WEXIT: Assessing the Costs
For the record, I don’t want Alberta or Saskatchewan to separate from the rest of Canada. There has to be a better solution to making Confederation work.
Unfortunately, Andrew Scheer, Jason Kenney, Scott Moe (Canada’s Three Wexiteers) and many others like to talk about the benefits of ‘WEXIT’, or Western-Exit. Like I didn’t hear enough of that garbage with Britain.
Now immature and assinine ‘separatists’ want to leave Canada so that they can get their pipelines built for shitumen.
Because who doesn’t want a multi-billion dollar bilge pump in their own backyard? Why would Ontario and Quebec want to invest in green energy and the future when they could be steamrolled by dirty oil?
(I’m sure the Wexiteers will find a way to blame Trudeau for that mess, too).
Assessing the Costs and Not Just the Benefits …
For starters, there’s the massive subsidies that Canada pumps into the West in the form of direct and indirect subsidies.
To the tune of $1,650 for every single citizen of this country.
Canada continues to subsidize the fossil fuel industry in myriad ways. First, it provides tax breaks under the federal Income Tax Act. For example, in 2015 the federal government introduced a new accelerated depreciation rate for equipment used in LNG facilities, which was a change proposed by the Canadian Association of Petroleum Producers.
Second, government provides funding to the fossil fuel industry at favourable rates through direct financing and loan guarantees. A recent example is Export Development Canada’s administration of a nearly $5 billion loan to support the government’s controversial purchase and operation of the Trans Mountain pipeline.
Ottawa has no plan to recoup that principal cost from industry — and is also subsidizing half the interest expense with taxpayer dollars.
Third, Canada provides direct funding to the fossil fuel industry through research, development and other services provided by federal agencies.
For example, the federal government is paying $1.5 billion for the Oceans Protection Plan, an initiative to safeguard bitumen transport through the Port of Vancouver. This plan was necessitated by new oil tanker traffic — and should be paid for by oil shippers.
Finally, there is the $60 billion subsidy that the IMF focused on — the “social costs” of carbon that governments pay, instead of fuel producers.
Lacking adequate carbon taxes, governments continue to pick up the tab for the impacts of climate change — for example, repairing damage from extreme weather events, building new levees, sea walls and storm sewers and paying for wildfire control and increased health costs.
Here are some other potential costs to the west if they were to seriously consider / implement separation:
- Treaty agreements would be reopened and, as the saying goes, Westerners won’t have anything but the dirt under their fingernails once Canada’s First Nations people are finished with them (with Canada’s support, of course).
- Open-ended natural gas lines to eastern consumers would vaporize. That recurring cash flow you get from the rest of Canada? It’ll dry up sooner than you think. Canadians would quickly adjust their building code and find ways to replace gas heaters.
- Reclamations costs to bring what they had back to what it was. The cost of repairing and replacing massive leaching ponds and waste disposal. The incalculable damage that’s been done to line the pockets of Albertans
- Loss of their portion of the CPP and other pension funds. Let’s see if Canada wants to give it back to the west.
- Complete loss of leverage for building additional pipelines in the future without over-the-top penalties or royalties for the east as part of the plan.
A Reminder …
Under a decade of Stephen Harper, Ontario and Quebec suffered.
I won’t let anyone in the west forget that.
We sacrificed millions of good, reliable, full-time jobs for the benefit of western oil producers (a high dollar meant our manufacturing exports were uncompetitive, but oil exports were incredibly profitable). Stephen Harper did little to stem the tide and we don’t want those kind of Conservatives back at the table again. Ever.
And it was Stephen Harper who was whispering in the ears of people like Donald Trump during NAFTA renogtiations
As people’s lives were thrown into complete disarray en masse, did the east talk about separation? Well, Quebec always does, but I don’t know what to say about that. Ontario has held strong despite the losses.
As I said, it would be a tragedy to treat these children like adults and give them the opportunity to separate from Canada without a good discourse about the VERY REAL COST of separation.