Michael Ignatieff: Canadian nationalist?
|THE SEAN KILPATRICK/CANADIAN PRESS|
|Liberal deputy leader Michael Ignatieff speaks during question period in the House of Commons in Ottawa May 28.|
The above title by no means suggests Michael Ignatieff is not a proud Canadian. But there's garden-variety Canadian nationalist and Canadian nationalist. The deputy Liberal leader's recent musings on the anomalies of the Canadian energy maze puts him dangerously close to Category 2, one which, for reasons I utterly fail to comprehend, carries oooooh! a whiff of danger in this country. Unpatriotic, no less.
It takes being slapped around pretty hard for Canadians to think differently, which is what I'd call the GM closure announcement Tuesday, two weeks after signing a contract with the Canadian Auto Workers. Star business reporter Tony Van Alphen brings us up-to-date on today's developments. But I digress.
The energy status quo is unfathomable and Ignatieff, quite naturally, has questions. He's an intelligent man. Why are we a big net importer of oil in the East and a big net exporter in the West? Why indeed? And where is that east-west hydro corridor? What about stringent NAFTA energy provisions?
Lawrence Martin reveals Ignatieff's thinking in a recent Globe column. Understandably, Ignatieff stresses he's no "Walter Gordon nationalist." Still, he asks, why do oil, natural gas and hydro links all go south? Says Ignatieff: "I look at the east-west linkages that tie our country together and I do wonder whether they are strong enough to offset the north-south flows that dominate our economy."
Good question. Consequently, he's brought in researchers to find out and explore solutions.
None too soon, I say. If this indicates the Liberals as a party are moving to tackle issues most often shouldered by New Democrats, and carry their solutions into an election campaign, it can't be a bad thing for the country, especially one that imports 49 per cent of its oil.
As minefields go, this topic is red-alert dangerous. (Or is it orange?) Ignatieff's attention to the problem is significant. But as he well understands, there are political and economic wheels within wheels, internationally, nationally and in his own party. There's already an energy critic in the Liberal caucus, Omar Alghabra (Mississauga-Erindale) who supports a national energy strategy, and water critic Francis Scarpaleggia (Lac-St.-Louis), has been fighting above his weight class on a related topic in the Commons.
But this is too important an issue to hive off to one or two critics. I'm assuming — although one never knows in this wacky party — this first balloon sent up by Ignatieff in the Globe has the approval of Liberal leader Stéphane Dion.
Solutions to the problem? That depends on how far Ignatieff cares to go in his summer research.
However, its genesis is obvious, and has been for a very long time. The singular focus of Canadian national policy, beginning with Brian Mulroney's Conservatives in 1988, has been greater integration along north-south lines. (For picky historians, I am aware of the ebb-and-flow of debate over continentalism since Confederation.) That integration is the purpose of the 1989 Free Trade Agreement between Canada and the U.S. and its offspring, the North American Free Trade Agreement, which brought in Mexico in 1994. The Three Amigos. Remember them? NAFTA was negotiated on their watch: Mulroney, U.S. President George H.W. Bush and Mexican President Carlos Salinas.
Some of you will remember Liberal Jean Chrétien campaigned against the NAFTA in 1993 and promised to re-negotiate, but then, once Prime Minister, he forgot. He was a busy man.
It's not just about trade, but rather harmonization across-the-board. The point was to entrench policy in the serious stuff of international treaty. And, while the public's attention is on the nightmare of the post-9/11 border, don't believe for a moment negotiations aren't continuing apace to expand the deal. Mexico has done its part for the moment, and the focus has shifted back to the original two nations. An elite business team, (Security and National Prosperity Partnership of North America), is beavering away on the next generation of vertical integration policy, while significant U.S. federal departments, including energy and transportation, have their own divisions for the same purpose.
Moreover, the north-south linkages go beyond these treaties. It's a mindset. Everything reflects it, from the privatization of Canadian National to the creeping move to Open Skies. Sneaky little deals, not widely publicized. Ever wonder why it's increasingly difficult to get a flight to somewhere in Northern Ontario, but easy to fly into the United States (apart from security lines)?
Ignatieff refers to NAFTA energy provisions, particularly the guarantees on Canadian supply even in times of shortage. (See 605a in the above link.) There's that, and the clause dictating Americans can't be charged more than Canadians (605b). However, a lesser-known clause (605c) says no substitutions "among specific energy or basic petrochemical goods ... for example between crude oil and of refined products."
That clause is impressive to trade lawyer Steven Shrybman because it was negotiated by the American team almost 20 years ago in the FTA. "Pretty amazing," he told me. "It's pretty sophisticated pro-active strategic thinking."
Were Canadian negotiators under-the-weather that day?
It means that once a product is in the pipeline — literally — it can't be changed. And jobs are lost when crude isn't refined.
They are lost big-time. The Communications, Energy and Paperworkers of Canada (CEP) made that point in an appeal to the National Energy Board last fall. Ottawa-based economist Mike McCracken did an analysis for their presentation to the board, in which the union opposes the application by two pipeline companies, Transcanada Pipelines Ltd. and Transcanada Keystone Pipelines Ltd. for the expansion of their infrastructure by two more lines.
More north-south flow.
The union argued jobs and benefits would be shipped south from the Alberta tar sands to U.S. refineries and, subsequently, the U.S. economy. McCracken determined if the unprocessed bitumen were to be upgraded in Alberta, some 18,000 jobs annually — that's 18,000! — would be created nationally. (See sections 20-24 of the above presentation for McCracken's analysis.)
The NEB quickly rejected their appeal. The union appealed to the federal cabinet, to no avail.
The kicker, according to Shrybman, is that should there be a future upgrade of the crude in the two pipelines — critical value-added to Alberta and the country — it would contravene NAFTA energy provisions, specifically 605c.
Is it any wonder Shrybman says he has to tip his hat to U.S. negotiators? Or that Michael Ignatieff has his work cut out for him?