“We must all be aware that demands for effective (energy) policies will yield only superficial change as long as the role of special interests in government remains unaddressed….Fossil fuels will continue to provide a large fraction of global energy (now about 80%) and release CO2 to the air as long as the price of fossil fuels does not include their costs to society, i.e., as long as we allow the atmosphere to be a free dumping ground for the waste products of fossil fuel mining and burning.”
- James Hansen, former Director of NASA’s Goddard Institute for Space Studies, and now adjunct professor and Director of Columbia University’s Earth Institute Program on Climate Science Awareness and Solutions
Today’s lead story in my CBC News Morning Brief is an “analysis” piece entitled, “Why High Oil Prices Aren’t Creating an Economic Boom in Canada”. It turns out to be a classic example of colonial journalism from our national broadcaster (and, I admit, a former employer of mine). By that, I mean, it is written from a corporate colonial perspective, full of astonishment that super profits don’t automatically result in new investment and job creation as corporate mythology insists. To be honest, this is nothing new for business reporting, but more inexcusable than ever today, being not simply faulty economics, but ignorant of the wider public interest.
The word, “environment”, turns up only once, as an aside. The reality of our living in a climate emergency is unacknowledged and excluded. And this, within a week or so of India recording its highest temperatures in more than 120 years (approaching 50C) and the Scripps Institute recording the highest recorded level ever of CO2 in the Earth’s atmosphere (421.37 ppm). The fossil fuel industry’s responsibility for these shattering events? Unacknowledged.
The possibility that Big Oil’s extraordinary profit levels might signal a fiscal failure on the part of provincial and federal governments, a failure to recoup for public benefit a windfall derived from our commonweal, is not considered. Remember, Jason Kenney’s UCP government’s 3 percentage point corporate tax cut (2019), was estimated to cost the provincial treasury $4.3 billion by 2022, based on projections of oil prices well under today’s levels. The cost was always a clear underestimation, since five oil giants (Canadian Natural Resources, Suncor Energy, Imperial Oil, Cenovus and Husky) by their own calculation expected to reap almost $4.3 billion in “savings” from the cuts. That was 2019. That number has clearly exploded with oil prices today predicted to average at least $25 per barrel over even the 2022 provincial budget’s assumptions.
Kenney’s justification for his corporate tax cuts was it would lead to job creation, even though the evidence is clear that this is one of the least efficient routes to job creating investment. And so the record of the past three years shows. Companies are more inclined to reward their shareholders and management than invest those tax “savings” in new projects. Yet Conservative economic mismanagement gets a pass, despite its costliness.
Given a wider context, higher prices for fossil fuels are indeed called for, prices that actually account for all the costs attendant on our production and consumption of those resources. The Trudeau Liberals have disingenuously gone so far as to argue that increased fossil revenues will fund the transition to a renewable energy economy. Nonsense, of course, ignoring history and accepting as it does continued expansion of production we can’t afford. It is an argument intended to cover up their inability to confront the industry, their colonial master, and to exact a fair share of returns for the public treasury.
The potential role excess fossil revenues might play in the hands of a democratic activist government, if directed to investment in the essential job-creating transition to a renewable energy future, is also unacknowledged in the CBC analysis. The focus, instead, is the failure of reinvestment in new fossil projects! Unbelievable!
The writer, like our governments, sees as natural what one of his industry interviewees calls, approvingly, Big Oil’s “wicked profitability”. We have been schooled to accept that the disposition of excess (and unearned) profits – really, public rents transferred to the private sector – is purely a matter for corporate decision-makers. Democracy be damned. Climate emergency be damned. Future generations be damned. This is modern colonialism, folks, and our continued acceptance of it has placed us firmly on the road to climate catastrophe, if not oblivion. Journalists today must question that acceptance, not submit to it.
There is much more to be said on this, especially the perplexing inability of our political representatives, of all stripes I regret to say, to give primacy to addressing the looming climatic point of no return. I will turn to that in a future post.