An indirect effect of the “cashing-in” on virgin natural resources by the introduction of the new industrial technique with government support has been an indeterminate relationship between government expenditures and government revenue. Expenditures made on the assumption that revenue will return from various directions has been responsible for the incurable and dangerous optimism which characterizes government effort. On the whole, public enterprises to which government contributes have introduced an element of uncertainty in the financial position of the government and a degree of unwholesome inelasticity.
Harold A.Innis, Problems of Staple Production in Canada. 1933, 64-65-emphasis added
On Tuesday, 6 October Premier Kenney, Associate Minister of Natural Gas Dave Nally, and a phalanx of corporate brass, distributed a most unusual press release, entitled “Building a bold and diverse natural gas industry.” The announcement, made the day before a major announcement from federal Environment Minister Jonathan Wilkinson on restricting certain single use plastics, builds upon the Province’s Natural Gas- Vision and Strategy announced in July.
In the The Globe and Mail’s 6 October story, given in advance to Emma Graney, the article’s headline read: “Alberta to diversify economy with big bet on hydrogen” (emphasis added). First point: the first 3 words read as a statement of fact. The last phrase informs the reader that the reporter and headline writer did had some reservations about the first claim.
Second point- the idea of Alberta governments making “big bets” has taken on added meaning with Alberta already betting $7.5 billion in financial support to TC Energy’s Keystone XL completion. Unlike the TC investment however, this announcement comes with no specific price tag for the Legislative Assembly to debate. Premier Kenney when asked about the cost acknowledged to Edmonton Journal report Lisa Johnson, the program “could be in the range of a billion-dollar program, but would involve offsets on future taxes.” This might be a claim the Canadian Taxpayers’ Association will be challenging- let’s hope so.
Third point- this press release reads as if it has been written by the multinational petrochemical industry which includes giants Dow-Union Carbide and Nova Chemicals, the industry association, the Industrial Heartland, and gas distributors like ATCO Gas. This form of boosterism is not new and has become an artform in Alberta where skilled industry lobbyists within trade associations like CAPP, or independents, or firms like Hill and Knowlton, coordinate efforts to lessen regulations, amend legislation or find ways to reduce taxes or receive grants.
Fourth, there is a certain degree of truth to suggest that this new “Vision” might succeed. After all Alberta have 300 years worth of natural gas! Yet, recently The Guardian and Reuters have stories (the Reuters’ piece is referred to in Graney’s article) about the troubles in plastic recycling, with serious implications for the plastics, and therefore the petrochemical industry.
[Interestingly, when I typed into Google the search term “Guardian plastics recycling,” the first answer was an ad for “Recycling plastic–search recycling plastic” which directs you to a whole literature about the problems with plastic recycling.]
Fifth – the news release suggests a whole range of interests in this growth agenda were involved including “natural gas industry partners, indigenous and municipal leaders,” and “expert advice” from the 2018 Roadmap to Recovery report. (The expert advice came from three former presidents from the Canadian Energy Pipeline Association, TransCanada Pipelines, and Alliance Pipelines- hardly an independent group.) This reference to a 2018 report delivered under the New Democrats suggests that this strategy is non-partisan. And indeed the development of Alberta’s resource sector has become a patriotic issue.
Sixth- The press release and strategy is another example of the most worrisome tendency of this government. It is the belief that whatever the government does is the correct decision and that its actions are deliberate and rely on “expert advice.” As we have seen over and over again, there is always a need to rely on the conventional opinion, the conventional experts, in short, those in positions of authority. The Premier likes to be with others who share his command and control, order and certainty perspective. His peers, mostly, men live in a world where all “leaders” believe they can issue any broad claim or order and it will happen as commanded. It ia a comfortable world where the decision-maker is insulated by a cadre of sycophantic personalities controlling access to the master. Yet, when the order means a loss of a few thousand jobs, a simple “communications strategy” will do. Possibly it might contain a virtual meeting where the CEO takes subordinates’ questions answered with crafted speaking points drafted by communications specialists and delivered sincerely. This is the modern way to solve a major problem- like plastics pollution?
Seventh – the use of language in the news release is full of symbols. The Table below provides some analysis of word use. This bold plan is a strategy that will succeed because the language reads as an action plan – as simple as tik-tok-toe. There are dates in the future and large numbers: for example: “According to Alberta’s Industrial Heartland Association, there is an opportunity to grow Alberta’s petrochemical sector by more than $30 billion by 2030, resulting in more than 90,000 direct and indirect jobs over the construction and operation periods of new facilities, and more than $10 billion in revenue for the Government of Alberta from corporate and personal income taxes.” Wow. This strategy reads from the same playbook that Harold Innis cautioned against.
Another claim by the Hydrogen Council, another industry lobby group, and cited in the release, claims:
- Global demand for hydrogen is projected to increase at least tenfold in the coming decades.
- The Hydrogen Council estimates that by 2050, the global hydrogen sector could generate US$2.5 trillion per year and create 30 million jobs.
Next was the need to stress the great job this strategy will do for the environment. Terms like environment, recycle and clean with along with #1 word “natural” speak to the virtue of this strategy. Will the environmentalists come onside? Doubtful given the reputation of the fossil fuel industry and its offshoots, pipelines, plastics and petrochemical companies.
| Word/Phrase | # of times used |
| natural | 33 |
| Strategy | 11 |
| Economy | 11 |
| Vision | 9 |
| Environment/environmental | 9 |
| clean | 9 |
| world | 9 |
| industries/industry | 8 |
| government | 8 |
| recycle/recycling | 8 |
| Plan | 7 |
| carbon | 7 |
| Production | 6 |
| Jobs | 6 |
| investment | 6 |
| opportunities/opportunity | 6 |
| stronger and strong | 4 |
| leader | 4 |
| innovation | 4 |
| building | 4 |
| potential | 4 |
| petrochemicals | 3 |
| Workers | 2 |
| Job creators | 2 |
| great | 2 |
| technology | 2 |
| bold | 2 |
| global competitor | 1 |
| competitive | 1 |
| economic engine | 1 |
| excellent/excellence | 1 |
| resilient | 1 |
| incentive | 1 |
| global competition | 0 |
| Risk | 0 |
| unstable | 0 |
| uncertain | 0 |
The most interesting treatment of word use however goes to carbon- it is married to other concepts in the following manner.
- “clean hydrocarbons”
- “low-carbon products”
- “no carbon emissions”
- ‘robust carbon capture and storage”
- “60 to 90 million tonnes of carbon dioxide each year”
The effort here is to deliver a slick marketing package, wrapped in a green bow that will make international investors giddy at the prospects in Alberta. Low taxes, attention to responsible environmental stewardship, etc. And it gets better with plastic recycling and green or blue hydrogen production.
Final point- is the absence of words like risk, uncertain and unstable which are all fundamental factors in the evaluation of any industrial strategy undertaken by governments that are attempting to force growth. The Province by accenting the positive is perhaps offering more than it can deliver. For instance, will the rules change during the investment stage – in particular, taxation policy, environmental and recycling policy. And certainly, as underlined by the federal announcement discussed below, provincial jurisdiction extends only so far….
Federal intrusion
Of course the federal government had to rain on Alberta’s carefully crafted and scripted investment prospectus. The very next day, 7 October, Jonathan Wilkinson made a much anticipated announcement to implement an election promise made last year by the Liberal government.
The goal is to “achieve zero plastic waste by 2030.” The press release began:
Plastic is polluting our rivers, lakes, and oceans, harming wildlife, and generating microplastics in the water we use and drink. Every year, Canadians throw away 3 million tonnes of plastic waste, only 9% of which is recycled, meaning the vast majority of plastics end up in landfills and about 29,000 tonnes finds its way into our natural environment. Canadians expect the Government to take action to protect the environment and to reduce plastic pollution across the country.
Source: Government of Canada
The modest proposal would eliminate six types of single use plastics including straws, styrofoam containers, plastic cutlery and shopping bags by the end of 2021. In addition, the federal government will be adding manufactured plastics to the list of toxins under the Canadian Environmental Protection Act. Bob Masterton, the President of Canadian Association of Chemistry Industry Association of Canada, pointed out that the short list would eliminate only one per cent of plastics production.
Industry objections boiled down to the arbitrariness of the six items, which Masterton claimed were being recycled anyway, and the fact that federal policy would chase away investment attracted by Alberta’s lower corporate income tax. Masterton also suggested federal measures could mean that the small players in Alberta’s plastics industry may not survive. Whether the billion or so treasure of offered grants would be attractive to small provincial enterprises is a big question mark.
Sonya Savage, Alberta’s Energy Minister hinted another constitutional challenge to federal regulation of the province’s natural resources might be in the offing. Savage referenced petrochemicals as being a key part of the province’s economic recovery strategy. Another federal dagger to Alberta’s resource economy.
Apparently the Alberta cabinet knows the future- it is a diversified energy economy which recycles plastics, builds new oilsands production facilities and processes and exports vast amounts of natural gas via LNG. The future seems bright. However, as Innis asks- will the revenue flow?
Meanwhile, by the time the reader has finished reading this piece, roughly 5 tonnes of plastic has entered the landfill system.