[Canada] Canadian Politics Redux

[crazy canuck]

Efforts are being made by two sitting MLA's to recreate the Progressive Conservative Party in Alberta.  They say essential it is an attempt to return to sane government in that province.

[crazy canuck]

Trade figures for the month just released. Unsurprisingly trade with the US continues its downward trend. Down 0.9%. Trade with the rest of the world increased 5.7%

The shift to other markets continues. 

[Jacob]

The likelihood is 0. Our operators are not interested in changing anything and the federal government can't whip up a new crown corporation fast enough for anything to matter.

I agree with that, it would take direct Federal investment.

Jacob, in answer to your question it all depends on what the Federal government does.  If they get directly involved, it can happen quickly. The infrastructure in Western Canada is good (we do bulk transport to the Port of Prince Rupert well). The issue is building the necessary links East and particularly into Quebec.

This seems to be a somewhat common theme with a bunch of resource related issues. Canada can extract the resources and we can get them to market using existing infrastructure, but when it comes to building new infrastructure to increase volume or open new markets it usually (always?) seems to be problematic.

Why is that?

My gut instinct is that there are two main factors, but I'd love to hear other folks' perspectives (and thoughts on how to address those factors if you agree they're significant).

• The cost-benefit analysis doesn't actually add up. That is, the expected return on investment is not substantial enough (or carries high risk) for private capital to fund the projects; and the political case is similarly not substantial enough for politicians to fund it.
• The transit provinces (I'm thinking BC and Quebec here primarily, but maybe elsewhere as well) don't see enough upside in taking on the environmental risk and local stakeholder dissatisfaction. It's a kind of a generalized point, so I'd like to understand more about what could turn it into win-win propositions for the transit provinces, beyond "it's good for Canada" and "it's good for the economy of other provinces" (not that these aren't good arguments, but evidently they're not always sufficiently persuasive).

[crazy canuck]

I don't think the premise of your question is correct.  We have been steadily upgrading our infrastructure in BC for years because the economic benefits of being the doorway to the Asian markets is significant.  Why do you think infrastructure has not been/is not being upgraded?

[Savonarola]

My gut instinct is that there are two main factors, but I'd love to hear other folks' perspectives (and thoughts on how to address those factors if you agree they're significant).

• The cost-benefit analysis doesn't actually add up. That is, the expected return on investment is not substantial enough (or carries high risk) for private capital to fund the projects; and the political case is similarly not substantial enough for politicians to fund it.
• The transit provinces (I'm thinking BC and Quebec here primarily, but maybe elsewhere as well) don't see enough upside in taking on the environmental risk and local stakeholder dissatisfaction. It's a kind of a generalized point, so I'd like to understand more about what could turn it into win-win propositions for the transit provinces, beyond "it's good for Canada" and "it's good for the economy of other provinces" (not that these aren't good arguments, but evidently they're not always sufficiently persuasive).

By "Upgrading infrastructure," what is it that you're looking to do?  Something like simply upgrading existing track can be done fairly quickly (by the standards of rail, I mean), and you can do pieces at a time.  If you're looking at building completely new track (a greenfield project in rail lingo), you need to think in terms of decades before you have an operating system.

The most logical place for Canada to start, in my opinion, is to mandate Positive Train Control so that the existing trains can run quicker and safer.  That took about ten years in the United States.

[Jacob]

I don't think the premise of your question is correct.  We have been steadily upgrading our infrastructure in BC for years because the economic benefits of being the doorway to the Asian markets is significant.  Why do you think infrastructure has not been/is not being upgraded?

I was under the impression that Alberta is still not satisfied with their capacity to export fossil fuels to Asia via BC, but perhaps that's outdated?

[crazy canuck]

I don't think the premise of your question is correct.  We have been steadily upgrading our infrastructure in BC for years because the economic benefits of being the doorway to the Asian markets is significant.  Why do you think infrastructure has not been/is not being upgraded?

I was under the impression that Alberta is still not satisfied with their capacity to export fossil fuels to Asia via BC, but perhaps that's outdated?

Yes, Alberta has concerns about pipelines, and that continues. But you made a claim about infrastructure generally. And that is not accurate.  Just take a look at the expansion being undertaken at the Port of Prince Rupert over the last 10 years. The expansion of YVR for the transportation of goods.  The expansion of the Port of Vancouver. The expansion of the transportation networks (rail and road) into and out of those ports, the development of LNG terminals etc etc etc

[Jacob]

Yes, Alberta has concerns about pipelines, and that continues. But you made a claim about infrastructure generally. And that is not accurate.  Just take a look at the expansion being undertaken at the Port of Prince Rupert over the last 10 years. The expansion of YVR for the transportation of goods.  The expansion of the Port of Vancouver. The expansion of the transportation networks (rail and road) into and out of those ports, the development of LNG terminals etc etc etc

Those are great counter examples, in fact.

What I'm curious about is what differs between the projects that get built and the ones that end up as long term contentious political topics - that is, pipelines for Albertan fossil fuels via BC and Quebec, and - as per Grey Fox - the rail networks that aren't going to be upgraded.

[HVC]

Yes, Alberta has concerns about pipelines, and that continues. But you made a claim about infrastructure generally. And that is not accurate.  Just take a look at the expansion being undertaken at the Port of Prince Rupert over the last 10 years. The expansion of YVR for the transportation of goods.  The expansion of the Port of Vancouver. The expansion of the transportation networks (rail and road) into and out of those ports, the development of LNG terminals etc etc etc

Those are great counter examples, in fact.

What I'm curious about is what differs between the projects that get built and the ones that end up as long term contentious political topics - that is, pipelines for Albertan fossil fuels via BC and Quebec, and - as per Grey Fox - the rail networks that aren't going to be upgraded.

My impression, which can be faulty, is that intra provincial infrastructure gets priority over inter provincial infrastructure. Which doesn't help the middle of Canada much. I wasn't so bad when America was right at the border. But that left weaknesses that are very apparent now.

[mongers]

My gut instinct is that there are two main factors, but I'd love to hear other folks' perspectives (and thoughts on how to address those factors if you agree they're significant).

• The cost-benefit analysis doesn't actually add up. That is, the expected return on investment is not substantial enough (or carries high risk) for private capital to fund the projects; and the political case is similarly not substantial enough for politicians to fund it.
• The transit provinces (I'm thinking BC and Quebec here primarily, but maybe elsewhere as well) don't see enough upside in taking on the environmental risk and local stakeholder dissatisfaction. It's a kind of a generalized point, so I'd like to understand more about what could turn it into win-win propositions for the transit provinces, beyond "it's good for Canada" and "it's good for the economy of other provinces" (not that these aren't good arguments, but evidently they're not always sufficiently persuasive).

By "Upgrading infrastructure," what is it that you're looking to do?  Something like simply upgrading existing track can be done fairly quickly (by the standards of rail, I mean), and you can do pieces at a time.  If you're looking at building completely new track (a greenfield project in rail lingo), you need to think in terms of decades before you have an operating system.

The most logical place for Canada to start, in my opinion, is to mandate Positive Train Control so that the existing trains can run quicker and safer.  That took about ten years in the United States.

Yes, there's been a push in Southern England to upgrade the tracks and tunnelling to allow greater width and height units* on freight trains coming out of Southampton, the UK's 2nd/3rd largest container port.

And as part of this process, when there was a minor two train crash at the entrance to a tunnel nr Salisbury, whilst repairing/upgrading the signalling and rail furniture, they dropped the level of the rails running through the tunnel by around a foot to allow large container freight to pass through.



* the technical term for this outline 'gauge' eludes me a the moment.

[crazy canuck]

Yes, Alberta has concerns about pipelines, and that continues. But you made a claim about infrastructure generally. And that is not accurate.  Just take a look at the expansion being undertaken at the Port of Prince Rupert over the last 10 years. The expansion of YVR for the transportation of goods.  The expansion of the Port of Vancouver. The expansion of the transportation networks (rail and road) into and out of those ports, the development of LNG terminals etc etc etc

Those are great counter examples, in fact.

What I'm curious about is what differs between the projects that get built and the ones that end up as long term contentious political topics - that is, pipelines for Albertan fossil fuels via BC and Quebec, and - as per Grey Fox - the rail networks that aren't going to be upgraded.

What has happened is you have identified one issue (pipeline construction) and built a thesis on the basis of that one thing that there is somehow a general problem with developing infrastructure.  Your thesis is not accurate.

GF was making a point about who is going to pay to upgrade rail lines, which is a different issue.

[crazy canuck]

Yes, Alberta has concerns about pipelines, and that continues. But you made a claim about infrastructure generally. And that is not accurate.  Just take a look at the expansion being undertaken at the Port of Prince Rupert over the last 10 years. The expansion of YVR for the transportation of goods.  The expansion of the Port of Vancouver. The expansion of the transportation networks (rail and road) into and out of those ports, the development of LNG terminals etc etc etc

Those are great counter examples, in fact.

What I'm curious about is what differs between the projects that get built and the ones that end up as long term contentious political topics - that is, pipelines for Albertan fossil fuels via BC and Quebec, and - as per Grey Fox - the rail networks that aren't going to be upgraded.

My impression, which can be faulty, is that intra provincial infrastructure gets priority over inter provincial infrastructure. Which doesn't help the middle of Canada much. I wasn't so bad when America was right at the border. But that left weaknesses that are very apparent now.

No, the development of the grain terminals in Vancouver to transport grain from the prairies demonstrates that thesis is also wrong.

[Bauer]

I think the problem is not that these infrastructure projects aren't being built (was going to mention port of prince Rupert but CC beat me to it) but that the process takes too long and is going too slow. Private investment simply dries up when that happens, and in some cases people move on from their careers.

Back when Trudeau first ran the liberals correctly identified the country needed more investment but did a terrible job implementing it.

[crazy canuck]

I think the problem is not that these infrastructure projects aren't being built (was going to mention port of prince Rupert but CC beat me to it) but that the process takes too long and is going too slow. Private investment simply dries up when that happens, and in some cases people move on from their careers.

Back when Trudeau first ran the liberals correctly identified the country needed more investment but did a terrible job implementing it.

Agreed.

[Jacob]

Ok, fair enough CC. Maybe there's no such generalized trend and it's just an oil thing.

On the infrastructure topic, apparently the Port of Vancouver is looking for a builder to expand its capacity by 70%.