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Economy

Feds ‘net-zero’ agenda is an anti-growth agenda

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From the MacDonald Laurier Institute

By Chris Sankey

Canada’s goal should not be to eliminate fossil fuels, but to carry out a steady and manageable reduction of emissions

The federal government is pushing an aggressive emissions reduction strategy that could devastate the Canadian economy and threaten our way of life. This isn’t just about the oil & gas industry. Port-related industries, transportation, infrastructure, health and education, and countless other sectors will be collateral damage. As will the standard of living of everyday Canadians.

One need only peek behind the curtain to understand the current course of federal policy.

Ottawa’s anti-fossil fuels agenda appears to be rooted in the ideas of two ideologically driven behind-the-scenes entities: Senators for Climate Solutions (SFCS) and Clean Energy Canada (CEC).

A group of 44 Canadian Senators, led by Sens. Mary Coyle and Stan Kutcher (both of Nova Scotia), launched SFCS in the fall of 2022. The Senators also recruited a team of interns from GreenPAC, a Toronto-based environmental lobby group, to help get SFCS up and running. GreenPAC Executive Director Sarah Van Exan told blog The Energy Mix at the time that the group had recently assigned its first-ever Senate intern to the office of Sen. Coyle.

“We saw the chance to lend critical capacity—with communication, coordination, and policy research—to help them get established,” Van Exan told The Energy Mix in an email. “The group’s cross-partisan aim and determination to put a climate lens on legislation, advance climate solutions, and hold the government’s feet to the fire is exciting.”

This team of ‘climate-minded’ Senators draws lightly on expertise from Western Canada, let alone calling on experienced energy experts from Alberta. Of the dozen experts listed on the SFCS website, just two – University of Calgary Geosciences professor Sara Hastings-Simon and Vancouver Island farmer Andrew Rushmere – are based in Western Canada.

12 years earlier, Clean Energy Canada was established as a subsidiary of the Morris J. Wosk Centre for Dialogue at Simon Fraser University (SFU) in Burnaby, BC. The group is the brainchild of Merran Smith, a figure The Province once described as “the spawn of the tendrilous and pervasive eco-activist group Tides Canada and [SFU].” Smith first came to prominence in the early 2000s while campaigning to protect coastal BC’s Great Bear Rainforest, rubbing elbows with the likes of Tzeporah Berman (an anti-pipeline acticist so extreme she was booted from the Alberta NDP’s Oil Sands Advisory Group). Other members of the team include BC Green Party alum Evan Pivnick and Electric Vehicle (EV) evangelist Meena Bibra. According to its own website, CEC’s mission is to “accelerate the transition to a renewably powered economy” via “inform[ing] policy leadership.”

Are these the sorts of people the Trudeau Government should be listening to on climate matters?

Let me give you a few stats and you be the judge. I recently had a chance to listen to Adam Waterous, the CEO of the Waterous Energy Fund and former Global Head of Investment Banking at Scotia Waterous. He is, I may add, an incredibly intelligent businessman who lives and breathes energy.

Adam shared some surprising facts about EVs. For instance, he mentioned that it takes five times the amount of oil to build an EV than it does to build a conventional gas-powered vehicle. In order offset this difference, a person must drive an EV 120,000 kms using the electrical grid.  Meaning, every time we build an EV demand for oil goes up, not down. Further, an EV battery does not last the lifetime of the vehicle itself, crapping out in as little as 8 years. This expands the EV’s carbon footprint even further as producing a single EV-grade battery emits over seven tonnes of C02e emissions. All told, an EV has roughly double the production footprint of a conventional vehicle.

Still convinced we are saving the planet?

The BC provincial government is forging ahead with a set of policies that its own modelling shows will make BC’s economy $28 billion smaller in 2030 than it would be absent these policies. (To put this number into context, this is roughly what the province spends on health care each year). This will set prosperity back more than a decade. This remarkable finding emerges from looking beyond the government’s glossy reports to the raw modelling results of the estimated economic impact of CleanBC policies that are studiously ignored in its public communication materials.

Similarly, Alberta Electric System Operator (AESO) estimates the cost of achieving a net zero electricity grid by 2050 to be nearly $200 billion, while the AESO Net-Zero Emissions Pathways report estimates that accelerating this timeline to 2035 could add an extra $45 to $52 billion. (That is without factoring in the costs of co-generation or the full distribution system and integration costs). Moving to net zero by 2050 will also eliminate 10,000 direct jobs in the oil and gas sector and an estimated 2.7 million jobs in total.

All provinces, and every Canadian household, will be impacted by the federal emissions reduction strategy.  However, no province will be impacted more than Alberta. The currently federal modelling used to develop the clean electricity regulations (CER) does not properly represent Alberta’s Electricity Market and thus is unable to adequately forecast the economics of energy production. Canada’s proposed emissions intensity limit effectively requires natural gas backed power plants to sequester an annual average of 95% of all associated emissions through CCUS or other technologies (CCUS) or other technologies.  As of writing, no natural gas generation with CCUS modifications has ever hit this mark.

The CERs create significant investment risk for (CCUS) projects as the physical standard for the technology is unproven.  Adding insult to injury, the federal government is proposing a 20-year end-of-life for natural gas facilities built prior to January 2025. This will result in some of the cleanest gas plants in the world being shut down decades before they run their useful life; all while Asia continues to burn coal at a record pace.

Canada is about to enter a world of self-inflicted economic pain at precisely the time that Indigenous communities are finally starting harness their resource wealth. We finally made it to the corporate table where we have a seat, a say and ownership – and now the federal government wants to take it all away. How is that for bad timing?

Without reliable and affordable energy, Canadians will be left choosing between shelter, food and keeping the lights on. I don’t know about you, but I will not follow those politicians and organizations driving our climate policies to extremes, into ankle deep water, but I will listen to and follow serious people like Adam Waterous.

The goal for Canada should not be to eliminate fossil fuels. The goal needs to be a steady and manageable reduction of emissions. We must get our ethical and clean energy out to the world.  Our economic future depends on it.

Chris Sankey is a former elected Councilor for Lax Kw’alaams Band, businessman and Senior Fellow for the Macdonald-Laurier Institute.

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Economy

Trudeau’s bureaucrat hiring spree is out of control

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From the Canadian Taxpayers Federation

Author: Franco Terrazzano

Bureaucrats love to think of themselves as “public servants,” but who is really serving who around here?

Prime Minister Justin Trudeau added another 10,525 bureaucrats to the taxpayer payroll last year. Since becoming prime minister, Trudeau has added more than 108,000 new federal bureaucrats.

That’s a 42 per cent increase in the federal bureaucracy in less than a decade.

Ask yourself, are you getting 42 per cent better services from the federal government? Unless your paycheque comes from taxpayers, the answer is a big fat NO.

While Trudeau’s bureaucracy grew by 42 per cent, Canada’s population grew by 14 per cent.

That means there would be 72,491 fewer federal paper pushers had Trudeau kept growth in the bureaucracy in line with population growth.

It’s not just the size of the bureaucracy that’s ballooning – the cost is too.

The total cost of the federal payroll hit $67 billion last year, a record high. That’s a 68 per cent increase over 2016.

Trudeau gave federal bureaucrats more than one million pay raises in the last four years alone.

Since taking office, Trudeau also rubberstamped about $1.4 billion in taxpayer-funded bonuses to bureaucrats working in federal departments.

The bonuses were paid out despite the Parliamentary Budget Officer finding “less than 50 per cent of [performance] targets are consistently met.”

Then there’s the bonuses at failing Crown corporations.

CBC dished out $15 million in bonuses last year, while their President and CEO Catherine Tait whined about “chronic underfunding” and begged the government for more taxpayer cash. The CBC takes more than $1 billion from taxpayers every year.

The Canada Mortgage and Housing Corporation dished out $102 million in bonuses over the last four years, while Canadians couldn’t afford to buy a home. The bonuses rained down, despite the CMHC repeatedly claiming it’s “driven by one goal: housing affordability for all.”

The Bank of Canada dished out more than $60 million in bonuses over the last three years, even though it failed to do its one and only job: keep inflation low and around two per cent.

The average annual compensation for a full-time federal bureaucrat is $125,300, when pay, pension and perks are accounted for, according to the PBO.

There are now more than 110,000 federal bureaucrats taking home a six-figure base salary – an increase of 154 per cent since Trudeau took power.

Meanwhile, data from Statistics Canada suggests the average annual salary among all full-time workers in Canada was less than $70,000 in 2023.

Here’s why all this matters:

First, it’s an issue of fairness. The last few years have spelled hardship for Canadians who don’t work for the government, but do pay the bills.

Countless Canadians were sent to the ranks of the unemployed, lost their business and struggled to afford rising rents and costly grocery trips.

They’re paying higher taxes so more highly-paid bureaucrats can take bigger paycheques.

Second, more than half of the federal government’s day-to-day spending is consumed by the bureaucracy. That means any government that wants to fix the budget dumpster fire must shrink the bureaucracy.

Let’s recap:

Taxpayers paid for 108,000 new federal bureaucrats. Taxpayers paid for more than one million pay raises over the last four years. Taxpayers paid for more than $1 billion in bonuses.

And bureaucrats barely meet even half of their performance targets – targets they set for themselves.

It’s clear Trudeau’s bureaucratic bloat isn’t serving taxpayers. It’s time to find a pin and pop Ottawa’s ballooning bureaucracy.

This column was first published in the Western Standard on July 202, 2024.

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Economy

We’re Getting Poorer: GDP per Capita in Canada and the OECD

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From the Fraser Institute

By Alex Whalen and Milagros Palacios and Lawrence Schembri

Canada lost ground compared to key allies and trading partners such as the United States, United Kingdom, New Zealand, and Australia between 2014 and 2022.

Canada had the third-lowest growth in GDP per person from 2014 to 2022 among 30 advanced economies, finds a new study published by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“In terms of GDP per person, a broad measure of living standards, Canada’s performance has weakened substantially in recent years,” said Alex Whalen, director of the Fraser Institute’s Atlantic Canada Prosperity Initiative and co-author of We’re Getting Poorer: GDP per Capita in Canada and the OECD, 2002–2060.

The study, which examines Canada’s historic and projected GDP per capita growth compared to similar OECD countries, finds that from 2002 to 2014, Canadian income growth as measured by GDP per person roughly kept pace with the rest of the OECD, but from 2014 to 2022 Canada’s growth rate stagnated.

In 2002, Canada’s GDP per capita was higher than the OECD average by US$3,141. By 2022, it had fallen well below the OECD average by US$231. Canada lost ground compared to key allies and trading partners such as the United
States, United Kingdom, New Zealand, and Australia between 2014 and 2022.

For example, Canadian GDP per person in 2014 was $44,710 (80.4 per cent of the US total of $55,605) but by 2022, Canada was only at $46,035 versus $63,685 in the US. In other words, the gap had grown from $10,895 to $17,649 by 2022 (all measures in inflation-adjusted US dollars).

“Canada has been experiencing a collapse in investment, low productivity growth, and a large and growing government sector, all of which contribute to reduced growth in living standards compared to our peer countries in the OECD,” said Lawrence Schembri, a senior fellow with the Fraser Institute and co-author.

  • This research bulletin examines historical and projected trends in the growth of Canada’s GDP per capita, and compares these trends to those in peer countries in the OECD.
  • Canadians have been getting poorer relative to residents of other countries in the OECD. From 2002 to 2014, Canadian income growth as measured by GDP per capita roughly kept pace with the rest of the OECD. From 2014 to 2022, however, Canada’s position declined sharply, ranking third-lowest among 30 countries for average growth over the period.
  • Between 2012 and 2022, Canada lost ground compared to key allies and trading partners such as the United States, United Kingdom, New Zealand, and Australia, with Canadian GDP per capita declining from 80.4% of the US level in 2012 to 72.3% in 2022.
  • Looking forward to 2060, Canada’s projected average annual growth rate for GDP per capita (0.78%) is the lowest among 30 OECD countries.
  • Canada’s GDP per capita (after adjusting by inflation), which exceeded the OECD average by US$3,141 in 2002 and was roughly equivalent to the OECD average in 2022, is projected to fall below the OECD average by US$8,617 in 2060.
  • The root cause of Canada’s declining long-term growth in GDP per capita—recent and projected—is very low or negative growth in labour productivity reflecting weak investment in physical and human capital per worker.
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