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  • Canada’s Fossil-Fuelled Pensions June 22, 2018
    The British Columbia Investment Management Corporation is?the steward of BC’s public pensions, but bankrolls companies?whose current business models exceed the climate change targets agreed to in the Paris Agreement to which Canada is a signatory. The pensions of over 500,000 British Columbians and assets worth $135 billion are managed by the Corporation—-one of Canada's largest […]
    Canadian Centre for Policy Alternatives
  • Imagine a Winnipeg...2018 Alternative Municipal Budget June 18, 2018
    Climate change; stagnant global economic growth; political polarization; growing inequality.? Our city finds itself dealing with all these issues, and more at once. The 2018 Alternative Municipal Budget (AMB) is a community response that shows how the city can deal with all these issues and balance the budget.
    Canadian Centre for Policy Alternatives
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    When we think of a “boomtown,” we often imagine a formerly sleepy rural town suddenly awash in wealth and economic expansion. It might surprise some to learn that for many municipalities in oil-producing regions in Saskatchewan, the costs of servicing the oil boom can outweigh the benefits. A Prairie Patchwork: Reliance on Oil Industry Philanthropy […]
    Canadian Centre for Policy Alternatives
  • What are Canada’s energy options in a carbon-constrained world? May 1, 2018
    Canada faces some very difficult choices in maintaining energy security while meeting emissions reduction targets.? A new?study by veteran earth scientist David Hughes—published through the Corporate Mapping Project, the Canadian Centre for Policy Alternatives and the Parkland Institute—is a comprehensive assessment of Canada’s energy systems in light of the need to maintain energy security and […]
    Canadian Centre for Policy Alternatives
  • The 2018 Living Wage for Metro Vancouver April 25, 2018
    The cost of raising a family in British Columbia increased slightly from 2017 to 2018. A $20.91 hourly wage is needed to cover the costs of raising a family in Metro Vancouver, up from $20.61 per hour in 2017?due to soaring housing costs.?This is the hourly wage that two working parents with two young children […]
    Canadian Centre for Policy Alternatives
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Andrew Coyne Off the Rails

Although I generally disagree with Andrew Coynea€?s take on economic issues, I enjoy his commentary because it is almost always articulate and well-informed. Last Saturdaya€?s column, which may be his second-last at the National Post before moving to Macleana€?s, was a glaring exception.?? In particular, it contradicted??Coyne’s own previous contentions.

When the Government of Newfoundland and Labrador took an equity stake in Hebron a couple of months ago, he wrote, “therea€?s something bizarre about the government paying for the right to participate in the extraction of a resource it already owns.” (In fact, offshore resources are technically owned by the federal government.) Now that the Government of Alberta is starting to behave more like a resource owner, Coyne has bought into Terry Corcorana€?s philosophical musings about how “there is no divine right that decrees the provincea€?s oil and gas reserves should belong to the state.”

Corcoran??and Coyne seem to think that, since natural resources do not theoretically need to be provincial property, Alberta should be content to continue giving away these resources for less than they are worth.?? I suppose that this argument might have merit in some parallel universe, in which Canadaa€?s legal and constitutional history had been completely different.

The Post printed the following letter from yours truly on Tuesday, but edited out the second sentence, which I thought was critical to the lettera€?s flow:

Re What is Albertaa€?s Fair Share?, Andrew Coyne, October 27.

Regarding resource revenue, Mr. Coyne asks, “why is it a€?fairera€? that the government should have it than the oil companies?” Last year, he derided low stumpage fees as a costly subsidy to the lumber industry. He should recognize low oil and gas royalties as a far costlier subsidy to a far more profitable industry.

Mr. Coyne then asks, “why dona€?t they just auction it off?” Of course, provincial governments do auction off exploration and development rights. However, like virtually all other oil-producing jurisdictions around the world, they understand that this process does not capture the full value of fossil fuels. There are not enough potential bidders (i.e. oil companies) for genuinely competitive auctions. Also, bids are severely discounted because the resourcea€?s value is unknown prior to exploration and development.??

Auctions would be particularly impractical in Albertaa€?s oil sands, almost all of which have already been leased to a handful of companies. Clearly, royalties must be charged. Mr. Coyne should applaud Alberta for moving these royalties modestly closer to the true value of its oil and gas.

Erin Weir, economist, Canadian Labour Congress, Ottawa

UPDATE (Nov. 18): In writing that Coynea€?s strange column on resource royalties might be his second-last at the Post, I incorrectly anticipated that he might have some sort of final “farewell column” there. Although no such column has appeared, I note that his debut column in Macleana€?s returns to his usual high standard.

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