Update 2018 12 31: Added quote from opinion piece by Danielle Smith, the table for Canadian federal transfer payments (Alberta and Quebec, 2013 to 2017), and information on Canada’s involvement in two world wars.
Update 2019 01 02: Added bar charts for Canadian Federal transfer payments (Quebec and Alberta, 2013 to 2017, provincial totals and per-capita amounts).
It’s the season to be jolly, and what does that have to do with the price of oil in Alberta?
h/t to: Rick Garza
Yes, but what Col. Wilkerson reports is not news. It has been known for many years. He is not the first but merely one of the last in a long string of people to lament that it is deplorable to be involved in promoting wars for the wrong reasons. Col. Wilkerson is also not the first but merely one of the last to identify that, in spite of the US being involved in a war for trumped-up reasons, the US is still merrily pursuing one military action after another and continues its military engagement in the Middle East and elsewhere, time and again.
Now, if Col. Wilkerson were to identify why the US does so, that would be great, but, although the reason for that is not as well-known, it is nevertheless the primary motivating factor. That is, military engagements cost money. The military engagements by the US in the Middle East (and everywhere else it does so, by the way) cost vast amounts of money and cause a lot of misery. That is good for business.
Col. Wilkerson points out that one percent of Americans suffer and sacrifice for the 99 percent who need to be kept safe. He is more than a bit light on that, where the one percent do the suffering and sacrificing, they cause damages to the localities and the locals that is orders of magnitudes greater.
What is it with the claims that the military actions and wars fought by the US in other parts of the world are being fought for the safety of the US? To insist that they are is ludicrous. That is well-known but hardly ever, if at all, discussed in the MSM or any media.
The primary reason military actions are being started and perpetuated is greed, the pursuit of profits by arms manufacturers in the US and elsewhere. Arms manufacturers have no allegiance to home and country. They have no allegiance to anyone or anything and worship no one but Mammon.
No one should have any illusions that the arms industry in the US is the only one to do so. The arms manufacturers in the US merely comprise the largest hotspot of arms manufacturing in the world.
What good would arms manufacturing be if there would be no demand for arms? Nothing creates demand for arms as well as does the starting and perpetuating of wars. Using the arms where they are being produced is bad for the business of producing them there. The smart thing to do is to use them elsewhere.
Certainly, to use arms elsewhere causes much misery and destruction, but that is there and not at home. It produces more business opportunities for the home industries, the need for more arms to be produced, and the opportunity of opening up markets for reconstruction. That is good for the country in which the arms are being manufactured. That country, with the ability of keeping its manufacturing base secure, will of course exploit the opportunities for supplying the market for reconstruction that its tradition for starting and perpetuating wars elsewhere created. Halliburton and any other comparable corporation operating internationally, while not involved directly in military operations, can tell a thing or two about that.
WWI: The War That Changed Everything, is a good example of how the international arms manufacturing industry benefitted by cashing in on a global free-for-all. As the Prager University video accessible at the preceding link shows, a local brawl between the Austro-Hungarian Empire and Serbia soon escalated to a global riot. That gave all of the industrial nation’s arms manufacturing industries a chance to cash in.
Shortly after the end of that war, in 1918, they all had another chance at it. In 1939, WWII started and continued what the first had not finished, but on a substantially greater scale. If anything, the video not only understates the scale of both of those wars, because it identifies only some of the major players in both, it does not even touch on the involvement of Japan in WWII, even though the Brits played a small part in the Pacific, while the U.S. fought the Japanese expansion back throughout the Pacific. Perhaps the fact that WWII brought the beginning of the end of the British Empire has something to do with the oversight of the important aspect that, if it would not have been for the U.S., all of the Pacific region would have become and stayed part of the Japanese Empire.
All of that shows that the U.S., even though only a late-comer (although a deciding one) in both wars, isn’t the only country engaged in exploiting the business opportunities created by the demand for arms.
The omission of the war in the Pacific is not the only omission in the Prager University video (mind you, it is mainly about WWI, but how can there be a world war that does not involve all of the world?). Amongst a large number of omissions, it also neglected to mention the involvement of large parts of the British Dominion that were no longer part of the British Empire by the start of WWI, foremost Canada, Australia and New Zeeland, for example. Canada needs to be mentioned, most certainly, as it owes much of its industrial expansion and modernization to the need to manufacture arms and military supplies for WWI and WWII, at the relatively small price of sacrificing the lives of only 40,000 and 37,000 men respectively, a small price for the economic returns it reaped. Those returns were not temporary. They left a lasting impression, a substantial capability to manufacture arms looking for a market.
Canada has a fairly large sector of its economy involved in the production of arms, for export to other countries. Nevertheless, Canada provides an excellent example of why – contrary to received wisdom – the business of arms manufacturing (and exporting the products therefrom) harms Canada’s economy, even though Canada’s arms-manufacturing industry is profitable and safe from interference by outside forces.
Canada has a reputation of being a peaceful country. Canada does not fight wars, at least not on its own turf. Everyone knows that. Therefore, Canada religiously restricts its participation in military actions entirely, except for those that take place far away – as far away as possible – from Canadian shores.
For example, Canada exports annually a billion dollars worth of arms (mostly armored vehicles) to Saudi Arabia. In return, Canada imports annually about a billion dollars worth of oil from there. One may think that is good business, and that would be correct. It puts a lot of bread and butter on the tables of the Canadians in Quebec and Ontario who produce the arms. Roughly half of Canada’s population resides and works in Quebec and Ontario. Therefore, federal politicians support trade deals that ensure a good state of health for Canada’s arms exports. After all, at least half of Canada’s politicians (actually more, but that is another issue) represent Quebec and Ontario (to what extent they represent the voters or themselves is an issue worthy of much discussion).
Well, Canada has no need to import oil. It is potentially self-sufficient with oil production. Canada’s oil is produced in Western Canada, primarily in Alberta (a small part is produced through off-shore wells east of Newfoundland). Alberta has about nine percent of Canada’s population and an a proportional share of Canadian voters.
There is no oil pipeline from Alberta to Quebec and Ontario. There is insufficient capacity of the oil pipeline from Alberta to Vancouver, British Columbia.
Western Canada has plenty of oil pipeline capacity for exporting to the US, to where customarily most of the oil produced in Canada was shipped. It used to be that virtually all of the oil required in Quebec and Ontario was imported from the US. Incidentally, initially, when Alberta’s oil industry emerged, there was much lobbying and pressuring by the US to prevent the construction of an all-Canadian pipeline from Alberta to Central Canada. That is the way things stayed and remain until today.
Thanks to the large-scale application of fracking, the US is now essentially self-sufficient with its oil production (it has become a net-exporter of natural gas). That drives down the prices for Canadian oil exports. The US is the major market for Canadian oil exports (about 80 percent). Prices for Canadian crude oil fell as low as $10 a barrel during the past few weeks. Now comes the clincher.
Canada is missing out on $80 million dollars a day ($30 billion a year) of net revenues for oil it would like to but cannot export. That is because Canada cannot supply its own oil to itself where oil is needed, and because it cannot export enough of what it can easily produce to satisfy the demand market in the Pacific region. Nevertheless, Canada’s federal politics aim at preventing the construction of sufficient pipeline capacity to Central Canada and to the Canadian West Coast. Not only that.
Canadian federal policies heavily constrain tanker traffic in Vancouver and the Westcoast, to prevent the export of Canadian oil to the Pacific region. On the other hand, Canada does all it can to keep the trade deal going that exchanges Canadian arms for Saudi oil imported at Canada’s East Coast, a trade that is worth a billion dollars a year, just to keep voters in Quebec and Ontario happy, so that they will vote half of Canada’s politicians back into office in the next elections. Does anyone think that Quebec and Ontario voters will not put Trudeau and his party back into office, or that Alberta voters are clamoring to vote for Trudeau’s Liberal Party?
Well, here is how that works. It is not what the Liberal Party can do for you, but what you can do for the Liberal Party. Vote the Liberal Party into office, and the Liberal Party can do all that is needed to make sure that the voters voting it into office have jobs. A lot more jobs are involved in making armored vehicles than in producing oil, thinks the Liberal Party. Even if the production of oil is far more profitable, what good will it do for the Liberals to make sure that Albertans have jobs producing it? Albertans don’t vote Liberal! The Liberals know that. Albertans know that they don’t vote Liberal and have good reasons not to, while the Liberals have good reasons not to do much or anything to help Albertans, as long as Albertans and the other hicks in the sticks in the West, traditionally seen – especially in Ontario – as hewers of wood and drawers of water, keep the federal transfer payments coming. The latter, once the federal contributions for Alberta are taken into account, amount to a net benefit of $22 billion a year for the Feds, from Alberta alone, with Quebec getting fairly substantial chunks of the loot.
“In 2017, according to Statistics Canada, the federal government generated $50.3 billion from Alberta taxpayers and only spent $28.5 billion in Alberta — a net transfer to Ottawa of $21.8 billion. Albertans pay more in federal taxes than we get back in federal spending. It is this difference that goes in part to support the equalization program.
Meanwhile, the federal government generated $53.7 billion from Quebec taxpayers and spent $70.1 billion in Quebec — a net transfer to Quebec of $16.4 billion.
To suggest that rich Quebeckers are somehow shouldering the burden of equalization is absurd. Quebeckers don’t pay anything into equalization because the province receives more in overall federal spending than Quebeckers pay in federal taxes. The extra money comes from taxpayers in other provinces, with Alberta taxpayers paying the largest share.”
Source: “Alberta needs a firewall, the sooner the better“
Danielle Smith, 2018 12 28, Calgary Herald
Bar charts showing provincial totals and provincial amounts per capita are contained in appendix.
Armored vehicles for the Saudi’s and for anyone else whose credit is good (if not, then the losses are written off) provide jobs and the desired voters in Ontario and Quebec, the more than half of the voters that bring the Liberals back into office, time and again.
Armored vehicles keep the world at peace. The war by Saudi Arabia against Yemen is a good example of how well that works, isn’t it? On the other hand, what has oil – especially that dirty oil from the Tar Sands in Alberta – ever done for Canada, other than to cause global warming?
Certainly, with Alberta going ever deeper into debt, it will eventually become a net recipient of transfer payments (no one knows where those will come from, because all of Canada will be broke) but first things first! This is politics, not economics! The transfer payments are still coming, right? They will keep coming for long enough to give the Liberals another chance to get elected.
Arms from Canada to keep the world at peace, keeping Western Canadian oil in the ground to help to clean up global pollution, surely, who wants to blame the Liberals for doing an excellent job?
Politicians are a consequence of a deeply rooted system of greed and its consequences. The international arms trade is an unduly large motivational force influencing the greed that controls local, national and international politics and economics.
It is not reasonable to saddle one or more politicians in Canada, the US or anywhere with the blame for the undue influence that the arms industry and the arms trade have on the workings of national and world economies. It would be far more reasonable to figure out ways by which that undue influence can be rooted out at the source.
Nevertheless, politicians can be and almost invariably are opportunistic enablers. We, the people, make that possible. The politicians we elect are enabled to do good and bad, but the politicians – and we who elect them – are not the only players in the game of “Peace on Earth and Good Will to Men.”
A government is not the expression of the popular will, but rather the expression of what a nation’s people are willing to endure.
— Kurt Tucholsky
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