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Economy

Fossil fuels aren’t going anywhere, we benefit too much from them

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From the MacDonald Laurier Institute

By Chris Sankey

Indigenous people are finally reaping the rewards.

Over the last eight years we have experienced an unprecedented push from environmental activists to phase out fossil fuels. The Government of Canada seems to think it is possible. During question period in the Senate earlier this year, Sen. David Wells noted that, according to the Liberals, the energy transition “will cost $100-$125 billion per year at least to 2050,” and asked “When Canada only emits 1.5 per cent of global emissions, how does this expenditure make sense?”

Let me repeat that. $125 billion each year.

Who is going to pay for this? This is simply not possible, unless people want to see the Canadian economy in ruins.

Without fossil fuels, life as we know it would not be possible. State-of-the-art lifesaving medical equipment comes from fossil fuels and critical minerals from mining. Critical infrastructure, vehicles, planes, trains, container ships, ferries, and the billions of household necessities we buy from Canadian Tire, Walmart, Amazon and Ikea come from fossil fuels and help us function in our everyday lives. Without these needs we simply do not prosper.

Take for instance the environmental marches we see on our streets. The protesters seemingly have zero understanding of what makes their marches possible? Yes, fossil fuels. If you are going to protest for “Just Stop Oil,” then climate activists have to stop blocking traffic, because an idling vehicle is so much harder on the environment. And what about showing up in clothing and holding up signs made of hydrocarbons demonstrates your commitment to saving the planet? Hypocrisy? Absolutely.

From the moment we come out of our mother’s body, fossil fuels make our lives better. From cradle to grave, our lives are intertwined with fossil fuels. Just think of the act of giving birth. Chances are the mother was rushed to hospital in an ambulance, helicopter, plane, your personal vehicle, or taxi. As grandparents, siblings, uncles, aunts and cousins arrive at the hospital in their fossil fuel-powered cars and trucks smiling ear to ear welcoming the new baby to the family. They show up with gifts likely made from fossil fuels and critical minerals. If it is not made from fossil fuels, they were most definitely transported to the store using fossil fuels.

It is time we stop kidding ourselves that we can step away from the oil and gas wealth upon which our country benefits so much.

Only now, it will be Indigenous communities who are going to lead the multi-billion-dollar opportunity and put Canada at the front of global markets as a preferred supplier. For far too long, activist’s voice have been the determining factor in how governments make decisions on this necessary industry in our territories.

We need to make sure we have a framework that lays out a technology transition where we produce cleaner oil and gas by using new technology that will reduce emissions and grow our economies.

Since the Liberals were elected in 2015 everywhere we turn, our resource sector is being badly hurt. Forestry, fishing, oil and gas are screaming for more production, but federal regulations threaten to not only destroy the energy industry, but all industries with the emissions cap. Renewables are costing taxpayers billions in subsidies and it will not end there.

Indigenous people have always took care of the environment and grown our economies. From fishing, logging, farming and hunting, we used fossil fuels to make it happen.

Obviously, humans did not use fossil fuels prior to the industrial revolution and indigenous people made hunting weapons out of wood and stone. Life was challenging for our ancestors back then; life expectancy was short for all people.

Over time, technology in the energy sector changed for the better. I would be remiss if I did not include the fact that industry did not always have modern clean tech; emissions were high and cancer-causing effects were widespread. That introduced chemicals foreign to indigenous people. Like all things, newer and safer technology emerged. Making life much easier and convenient.

However, historically speaking indigenous people lived on fat and protein. Everything we ate was natural. Like all things that come and go, European contact forever changed our way of life. We were greatly impacted in every possible manner, from social, cultural, status and creed. But like we always have, we persevered like our ancestors wanted us too.

This is our turn to take our rightful place on the global stage. We are watching it play out in real time around the world. Energy and food security is the number one priority around the world. Indigenous communities near and far are leading the way in the pursuit of sustainable development, but government and activists are hindering our ability to progress.

It is important that Canadians be realistic when it comes to the use of oil and gas. All of us want to leave our planet better for the next generation. To do so, we must manage expectations. Many countries are just now finally transitioning to oil and gas from more environmentally harmful coal and countries like India will not be carbon neutral until 2070 or later.

Our country has an abundance of resources that the world wants. They are literally knocking on our door to get access to our wealth. We can help countries like China, India and Indonesia move away from burning coal and wood, and thereby help lift millions out of certain poverty, and improve their health.

New climate change technology has emerged in the energy sector, such as carbon capture and storage that will reduce and eliminate emissions and the need for diluent in oil pipelines. Our combination of Indigenous knowledge and history to the land makes for a stronger argument to partner with Indigenous communities.  Alignment amongst indigenous communities is key to securing a project. Proper alignment will de-risk a project and attract investment and industry to the table where we will have a seat and even equity.

Engagement with Indigenous communities is the solution. The vast majority of our people are not against development. We are only against development when we are excluded from the opportunities, or if the evaluation process was developed without Indigenous input.

It is not rocket-science. Include the people whose territory you want to build on. This is an opportunity to build relationships through meaningful dialogue and trust. We must have nation to nation dialogue and build leadership to leadership relationships.  No hidden agendas, just up-front, honest conversations about oil and gas and the costs and benefits of development.

I am tired of watching our people struggle. Our people do not want to watch the prosperity boat sail by Poverty Island. Markets do not wait for anyone. We cannot keep waiting for the right time. We cannot keep waiting for life to get better. First Nations can make it better by being at the economic table where our people can bring traditional knowledge to industry and make decisions in the best interests of our communities. Whether we agree or not in the first instance, we need to be in the room working towards a brighter future, because at the end of the day we all need rubber boots too.

Chris Sankey is a Senior fellow at the MacDonald Laurier Institute, a former Elected Councilor for the Lax Kw Alaams Band and Businessman.

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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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