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Shifting sands, Part V

Frugal Norway saves for life after the boom

DOUG SAUNDERS

From Thursday's Globe and Mail

Latest comment posted at 12:20 PM EST 20/06/08

The lesson Norway can teach Alberta about oil wealth. ...Read the full article

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  1. S Lucht from Canada writes: The top marginal tax rate on wages is about 48% in Norway, and there's a 28% flat tax on corporations. VAT ranges from 13% (for food) to 25% (for other things). Canada's mean top marginal tax rate isn't about 45%, though we'd generally pay less GST/PST. Corporate tax rates are generally higher.

    So given that there aren't dramatic differences between our rates of taxation, how is it that Norwegians enjoy one of the best standards of living in the world and still have a high disposable income? Where's all our money going?

    No Canadian government in my memory has ever had the foresight, intelligence, or integrity to invest royalties, taxes, etc. in order to create a stable contingency fund for the country. Rather than do something financially useful for the country, our politicians stick to a simple formula: Tax, spend--repeat. Pathetic, but as long as it keeps their pensions safe, they're happy.
  2. ghostofpatbuchanen buchanen from Victoria, Canada writes: The problem in Canada is that politicians get their hands on that oil money. So naturally it's used to buy votes, not a better future for ourselves and our kids. Pretty straightforward.
  3. 20 20 from Canada writes:
    "In exchange for the right to drill, they must hand 78 per cent of their profit over to Mr. Slyngstad's fund."

    And yet the Big Oil companies including Talisman and Petro-Canada are there. This goes to show that Canadians can and should be demanding more of the oil profits here in Canada and should not be so easily conned by dire warnings that it will "kill the golden goose".

    Besides having the government oil fund, Norwegians also have their widely-respected state-owned oil company, Statoil.

    We used to have Petro-Canada, which according to the US Department of Energy's website, the Canadian government formed "in 1975 in an effort to reduce the dominance of U.S. companies in Canada's oil industry."

    So of course Mulroney began selling off Petro-Canada in 1991, and Conservative-Lite Paul Martin completed the sell-off in 2004. What they privatized for just $5.7 billion, giving taxpayers an estimated profit of just $0.75 billion, is today worth some $23 billion as valued by the markets.

    That's some $17 billion in gains Canadians missed out on, and at least another $2 billion in dividends, without even counting interest. Since Petro-Canada is majority foreign-owned, the majority of those gains went to foreigners.
  4. 20 20 from Canada writes:
    Another key point from this article is Dutch Disease, where too much oil revenue coming in too quickly inflates the currency and destroys exports, jobs, and a country's diverse industries and economy.

    A meeting in Houston, Texas, kept secret from the Canadian public for over a year before Radio Canada got a hold of the minutes, called for a "fivefold expansion" in Canadian oilsands production in a relatively "short time span" and encouraged decision-makers "to streamline the regulatory approval process" with a "one-stop-shop" for project proposals to facilitate that expansion.

    Snapping right to, "Harper has said the oil sands could produce 4 million barrels per day by 2015 and has indicated he would work to see that happen," and established the "Major Projects Management Office" to "streamline the regulatory system for major resource projects" and "provide a single point of entry into the federal regulatory process for industry".

    That too rapid acceleration of oil sands production for the sake of the Americans is a sure recipe for Dutch Disease. We see it already damaging many of our other export industries, and Harper has offered cheap bandaid solutions to them all while practically ensuring Dutch Disease.
  5. Owen Perry from Windhoek, Namibia writes: Excellently written and highly informative article.
  6. D. G. from Burnaby, BC, Canada writes: Doug Saunders- Exactly what expertise does this guy have, about anything? He wrote articles in the G&M "Focus" section. He should write about politics, ....oh wait, I guess this really IS a politically driven article, my mistake.

    First, the oil belongs to Alberta, NOT Canada.
    "Saving the revenue for a rainy day" like Norway does, suits Norway, because they lack any ideas on how to grow their economy, they just hope their government knows how to invest it properly, which governments rarely do, because they normally like to spend on buying votes, they make POLITICAL decisions, not economic ones, which do not benefit the country, just their party, especially in Canada, where they pay-off one end of the country for votes at the expense of another. Keeping the money out government hands at all costs is sound economic policy ,and has been proven true worldwide for decades.

    Norway also produces more oil than Alberta, with about the same population, so they should take more revenue per capita.
  7. D. G. from Burnaby, BC, Canada writes: .... In addition, because the oilsands are MINED, the oil EXTRACTED, and then PROCESSED, all before it ever sees a refinery, the capital costs are freaking HUGE compared to platform drilling. Consequently the RETURN after EXPENSE will be less, and thus the revenue $ per barrel will be less as well. And because these oilsands projects will COST around $20 Billion EACH, the RISK will be higher, therefore the shareholders (this means anyone in Canada with a pension fund or RRSP) should get a better return for that increase in risk. But this is great news economically speaking, because that $20 Billion spent for each plant goes primarily into labour cost (country-wide), whether it is engineering, fabrication, construction, or services, IT ALL GETS DISTRIBUTED to INDIVIDUAL Canadian WORKERS. What could be a more PERFECT way to distribute wealth in an economy. And on top of that, yes, ON TOP OF THAT, any profit the companies ever make will be paid out to shareholders that comprise the majority of Canadians who hold any RRSP's, Pension Funds, or Mutual Fund. Would you rather have the Federal government piss it away on free loans to Bombardier, or start a farce of a gun registry in New Brunswick? The Oilsands and Norway are not similar in anyway. The Alberta energy minister is right, Norway has nothing to teach him or any other Albertan, unless its how to pickle herring. But I think it would be well worth Doug Saunder's while to sit in a few classes on basic economics, starting with free market theory.
  8. Ron Pacific from Victoria, Canada writes: Canadians are far too complacent about their future. Norway is investing in its future now while living modestly in the present. Unfortunately, we as individuals are too busy pissing away too much of our resource wealth on monster SUV's and granite kitchens. We salivate (or our media and political hacks tell us we should be saliviting) at the prospect of sales tax cuts so we can spend more on Starbucks and less on our grandchildren! How has the Alberta government fared? Not well - their solution is to dish out vote buying "Ralphbucks" to be blown on trips to Vegas, Mexico and casinos. Meanwhile, our federal government is too busy blowing billions of wads of cash on a silly and unwinnable war to properly plan for our future. Very sad!
  9. Robert Miller from Halifax, Canada writes: Here's the key quote:

    "In exchange for the right to drill, they must hand over 78 per cent of their profit over to Mr. Slyngstad's fund..."

    78%!!!

    Anyone kow what Alberta gets. Have a look:

    http://economist.com/displaystory.cfm?story_id=10091402

    Yes, that's Alberta way down at the very bottom of the list -- where Stelmach and Klein seem quite content to keep them.

    Meanwhile there are a number of posters (whose posts obviously do not emanate from this country) on these Albertan threads who clearly have vested interests in perpetuating their lies to Albertans and polarizing Canadians...

    I just realized that many Albertans actually still believe that Atlantic Canadians are living off employment insurance as the Federal Government maintains an employment insurance surplus of $55 BILLION AND GROWING!!! Time to get the Feds off our employment insurance.

    Very sad, indeed!
  10. Robert Miller from Halifax, Canada writes: The big picture that is emerging here just keeps getting uglier and uglier... We need a Federal inquiry/royal commission to understand what these politicians are doing with our money in Canada...

    Canadians need to be more vigilant... Albertans who claim to be the most aggressive about these issues should take the lead in this country because their province seems to be the one getting screwed the most by politicians (both Federally and Provincially)...

    The NEP was 25 years ago... time to wake up and look at the present...
  11. old curmudgeon from Armenia writes: Looks like D.G. from Burnaby is one of the Albertans who retired to BC. Having worked for the federal Energy Department during the NEP programme, I find it illustrative that the companies that were screaming then about illegal confiscation are now content to participate in a regime where even more of their profit is turned over to the government. Actually, it was during the NEP period that I--as someone born and raised in Alberta--lost all respect for the oil industry and Albertans oft-trumpeted but infrequently-observed commitment to "principle". During the good times, the talk was all about expropriation, unfairness, that-damned-commie-Trudeau, etc., and the government was being urged to keep its hands off the oil industry (which was--and still is--conveniently US-owned). When the crash came, who was first to the trough for handouts? You guessed it--the oil industry. How quickly capitalists change their views to become welfare recipients when the market which they adored whilst becoming wealthy turns against them. I have had occasion to visit the Nordic countries in connection with their pension systems. What most struck me was the truly universal concern of citizens with their country's interest rather than their own local interests. Norway's approach works because its citizens buy in to the broader public good on a willing and informed basis. This approach can never work in Canada, where what is Alberta's must remain Alberta's, and the national interest is followed only where it coincidentally parallels self and local interest.
  12. Raymond Conway from London, United Kingdom writes: We have to stop blaming the politicians for all our ills. The voters of Canada complain about how the politicians buy peoples votes, but who votes for those that do? Unfortunately, elections in Canada (and many other countries) are more like elementary school student elections. Vote for whoever promises you the most.

    Look at the economic achievements under the Mulroney Government and the fate of the Progressive Conservative Government. They fundamentally restructure the Canadian economy and prepared it for the 21st Century. Their reward? Political oblivion.

    So stop bellyaching about politicians and look in the mirror! I have seen the enemy and he is us!
  13. Robert Miller from Halifax, Canada writes: Raymond Conway from London, United Kingdom:

    Are you kidding me? Canadians are far too easy on their politicians...

    I check the comments section in The Times of London frequently, and am amazed at how knowledgeable some people are about their own governments...

    In Canada, we blame the "creeps and bums" for taking our money that we pay in employment insurance while the Federal Government is running up surpluses of $55 BILLION DOLLARS AND GROWING on Employment Insurance...

    I think that says alot about how politically naive that we are being in Canada...
  14. Robert Miller from Halifax, Canada writes: Raymond Conway from London, United Kingdom:

    Sorry -- I have re-read your post.

    Yes, you and George Bernard Shaw are correct that we still do get the lousy government that we deserve...

    However, our limited and partisan media in this country is pathetic... The G&M, at least, seems to be trying to be more inclusive of others' opinions...

    Lord Black's old paper, the National Post, forget about it! Lost cause!
  15. JT From TO from Toronto, Canada writes: Can you imagine the howls from all the special interest groups to spend the money on their pet cause if Canada followed this sort of model?
  16. Ludo Segers from Outside Canada, Canada writes: The taxation issues are correct. However, add the provincial sales tax (a non-issue in most European countries) and we are close to that basic VAT rate in Norway.
    It is always sad to comments; made earlier, stating that Canada has no lessons to learn. How is that possible in an integrated 'global' economic context?
    Moreover, at a gathering of the world's top economist in the summer of 2006, Norway with a mixed economy (and substantial government intervention) was voted the best economy in the world.
    A number of recommendations have been made to the Government of Alberta to deal with the oil wealth and to position itself for the future. Heavy investment in higher education was one of them...
    I think we live in a world, where governments (with a vision and leadership) can learn a lot from each other. Just leaving it up to 'industry' and 'free economics' will not accomplish a lot for the future of the citizens of Alberta and Canada. Alberta's government and Heritage Fund have (comparatively) have so far very little to show for. Given the present reserves it is high time for action.
    The Saunders article is a good eye opener and a starting point. Do not wait too long!
  17. Bob Macdonald from Liverpool, United Kingdom writes: Yeah, Canada is soo not in need of advice that it has been slipping down the global human development index year-after-year. It is doing this because the country has become lazy, complacent and arrogant about its achievements. Its cities are littered with homeless people and hundreds of thousands exist on food banks.

    Public infrastructure is falling apart, you can't travel across the country cheaply, there isn't a fast train service from Toronto's Pearson Airport to downtown, the highways are clogged with cars and trucks, vast tracts of ugly houses are plopped down with no plan, and the suburban rings around the cities are areas of despair and hopelessness than the New Canadian Dream.

    The country needs fresh thinking and a plan.
  18. Robert Miller from Canada writes: Bob MacDonald from Liverpool, United Kingdom:

    As you have correctly identified, not only is there no vision, but there is far less "openess and accountability" in government and media on this continent than ever...

    The secretive cabals (ie. Council of Foreign Relations, SPP, PNAC, etc.) look after their own special interests at the expense of the citizenries while their media brethren look the other way... or even worse while employing high school drop out, former deejay pundits from Canada to tell us all lies like the Iraq War is over, Bin Laden is dead and that his old boss, Lord Black, should be acquitted...

    Before we could even get on with the process of fresh thinking and a plan, Canada needs to recognize what is currently happening with their government.

    I am really not sure that enough Canadians are there yet.
  19. della baird from vancouver, Canada writes: dee vancouver: scandanavian countries have been at the forefront of taking care of their own. i believe that is why there isn't the huge migrations that other places experience. why doesn't this country wise up and follow the the best example. scandinavins generally have more respect for their leaders because they are shown more respect. bravo!
  20. Bob Van Derlay from Toronto, Canada writes: DG from Burnaby has summarized much of what is wrong with this article. However it is good to see the Norwegian situation presented. Norway escapes most of the press reports and statistical reviews because of its small population. During a visit to Norway I noticed that there were signs in the buses asking Norwegians to be more considerate of people of various ethnic origins. I asked my host about Norway's immigration policy. He said we tried it, we didn't like it so we don't do it anymore. I investigated immigration to Norway on the web. The Norwegian government hosts a site, aimed at potential immigrants, many from Russia, that says that Norway does not have an immigration policy and urges potential immigrants to consider countries that do have immigration policies, like Canada and Australia. That policy together with relatively cheap oil is what produces $78,000 per head in Norway. Also all those spin off businesses are possible in a rich country with a vast government account surplus and current account surplus. They are a little more difficult in a country with a massive debts at most levels of government. Very few Canadians, although familiar with the terms, debt, deficit, and surplus, cannot remember the name used to describe the situation when the government actually has money in the bank.
  21. black dog from canada, Canada writes: old curmudgeon, your post is hilarious in its bias. You ignore a very key point: Norway does not send massive amount of its revenue outside of its jurisdiction! Start shipping Norwegian money to central Europe on a per capita basis comparable to what Alberta sends to the rest of Canada (via taxation) and then see how warm and fuzzy Norwegians feel.

    I'm not saying Alberta shoudln't send its money out, or that Norway should, all I'm saying is that of course (!) Norwegians have more money in the bank - they haven't given credit cards to their neighbours... And of course this impacts their universal outlook, which you observed.
  22. Robert Miller from Halifax, Canada writes: Norway also seems to do a better job at limiting GHG emissions.

    Although Norway is listed as the third largest oil exporter behind Saudi and Russia, here is an interesting comparison:

    Norway GHG (2003) - 56, 500, 000 tonnes CO2

    Alberta GHG (2004) - 109, 503, 697 tonnes CO2

    Houston (and I mean that) -- we have a problem!

    Maybe, tell your boy, Stelmach, that he should do something about it!
  23. dallas mcquarrie from Regina, Canada writes: Norway just shows how stupid oil producing provinces like Alberta and Saskatchewan are. In Canada, government exists to service the oil industry and the needs of the people - both short and long term - come second. In Norway, the oil serves the nation. Canada could learn a lot from Norway's approach if our leaders weren't so short-sighted and spineless.
  24. Bob Macdonald from Liverpool, United Kingdom writes: Let's address a number of points: saying Alberta should not be sharing its wealth with the rest of Canada is idiotic. Alberta is a province of Canada, not a nation unto itself. Why don't you get really stupid, and say that Edmonton should not be giving money to Alberta.

    Immigration is an interesting question. While at one time it was seen as a driver of wealth in Canada, it has now morphed into being a social service. This is a big distinction and a reason why Canada is not getting the wealth kick it should be from immigration. Strangely, Canada educates and then exports large numbers of Canadians to the US etc., while turning around and importing people to make up the loss.

    Canada would get a wealth kick if it reformed its immigration programme, stored its wealth and invested it in modern infrastructure and business creation, and anchored all of this in some imaginative and thoughtful planning for the future. At present, Canada is a nation adrift.
  25. garlick toast from Canada writes: i bet danny williams will be studying the norwegian method.
  26. Robert Miller from Halifax, Canada writes: Garlick Toast from Canada:

    Norway's, Norsk Hydro, is one of the partners in the Hebron Oil field?

    What do you think? -- I think that it must actually be challenging for Williams to deal with the likes of Chevron and Exxon when he has partners from China and Europe who have been used to playing by the rules that Norway uses...

    Think what may have been if only Steve had originally helped Danny develop Fallow field legislation (similar to that in Alberta) for the Offshore of NL as Williams had requested...
  27. old curmudgeon from Armenia writes: Hey Black Dog!!! I think I know what you mean, although you actually said the exact opposite. The whole point of the article was that Norway avoids the Dutch disease precisely because it DOES send its money outside. I think what you're getting at, though, is that Alberta gives a lot of its money to other parts of Canada, through the progressive tax system, redistribution programmes, etc. And that may be true (although with all the toing and froing it's hard to get an accurate picture of who ends up the winner at the end of the day). And that would also get us into the old "we subsidized you when wheat was cheap" etc. debate, which is a matter for another day. But that wasn't the point of my earlier contribution, which was that people in Canada think along local rather than national lines, unlike Norway and other Scandinavian countries. In fact, what you have said is a perfect example of that. And I don't agree that Norway's policies or circumstances impact its citizens' outlook. Quite the opposite--their citizen's outlook determines the policies and circumstances. I'm not trying to pick on Alberta--it's just the most graphic illustration that regional interests trump national ones. Canada's political structure is indeed different from Norway's. It is based along provincial rather than national lines, which creates and promotes the regional approach. As a result, it can never do what Norway is doing unless the provinces all agree to act in unison, something that will never happen. So my point is that it would be nice if Canada could adopt the Norwegian approach, but for constitutional and cultural reasons, it can never do it.
  28. Terry Quinn from A proud free Canada, Canada writes: I would think that if one added the pension assets of each provinical government along with the CPP Canada might not look so bad in terms of saving for the future. We simply have a different system that Norway's.

    Just between Ontario, Quebec and the feds alone I believe there are over $400 Billion in pension assets under their control.
  29. Terry Quinn from A proud free Canada, Canada writes: I also think people are also forgetting the very high cost of producing oil in Canada as opposed to the North Sea.
  30. old curmudgeon from Armenia writes: But the whole point of the article is not whether Canadian oil is more expensive, or whether Canada has more or less money than Norway, or whether Norway is capable of saving more or less than Canada. It is what is done with the current income to ensure future prosperity. It is not oil-revenue specific, although that is currently the resource producing the windfall profits. If gold or diamonds or whatever were suddenly to return similar profits, the same issues would arise. The choice is between using income for current consumption or saving it for the future. Norway as a nation has chosen to forego current benefits in favour of future ones, while Alberta/Canada have chosen the other direction. In Norway, it is a decision made by the people themselves, based on their dedication to their own country as a whole. In Canada, due to the constitution, it is a decision made by regional politicians to appease their constituents and extend their political tenure.
  31. Tony Mareschealle from Mississauga, Canada writes: As one of there next biggest hurdles is finding labour - lets hope they do not make the same mistake as Canada and adopt similar free for immigration laws.
  32. P Martin from St. John's, NL, Canada writes: It is useless for Danny Williams to study the Norwegian way when you have 50% of non-renewable resources removed from the equation, a fiscal capacity cap tied to Ontario and a per capita debt more than double the national average. Of course if that billion per year stolen from NL by Ottawa was there and that billion per year stolen by Quebec was there, there would be an opportunity to look at some sort of strategy similar to Norway, or even Iceland.

    But good luck to Norway. They seem to have more foresight and economic smarts than our bunch. You have Harper spending like a drunken sailor, whether it is for buying votes or increasing the government. You have a government divided upon itself, with short-sighted policies and destructive governing tactics. And you have a population so disgusted by our thieving, greedy politicians that we keep voting in self-proclaimed slime, because the alternatives are no better.

    Of course Norway is doing well, they are happy with their government. And their government is trying to look out for their future. The chances of our government being like that are the changes of that snowball in hades.
  33. Lee Thompson from Sarnia, Canada writes: Surprise!

    Short term thinking from the small-minded Government of Alberta.

    Some things will never change.
  34. Rollo Tomasi from Ann Twerp, Belgium writes: Sounds like a bunch of farmers, saving their money in the bank, no imagination. I bet the banks Love the cut, 78%. It looks like a much better model than Alberta's, but, what is the evironmental footprint of leaky oil platorms up and down their coast?
  35. Dan Green from Palm Beach Gardens Florida, United States writes: Have been in the oil and gas industry many years, as a supplier to the Oil companies. It is true, most Oil rich nations, cannot seem to get the revenue to their people. Seems a pattern. Arabs of course need to keep their folks in poverty, so the leaders can keep their kingdoms, and support Terrorist. Hugo Chavez still has astounding poverty, and now food shotrages. On and on the list goes. I would predict, that eventually, Ottawa will have to take controling interes,t and see if they can spread it around. Quebec probably would get the biggest slice, followed by Ontario. The mega Oil companies know how, and what to expect, dealing with governments. Usually if they don't toe the mark, they get nationalized, or they pack up and leave.
  36. George S from Toronto, Canada writes: One small area that Norway has invested in a big way is its public transit system in Oslo, a city of roughly the same size as both Calgary and Edmonton are. That city's T-bane system has roughly about the same amount of kms that the city of Toronto's subway system has, and the greater Toronto area has roughly 5 times the population.

    To me this shows that the government cares much more about its citizens and the environment by investing much more then we do in urban transit. This investment will pay off when the oil runs out and their workers and students will still be able to make it to their destinations without breaking their bank accounts or hurting the environment as much. Oslo is preparing to keep on working in the changing world, wish Canada would have such foresight.
  37. Alex Yaxmos from Canada writes: THe Canadian governemt just lacks forward thinking plans, self-discipline and has no long-term learning process. I think that's more our fault for not demanding it from them. We are happy with we get.
  38. Thomas t from Hong Kong writes: One model is the save for the future model the other is send all the profit to American shareholders model.
  39. Der Kommissar from T.O., Canada writes: Rollo: Norway's Oil Fund is one of the world largest investors. The fund invests outside of Norway following strict ethical guidelines (i.e. they pulled out of Wal-Mart, because of Wal-Mart's labor exploitation policies).

    As for the leaky platforms, I suggest you go and have look at the Norwegian cost line for yourself - it is one of the prettiest areas of the world. I am not saying that drilling in the seabed is without environmental impact but compared to what is happening with the oil sands in Alberta it is fairly benign.
  40. Robert Miller from Halifax, Canada writes: Dan Green from Palm Beach Gardens, Florida, United States:

    Agree with what you say, but unfortunately, the peripheral areas of Canada particularly Atlantic Canada and Western Canada no longer trust the Federal Government possibly with good reason.
  41. Dave Roberts from Toronto, Canada writes: Norway's "great example" is actually a lesson in over taxation. Norwegians pay significantly higher taxes than the average Albertan, this allows them to save 100% of resource revenues directly into their savings fund. Albertans by contrast save about 30% of resource revenues in their basket of various endowment funds.
  42. John Cameron from Red Deer, Canada writes: I am not sure what the eventual rate of extraction from the oil sands and other may be but if it was to get to say 5 million barrels a day the resource has a lifespan of about a 100 years with present technology.

    Alberta has to spend at present a lot of money to provide infrastructure up front and will be waiting at least 10 years for meaningful returns from current projects under construction.

    It definitely is time for debate on optimizing deployment of the cash flow but it will be hard to do in isolation since there are 13 competing jurisdictions.

    Personally I favor inclusion of all in the discussion, as long as all parties are working together.
    Instead of beating up on our present and past premiers every time they shows up at a conference perhaps the agenda could include some discussions about planning.

    As it is the premiers only agree on one thing, how to extract as much from Ottawa as they can.

    Change that and you just might change this country.
  43. Counterspinner tells the truth from Canada writes: Western Canada could manage its resources just as well if it didn't have to send billions to the welfare provinces of eastern Canada via the vote buying politicians of ontario and quebec.
  44. Bart Farquart from Calgaria, Canada writes:
    As a voting Albertan I would like to thank the Globe and Mail for it's unsolicited advice on how my province should manage it's resources revenue. And in particular I would like to thank Robert Miller of Halifax for all his brillilant comments (I shall henceforth watch out for those "secretive cabals" Robert speaks of).

    Don't worry all. We in Alberta are quite capable of kicking Stelmach in his backside with our size 12 cowboy boots if needed.

    Finally, I will let Alberta energy minister Mel Knight, quoted at the end of this fine article speak for me:

    [“But our Constitution in Canada dictates that the province of Alberta has the mandate to deal with our own natural resources. We feel that wealth generation in the province of Alberta is worth something, and that to put that money back in the hands of Albertans, and let those people do what they do best with their money, is a better opportunity for us.&8221;]

    Thanks again fellow Canadians!! Bart
  45. Farm Boy from Big City, Canada writes: Countries get the governments they deserve and that are a reflection of themselves. Stupid is as stupid does.
  46. Jimmy K from Toronto, Canada writes: Nice. Meanwhile we allow inflation to run rampant and for the "Dutch Diesease" to take hold without any plan as to what to do when we get hollowed inside out.
  47. Jasper the Black Lab from Vancouver, Canada writes: Tough to follow Norway's model here in Canada, because Alberta does not charge reasonable royalties on oils and gas, and the avenues for the Federal government to collect adequate funds from these projects would be large carbon production taxes and large export taxes, which for some reason are unpopular. I say bring them on: a 23-cent per litre gasolinetax would directly cost me about $200 per year, but if the system is "revenue neutral" I should save thousands on income tax, and if the money is spent wisely I would have better bus and train service.
  48. Northern Pike from Canada writes: Any anti-Newfoundland posters in here now? People in here are happy to question why Norway appears so much wealthier than Canada yet when it comes to Newfoundland they say Ontario is supporting them? How many articles have I seen whereby Newfoundland (not Canada) is compared to Norway (it's oil, fish, timber, hydro, etc..,). I believe it was on wikipedia whereby the breakdown and compare provinces to countries in the world. Alberta and Newfoundland match up with Normawy while Ontario with? The Republic of Ireland. Newfoundland's GDP per capita is a few hundred dollars off Norway's in the $47,000 range. With an increasing interest and need to diversify Newfoundland's economy is branching out as well. I was actually surprised to see some surprise forms of agriculture starting up as well in the past 5 years. If Newfoundland keeps going at the rate it's going - getting more involved with manufacturing and farming and manages to hook up with the mainland powergrid w/o going through Quebec it will likely surpass Norway's GDP per capita. As a whole many of the provinces aren't too far behind so for a country it's surprising Canada isn't better off. Canada ranks 11th on the GDP per capita as opposed to Norway sitting 4th.
  49. Dave Roberts from Toronto, Canada writes: Northern Pike, if Newfoundland has a higher GDP per capita than Ontario why is Ontario a net contributor to equalization while Newfoundland is a net beneficiary - is this not contrary to the concept of equalization?
  50. lynn H from Canada writes: If you examine Norways model it looks something like this: government takes cut of money from oil companies then saves the majority and invests the rest outside of the country which gains a them a return on investment. In our country the constitution makes Alberta the owner of resources not the feds. But if you looked at Alberta as a individual country instead of a province then it could work the same way while still benefiting all Canadians. The Alberta government could continue to save money in the heritage fund but invest the rest in private companies in the Alberta or the rest of Canada. That way Alberta would get an actual return on their investment instead of just a forced handouts to the ROC. They would get to determine who and where the money goes. The money would more likely go to wealth/job generating companies instead of new federal vote -buying social programs.
  51. Der Kommissar from T.O., Canada writes: John Cameron's observation about how Alberta is investing in infrastructure to facilitate the oil production addresses a key omission from G&M's article: Norway's government spent 30 years investing in the oil production before it was able to start saving. Between 1964 and 1994 the was not a single dime in the 'Oil fund' - only in the last decade has the investment in infrastructure paid off.

    The other thing which wasn't said in the article, concerns the Ts & Cs oil companies operating on the Norwegian sea shelf had to comply with: A significant amount of the work on the oil platforms themselves had to be delivered by Norwegian companies. Over time this has helped Norway develop world leading engineering capabilities and technologies on everything off-shore related; which is why the Norwegian non-oil economy is doing as well as it is today.

    I believe that is a much more important point for Albertan's and New Foundlanders to take into consideration when engaging with the oil companies; leveraging the oil activities to facilitate the development of high tech capabilities which will benefit the economy as a whole.

    One obvious opportunity for both provinces would be to ask the oil companies to voluntarily develop technology that will reduce the carbon emissions related to oil production. The incentive would be that they would face a tax on carbon emissions from a certain date, say 2015. By having the oil companies fund research at local universities and work with local technology providers there is a good chance that Canada would end up with much sought after technology, competencies and employment opportunities - something that is much better than 'money in the bank'.
  52. Henry Cunningham from Edmonton, Canada writes: Mel Knight is a fool that lacks vision, he is one of many individuals in Alberta responsible for the mismanagement of the oil industry. Just because Alberta isn't a central government doesn't mean that it can't operate the heritage trust fund like that of Norways. Dumping oil revenues into the budget means Alberta suffers high inflation, there is a role for the provincial government in making sound macro-economic. That $400 cheque I recieved was easily the biggest waste ever, a program that cost 1.3 billion made no meaningful difference in my life, and broadly speaking that of many (if not all) Albertans. That cash didn't make me rich, and now I hear we're funding 17 new schools through P3s...what incompetent boobs.
  53. CD W from Canada writes: Norway is culturally monolithic and does not to have spend a dime on crybabies and whiners. No truck or trade with the self infantilizing downtrodden, unless you count the reindeer herders.
  54. Kevin Cochrane from Clear Lake, Manitoba, Canada writes: DB from Burnaby has it exactly right and again the G&M drops the ball. There isn't going to be another nation wide sharing of the oil wealth because Trudeau screwed that up royally with the NEP, so get that thought out of our minds right now. Next, if it was explained to the readers in minute detail as to what exactly is required to turn dirt into oil the reader may understand why the province of Alberta cannot possibly get 78% for a royalty rate. Bitumen requires huge amounts of labour and capital to mine and process. As the oil sands develop to a global-size provider of oil next-thing-next comes the requirement of developing the process to fit our 21st century's environmental-impact needs. There is no question that the companies making oil have to clean up their act, they currently are relying on technology that is decades old, the low price of oil for 30 years saw to it that there was little to no R&D in the tarsands until very recently. Long story short, oil sands very, very expensive but tremendous reserves, conventional deep sea oil, comparatively easy to extract, no upgrading however will run out much much sooner. Could we please have an article that has some understanding as to what is actually going on in the tarsands, please??
  55. Go Oilers Go! from Canada writes: I support more oil revenue being diverted into the Heritage fund; however comparing Norway to Alberta is disingenuous.

    Norway is a sovereign nation. Every dime of income tax, corporate or personal, stays in Norway.

    Not so in Alberata. Over $100 billion in the last ten years alone has been removed from Alberta and redistributed across Canada in the form of equalization.

    If all of the income tax I and other Albertans paid as well as the corporate income tax paid by the oil companies stayed within Alberta exclusively the Heritage fund would be considerably larger.

    Over the next 20 years the Federal gov't stands to bring in more revenue from the oilsands operations than Alberta's provincial gov't. The Feds take is estimated to be $50 billion or more.
  56. The Prytanis from Ottawa, Canada writes: D.G.:
    "First, the oil belongs to Alberta, NOT Canada."
    "I think it would be well worth Doug Saunder's while to sit in a few classes on basic economics"
    Here's his bio:
    theglobeandmail.com SaundersBio.html
    What have you done, D.G.?

    Joseph Stiglitz, a pro-globalization, Nobel Peace Prize winning economist, and Former head of the World Bank seems to think that the Norwegians have the right idea on how to manage Dutch Disease. Read his book MAKING GLOBALIZATION WORK, especially the chapter on "Lifting the Resource Curse". Perhaps you'd like to criticize his credentials in an ad-hominem logical fallacy as well?

    As for you idea that Alberta exists in a vacuum, I'd like to remind you firstly that a province can suffer from Dutch Disease too. Any production in Alberta not connected to oil can also suffer. Secondly, that it's Canadian Dollars that are being effected by this, not Albertan dollars.

    Sounds to me like you still believe in mercantilism. Now who needs a course in economics?
  57. toronto,canada's only city that counts from Canada writes: where do all you oil millionaires get the time to post. from your postings its 24/7 work hard play hard. looks more like play hard.
    by the way if you stuck calgary next to toronto what would you get?
    another toronto suburb.
  58. Alan Burke from climatechange.dynalias.com in Ottawa, Canada writes: Northern Pike I'm afraid you're right. What's tragic is that having destroyed one resource (e.g., cod) you appear to be happy to move on to the next rapacious strategy.

    Sustainability.
  59. Doug - from Canada writes: Look at it another way. Couldn't you say that the Federal budget surpluses are due to Alberta oil and by paying down the debt we are in fact saving? Its funny how the NDP are the exact opposits of the Norwegians

    And all the illinformed comments on Alberta's royality amounts. They have increased and the money is going to BC and Sask. Also for every billion extra Alberta takes the Feds lose $400 mil not including the loss on less economic activity. Now if you want to raise royalities to reduce the pace of development OK that is a plan but don't do it to provide extra money for schools because in the long run it won't.
  60. scarlet pimpernel from Canada writes: alberta sells to u.s. exclusively. its a free world champs, why not get the best price you can get? some of you say all the wealth generated by the oil sands goes to all those lazy, unemployed canadians.
    where do most of the profits go or does the "s." in u.s.a. mean santa claus?
    when all the beef producers ran into trouble with mad cow disease the u.s. producers didn't offer to take our cattle, nor should they. its a business - get the best dollar you can. americans are our best friends and i'd be hard put to think of a better neighbour, but business is business.
  61. R M from Toronto, Canada writes: I think the article has a lot of merit. Norway's model is a way of forcing savings. If you believe economic theory, the only way to move to a higher standard of living in the long-run is to encourage savings and investment in industry and R&D. I lived in Norway for a year, and they seem to have it right -- the differences between rich and poor are relatively narrow and everyone seems to have a roof over their head and food on their plates.

    Sadly we seem more intent on increasing our consumption today by putting more money in our pockets now, than on saving for the future. For all the talk of the government squandering tax dollars, as Canadians we haven't been great savers (on average) when money has gone into their own pockets. I agree with old curmudgeon though in that we seem to lack the political will to actually make things change.
  62. Go Oilers Go! from Canada writes: R M from Toronto, Canada writes:

    Sadly we seem more intent on increasing our consumption today by putting more money in our pockets now, than on saving for the future.

    Why do you assume that because individuals are being paid more money that none of it is being saved?

    I don't need the gov't to save and invest money for me.
  63. Bottom Line from Picton, Canada writes: Norway is showing the world that its oil policy means that long-term gain is more important than short-term pain when it comes to the future well-being of its citizens.
  64. Go Oilers Go! from Canada writes: scarlet pimpernel from Canada writes: alberta sells to u.s. exclusively. its a free world champs, why not get the best price you can get?

    That's not true at all.

    The US is by far the largest consumer of Alberta oil; however Alberta oil is sold also sold to Asian markets...and all at full market value.

    It's interesting you ask "why not get the best price you can get?"

    The answer is we do...why do you think Albertans were chapped when the NEP forced Alberta oil to be sold to Central Canada below market value?
  65. Joe Canadian from Canada writes: Norway has not grown its population via immigration like Canada.

    Since 1975 they have grown by about 500,000

    Alberta has more than doubled its population and is still spending like mad to catch up with infrastructure.

    So with Alberta having to spend more internally and shipping out billions to the rest of Canada we are comparing apples and oranges.

    Most Canadians would also revolt if the price of gas was raised to over $2/l next week by a tax increase/ carbon tax etc.
  66. Philippe Baillargeon from Ottawa, Canada writes: Two points:

    First, the article underlines the need to refocus standard Canadian comparative political analysis away from, say, Australia, U.S. and Britain, to Scandanavian countries.

    Second, while not specifically cited as such in article, note emphasis by Norwegian policymakers on inter-generational equity. State oil coffers are not used to, say, reduce current taxes. Oil is essentially seen as a public resource belonging to FUTURE generations; current profits cannot be made without due consideration to paying back a loan made - really, without their consent - by future citizens yet to be born.

    The latter practice is actually good economics for the current generation because, as the article points out, it helps curtail and contain current inflation and a rise in the country's currency (which can make exports uncompetitive).

    Essentially, an intergenerational economic pact to help each other.
  67. Joshua Albert from Toronto, Canada writes: Trudeau and Lalonde killed any ability to do something like this as a result of the disastrous NEP.
  68. h p from comox valley, Canada writes: Lynn H from Canada writes: "But if you looked at Alberta as a individual country instead of a province then it could work the same way while still benefiting all Canadians. The Alberta government could continue to save money in the heritage fund but invest the rest in private companies in the Alberta or the rest of Canada."

    With all due respect Lynn, reinvesting the majority of those petro-bucks in Canada will raise/buoy the Loonie versus other currencies. In order to negate that, investments should be in foreign lands. So even though we British Columbians might happily accept Alberta's largesse/investments, Canadian exporter's of most products will have a tougher go of it, with a "Loonie on steroids."
  69. Rocky Zhao from Canada writes: Joshua Albert from Toronto, Canada writes: Trudeau and Lalonde killed any ability to do something like this as a result of the disastrous NEP.

    Joshua, the NEP has not been in effect for over 20 yrs now. Time to move into the 21st Century.

    And btw, here's a refresher in case you are stuck in this revisionist time warp:

    http://www.youtube.com/watch?v=Op6XLJCXagk
  70. Kevin Cochrane from Clear Lake, Manitoba, Canada writes: Saunders is essentially comparing apples with oranges if he is trying to draw some correlation between the tarsands and Norway, but what the hey, why have informed opinions, that requires research and effort. Far better to do something off the cuff and have everyone believe we are one vote away from a perfect utopia.
  71. Non Conformist from Alberta, Canada writes: "In exchange for the right to drill, they must hand 78 per cent of their profit over to Mr. Slyngstad's fund."

    This isn't a royalty. It's a tax. On profits. This makes more sense than charging royalties. Companies will always try to maximize profits. Which will maximize the taxpayers share of their oil wealth.

    Canadian companies are operating in Norway and paying a tax of 78% on profits for only one reason -- because they are still making a good return on investment -- otherwise they wouldn't be there.

    Alberta should scrap it's royalty scheme and replace it with the Norwegian model. It makes much more sense....
  72. L Harder from Canada writes: The Albertans who think that their management can't possibly be better while being proud of being suckers confound me. But it is typical of all Canadians. In a world needing resources, we are incredibly unaware of the clout we have to negotiate better terms.

    The lack of dependence on oil revenue in running government has one other big effect. Norway has tremendous leverage when dealing with oil companies. If prices are low, just leave it in the ground. Somebody doesn't want to play ball, just outwait them. Their strategy also shows a steely resolve/discipline that can't easily be undermined.
  73. W Ross from Up North, Canada writes: Yep, we're screwed!

    We have neither the governmental direction or the individual discipline to avoid the "Dutch syndrome".
  74. J T from Victoria, Canada writes: The first of many mistakes in the article that destroys credibility: Quote: "It's a phenomenon known to economists as “Dutch disease,&8221; after the tragic experience of the Netherlands, which discovered oil in the 1970s." The Dutch actually discovered natural gas, not oil.
    And gee, old curmudgeon, I have you to thank for the NEP. Fortunately I worked for an American company so I kept my job and career, as well as my house. My friends who proudly worked for Canadian companies lost their jobs, and much more. Nice going old curmudgeon. Be proud. And that American company bought all the assets of the Canadian companies that went under at distress prices. They now have one of the biggest and shiniest towers in downtown Calgary - from 4 floors in 1980 to about 20 now. Be proud, you certainly helped their US shareholders. And trudeau called me a "bad Canadian" for disagreeing with his deliberate attack on Alberta and Albertans. I have been a very bad Canadian ever since. Be proud. I hope filling your Kcars and Volares for a nickle less, and the satisfaction of needlessly damaging Alberta was worth destroying 60,000 jobs and careers and permanently rifting this country. Be proud.
  75. Richard Roskell from Canada writes: As usual, those damned socialists are ruining Norway with their meddling ways and so-called "economic oversight". And you call that $380 billion nest-egg a contingency fund? Hah!

    And once the oil dries up and that highly diversified economy has to fall back on high-tech manufacuring, knowledge-based industries, and the rest- along with the pitiful trillions they have in the bank- where will Norway be then? I say "hah!" again!

    Thank god Alberta and Canada have chosen to sell off our resources to foreign-based companies for a song. Rather than give in to the bleating calls from those who would see a system that benefits Canada first, Alberta wisely saw the communist-inspired thinking behind that premise. Unbridled, unfettered corporate greed-and-profits is the way of the world, and the hope for the future.
  76. Robert Miller from Halifax, Canada writes: Remember NEP is 25 years in the past -- this is the present.
  77. Rebekka Hammer from Canada writes: Jante Law:

    "You shall not think that you are special.
    You shall not think that you are of the same standing as us.
    You shall not think that you are smarter than us.
    Don’t fancy yourself as being better than us.
    You shall not think that you know more than us.
    You shall not think that you are more important than us.
    You shall not think that you are good at anything.
    You shall not laugh at us.
    You shall not think that anyone cares about you.
    You shall not think that you can teach us anything."

    The organizing principles of Scandinavian culture.
  78. Boomer AB from Canada writes: Let's put a different spin on this. Next week an Alberta paper should have an article about how Ontario's auto industry has screwed up the Canadian economy by insisting on building vehicles that no one wants to buy. I'll sit back, watch the fur fly, and LMAO. One final point; it's Alberta's oil. What we choose to do with it is up to Alberta. What I see here is more peni$ envy than anything else.
  79. R G from Canada writes: "You" being the individual
    "Us" being the community or society
  80. Boomer AB from Canada writes: Robert Miller, guess who headed the LPC campaign during the last election. Marc Lalonde; the same Marc Lalonde who dreamed up the NEP, which was found to be totally unconstitutional by the way. We'll quit being concerned when the mentality and the henchmen die off.
  81. Will Hoaccio from Toronto, Canada writes: Ha! I love the Norwegian oil fund investment banker modestly pointing out why their strategy is best, pointing to high standards of living, high measures of economic freedom and entrepreneurial activity, high disposable income, high savings, low unemployment, countries from Brazil to Russia lining up to learn what they can and then some Canadian jerk saying "we have nothing to learn from the rest of the world!"

    We really are a stupid country...
  82. The World Is Mad from Hamiltonia, Canada writes: Canada, as a large country comprised of a number of different tribal regions is indeed difficult to govern. I would like to see the people of Alberta be given the right to determine the answers to the key questions about their resources directly by way of referendum. In light of the climate change crisis and the very low net energy value of the tar (approx 3 units of energy out for 1 in vs. approx 75 out and 1 in for conventional crude), should they be expanding oil sands production? Will the seventh future generation believe that the exploitation rate and existing royalty structure is adequate and equitable for all vested interests (including the other constituents in the local as well as global ecosystem)? We must remind ourselves that Canada is a confederation, a series of tribal regions co-existing and co-operating for their common benefit. We have developed a unique society north of the 49th parallel. We either stand united for the true north strong and free or fall divided into the hands of the carpetbaggers.
    P.S. Water exports, not oil is the emerging issue in Canada. Conventional oil is gone and we are now fighting over food scraps.
  83. L Harder from Canada writes: It just occured to me looking at the Norway vs Alberta stats, how pouring oil money into the economy is akin to creating a welfare state. The number that really strikes me is the productivity number. The Norway number is probably high because of the lack of easy money. I suspect that the government is very proactive in investing in infrastructure making it easy for business to rachet up its productivity. University education is also free, which is essentially an investment in infrastructure and gives business a well educated work force. The lack of immigration with is concurrent lack of cheap labour also contributes to business finding a way to get things done with less people. Finally I would be surprised if Norway ate their young as we did during the 80's and 90's. The lack of integration of each generation has created huge holes in our management/production structures moving forward as the boomers retire. The decision to scale back on doctor training is an example of this amazingly short sighted practice.

    How did we get so lazy?

    This
  84. Green Tory from Canada writes: Go Oilers Go! from Canada writes: "Why do you assume that because individuals are being paid more money that none of it is being saved? I don't need the gov't to save and invest money for me." >>> There are a few problems with this statement. The first is that it's not an assumption. It's proven economic fact that the savings rate has declined. Secondly, the problem is not that the government is saving and investing for you, the problem is that the government has taken out huge loans on your behalf, and now you are paying it back through high taxes. Last of all, I would say it makes perfect sense for the government to set up a rainy day fund, if no one else is willing to do it. And so far no one else (not the industry, not industry employees, not the provincial AB government) has stepped up to the plate. Planning for the day when oil inevitably ceases to be used as an energy source (a generation away, at most) is just good thinking. I fear that the energy industry will be more than happy to extract Alberta's oil wealth until it's no longer needed, then take their capital and flee the province, leaving it to bankruptcy and social decay. As an investor I support that--I don't want my money to be anywhere where it's not making money. But as a Canadian, I shudder to think what this will mean for the country. Maybe Albertans are perfectly happy to drive their economy straight into a brick wall, but we in the rest of the country aren't drunk on our own economic success and can see things a little more clearly than that. I hope.
  85. J T from Victoria, Canada writes: Robert Miller from Halifax, Canada writes: Remember NEP is 25 years in the past -- this is the present.

    Smug, glib, and pointless as ever.

    How about "Those who ignore the past are doomed to repeat it"?
  86. Green Tory from Canada writes: Boomer AB from Canada writes: "One final point; it's Alberta's oil. What we choose to do with it is up to Alberta. What I see here is more peni$ envy than anything else." >>> This is the attitude that will lead Alberta to ruin. We're the greatest, we're the best, it's all ours, and fLIck you if you don't like it. Here's something you may not have considered, Boomer AB: That oil is in northern Alberta, heavily concentrated around Fort McMurray, High Level and so on. That oil belongs to Fort McMurray. It belongs to High Level. What right do Calgarians have taking oil revenue from northern Alberta? What right do the fat cats in Edmonton have to the oil there? What Alberta is doing is running a huge, provincial NEP (a PEP?) that transfers wealth from Fort McMurray to a bunch of pencil-pushers in Calgary and bureaucrats in Edmonton. Those parasites in southern Alberta are stealing northern Alberta's wealth. As someone who is deeply concerned about the territoriality of oil, I expect you'll be jumping on this wagon, Boomer, and fighting for the right of Fort McMurray to protect its interests against the socialist thieves in Edmonton....
  87. William Auger from Edmonton, Canada writes: It's painfully obvious that the oil sands (our only petro-asset of any significant magnitude) needs to be nationalized on some level. There is a reason the Chinese, the French & every other international oil co. are lining up to get at the least feeding frenzy, free for all oil asset acquisitions on the planet. If the the "dutch-disease" is a reality the investment flight from Alberta this would cause would help the country in the short term. In the long term cheap oil for Canadians who would actually own the resource and the refining capability. Why stop there while on a roll... Oil and NG for Canadians first at reduced prices. Any remainder goes to the open market. Oh right! Mulroney sold Canadians rights to have their own energy policy to the US under the terms of the free trade agreement. Guess we'll have to carry on with the US imposed status quotient.
  88. Boomer AB from Canada writes: Quite frankly Greeny I'm more worried about the socialist theives from Toronto. You guys want Miller's economics fine, have at 'er. Don't expect us to pay for it. As was stated earlier, this whole series is nothing more than attempt by the Liberal's mouthpiece to gain votes for them by pitting regions against each other. Nice try at the bait and switch though.
  89. Jimmy K from Toronto, Canada writes: I am fully onboard with all those who blame Trudeau for this. If it wasn't for his disasterous NEP which was designed to suck Alberta dry, now we wouldn't have such rancorous discource when it comes to the oil industry. We as a nation could probably come to an agreement on how to use this precious resource to benefit us all. Instead, Albertans feel (rightly so) threatened anytime the federal government even talks about oil, and how could you blame them? Last time hundreds of thousands of families were thrown out of their jobs and homes to satisfy one man's ego. After that they are very weary about any national oil strategy and won't even let this get off the drawing board.
  90. GlynnMhor of Skywall from Canada writes: old curmudgeon from Armenia writes:"... people in Canada think along local rather than national lines, unlike Norway and other Scandinavian countries."

    In scandanavian countries, thinking locally is the same as thinking nationally.
  91. GlynnMhor of Skywall from Canada writes: Rocky Zhao from Canada writes: "Joshua, the NEP has not been in effect for over 20 yrs now."

    The last vestiges of the NEP were not removed until 1992. That probably didn't make the news out east, but in Alberta its final and long overdue demise was noted.
  92. Green Tory from Canada writes: Boomer AB from Canada writes: "You guys want Miller's economics fine, have at 'er." >>> Well, actually, Boomer, most of us don't want Miller's economics, and we don't support it. But most of us also don't want the short-sighted stupidity of Alberta's government either. Those are not very inspiring choices. "As was stated earlier, this whole series is nothing more than attempt by the Liberal's mouthpiece to gain votes for them by pitting regions against each other." But Boomer, how can you not see that you have bought into the regionalistic politics more than anyone? YOU'RE the one asserting that this "Alberta's oil," not "Canada's oil," aren't you? If this article is an attempt to pit region against region, you've fallen for it, hook, line and sinker. This bitterness over an energy policy 25 years ago, this irrational hatred of Toronto, these are all symptoms of regional disease, and I suspect that you were suffering from it long before this G&M article came along. But here's the thing: You should fear the politics of regionalism that you spread. Because if Ontario and Quebec ever get a serious hate on for Alberta, you guys are toast. There are 20 million of us, 4 million of you. You want to spread hate? Fine, but be prepared to live with the consequences.
  93. GlynnMhor of Skywall from Canada writes: Robert Miller from Halifax, Canada writes: "Remember NEP is 25 years in the past..."

    Actually its less than 16 years in the past.
  94. globefan EH from Canada writes: Great article.

    I gather Norwegians think of themselves as a state of all the people. Since the NEP it appears that Alberta prefers to think it itself as a nation state and since the NEP it became obvious sharing was not part of the equation considering how much it was begrudged every step of the way.

    Canada is as strong as its weakest links.
  95. anonymouse Z from Canada writes: GlynnMhor of Skywall from Canada writes: ... In scandanavian countries, thinking locally is the same as thinking nationally.
    _________
    And your point is...? In case you were talking about how small they are, their contribution to the world is huge and they have a higher standard of life than most other places.
  96. Rocky Zhao from Canada writes: GlynnMhor of Skywall from Canada writes:The last vestiges of the NEP were not removed until 1992. That probably didn't make the news out east, but in Alberta its final and long overdue demise was noted.

    How so? Please elaborate with details.
  97. lynn H from Canada writes: h p from comox valley, Canada writes:With all due respect Lynn, reinvesting the majority of those petro-bucks in Canada will raise/buoy the Loonie versus other currencies..... Yes, you are right but there has to be creative way for Alberta to save/invest its oil wealth and help the ROC. A way that does not cause rifts between energy producing provinces and the power centers of central Canada. Carbon taxes and ETS do not seem to be the answer to this problem either since the perception in Alberta is that it merely transfers money from west to east like NEP and equalization.
  98. Joshua Albert from Toronto, Canada writes: Memories, distrust and anger at the NEP will prove to last much longer than 20 years.

    What's more, specifying in law a stream of revenue from our resources must be invested outside the country will never fly politically in Canada.

    What might be possible is to specify that a fixed revenue stream be invested in some of our universities to get them closer to world leaders.
  99. Boomer AB from Canada writes: Greeny, I didn't decide it was Alberta's oil. The CONSTITUTION decided it was Alberta's oil. As for your "irrational hatred" of Toronto comment, didn't some guy just have a show trying to figure out why Canadians outside of Toronto generally hate it. Am I real happy with Stelmach; no I'm not. Do I think some bad decisions have been made; yes I do. Has the LPC spent a good chunk of every federal election for the last 40 years or more telling people they would keep Albertans "in their place"; absolutely. Do we need advice from Central Canadian Socialists about what we should do on the go forward to save us from ourselves; no freaking way. I have to go for a walk now to pick up some money; it's just laying on the street out here don't-ya-know. As Dijon said "all dat heasy money out dear his not good for dem".
  100. Bill Daly from Edmonton, Canada writes: Alberta's Tory government has been in office too long to learn anything.
    They only pretend to consult with a process designed to get the kind of answers they want. right now the new premier is spending all kinds of money designed to keep a patronage government in office. The province is badly in need of changes and more equitable voting rather than one that has a rural vote worth almost twice a city voter.
  101. Michael B from Canada writes: “First of all, Norway is a country that is a federal jurisdiction. And if we were to turn over all of our resources in Canada back to the federal government, perhaps they would operate the thing differently.

    &8220;But our Constitution in Canada dictates that the province of Alberta has the mandate to deal with our own natural resources. We feel that wealth generation in the province of Alberta is worth something, and that to put that money back in the hands of Albertans, and let those people do what they do best with their money, is a better opportunity for us.&8221;
    ****************
    You've got to love how Norway is all about taking care of all of their people, helping their entire economy, basically really healthy, socialist beliefs... And then Alberta's Minister of Energy basically says "well we don't care, we don't want to give more than we have to to the feds, so back off, it's our right!" Gotta love the regressive, fiercely regionalistic mentality. Idiots like that are why Canada keeps falling in the "Best places to live in the world" index. Sometimes I think we should cut Alberta out and give them to the Americans -- they're just as oil-crazy and xenophobic as the Americans, they'd fit right in.
  102. Jean Malice from Calgary, Canada writes: “We're doing our best business in parts of the economy that have nothing to do with oil *or fish being pulled from the sea,” said owner Helge Rasmussen, 34. *His plastics firm's wind-power division built $4-million worth of housings last year and has completed deals across Scandinavia and northern Europe."

    Someone should explain to Mr Saunders that PLASTICS comes from OIL...
  103. Kathleen Degelder from AberdeenUSA, Canada writes: Joshua Albert: Good Post!
  104. Green Tory from Canada writes: Boomer, you go around and around like a cat chasing its tail, and conveniently ignore the salient points in front of you. Yes, we already know about your hatred of "Central Canadian Socialists" (ever met one of those, by the way, or did you just read about it in the Western Standard?) but you keep averting the logic of the points you bring up. Question: How is your regionalistic hate-mongering better than the alleged regionalistic hate-mongering you accuse the Globe and Mail of? You reject the notion of an oil fund to invest in Alberta's future, or any other plan that might gain the support of anyone in Central Canada. Okay, fine. So, next question: What is YOUR plan for Alberta's future? Please answer these questions, or I'll know you have nothing to add to this debate except your regionalistic prejudices. Nice imitation of a French Canadian accent, by the way. Very mature. Where did you learn that? The schoolyard?
  105. Cowboy Chris from Calgary, Canada writes: Robert Miller everyone and their grandma who has zero knowledge of oil and gas loves to quote the 78% and say big evil oil cos are under taxed in Alberta. Here are the hard numbers. You drill a well out by provost alberta. $300,000 at first you're getting 2 or 3 M3 at most per day oil with 7 or 8 M3 of water for maybe a year thats a good well your paying a small amount for trucking to a terminal. After a year you're you've made $320,000 gross on the well however your cuts deteriorated its not worth trucking and you need to decide are you going to pipeline connect this well or shut it in. If it's close enough maybe you only need to throw another $20,000 at it to pipeline connect the thing. Your cut continues to drop now you're at 3 or 4 % very realistically you're at 1% and that's a lot of water do you need another injection well to maintain reserve pressure? How much natural gas is needed to seperate the two not to mention a pipeline leak on that line can very quickly turn a field into a lake and how much did it cost to assess that pool in the first place? Bottom line with those figures would you be willing to lose another 20% of your profit to the government? No, you wouldn't have drilled the well in the first place because of the down side risk. Second misconception. The oil cos have no risk because oil sands are proven. First oil sands are only profitable with oil above $25 per barrel but you say that'll never happen again, well prices peaked at over $100 (adjusted) in the 70's and they plunged to $8 in the 1990s these projects have a 50 yr life we could see 2 more boom busts cycles. The cost of these projects at $20 billion is extremely prohibitive $700 per person in Canada and there are like 10 of them. Which causes costs to soar. On top of that facility fires are pretty common and have set back suncore several times. SAGD another less intrusive oil sands technology is hit or miss. But lets increase taxes? Butt head.
  106. Green Tory from Canada writes: Cowboy Chris, you are right in pointing out that the tar sands are riskier and less profitable than just about any other oil field out there. But this is what Reuters reported today: "Canadian Oil Sands said it earned $515 million, or $1.07 a unit, up from a year-earlier $128 million, or 27 cents a unit. Revenue rose 36 percent to $1.01 billion amid the sharp run-up in oil prices during the quarter toward $100 a barrel." If I read this information correctly, that means profit at the company quadrupled in a single year, and the company now has a 50% profit margin. That is insanely huge by any other industry's standards. So how do we reconcile these facts with the assertion that the oil industry can't afford to fund a long-term security fund for Albertans? It seems to me that NOW is the time to set this fund up, while the business is booming, so that by the time the next bust comes, Alberta will be prepared.
  107. GlynnMhor of Skywall from Canada writes: Rocky Zhao from Canada writes: "GlynnMhor... writes: 'The last vestiges of the NEP were not removed until 1992.' How so? Please elaborate with details."

    The NEP consisted of a whole series of legislative measures, and while some of the worst were gotten rid of immediately by Mulroney, the last one was not rescinded until 1992.
  108. Jim OKeefe from Toronto, Canada writes: Norway and Alberta share two similarities - a small population (Norway - 5 million), and most of their revenue comes from oil. It ends there. Alberta is part of a larger country called Canada, doesn't have much in the way of manufacturing, nor does it have the population to support it. As well, the oil is not as profitable, being harder to extract and purify than the sweet North Sea Crude (its called the tar sands for a reason). Norway is doing the right thing though. Suprised that none of the revenue is invested in Norway. Makes sense in hindsight. Abu Dabi and Dubai are going a different route, but also stand to be very well off following the oil bust.
  109. John Cameron from Red Deer, Canada writes:
    Green Tory from Canada writes:.."n: What is YOUR plan for Alberta's future?"

    Personally I think there should be some kind of public contest with a prize to the winner similar to Barrick Golds "unlocking the Value" program to solve a silver recovery problem they couldn't solve in house.

    First a pre-qualifying round and then some debate. I'm sure there are good ideas out there probably better than Norway's or anything else tried so far, to boot.

    Somehow you have to bring in some real expertise, not just some think tank biased reports to sway public opinion.

    I promise you that the ultimate answer is not simple nor easy but hard and difficult.
  110. Boomer AB from Canada writes: Greeny, my plan for Alberta is that is for ALBERTANS TO DECIDE; what WE decide is OUR business. You have no more say in OUR oil industry than we have in YOUR auto industry. Quite frankly I really don't care what people in Ontario think, anymore than you care what I think. Personally, I'm more interested in my future than I am in yours. I always find it funny how it becomes Canada's "insert resource here" when Ontario and/or Quebec doesn't have any, but what's yours is yours alone. The country has changed; we don't have to bow to you anymore. As for your "we're 40 million so wise up" comment earlier, I've thought for a long time that really threat to Canada lies not in Quebec leaving but that Alberta (with Sask and B.C. possibly as well) getting sick of kissing Ontarios butt and deciding to go it alone. And NEP II would probably do it. Now I'm going to go drive my non-Ontario, non-union made car because I can.

    PS. I did like Borat Dijon refering to us as "milk cows" either. Like he'd know the difference between a cow, bull, or goat anyway.
  111. Robert Miller from Halifax, Canada writes: GlynnMohr from Skywall:

    You are not in Canada -- stop stone walling these threads to try to bring the long dead NEP up
  112. GlynnMhor of Skywall from Canada writes: Robert Miller from Halifax, Canada writes: "GlynnMohr: ... stop stone walling these threads to try to bring the long dead NEP up"

    I didn't bring it up; I just corrected some BS that others were trying to foist upon the naive.
  113. Rocky Zhao from Canada writes: GlynnMhor of Skywall from Canada writes:The NEP consisted of a whole series of legislative measures, and while some of the worst were gotten rid of immediately by Mulroney, the last one was not rescinded until 1992.

    I'm quite familiar with the Oil and Gas industry, and I believe what you are claiming is B.S.

    Give the details, or admit you are full of it.
  114. GlynnMhor of Skywall from Canada writes: Rocky, I just did. I remember distinctly seeing the item appear in the news at the time, and the mention that it had been over ten years since the noxious plan was first implemented.
  115. J T from Victoria, Canada writes: Robert Miller, I find your posts really funny. You have spent the last 4 days whining about perceived injustices done to Nova Scotia by the rest of Canada going back 100 years or more, but today you self-righteously tell us all to forget the NEP because it is no longer relevant. It's far more relevant because it happened to us, and not your ancestors. I expect you will keep us all amused with "further wisdom" for the rest of the week. Thanks for the laughs...
  116. Chris Cosack from Toronto, Canada writes: Politicians, Politicians, Politicians. It will be a cold day in hell before general sentiment on GandM message boards shifts to public accountability. Consistently posters attack the tax and spend policies of governments, but ladies and gentlemen, we elect those representatives. And if anything, their actions mimic our own, and in an increasing effort to buy votes our political efforts have shifted from the greater good (foresight) to short term spending (i.e. GST cuts). If we want better management of our nations great wealth and resource endowments, demand it from our politicians, and practice it in your own lives.
  117. John Rowat from Vienna, Austria writes: Looking at Canada from the outside for the past 5 years, I find the posts from other expats pretty much sum it up. The country seems to be hopelessly balkanized -- people from one region hurling insults at their countrymen from other regions (the country seems to suffer from some invisible force of divide and conquer). With no shared goals or common purpose there won't be much of a future for any citizen of Canada. Norway functions -- Nigeria doesn't. None of the resources in Canada (oil, metals, water, agricultural lands, potash, forests...) will count for much if they exist only for plunder.
  118. Mr X from Edmonton, Canada writes: Norway is a small country with only 4 million people. The oil is easy to get at and easy to ship in large quantities.

    Canada on the other hand has 30 million people dispersed accross a vast area. The costs for infrastructure alone are enormous. In addition the oil is difficult to get in an area with very cold weather and massive pipelines must be build to ship the product to market. We currently don't produce anywhere near the volume that Norway produces.

    The Federal Government takes the largest portion of tax from Alberta Oil and uses it to subsidize the have not provinces and pay down debt. The problem with the Federal Government is the largest single expenditure is interest on the National Debt which is around $500 Billion.

    The Alberta Government takes its portion and saves some and spends the rest. Currently Alberta is making massive infrastructure upgrades in the province. For example a ring road is being built around the city of Edmonton.

    Want to eliminate the Dutch Disease? Stop the Federal Government and have not province from looting all the cash and put it into investments instead. Albert could also invest more than it does.
  119. Rocky Zhao from Canada writes: GlynnMhor of Skywall from Canada writes: Rocky, I just did. I remember distinctly seeing the item appear in the news at the time, and the mention that it had been over ten years since the noxious plan was first implemented.

    Kryptonite is bad for Superman. I remember distinctly seeing the item appear in the news.

    You have no credibility. If you can't back up your farcical claims when challenged, then don't make them to begin with.
  120. Mr X from Edmonton, Canada writes: NEP derailed Alberta's oil and gas industry for decades... It is still relavant because most of the growth pains and low subsidies are a result of the the NEP destroying the industry. We are still paying for. Most of the Canadian players were wiped out and substantial incentives had to be made to get the industry rolling again.
  121. GlynnMhor of Skywall from Canada writes: Rocky Zhao from Canada writes:"You have no credibility. If you can't back up your farcical claims when challenged, then don't make them to begin with."

    Back up yours then. Find ALL the legislation created for the NEP and determine when each one was eliminated.
  122. rich gunter from Regina, Canada writes: A socialist paper commenting on a socialist country. Bias anyone?
  123. Rocky Zhao from Canada writes: GlynnMhor of Skywall from Canada writes: Back up yours then. Find ALL the legislation created for the NEP and determine when each one was eliminated.

    Let me start with this wiki entry which is entirely consistent with my inside industry knowledge:

    http://en.wikipedia.org/wiki/NationalEnergyProgram

    The rationale for the program weakened when world oil prices began to decline in the early 1980s, leading to the start of a phased shutdown by the new Minister of Energy, Mines and Resources Jean Chrétien. In the 1984 election the government of Brian Mulroney was elected with the support of western Canada after campaigning against the NEP. However, Mulroney did not eliminate the last vestiges of the program until two and a half years later at which time world oil prices had dropped below pre-1980s levels (as adjusted for inflation). This was a contributing factor to the creation of western Canada's Reform Party of Canada.

    Over to you, Lois Lane.
  124. GlynnMhor of Skywall from Canada writes: Heck, Rocky, even the PGRT wasn't phased out until August 1988, less than the 20 years you claimed the whole NEP was gone much less Robert's claim that it had been 25 years.
  125. GlynnMhor of Skywall from Canada writes: In fact, Rocky, here's a link to a 1994 amendment to the PGRT, so it was still in existance even then!!!

    http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=2329960&Language=e&Mode=1&File=169
  126. Jeff S from Canada writes: somebody forgot to tell the writer of this article that Alberta has been subsidizing over half the rest of the country.

    There is a reason the french are enjoying their severely cheap daycare: Alberta.

    You don't see Sweden nagging and whining to Norway to get money. Maybe if Canada could show Quebec the door Alberta would be able to keep more money for the heritage fund.
  127. J G from Ontario Mexico, Canada writes: I wonder how many other countries turn over their natural resources to a province/state etc.?
  128. GlynnMhor of Skywall from Canada writes: G from Ontario Mexico, Canada writes: "I wonder how many other countries turn over their natural resources to a province/state etc.?"

    How many provinces, states, cantons, etc. turn over their natural resources to a far away and uncaring federal government?
  129. lynn H from Canada writes: When NEP ended does not matter. The fact that it happened at all is the problem. Alberta has no reason to forgive and forget. Mostly because the aggressive and condescending language from central Canada and the federal political parties never stopped (A member of the LPC already alluded to a NEPII last year on a radio show - Alder). I am not from Alberta but I completely understand why they are defensive and protective of their province and resources. It would probably be better for the ROC to work with them instead of attacking the province, its people and its livelihood. Only Danny Williams and Alberta's provincial neighbors seem to understand that.
  130. Robert Miller from Halifax, Canada writes: Alberta is currently neither protective of its province nor its resources...

    I think that might be the point that some are trying to make.

  131. GlynnMhor of Skywall from Canada writes: lynn H from Canada writes: "When NEP ended does not matter. The fact that it happened at all is the problem."

    I absolutely agree. The effects of the NEP carry down today, not just in the economics of the oil industry, but in the minds of the citizens.

    It was never intended to be an economic policy anyway, but a political one to buy votes in the east at the expense of the west.
  132. Rocky Zhao from Canada writes: GlynnMhor of Skywall from Canada writes: In fact, Rocky, here's a link to a 1994 amendment to the PGRT, so it was still in existance even then!!!

    OK, good find. I will acknowledge technically that a very minor part of the NEP was still on the books then.

    But the fact that an Act is still on the books does not mean it is being applied, or is affecting investment or profits whatsoever.

    Prove to me that it was still applied in 1994 and that O&G companies were paying PGRT. Many of the NEP policies did not effectively kick in until oil prices hit exceptional levels. This is why it had no effect whatsoever when the world oil prices collapsed in 1986.

    Btw - I believe as part of the NEP, incentives were provided for development of the oilsands (something I just read) - now wouldn't that be ironic.
  133. Gary Thomson from Surrey, BC, Canada writes: "Will Canada avoid the 'Dutch' disease?" No! Norway's far sighted economic policies were determined by a national gov't that was attempting to balance the benefits and draw backs of an oil boom among the entire country. In Canada, the provincial/federal division of powers, and the geographic distribution of petroleum resources, mean that our policies regarding our oil boom fall, in effect, into the lap of the Albertan gov't. Albertans are a hard done by province, at least in their own minds, and they haven't produced a leader capable of long term planning in the 'national interest' since Lougheed. Read these comments, it is not even a matter of Albertans not knowing the effect on the national economy, they just don't care. At least if Quebec had Alberta's resources, they'd leave, and our manufacturing sector would continue to grow.
  134. Lyle Wagner from Vancouver, Canada writes: Alberta is doomed. What a bunch of rednecks. They are completely destroying their land and water for short-term gain. In 20 years the place will be a ecological and financial disaster that the rest of the country will have to bail out.
  135. Robert Miller from Halifax, Canada writes: Rocky Zhao from Canada and others:

    Beware: More Stone Walling from "Cyberspace" to try to rekindle Albertan nationalism on the NEP... The particular commenter actually does not come from Canada

    Avoid the pitfall.
  136. Rocky Zhao from Canada writes: Robert Miller from Halifax, Canada writes: The particular commenter actually does not come from Canada.

    Actually Robert, if they do in fact come from the US, then they are the country responsible for the concept of price controls. The Trudeau gov't was basically following the Nixon/Ford, and Carter administrations:

    The rapid increase in crude prices from 1973 to 1981 would have been much less were it not for United States energy policy during the post Embargo period. The US imposed price controls on domestically produced oil in an attempt to lessen the impact of the 1973-74 price increase. The obvious result of the price controls was that U.S. consumers of crude oil paid about 50 percent more for imports than domestic production and U.S producers received less than world market price. In effect, the domestic petroleum industry was subsidizing the U.s. consumer.

    http://www.wtrg.com/prices.htm

  137. h p from comox valley, Canada writes: Lynn H from Canada: Thanks. It is a nice problem to have.

    I guess a place to start is for us to react, even if only in small, individual ways, when the Loonie is grossly overvalued. Is it overvalued now?.. well I'm not that smart. Generally, a stong currency makes us wealthier than a weak one.
  138. Kevin Cochrane from Clear Lake, Manitoba, Canada writes: Kay, if were going to talk about Norway and deep sea drilling oil correlate this economic wizardy to what's going on in Newfoundland, not Alberta. WAKE UP PEOPLE, THIS IS APPLES AND ORANGES! None of how Norway handles their royalty money can possibly compare to the economics of Alberta oil. Yes, it's ultimately oil and that's as far as it goes. I can not believe how many here have absolutely no understanding of the oil business yet can pass all these judgements on what Alberta should be doing. Priceless.
  139. V B from Regina, Canada writes: Norway has seen the writing on the wall. Wake Up People. Best case scenario is that there will be enough world oil production to last about another 200 years but I don't buy it. The easy cheap oil we are accustomed to will likely last about 30 years. World oil production will peak in another couple of years if it hasn't already and then there will be a gradual, steady decline but demand will continue to grow. We are very dependant on oil for everything, i.e. agriculture, industry, transportion. Norway's oil production has already peaked and they are looking to save for the future. Will any of us be that smart?
  140. Gary Thomson from Surrey, BC, Canada writes: Kevin Cochrane(4:56): Talk about not understanding what one is talking about, look in the mirror pal. We are not comparing apples to oranges just because Norway's oil is offshore and Alberta's is not. We are talking about the economic distortion of the rest of a nation's economy caused by rapid increased growth in its oil sector. In fact, it doesn't even have to be the oil sector at all, it could be any nonrenewable natural resource, gold, for instance, though this is unlikely in an economy as large as Canada's. I am not going to give you a much needed economics lesson, but when one sector's rapid growth takes resources, labour, and capital away from the rest of the economy, it also inflates the other sectors costs, making them unproductive. That's why Mideast countries have, for the most part, been unsuccessful in their attempts to diversify their economy. Norway has used foresight to put their potentially inflationary oil profits to use in a way that does not hinder the rest of their economy and builds up a fund that can continue to produce income when the oil runs out. Lougheed tried that with the Heritage Fund but subsequent Premiers raided the cookie jar when times got tough and showed little foresight the current good times, choosing, instead, to spend like drunken sailors.
  141. Jeff S from Canada writes: don't forget folks that norway is not a welfare state as is Canada.
  142. Gary Thomson from Surrey, BC, Canada writes: Jeff S(5:34): Careful. Sarcasm doesn't translate well on the internet. Some people might think you mean twhat you said when, as we all know, Norway is the very defn. of a 'welfare state'.
  143. Kevin Cochrane from Clear Lake, Manitoba, Canada writes: Spare me Gary Thomson. Spend like drunken sailors??? Billions of dollars spent on Alberta's secondary schooling, yes the fools, blasphemy! Spending on roads? How dare they! Lissen, bud, until you have commuted daily for four years on #63 highway do NOT tell me that Alberta doesn't need to spend money on infrastructure. If you want another version of the NEP try and sell it to Danny Williams first then see how it goes in wild rose country. The economics lesson is this, bitumen derived oil is horrendously expensive to produce but the reserve is massive. The labour intensity of it means that the feds get lots and lots of payroll tax revenue and a lot of provincial payroll tax from out of province workers as well. Yes, Norway gets a lot of revenue directly from the oil, however, the initial investment costs of developing that oil is absolutely miniscule in comparison to what it takes to develop, extract and maintain bitumen derived oil. Apples and oranges. Suncor announced this week that their expansion project to increase production by 200,000 bpd will cost over $20 billion that will be directly invested in Canada. What do you think a few off shore rigs cost? Norway has one means of revenue right now and that is oil, they better sock it away.
  144. BC Green from VANCOUVER, Canada writes: Boomer AB: You suggest that perhaps B.C. would join Alberta in separating from Canada. Please do not hold your breath! Alberta and B.C are miles apart in ideals, and although there are many transplanted Albertans here, I can assure that there would be a revolt if Campbell tried to lead the population down that garden path. Like the rest of Canadians, we like to complain about the federal government [its a pastime for us all] but if push came to shove, we like B.C.'s greener policies by far over Alberta's. Besides in about 50 years, we are going to have an abundance of the world's scarcest resource- water- and Alberta will have used up all theirs.
  145. Gary Thomson from Surrey, BC, Canada writes: Hey, I've got no problem with spending money on education, health care, infrastructure, etc.. But I'm not an Alberta Conservative, like so many posters on these articles are, that gripes about everyone else's overspending when the growth of my provincial gov't.'s spending has consistently been way above inflation for years. I also think the NEP was a big screw up but I don't talk about it like it was an intentional genocide against the people of Alta. that they were fortunate to survive, as do so many posters during this series of articles. That a very large investment is needed to extract a very large amount of oil and make a very large profit has nothing to do with apples, oranges, or Newfoundland; it's called capiltalism. Norway's offshore oil was not cheap to get at either. Also, while screaming NEP, you do not seem willing to credit the feds for all the taxbreaks and subsidies they threw your way when oilsands oil was too expensive to get at profitably. Sure, prices have gone up, but production costs have gone down, in part, to federal subsidies of pilot projects. Why are so many Albertans so sanctimonious about their current good fortune and so begrudging to the rest of the country? You happen to be sitting on a large supply of a currently very valuable, nonrenewable resource; you didn't make it, invent it, or figure out what it is good for. BC was never as obnoxious as Albertans are now when lumber was king, and you all were coming out here to find gainful employment. It's your oil and your good fortune; suck it out, make a buck, spend and save it, just quit acting so hard done by and, perhaps, at least, pay lip service to the difficulties your current good fortunes are creating for some of your fellow citizens in other provinces, even if they are too 'stupid' to move to Alberta and cash in.
  146. west slope from Greater Vancouver, Canada writes:
    Owen Perry from Windhoek, Namibia writes: Excellently written and highly informative article.

    Agreed.

    Am not surprised at Alberta's Energy Minister Mel Knight's reaction.

    First-come, first-serve, easy-access traditions are an integral part of the makeup of western Canadian colonial descendents.

    Tragedy of the Commons, you say? It is a deeply entrenched way of life and absolutely instrumental in opening up the west. The ethics of 'open access' exploitation once helped us deprive First Nation communities of their resources such as fish, and now provide bargain-basement priced boreal forests and water to the tax-holiday-rich oilsands industry.
  147. Matt Toma from Vancouver, Canada writes: CD W from Canada -
    _______________________________________________________

    An investigation of Norway's social spending and social program infrastructure, and patterns of immigration, would likely be beneficial to you.

    Norway spends a great deal of money on individuals you characterize as "crybabies and whiners". In fact, Norway has some of the highest marginal tax rates, and highest levels of per capita social spending no just in Europe, but the entire developed world. The OECD and EU websites have all the raw data you would need to confirm this should you be so inclined to research your arguments in the future (and free of charge).

    Norwegian social expenditures go far, far beyond Canadian levels on a per capita basis, and their income distribution is no where near as inequal as Canada's.

    Not that your argument has merit from a point of view of material fact, but even if it did, Norway proves demonstrably that you can have a robust industrial economy, and robust social spending, without one compromising the other.

    Then again, when an individual posts from behind a pseudonym, should anyone expect anything more than ill informed put downs? Probably not.
  148. Steve Gibbons from Calgary, Canada writes: Gary, you expect the average Albertan to not play the NEP victim? Thats not going to happen.
  149. J T from Victoria, Canada writes: That's true BC Green, the numbers aren’t quite there yet, but I bet they are bigger than you imagine. From Gordon Gibson's column in the Vancouver Sun, Tuesday August 16 2005 'Western separation, again, - new feeling is based on what could be - a fine prosperous country' A poll of 1,448 taken near, ironically, the Canada Day weekend asked "Agree or disagree, that western Canadians should begin to explore the idea of forming their own country". 42% of Albertans agreed, 33% of those asked in BC and Saskatchewan agreed. Quote: "The new sentiment is more based on the constructive idea of what could be, in a West free to make its own decisions. It would of course be a fine little country, one of the most prosperous in the world." And another quote: "The West has never had its Rene Levesque...but should our Levesque emerge, he or she will have a powerful story to tell. For the underlying reality is that a good, constructive case can be made for a new country...That is just a fact and more and more people are figuring it out." Gordon Gibson also wrote in the Globe Oct 4 2006 ‘A little friendly talk about Alberta separation’, “The economic and geopolitical necessities for an independent state all exist in spades in Alberta.” And he reported that at the Calgary Congress, a 350 delegate meeting about renewing confederation also heard from Leon Craig, a respected U of A professor who asked “If you were already independent, would you consider joining Canada under the same conditions as today?” The big laugh and long applause made it clear the answer was “No”. So if you elect Dion as PM with a corrupt party that hates the West, and particularly Alberta, where Dion has stated in Halifax last year that “Alberta ees Canada’s meelk cow” and Liberal MP Marx Holland stated Alberta could be nationalized, expect those numbers to soar to “clear majority with a clear question” Clarity Act levels.
  150. Go Oilers Go! from Canada writes: Gary Thomson from Surrey, BC, Canada writes: Why are so many Albertans so sanctimonious about their current good fortune and so begrudging to the rest of the country?

    Gary Albertans in general are not sanctimonious.

    As you mentioned the NEP was a huge screw up; politicians from outside Alberta's jurisdiction stuck their nose where it didn't belong and screwed things up.

    So now many Albertans are simply on guard; I know I'll never trust another politician from Ottawa. They have proven repeatedly they really couldn't give two sh!ts about the prosperity of Albertans.

    The only thing Alberta has said and continues to say is "hands off and stay out of our business". No one feels hard done by now. We got screwed in the past and moved on. We simply won't allow it to happen again.
  151. Gary Thomson from Surrey, BC, Canada writes: Steve Gibons(6:53): I know, but why? I mean, I understand Quebec's tight grip on victimhood, what Canadian doesn't?(Understand, not agree) But Alberta's? Even during the days of the, admittedly economically, particularly in hindsight, stupid and politically insensitive NEP, which didn't actually kill swathes of Albertans, Alberta has been doing better than most all provinces.
  152. lynn H from Canada writes: The relationship between individual provinces and the federal government is much like any other relationship. Once trust is broken it is hard to get back. The fact that successive government since Trudeau have continued their bad treatment of Alberta (and other western provinces) certainly does not help. Central Canadian media writing nothing but bad news articles about Alberta does not help. Blaming Alberta and Alberta alone for CO2 pollution does not help. Asking for more and more money while refusing to explore power sharing like tripe E does not help. Favoritism towards Quebec and Ontario does not help. Actually, looking at it from an Albertans point of view, they give a lot of money and yet get nothing but abuse and interference in return. What reason do they have to trust Ottawa politicians?
  153. freelix the cat from Canada writes: i don't know why you're all going on about nep - it's ancient history, use your google and forget all this bs, the world production of oil is approx. 85 bbl/day, alberta produces approx. 1.3 bbl/day and will soon rise to approx. 1.7 bbl/day - great.
    but, 99% is sold to u.s. most of alberta's oil is owned by u.s.
    things albertans should think of:
    most of the money leaves alberta and alberta still hasn't done much to look after its social needs in the future.
    does alberta have a never ending supply of water that i haven't heard of?
    alberta is going to have to figure out how to heat all that water cheaply, alberta is running out of natural gas.
    alberta is very busy extracting as much oil as it can - no thought for the future.
    if you think alberta can stand on its own 2 feet you're dreaming.
    if alberta has infinite water and infinite heat supply, where the hell are you going to put all these different facilities.
  154. Child of the North in Canada from Canada writes: All you hard-done by Albertans: better hope Canada's First Nation's people don't decide to take back their oil. You think that Ottawa screwed you over with NEP, imagine how they feel.
  155. Bobby Dy from Edmonton, Canada writes: Given the way that Alberta manages it's money today, the NEP was a good thing. At least there was some benefit to the country. Alberta mismanages this sector and the revenue it receives from it. At 1.25X the per capita spending of Quebec, Albertans get very little in return for high government spending. There is virtually no planning for the future. No building of an economy beyond its resource base--one that could come crumbling by any number of factors.
  156. cam befus from Alberta, writes: Wow. Lot's of stereotypes flying around about people from all regions of the country! As an Albertan, I am dismayed at the lack of foresight by the different levels of government.
    On the radio this morning, there was talk that Alberta's next quarterly financial update (coincidently, during the last week of the expected provincial election) will demonstrate that Alberta may have up to 10 billion dollar surplus! I can't even get excited about it because 'Steady-Eddy' is spending it as fast (spending announcements) as he can in order to ensure a 4 decade run of single party rule in Alberta.
    Cynical... you bet! Reminds me of an old bumper sticker from just after the last oil boom....
    "Dear Lord, please send us another boom and this time we won't piss it away."
  157. D. G. from Burnaby, BC, Canada writes: Kevin Cochrane;

    Don't waste your time on these simpletons. You've explained it at least three times. Norway drills/pumps oil, in Ft. Mac they manufacture oil.

    Hope you took home a good nest egg to get you life going in Clear Lake, that's what it is all about.

    All the best.

    These discussion boards have been extremely enlightening, I hope all Albertans have taken note, Eastern Canada still thinks they own what you have, as always. Be prepared, the assaults are just about to start, and will continue.
  158. Woody Forrest from Out in the Sticks, Canada writes: My memories of Norway: Very clean and tidy, no panhandlers, all restaurant wait staff spoke English and a pint of beer cost about $14.00 Cdn. The flying time east to west across the country is about 50 minutes - and the view is spectacular... As many posters have already pointed out, you have to consider the difference in size between the two countries. The distance from Oslo to Milan is about 1600 km. This about the same as the distance between St. John's and Fredericton, or Toronto and Moncton. Winnipeg and Toronto are about 2100 km apart and St. John's and Victoria are a whopping 7800 km apart. I try to be a glass half full (not half empty) kind of person. Think about how different Norway and Italy are, and the differences between Toronto and Calgary shrink quite a bit. Hanging together as we do over the vast distances is quite an accomplishment. All the carping about how well or bad Alberta manages their resources is wasted effort. It IS their oil as they negotiated when they joined Canada (instead of the USA, who would not have given them as good a deal). When the shoe was on the other foot (pre-NAFTA) Central Canada behaved about the same. We'll muddle through somehow, but those incredible distances between regions, and the wide open spaces in between, will always dominate how we live. This is something Norwegians will never have to deal with.
  159. L Harder from Canada writes: While the NEP was probably a stupid idea, if you understand the global situation, its a bit understandable

    Rocky Zhao contributed important contextual information that implies that the NEP was not the only cause of the severe recession that everyone remembers. My parents barely held on to their place (NE BC) and it took them about 5 years to get their lives back to normalcy. Was it the NEP. Not really, interest rates were sky high, and there were no jobs anywhere in the province. In the absense of the recession (US based), would the NEP had such a negative influence? Probably not.

    That being said, paying market prices is a good idea as it doesn't distort economic allocations of capital.

    Notice the biggest blowhards here resort only to rhetoric when asked about what they would do. Squealing like pigs at the trough.
  160. Counterspinner tells the truth from Canada writes: If BC, Alberta and Sask were on their own, they could make the oil dollars last just like Norway does. Dare to dream, dare to dream.....
  161. Jean Malice from Calgary, Canada writes: Separation from Canada!
  162. Gary Thomson from Surrey, BC, Canada writes: DC from Burnaby(8:14):It matters not what you have to do to get at the stuff, it's still just oil and the economic impact on a nation's economy is still affected by oil booms. If Albertans were manufacturing oil, then they would not have to allow for the fact that one day, it will run out. Hence the term, non-renewable resource. Did you read the accompanying article about how Norway minimized its oil boom's impact on the rest of its economy while socking away a large part of a nonrenewable resources windfall for future generations? Lougheed was aware of this and set up the Heritage Fund.
  163. Robert Miller from Halifax, Canada writes: I don't think that the NEP wasn't entirely a stupid idea if local opinion in Alberta had been managed better by the Federal Government of the day...

    I think that Trudeau's arrogant attitude towards the West was the real problem...

    Now, we are all still paying the price...

    However, it's time to put the past in the past.

    Trudeau's ghost must be exorcized from Alberta! So should all these trolls from Foreign countries who are using the politics of polarization to try and divide us...

    Surely, the G&M threads can stop people posting that say they are posting from Canada when they are clearly not...
  164. Robert Miller from Halifax, Canada writes: Jeff S from Canada writes:

    "don't forget that Norway is not a welfare state as is Canada is."

    ---------------------------------------------------------------------------------

    Jeff:

    Are you speaking of the billions of corporate welfare that is paid annually to Quebec and Ontario?

    A list of the Top 100 Grants and Contributions Approved by the Federal Government -- 2006/07 Fiscal Year

    http://www.taxpayer.com/pdf/top100.pdf

    Or the $55 BILLION (AND GROWING) SURPLUS that Ottawa has amassed in employment insurance...

    I would love to see an end to these types of welfare in Canada --

    let's get right on that issue next!
  165. Woody Forrest from Out in the Sticks, Canada writes: Robert Miller, I don't know what, if anything, the G&M does to confirm your country details when you set up your account. I do know that after you set up your account, you can't change your country like you can change your handle.

    I was in the UK recently and wanted to change my location from Canada to England. When I logged in under my normal account, it would not let me change my country details.
  166. Robert Miller from Halifax, Canada writes: By the way, could someone please explain to me what "Miller's economics" are?

    Because I have no idea...

    Kinda nice to have an economic theory named after me though...

    Thanks, Boomer.
  167. Rocky Zhao from Canada writes: I suspect he was referring to the mayor of T.O. , David Miller
  168. D. G. from Burnaby, BC, Canada writes: Woody Forrest;

    Well put. Excellent comments. There are vast differences in people's outlooks across this country. It seems urban Ontario likes socialism, Albertan's on the whole like freedom and independence from government, always have. So running the country federally like the people in Ontario want it to be run has, and always will be problematic for national unity. The Liberal/Trudeau approach has always been the hammer, which is not appreciated by the one's getting hit with the hammer. The Trudeau style will not be tolerated anymore and if resurrected will further fractionate the Confederation until real, permanent splits occur.
  169. george hervey from Canada writes:
    It is particularly grating when one considers the three relatively small countries of Norway, Finland and Iceland, their quite different but distinctive approaches to their places in the economically globalized world, and then ponders the gross ineptitude, if not downright stupidity, of our Prime Minister, many of his 'ministers' and spokespersons, the leaders of the other federal political parties, and the majority of our provincial leaders. When are Canadians from coast to cost going to get together and demand effective solutions to our many problems? The political system is not working! We need five years (or more) of leadership from a group of eminent Canadians from various fields, whose experience, integrity and judgement have been publicly established and proven.

    We simply cannot continue to put up with the current crop of political miasma that is on the verge of sending Canada even further down the steep slope to mordant mediocrity.
  170. Robert Miller from Halifax, Canada writes: Here's a summary (hopefully, somewhat unbiased of some of the recurring themes above)

    (1) Trudeau created a long lasting and detrimental bitter dispute between regions in Canada with his belligerent attitude and inflexibility of approach on the NEP somewhere between 16-25 years ago.

    (2) Our recent and current political leaders in Canada (both Provincially and Federally) are generally short-sighted and spineless money grubbers who cannot be trusted. Some regions of the country are now starting to suffer as a result of their lack of vision.

    (3) The Norweigian model presented in this article (although some posters don't believe entirely comparable with the situation in the Oil Sands) is a superior model to the Alberta model or lack thereof.
  171. Robert Miller from Halifax, Canada writes: D G from Burnaby, BC:

    I raise this point to illustrate a fact, and not start a partisan debate...

    When PM Harper reneged on the terms of the Atlantic Accord 2005 in last year's Federal budget, a Conservative MP from Nova Scotia likened this act to "dropping a sledge hammer on two provinces."

    Dropping hammers on regions is not a unique feature of any one single political party in Canada...
  172. D. G. from Burnaby, BC, Canada writes: The worst thing you could do is build a massive Heritage Fund. First provincial jealousies would be even worse than they are already. Two, that would mean the government will decide how to spend it, and if they are not wasting it on politically motivated ventures, they will waste it on ill conceived ideas that will yield little value to its citizens. Governments are the last ones to be entrusted with spending people's money. The best way to distribute that wealth is to keep it flowing through the economy for the benefit of everyone involved. Long term, good paying jobs are the result. People will either invest THEIR money in RRSP's, their house, education for their kids (RESP's), building businesses, or just plain old enjoying life. After 50 years of an economy driven by oilsand development, there WILL be vast increases in secondary and tertiary industry, there is even NOW, what do think was going on when oil was $10 a barrel? there will be no Dutch Disease. Alberta is not Holland, you could fit a couple of Hollands inside Banff National Park by itself. Alberta has much more potential, that is just now being realized. One thing to consider, the amount of labour required for oilsand development is many times higher than Norway's deep sea oil requires, and doesn't generate many jobs in comparison. They have developed other industries because they aren't used in oil, which is natural, hardly genius forethought. The $20 Billion per oilsand project goes directly to the pockets of workers, in Alberta, and indirectly to the rest of Canada, whether you are too myopic to realize it or not. Economies are complex entities, money gets diffused and flows from one end to the other, until governments decide to intervene "on our behalf". Anyone remember Trudeau's genius policy of Wage and Price Controls? It was practically Marxism.
  173. Robert Miller from Halifax, Canada writes: Clearly inept governments should also be the last to be entrusted with managing one's own resources too...

    This is not too different from allowing government to spending one's money...
  174. Dick Garneau from Canada writes: We are not told that Norway lost 85% of their US investments in sub prime mortgages
  175. Go Oilers Go! from Canada writes: D. G. from Burnaby, BC, Canada writes: The worst thing you could do is build a massive Heritage Fund. First provincial jealousies would be even worse than they are already.

    I know there were some in the Klein gov't who felt this was true, but they were more worried that a $100 billion fund would be too tempting for the Federal gov't to not try to confiscate.
  176. M P from Ottawa, Canada writes: Instead of focusing on why the model can't work in Canada why not look at the main point of the article that comes across. This is a country, a government, a people with a vision and a plan for their future, their children's future, their grandchildren's future. It really doesn't matter whether what they're doing can be exported here. What matters is they have a vision and a plan for the future.

    Our vision and plan is how much more we can buy this year with our 1% GST cut....
  177. Robert Miller from Halifax, Canada writes: M P from Ottawa, Canada writes:

    "This is a country, a government, a people with a vision and a plan for their future, their children's future, their granchildren's future..."

    Wow, you even sound like an MP from Ottawa -- how do you guys come up with that corny shtick anyways?
  178. Go Oilers Go! from Canada writes: Robert Miller from Halifax, Canada writes: I don't think that the NEP wasn't entirely a stupid idea if local opinion in Alberta had been managed better by the Federal Government of the day...

    The policy of double taxation and selling the commodity at below market prices isn't very good for business. It tends to ruin the economics for most projects and drive out investment.

    I agree Trudeau's attitude is probably why the bitter feelings still linger as strong as they do.

    However the NEP was bad policy. There are many companies besides Norway's state-owned company that operate in the North Sea. Most of them make more money there than in Alberta right now too.

    Whether you agree with Norway's policy or not it attracts investment. The NEP drove invest out in the tune of billions.

    To compare tax or royalty rates straight up is disingenuous. Cost per barrel is what counts.

    In the North Sea it has been $15/bbl until the last few years; now it's creeped up to $21/bbl.

    The oilsands projects right now are all $30-35/bbl.
  179. D. G. from Burnaby, BC, Canada writes: GO Oilers GO!
    That's what I meant (not internal Alberta jealousies) other province's (like Ontario). If it is a huge fund, it becomes a large target, the Feds, if Liberal, will devise a means to take it away. Better to keep it invisibly flowing in the economy (people's pockets, RRSPs', RESP's, houses, personal investments) where it can't be touched by bureaucrats.

    Oilers may be done this year, but will rise again ... if Hemsky ever learns to shoot at the freaking net! :)
  180. Go Oilers Go! from Canada writes: D. G. from Burnaby, BC, Canada writes: "Better to keep it invisibly flowing in the economy (people's pockets, RRSPs', RESP's, houses, personal investments) where it can't be touched by bureaucrats."

    That's what the Klein gov't believed. They didn't and don't trust the Feds to have large sums of money sitting in one account. Even Taft has expressed concern.

    I know the concept of multiple funds has been tossed around.

    "... if Hemsky ever learns to shoot at the freaking net"

    The prayer I say every night.
  181. Robert Miller from Halifax, Canada writes: Go Oilers Go! from Canada:

    Look again at my original post...

    "don't think that the NEP wasn't entirely a stupid idea" is actually a double negative, but since I have you on the line...

    Earlier in the thread, you said...

    "The US is by far the largest consumer of Albertan oil, however oil is sold also sold to Asian markets... and at full market value."

    (1) Can you give me an actual percentage of how much Albertan oil is sold to Asia?

    (2) Does Alberta not sell their oil to the US "at full market value?" If not. Why not?

    In response to the question from a another poster asking why Alberta doesn't get the most that it can from its resource, your answer was:

    "The answer is we do... why do you think Albertans were chapped when the NEP forced Alberta oil to be sold to Central Canada below market value?

    (1) From your above answer, do you not see how the ghost of Trudeau past is still haunting your Province to do that which is not entirely sensible economically or ecologically?

    (2) It seems Alberta is cutting off its nose to spite Canada's face? Why? That's what some of us really don't understand.
  182. Pragmatic Pundit from Calgary, Canada writes: A good article published by the Canada West Foundation on this subject.
    http://tinyurl.com/2hrbb7
  183. Steve Not an Alberta Redneck from Calgary, Canada writes: In 1982, the Alberta Government was advised by its Auditor General that it had a 2.5 billion dollar pension liability. This was due to the fact that while the employees and most employers (such as municipalities, etc.) paid their full share, the Province did not contribute at all, deciding instead to "pay as you go". They put the money in the politically driven Heratage Trust Fund instead. Within 10 years, this liability had grown to enormous proportions and Alberta allegedly teetered on the brink. To get back on their feet, this amount was stolen from these employees again and many groups still have enormous amounts to fund. All this while there are multi billion dollar surpluses (possibly 10b this year) As most know, this 2.5 billion, invested conservatively in the NY Stock exchange index would have been worth in excess of 30 billion by the late 1990s and the province would never have been in this manufactered crisis. Meanwhile, the HTF actually lost money on bad investments - mainly loans to political cronies.
  184. Steve Not an Alberta Redneck from Calgary, Canada writes: Current royalty policies are actually a negative to most Albertans. While a few (real estate speculators, some oil executives and owners of oilfield service businesses) are making off with the loot, the overheating that has resulted from give away royalty rates have created a situation where it is costing far too much to find new resources and build the needed infrastructure. When the party is over, the hangover will be severe and the locals will be taught a lesson they should have learned in the 80's: (and that is) Unlike Norway, once the oil is found and developed, there is little spin-off to the workers of the province. Its time for the oil companies to export their product and repatriate their profits. Incidentally, I always know I'm dealing with a moron when someone dredges up the NEP to blame for the bust in the 80's. This folk legend will likely continue to rally the local right wing nitwits but for those of you outside the province who are interested in facts rather than fantasy, name me any place with a strong oil economy in the 70's that didn't tank after 1981. And some took much longer than Alberta to recover. But we can blame the NEP for that too. Basically Alberta's problem in 1980 was that it was at the crest of a speculative bubble and without further oil shortages to keep this unsustainable speculation going, it was ready to crash. I was doing accounting for many of these companies and speculators at that time and I only encountered one individual realized that it was coming to an end. For everyone else, it was either stupidity or in some cases fraud. But when you can "turn around" portable biffies in 38 weeks, its difficult for these types to not mortgage everything they have and buy ten times as many.
  185. Will Hoaccio from Toronto, Canada writes: Hmmm... What Canada needs, really needs, is a war! Think about like Bismark's Wars of Unification, i think we missed that step of nation building.

    Who to target? Geography would dictate the U.S.A, but logic would suggest otherwise (though a short jaunt into Detroit may be possible, who wants it?). In terms of social character, millitary capacity and economic capacity, I would say our most logical competitor would be the CARRICOM nations or Australia and New Zealand.

    Ultimately, i feel it is Canada's destiny to invade Australia. Those so-called people have lived a crude pantomime of our glorious nation for too long! Where we have the frigid north, they have the barren deserts, where we have the honest mounty, they have the bafoonish crocodile dundee, our Toronto is their Sydney (our CN Tower their Opera House) and not to mention our common British colonial origins.

    If we just pulled a lightning fast Blitzkreig to capture the west end of their continent, we could hold it and make a punitive peace, gorging our latent nationalism in the process.
  186. Robert Miller from Halifax, Canada writes: Pragmatic Pundit from Calgary, Canada:

    Excellent paper (http://tinyurl.com/2hrbb7) -- Thanks for that!

    I also don't get why the electorate in Alberta aren't demanding this kind of approach from their current Provincial government?

    What bigger issues in Alberta are there currently?

    Maybe, we could all just admit that the Make Beleafs have sucked for the last 40 years, and skip the War thing...
  187. Will Hoaccio from Toronto, Canada writes: Robert Miller from Halifax, Canada writes: "Maybe, we could all just admit that the Make Beleafs have sucked for the last 40 years, and skip the War thing..."

    Come on, most people here would agree with the statement that Canada has flexed it's national muscle less than any other nation. At the same time, I am sure most people would agree that Australians imitate Canadians at every turn, and poorly at that!

    If Canadians have difficulty getting along with each other and Easterners and Westerners view each other as mutual worse enemies, the most logical solution would be to introduce an external enemy (obviously i favor Australia, am open for suggestions though). Think about it, the United States got the message, for the past century there has been an "enemy", first the huns, then the commies, now the terrorists. Infact MOST countries do this, every nation state has a pepsi to their coca cola, the defining attribute of Canada is that we are both pepsi and coca cola.
  188. Robert Miller from Halifax, Canada writes: Will Hoaccio from Toronto, Canada:

    OK, let's invade St. Pierre and Miquelon then.

    Here's the plan.

    You and I will take a dozen bottles of Black Horse and a canoe out of Grand Bank, Newfoundland armed with hockey sticks and full gear on a Saturday evening...

    We should have the place conquered just in time to catch Don Cherry praising the Habs on Coach's corner on HNIC. We can say that we were freeing captured Canadian medical students being held on the island by evil Franco-Islamo-Terrorists...

    We will, of course, need to provide a full acount to Steyn so he can publish stories of our victory in Canada's national news magazine.
  189. Robert Miller from Halifax, Canada writes: Hell, let's just get Steyn to write it up even it didn't happen... He seems to do that all the time anyways.
  190. Josh K from Edmonton, Canada writes: Reading this article -- particularly my energy minister's inspiring comments at the end -- was truly depressing. I am about as harsh a critic of Alberta's provincial government as one could find, but it stings to be reminded of the unprecedented myopia and lack of vision in this province. It's also depressing to know that since self-restraint, austerity, and foresight were keys to Norway's success, this will likely never happen in Alberta.

    On a more specific note, I would like to point out what I see to be a glaring weakness in the argument presented by many here that such a royalty scheme would never work in Alberta because of {insert myriad of excuses here, ie difficulty in extracting from oilsands vis-a-vis offshore, transportation challenges, etc}. These royalties are based on a percentage of profit -- so, if the companies don't make a profit, they don't pay royalties. The royalties are therefore normalized to the success of the company (as measured by profit) -- they aren't an additional cost.

    So, the worst that can happen is that investment capital gets directed elsewhere where it could potentially earn a higher rate of return. However, in the case of oil, these "elsewheres" are steadily dwindling, and in the case of Alberta, more investment capital is the last thing that we need as, in my opinion, Dutch Disease is already starting to rear its head. Saying that such a model wouldn't work here is simply an excuse, something to make those offering it less guilty about the truly spectacular mismanagement that has characterized oil development in Alberta.
  191. Robert Miller from Halifax, Canada writes: Vision? You want vision, Josh K??

    Will and I are planning to kick some serious Franco-Islamo-terrorist butt on St. Pierre and Miquelon!

    So are you Western guys also coming or what ?

    Because you are either with us or you are with the Franco-Islamo-terrorists???
  192. M B from Calgary, Canada writes: The main reason Alberta does not have large Heritage-style fund like Norway is that evil Trudeau and the Federal Liberals robbed Alberta to the tune of over $ 200 Billion in net transfer payments in the 1960s-1970s and early 1980s, especially with the NEP. Ironically Quebec received almost the exact same amount in net inbound transfers. The conquest of Alberta's treasure was significantly more in those days, when adjusted for current dollars, than anything resembling the economic boom that we have today.
  193. martha stewart from Canada writes: But Robert Miller - Quebec won't join. They are Franco-sympathizers. I'm thinking that since the Americans are distracted in Iraq, maybe its time we finished off the War of 1812.
  194. Will Hoaccio from Toronto, Canada writes: Man, why are so few Canadians offended by our Aussi-enemies? At the very least we should be able to annex New Zealand, and raise our mean temperature in the process.
  195. Robert Miller from Halifax, Canada writes: martha stewart from canada:

    ietquay -- on the arway of 1812, eh?

    You're going to get the boys from Texas all over this thread with such talk...

    Perhaps the boys of the God Pod are too busy roasting kittens with Steve, Dick and Dubya, however...

    We could use someone on our expedition who knows how to make attractive lawn furniture out of the pile of rock that is St. Pierre and Miquelon... That would be a good thing.
  196. Robert Miller from Halifax, Canada writes: Will Hoaccio from Toronto:

    Alright, I will give you that point!

    Aussi-Franco-Islamo-fascists on St. Pierre and Miquelon, it is then!
  197. Robert Miller from Halifax, Canada writes: People of Alberta:

    Please forget these imaginery threats that all these damn lying Liberals are trying to force down our throats.

    Water depletion, pollution, economic migrants, astounding GHG emissions, minimal royalties, deforestation, unchecked growth and over-development.... Liberal lies!

    Let's get serious and focus on who our real enemies are --

    Namely the Aussi-Franco-Islamo-fascists of St. Pierre and Miquelon.
  198. Robert Miller from Halifax, Canada writes: I am hearing nothing but crickets out here in Halifax...

    What is nobody joining this War? OK, I am going to bed then!

    WIMPS!
  199. old curmudgeon from Armenia writes: Does anyone have any knowledge of the NEP, other than the urban myth that it was a "bad thing"? Yes, for a number of reasons (including timing), it didn't turn out well, but how did it work? First, it didn't "expropriate" existing interests--it was purely prospective, not retrospective. It merely said that if you leased Crown land, the government was your partner for a percentage of any production profits (in other words, it's my land, but if I let you make money off it, I want a share of the profits). That sounds a lot like capitalism to me. Even the cowboys in Calgary don't give their resources away (as this discussion forum proves). Second, in exchange, the government would reimburse you for part of your drilling expenses (even if you only drilled dry holes). So, the government provides the resource, and pays part of your drilling expenses, for a share of the profits, if any. For a dry hole, the company doesn't even have to pay all the drilling expenses, as would normally have been the case. And what was the rationale behind implementing the NEP? That the Canadian oil industry had the highest concentration of foreign (read US) ownership in the world, at a time when predictions of catastrophic price increases were rampant. Shouldn't a responsible government try to protect its citizens in this situation by attempting to ensure long-term management of scarce resources and attempting to keep some of the profits in the country? Did it work? No. Admittedly, it was flawed. But the biggest reason for Alberta's woes at the time wasn't the NEP--it was the general recession that hit in the early 80s. Convenient to blame the NEP rather than the market. And many of those who lost their homes did so because they had extended themselves by buying second properties, 49 cars, and condos in Arizona. Just the sort of behaviour that the Norwegian approach to windfall management would have prevented. (continued)
  200. old curmudgeon from Armenia writes: (continued) Remember the old bumper sticker popular in Alberta at the time?--"Dear Lord, please let there be another oil boom--I promise not to piss it away this time". This realization even hit home with Albertans at that time.

    Final replies:

    GlynnMhor - You're right, in Norway local thinking is national thinking, while Canada is a confederation of localities. What I was arguing for was that it would be nice if Canada could move toward national thinking. Given the constitution, the history, and natural greed, I realize that can't happen. Doesn't stop me wishing, though.

    Michael B - You don't have to give Alberta to the US--they've owned it for a long time (Interesting fact - Calgary was [maybe still is] the largest US city outside the US, based on population [was 80 to 90 thousand, as I recall). Much of it from the oil areas of the US--Texas, Oklahoma, etc.--giving it every reason to call itself Dallas north and the mentality to match).
  201. rich gunter from Regina, Canada writes: This article says that Norway will not not touch her oil money until the oil runs out. Setting aside all the other issues and differences between Canada's situation and Norway's, has anyone considered the fact that the oilsands will not run out for hundreds of years, even at higher rates of production? And we have not even started on Saskatchewan's oilsands...
  202. Fan of Intelligence from Canada writes: Another excellent, informative article from Doug Saunders. I agree with many posters here - seeing how it can be done, high standard of living, low unemployment etc etc.. is depressing because Canadian leaders lack this kind of vision. There are some that have it, but it is never expressed - probably due to our electoral system that entrenches two-party rule and does not allow for innovation in policy to be expressed as it has in Norway.

    Bravo to the Norwegians
    Shame on us
    Pity the Albertans who will be living in a moonscape soon enough
  203. Ben Dover from Ottawa, Canada writes: Has anyone noticed an oil boom going on...? I haven't felt a thing! Actually, Statistics Canada recently reported in the Globe and Mail
    January 5, 2008: and I quote: "...that the earned income of the "average" Canadian -- the so-called median income -- was the same in 2004 as in 1982. After we subtract inflation to keep the purchasing power of a dollar roughly constant, it turns out that median income, before taxes, did not rise at all over those 22 years. Yet during that same time the Canadian economy grew, in real per capita terms, by more than half. But only the very well-paid - those above the 90th percentile of the income distribution - saw any significant increase in earned income; and the higher up the earnings ladder, the greater the growth. What has been going on?". IF THERE'S AN OIL BOOM IT WOULD BE NICE TO LET EVERYONE ELSE KNOW ABOUT IT.
  204. Doug - from Canada writes: But really going with what the Norwegians are doing would require an about face for the left AND the right. The left in Canada don't want the surplus to retire debt. The right says taxes are too high.

    The Norwegians aren't getting rid of debt they are saving!! And at the same time have a high GST and high taxes. Prices are high so every where else in the world has low prices compared to them. But they don't reallyhave enough cash to go out and enjoy it. Try to get elected in Canada on that platform!!
    =
    I will increase the GST, taxes and will foce you all to live with in your means. I will lower your standard of living now for the good of your childrens children. ---- Good luck with that.
  205. J T from Victoria, Canada writes: Old curmudgeon, it's me, that Bad Canadian again. On October 27, 1980 our projects were all viable. We did cash flow analysis (maybe you have heard of it? Probably not…) on October 29, 1980. None of our existing projects were viable, none of our planned projects were viable, all due to the changes made the day before. Our suppliers in Ontario got hurt too, immediately, when the orders for trucks, cars, pipe and other manufactured goods had dried up, and their kids started coming back to Ontario unemployed. Alberta could have helped with that recession the rest of Canada was having. And the recession? It started in the RoC in 1979, and didn’t hit Alberta until after the NEP. The two friends I helped move out of two houses because they both lost them were originally from Ontario, so don’t suggest to me that Albertans were the only ones who got overextended. And their houses were small, and their cars were old, and no properties in Arizona. We were just young professionals. Some of them moved to places like Libya and never came back. The most satisfying part was one of my friends who lost his house had a large second mortgage from a shyster in Toronto. I hope he was a Liberal voter because he lost all his money. And the “cowboys” in Calgary you refer to happen to be part of the best educated work force in Canada - your arrogant eastern condescension is showing. My favorite quote was from our general manager, who told me not to worry. “We have operated in this country for 30 years. We operate all around the world. If Canada wants to behave like a banana republic, we can wait. In the meantime, we’ll get ready for when this is over.” We did get ready. And we cleaned up afterward. We bought the assets of many of the Canadian companies that failed at distress prices. Nice going Pierre. My main point: Would the Liberals have subjected the Ontario economy to the risk of such a disastrous policy? Don’t bother answering, I know the answer.
  206. Lee Nowak from Traverse City, MI, United States writes: I so much admire your country and it's people. Kind of remind me of my friends and relatives in Michigan's Upper Peninsula. Your country has such a wealth of natural resources. The oil of Alberta and the diamonds in Northwest Territories, your forests, etc. are all examples. I would hope you would use the money to: 1. Heavily subsidize the health care of your citizens. 2. Subsidize higher education and trade skill training. 3. Make efforts to preserve your First Nation way of life. 4. Invest the rest in major foreign markets as a cushion or Trust against the above commitments and as a reserve in case of major catastrophies.
  207. Robert Mermelstein from Vancouver B.C., Canada writes: In comparing the effects of an oil boom on Norway vs. Netherlands the sound investment strategy of the former nation is obvious. It is about time that Albertans woke up and directed their government to place at least 10% of the government, that the people's share into diversified foreign investments. Such a step may earn reasonable income and provide some benefits for the future generations!
  208. The Last Honest Conservative from Western, Canada writes:
    Yes Robert,
    Albertans should shop being such phoney conservatives.
    ................ and tip their hats to socialist Norway
  209. Doctor X from Auckland, New Zealand writes: The only solution I see is for Alberta to either set up its own currency or for Canada to join in a monetary union with the US (and possibly Mexico as well), in order to dilute the harmful effect of Alberta's oil on the currency.
    New Zealand is experiencing a similar problem, having a fair bit of 'Dutch disease' from its own 'white oil' (dairy), whose price has rocketed in the past few years, pushing up the Kiwi dollar, and thus hurting the non-dairy regions and sectors of the economy, pushing NZ toward possible monetary union with Australia.
  210. Dick Garneau from Canada writes: Lee Nowak from U.S.A.: Thank you for your kind words, we will surely try to maintain your and our expectations.
  211. Lawrence Davis from United States writes: Great blog with lots of useful information and excellent commentary! Thanks for sharing.

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