded.

But one thing that makes Canada unique is the shame that its governing elite feels about one of the pillars of its economy. As Dan McTeague of Canadians for Affordable Energy said the other day in an excellent piece on Erin O'Toole's environmentalist pitch in the CPC leadership contest,

Rather than championing Canada's hydrocarbon industry and creating economic growth with our country’s wealth of natural resources, O’Toole’s policies seem most focused on maintaining the what-seems-to-be-required, green-is-god image of so many politicians.... Our natural resources are an asset to this country, not a liability. They keep energy affordable, and give us one of the highest standards of living. O’Toole and other political candidates seem determined to remain blind to that fact.

You would hope that this turn of events would cause Canada's governing class to thank its lucky stars for the energy sector, a potential launchpad for recovery. But unfortunately they'll probably keep just hoping for pats on the head from similarly green-obsessed organizations like the UN  -- and how's that been working out for them?

Eventually someone is going to have to grow up and start taking things seriously.

Erin O'Toole, Environmentalist

Back in March I drew your attention to an article by Canadian Tory insider Ken Boessenkool which argued, in the wake of an election which saw the Conservative Party of Canada (CPC) pick up 26 seats, that the party needed to go all in on environmentalism.

Vote for us, the Conservatives said, and we’ll cut your taxes.

Vote for us, the Liberals said, and we will address climate change.

This worked wonders across western Canada, in rural Ontario, around Quebec City, and in a smattering of ridings in Atlantic Canada. But new polling for Clean Prosperity conducted by Conservative pollster Andrew Enns from Leger suggests climate change was a key reason why the Conservatives failed to gain ground in the 905.

I pointed out at the time that this was specious reasoning, since the Conservatives are less likely than ever to win in the Greater Toronto area because of the collapse of the New Democratic Party as a viable electoral (and vote-splitting) force, not to mention the fact that the polling he cited was done by the carbon-tax activist group Canadians for Clean Prosperity. It isn't that surprising that their conclusion was Canadians Love Carbon Taxes!

Shockingly, Erin O'Toole, purported co-front runner in the CPC Leadership race, seems not to have read my post. (He must have skipped his press clippings that morning). That is, he sounds like he's going all in on the Boessenkool theory. At last week's leadership debate, his opponents hammered O'Toole's plan to introduce a "national industrial regulatory and pricing regime" as being a carbon tax-like scheme that would harm consumers and the oil and gas industry alike.

O'Toole [replied that] the party needs a serious environmental platform for the next election. "I'm the only one who has a detailed plan. It's disappointing to see Mr. MacKay attack that. If we're not clear on the environment in the next election ... we're not going to be able to get pipelines built," O'Toole said.

It's a surprising tack for True Blue O'Toole to take. His whole campaign is built upon contrasting himself with Mr. Progressive Conservative, Peter MacKay, but here he is going all in on alienating the west.  Maybe he figures he can get away with it because they have no where else to go -- what are they going to do, vote Liberal?

But O'Toole is counting his chickens before they're hatched. He isn't leader yet, and western Canadian party members can still give that title to someone else, perhaps Derek Sloan or Leslyn Lewis.

Hopefully they do something to make it clear to O'Toole or MacKay or whoever wins that the party's base can't be ignored.

Alberta's Petrochemicals Protecting Canada

The collapse in oil prices combined with the virus and the lockdowns are hitting the Canadian province of Alberta extremely hard. Some are even predicting the worst economic contraction in its history. But I was glad to read in the Financial Post about one bright spot in the province's economy at the moment, its petrochemical sector which produces a variety of plastic products that are in high demand at the moment:

In 2019, Prime Minister Justin Trudeau said the government would move to ban single-use plastics such as shopping bags, cutlery and straws to curb the proliferation of plastic waste in landfills and oceans. Now, in the middle of a public health crisis, the demand for plastic packaging has exploded. In Alberta’s oilpatch, ethane crackers used to make polyethylene film are among the only facilities that are busier today than before the pandemic knocked out global oil demand and led to hundreds of thousands of barrels of oil being shut in.

“The demand for plastic packaging has never been higher than it is right now,” said Bob Masterson, president and CEO of the Chemistry Industry Association of Canada, noting that the evidence of the huge demand for the industry’s products is plain at any grocery store in the country. Some grocery stores that had previously banned or started charging for plastic bags have eased those policies as workers are concerned about handling re-usable grocery bags. Acrylic plastic shields have been installed at tills to separate cashiers from shoppers, both of whom are wearing plastic gloves and masks in increasing numbers.... Masterson said the current crisis has led to “an absolute boom in the demand for packaging,” as grocery stores and consumers are wrapping food in plastic to prevent surface contamination of foods from the coronavirus.

Plastics, of course, aren't the only timely products produced by petrochemicals. Another is isopropyl alcohol:

I think it has shown some vulnerabilities in Canada’s supply chain,” Masterson said, noting that Shell Canada Ltd.’s Sarnia plant is the only producer of isopropyl alcohol in Canada, used to make alcohol-based cleaning products such as hand sanitizers. Shell president and CEO Michael Crothers said in a March 31 release the company would donate 125,000 litres of isopropyl alcohol, which is “approximately enough to create nearly one million 12-oz bottles of hand sanitizer for use in hospitals and medical facilities....

In Alberta, successive governments have implemented incentives designed to attract more petrochemical investment in an effort to diversify the province’s economy and build out the supply chain for hydrocarbon production. An incentive program introduced by former NDP premier Rachel Notley resulted in both Inter Pipeline Corp. and Pembina Pipeline Corp. spending $8.5 billion combined on under-construction polypropylene facilities, which will turn the province’s abundance of propane into plastic pellets used in a range of consumer goods.

The article notes that there is some question as to whether the industry will continue to boom once the pandemic and the lockdowns are over, and that is a real concern should the Greens return to form. The environmentalists are working hard to keep the "climate emergency" front and center, and even to link the two. But from where I sit, this pandemic definitively demonstrates the necessity of this industry, and the people talking about managing its decline are nuts.

Trudeau's Oil Sands 'Relief' a Bust

Back in 2017, Justin Trudeau was speaking at a town hall event in Peterborough, Ont., and was asked about his government's decision to approve an extension to Kinder Morgan’s Trans Mountain pipeline, which seemed in tension with his environmentalist commitments. He replied:

We can’t shut down the oil sands tomorrow. We need to phase them out. We need to manage the transition off of our dependence on fossil fuels but it’s going to take time and in the meantime we have to manage that transition.

This was widely considered to be a gaffe of the Kinsley variety, which is to say the type in which a politician "accidentally reveals something truthful about what is going on in his or her head." Trudeau was acknowledging that somewhere in that woolly brain of his is the desire to shut down Canada's oil sands, the backbone of Canada's western economy, and a key sector of the national economy as well.

The representatives of affected Canadians were compelled to respond. Rachel Notley, whose socialist New Democratic Party was enjoying a rare period in power in Alberta, said, “[Our] oil and gas industry and the people who work in it are the best in the world and we’re not going anywhere, any time soon.” Jason Kenney, who would replace Notley as premier two years later, asked whether Trudeau's "phase-out" meant "he wants to hand-over all global oil production to Saudi [Arabia], Iran, Qatar, et al?" Then-opposition leader Brian Jean replied, "If Mr. Trudeau wants to shut down Alberta's oil sands... he'll have to go through me and four million Albertans first." The pushback was such that eventually -- that is, more than a week later -- Trudeau walked back the comment, saying that he "misspoke," and that he had “said something the way I shouldn’t have said it.”

Fast forward to our present calamity, which has seen Canada's oil and gas industry pounded by a perfect storm consisting of the COVID-19 pandemic and its attendant lockdowns on the one hand, and the Saudi/Russian production war on the other. Back in the middle of March, as the nature of these twin crises was becoming clear, news began to surface about Ottawa's proposed response.

The federal government is preparing a multibillion-dollar bailout package for Canada’s oil and gas sector that is expected to be unveiled early next week, sources say.... [G]overnment insiders are saying little about the details... but the oil and gas sector can expect to get more access to credit, especially for struggling small and medium-sized operations, and significant funding to create jobs for laid-off workers to clean up abandoned oil and gas wells.

One senior Alberta source said the province is expecting Ottawa to provide $15-billion in relief to an industry that has been hammered by the COVID-19 crisis and the price war between Saudi Arabia and Russia that has cratered oil prices and energy-company stocks.

Finance Minister Bill Morneau assured the nation on March 25th that the government understood that "the energy sector is in a particularly challenging situation," and that the rumored bailout was imminent, not "weeks [but] hours, potentially days" away.

Well, not hours or days, but nearly a month later details of the relief package were made public, and they were underwhelming to say the least. Reports of a $15 billion package were off by almost an order of magnitude, as the actual package came to $1.7 billion, largely geared towards environmentalist priorities. Whereas oil and gas representatives had been asking mainly for new lines of credit and an easing of regulations, the actual package earmarked the vast majority of dollars for the remediation of abandoned oil wells and methane-gas emission reduction.

As Grant Fagerheim of Whitecap Resources put it, “This is not going to do anything... If this is as good as it gets, it will do very little or nothing to assist with operations for companies.”

What changed? Well, for one thing, the environmentalists got involved. Around the time of Morneau's pledge, a coalition of environmentalist groups wrote an open letter to Trudeau arguing against such a package, saying

"Giving billions of dollars to failing oil and gas companies will not help workers and only prolongs our reliance on fossil fuels."

They seem to have had an influence. As one oil executive observed to the National Post:

[T]he announcement appeared to adhere closely to Ottawa’s tendencies around environmental messaging, rather than addressing immediate concerns on private sector balance sheets. “I think they made the calculation that it would be politically unpalatable in Ontario and Quebec to provide direct supports to oil and gas."

Of course, Canada's environmentalist groups were elated and were quick to offer praise:

Josha McNabb of the clean-energy think tank Pembina Institute said well cleanups and methane reductions are good steps toward reorienting Canada’s economy toward a low-carbon future. “Those are types of things that are going to lead to an oil and gas sector that is more competitive because it’s cleaner, and also (develop) the kind of expertise that is going to be in demand,” she said.

Even more to the point was the statement put out by Tzeporah Berman of Stand.Earth, which read,

Today, Prime Minister Trudeau made clear that Canada’s bailout package will prioritize addressing the climate crisis and building the cleaner, safer economy we need. This is the kind of leadership the world needs .… This bailout announcement is a major turning point for oil and gas politics in Canada.... [W]inding down the oil and gas industry [is] a hard, but necessary part of achieving [Canada's Paris Agreement climate] targets.

Of course, Trudeau's cabinet is itself brimming with borderline enviro-activists, including Catherine McKenna, Navdeep Bains, and Steven Guilbeault (the latter a full blown activist, who spent ten years with Greenpeace before running for office). None of them needs much pressure -- public or private -- to leave the resource sector out in the cold. No doubt when Morneau said that relief was "hours, possibly days" away, that was based on his perception of the negotiations as they stood at the time. Perhaps he was even trying to hurry his fellow ministers along. But he appears to have gotten ahead of his skis, and in the end the greenies won out.

Furthermore, despite requests from industry representatives, the Trudeau government insisted on going ahead with its plan to double the Federal Carbon tax and merely delayed the implementation of their Clean Fuel Standard by a few months.

“Just because we are in one crisis doesn’t mean we can forget about the other crisis, the climate crisis, that we’re facing as a world and as a country,” said Trudeau.

It must be mentioned that one request from the resource industry was included in the relief package, namely expanding credit availability for small and medium sized energy companies, and there has been talk of further assistance aimed at ensuring that the industry maintains liquidity. There's a good argument for such interventions -- since government ordered lockdowns are a major contributor to the industry's plight, it makes sense that the government would help shoulder the burden while oil and gas companies work their way through this. And it's worth noting that, as the energy sector has contributed more to the Canadian economy over the past 20 years than any other, a lot of that money comes from oil and gas to begin with.

Even so, the core of this package makes plain the Prime Minister's priorities. Weighted as heavily as it is toward capping off old wells, it serves mainly as an instruction to an ailing industry that it had better restructure itself with an eye towards closing up shop for good. Rahm Emmanuel famously advised Barack Obama in 2008 to never let a good crisis go to waste, and Trudeau and his ministers appear to have taken that to heart. Never mind that the resource sector makes up roughly 10 percent of the Canadian economy; that, as this pandemic has reminded us, it contributes the material to make personal protective equipment and ventilators; or that the Green Energy Industry on which they have pinned their hopes has been shown to be a sham. This is their moment. They will not let it pass.

Tory Insider to Western Canada: Drop Dead

Hey, here's a ridiculous article, by Tory insider Ken Boessenkool, writing for the parish newsletter of Canada's bi-partisan elite, Maclean's:

If Conservatives want to win another national government they are going to have to find ways to win critical seats in the suburban belt around Toronto⁠—the 905, encompassing cities like Ajax, Brampton and Burlington. Harper swept the 905 for his majority in 2011 and the party has been on the outs ever since.

Can Conservatives win again in the 905? They cannot count on an assist from the NDP whose vote has dropped from 25 per cent in 2011 to around 10 per cent in each subsequent election. To win, Conservatives will have to increase their vote by attracting new cohorts of voters. In the last election, Conservatives centred their campaign around cutting taxes (eliminating the carbon tax), while the Liberals centred their campaign around climate change and cutting greenhouse gasses (sticking with their recently introduced carbon tax)....

Vote for us, the Conservatives said, and we’ll cut your taxes.

Vote for us, the Liberals said, and we will address climate change.

This worked wonders across western Canada, in rural Ontario, around Quebec City, and in a smattering of ridings in Atlantic Canada. But new polling for Clean Prosperity conducted by Conservative pollster Andrew Enns from Leger suggests climate change was a key reason why the Conservatives failed to gain ground in the 905.

So, in order to win back the Toronto suburbs, which Boessenkool readily admits the Conservatives won in 2011 because the socialist NDP split the vote with the Liberals (something they have failed to do since the death of their charismatic leader Jack Layton), the Tories will have to betray their voters out west (remember how they won 47 of the 48 seats between Saskatchewan and Alberta?).

This seems like questionable advice. A bird in the hand is worth two in the bush, goes the proverb, but Mr. Boessenkool begs to differ, based on some polling done by the carbon tax activist group Canadians for Clean Prosperity, which found that, 1) Canadians *love* the Carbon Tax, and 2) the only thing keeping them from voting Conservative is that party's support for Canadian oil and gas.

Amazing! That's exactly what the CBC have been saying all along! Canada is the one place in the world right now where there's no divide between elite and popular opinion! Who knew that Rosemary Barton had such a finger on the pulse of the persuadable voter?

This, in all seriousness, is garbage. The Tories have a lot of serious work to do if they want to build a winning coalition in the near future. Too much to go into in a blog post. But the idea that the secret to Tory domination is to join every other party in spitting on western Canada, which just made them the largest single party in the country, is insane. Mr. Boessenkool and Canadians for Clean Prosperity might find it appealing to try and save the Conservatives from their own voters, but that isn't going to win them any elections.

Luckily for western Canadians, Alberta premier Jason Kenney has thus far flouted elite opinion (including that of his deputy minister of Policy Coordination, Mark Cameron, formerly head of, er, Canadians for Clean Prosperity) and continued the fight against Trudeau's carbon tax. This past Monday saw him strike a major blow in that fight, when the Alberta Court of Appeal, in a 4-1 decision, found against the Federal Government and declared the carbon tax unconstitutional.

In the 269-page decision, Justices Catherine Fraser, Jack Watson and Elizabeth Hughes said, in part: "The division of powers remains key to our federal state. It is part of the fabric of Canada itself. The federal and provincial governments are co-equals, each level of government being supreme within its sphere. The federal government is not the parent; and the provincial governments are not its children." They go on to call the act "a constitutional Trojan horse," as it would set a precedent, allowing the federal government to impose almost any law it wished on Canadians.

The Appeals Courts of Ontario and Saskatchewan have previously sided with the Trudeau government's argument that the carbon tax isn't a tax at all, and falls within the federal government's regulatory authority.

So -- onward to the Supreme Court and good luck to Alberta!