[Canada] Canadian Politics Redux

[Grey Fox]

I approve of Provinces doing things without the Federal government.

[crazy canuck]

On our road trips from Toronto to our friend's camp it seemed that everybody was travelling at about 110 anyway so I suppose this just reflects reality.

Wait until rush hour. North America's largest parking lot 

Oh yeah, that's the part that Mrs. CC drives.  I can't stand the bumper-to-bumper going for miles on end.  She is also a lot better darting in and out of traffic.

[Jacob]

Don't worry - I'm sure BC will be allowed to invest if you so wish.

Personally I think that is the model that should be pursued. If pipelines are built, it's best if they're built in a way that all involved stakeholders are invested in a way that they see it as beneficial.

But like you say...

The problem with pipelines right now is the business case for a west coast pipeline has nothing to do with economics.  Several pipeline companies would be happy to fully build a west-coast pipeline or three if they had a regulatory regime that would allow it.

The reason pipeline companies are not trying to build pipelines is the hostile regulatory regime.  BC in particular has basically promised to do everything it can to block a new pipeline.  Not "we support a pipeline if it meets environmental regulations", not "we support a pipeline if it passes First Nations consultation" - but straight-up opposition.

Yeah.

Without getting into how we got here, the positions seem to be:

Alberta: fuck you, we're going to build this pipeline no matter what you say because fuck you!
BC: fuck you, you're not because fuck you!

Personally I'd be okay with BC changing to: okay, now that our concerns have been addressed sufficiently and the risks we're taking on are balanced by a reasonable set of mitigations and benefits, we'll support a pipeline.

From a BC perspective it seems like it'd be a big political challenge for the government to move to that stance given the messaging coming out of Alberta. I suppose Smith has her own political imperatives for not attempting a more conciliatory approach.

We see this in the US right now.  Trump has re-authorized Keystone-XL.  The reason nobody is building it is because it is well understood that a Democratic President would rescind permission.

Right now the Carney government has promised to support a new west coast pipeline.  We'll see.  But there's a reason the TMX expansion had to be taken over and funded by the Federal government.

[crazy canuck]

This mess all traces back to then premier Christy Clark deciding  to oppose pipelines on the basis that there had not been sufficient public license given, and the interest of BC had not been appropriately considered.

I said then, and I still say that position was wrong headed. Pipelines crossing provincial boundaries are clearly the jurisdiction of the federal government under our constitution.  She opened up a can of worms when she took that position and she did so for purely political reasons because she needed to find a way to win the next election, and that was politically popular to do.

Now fast forward to the world we now live in, and we hear almost nothing about who has the jurisdiction to decide whether a pipeline should go through the country or not.  And the federal government has essentially ceded the field to the provinces.

I know it's boring, but one need to only look at our constitution to see that the provinces have nothing to do with it

[crazy canuck]

Back to the economy, from the Globe

The Canadian economy bounced back to expansion in the spring months, recovering from a winter stagnation and quieting the debate about a potential recession.

Real gross domestic product jumped by 0.5 per cent between March and April, with a preliminary estimate for May showing an additional 0.1-per-cent gain, Statistics Canada reported on Tuesday. The economy is tracking toward annualized growth of more than 2 per cent in the second quarter.

[Barrister]

Don't worry - I'm sure BC will be allowed to invest if you so wish.

Personally I think that is the model that should be pursued. If pipelines are built, it's best if they're built in a way that all involved stakeholders are invested in a way that they see it as beneficial.

There's a phrase for that though.  It's called rent-seeking.  It's considered to be a bad thing.

https://en.wikipedia.org/wiki/Rent-seeking

Let's keep it to oil and gas, but back up production ladder.  A lot of mineral rights (including petroleum) are owned separately from surface rights.  So lets say the O&G company owns a million dollars worth of oil rights under a piece of property.  They go to the farmer and say "hey - we'd like access to a tiny fraction of your land in order to pump our oil.  We'll pay you fair market value in order to access that land, and compensate you for any lost crops".  The farmer instead goes "nah - I'll take half.  It seems to me you don't have any other choice".

In this case the farmer isn't bringing any actual value - they're just trying to extract as much money from the oil and gas company as possible.

Now in Alberta (and most oil and gas producing jurisdictions) if the farmer and gas company can't come to an agreement there is a regulatory procedure for the oil and gas company to get access at a mandated rate.  Now any time governments get involved not everyone is perfectly happy, but the system, seems to work well enough.

We can also see this in the Gordie Howe Bridge between Windsor and Detroit.  The bridge was 100% paid for by Canada.  The deal was struck before building that Canada would keep 100% of the tolls generated until the bridge was paid for, at which time the State of Michigan would gain half ownership and tolls would be split 50/50 between Canada and Michigan.

The bridge is now fully built.  But before the bridge can be opened the US Federal government needs to give some kind of permission.  So now the Trump administration is holding up that permission, suggesting the US should get half the toll revenue immediately.  The US government has brought nothing of value to the table - they're just trying to extract money aka rents.

[Josephus]

On our road trips from Toronto to our friend's camp it seemed that everybody was travelling at about 110 anyway so I suppose this just reflects reality.

It is generally assumed that you won't get pulled over doing 20 or less over the posted limit.  So 120 is the de facto speed limit.

But now, obviously, that will be 130, which for this old man is too fast.

[Jacob]

There's a phrase for that though.  It's called rent-seeking.  It's considered to be a bad thing.

What a remarkably negative interpretation of me... agreeing with you.

You proposed that BC should invest in the pipeline and I said that I think it'd be a good model because it would shift the situation to a win-win dynamic which would be helpful. But now it's actually rent-seeking and bad?

[crazy canuck]

On our road trips from Toronto to our friend's camp it seemed that everybody was travelling at about 110 anyway so I suppose this just reflects reality.

It is generally assumed that you won't get pulled over doing 20 or less over the posted limit.  So 120 is the de facto speed limit.

But now, obviously, that will be 130, which for this old man is too fast.

Then I also will be sticking to the slow lane

[viper37]

I approve of Provinces doing things without the Federal government.