NDP leader Thomas Mulcair has thrown his party’s support behind a proposal to ship oil from Alberta to eastern Canada, saying it would lower energy costs for Canadians and increase energy independence.
“New Democrats support recent proposals to increase west-east pipeline capacity,” Mulcair told an audience at the Canadian Club of Toronto on Friday.
He pointed out that eastern Canada imports oil from the Middle East and elsewhere at prices that are some $40 per barrel higher than the oil Alberta sells to the U.S., and called a west-to-east pipeline a “common sense solution that not only creates jobs, it strengthens Canada’s energy security.”
Faced with a deep “discount” on their oil sands product — due to a boom in U.S. oil production and lack of access to global markets — Alberta producers have been considering reworking Canada’s oil and gas infrastructure to ship oil to eastern Canada.
TransCanada CEO Russ Girling confirmed in April his company is considering doing exactly that, and the plan has garnered support from New Brunswick Premier David Alward and P.E.I. Premier Robert Ghiz, among others. Enbrigde recently got the go-ahead to reverse an Ontario pipeline between Hamilton and Sarnia as part of a plan to ship more oil eastwards.
Mulcair’s comments were part of an effort by the NDP leader to paint a business-friendly image in front of the crowd of business leaders.
“I see that Lloyd Blankfein from Goldman Sachs spoke here just last week. So I have to apologize to those of you who will have to sit through what is essentially the same speech twice,” Mulcair joked.
And in an unusual reversal of roles, Mulcair even criticized Finance Minister Jim Flaherty — for criticizing businesses.
“Conservative Finance Minister Jim Flaherty has been blaming Bay Street for the half a trillion dollars in dead money held by Canadian businesses,” Mulcair said.
“I share Mr. Flaherty’s concern about large Canadian corporations hoarding cash and cash-like assets, but unlike Mr. Flaherty I have no interest in lecturing business. We are here to support businesses.”
But Mulcair seemed to hold his ground on the “Dutch disease” controversy. Without using the term, he repeated the assertion that rising commodity prices have caused the dollar to appreciate to the point where it has hollowed out Canada’s export-reliant manufacturing base.
But he added a new twist to the debate, arguing the Conservative government itself may be to blame for some of the phenomenon
“Prime Minister Stephen Harper’s government has poured billions of dollars in direct and indirect subsidies into some of our worst polluting industries,” he said. “Those subsidies, in combination with rising commodity prices, have led to an artificial rise in the value of Canadian dollar — and that’s hobbling our export industries.”
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Little-Known Mulcair Facts
Here are some facts you may not have known about NDP Leader Thomas Mulcair. (CP)
10. He Used To Be A Liberal
<a href="http://en.wikipedia.org/wiki/Thomas_Mulcair" target="_hplink">Mulcair was Minister of Sustainable Development, Environment and Parks</a> in Jean Charest's Liberal government in Quebec. He served in the role from 2003-2006. (CP)
8. He's French (Kind Of)
Mulcair married Catherine Pinhas in 1976. She was born in France to a Turkish family of Sephardic Jewish descent. <a href="http://www.thestar.com/news/canada/politics/article/1158289--thomas-mulcair-s-wife-catherine-a-psychologist-and-political-confidante?bn=1" target="_hplink">Mulcair has French citizenship through his marriage</a>, as do the couple's two sons. (KENZO TRIBOUILLARD/AFP/Getty Images)
7. They Used To Be Friends
<a href="http://en.wikipedia.org/wiki/Thomas_Mulcair" target="_hplink">Mulcair left Charest's Liberal government in Quebec </a>after he was offered the position of Minister of Government Services in 2006, an apparent demotion from Minister of the Environment. Mulcair has said his ouster was related to his opposition to a government plan to transfer land in the Mont Orford provincial park to condo developers. (CP)
6. Ancestor Was Premier Of Quebec
Mulcair's great-great-grandfather on his mother's side was <a href="http://en.wikipedia.org/wiki/Honor%C3%A9_Mercier" target="_hplink">Honoré Mercier, the ninth premier of Quebec</a>. (Public Domain/Bibliothèque et Archives nationales du Québec)
<a href="http://en.wikipedia.org/wiki/Thomas_Mulcair" target="_hplink">Mulcair was the first New Democrat to win a riding in Quebec during a federal election</a>. He held the riding of Outremont during the 2008 election after first winning the seat in a 2007 by-election. Phil Edmonston was the first New Democrat to win a seat in Quebec, but his win came in a 1990 by-election. Robert Toupin was the very first to bring a Quebec seat to the NDP, but he did it in 1986 by crossing the floor. (Alamy)
4. He's Half Irish.
<a href="http://en.wikipedia.org/wiki/Thomas_Mulcair" target="_hplink">Mulcair's father Harry Donnelly Mulcair was Irish-Canadian</a> and his mother Jeanne French-Canadian. His father spoke to him in English and his mother in French -- explaining his fluency in both official languages. (Photo by Spencer Platt/Getty Images)
3. He Votes In France
Muclair has voted in past French elections, but says that now that he is leader of the Official Opposition <a href="http://www.thestar.com/news/canada/politics/article/1157191" target="_hplink">he will not take part in the upcoming French presidential vote</a>. (Thinkstock)
2. Young Love At First Sight
<a href="http://www.thestar.com/news/canada/politics/article/1158289--thomas-mulcair-s-wife-catherine-a-psychologist-and-political-confidante?bn=1" target="_hplink">Mulcair met his future wife at a wedding when they were both teenagers</a>. Catherine was visiting from France. They married two years later when they were both 21. (CP)
1. Mr. Angry
<a href="http://www2.macleans.ca/2012/03/16/thomas-mulcair-is-mr-angry/" target="_hplink">Mulcair was given the moniker in a Maclean's headline</a>, but the new leader of the NDP has long been known for his short fuse. In 2005, he was fined $95,000 for defamatory comments he made about former PQ minister Yves Duhaime on TV. The comments included French vulgarity and an accusation that alleged influence peddling would land Duhaime in prison.
It Began In The Netherlands
In 1977, <em>The Economist</em> coined the term "Dutch Disease" to describe the phenomenon of economies whose industrial bases suffer when large deposits of energy, such as oil or natural gas, are found. The magazine named it "Dutch Disease" because of the rapid deindustrialization seen in the Netherlands in the years after a major offshore natural gas find in 1959.
One of the effects of becoming an energy-exporting country is that speculators will start treating that country's currency as a "petro-dollar." The value of the currency rises (and sometimes falls) with the cost of the country's energy exports, which often means it becomes too high in value for exporters in other sectors. Those exporters then see their sales decline, and manufacturing suffers as a result.
As the energy export sector grows, it attracts workers from other sectors, including manufacturing, leaving fewer skilled people to fill jobs in those areas. This is known as "direct deindustrialization."
The Spending Effect
As money flows to the energy exporters from energy consumers around the world, it increases the amount of spending cash people have. That additional cash increases the demand for non-manufacturing labour -- things such as beauty salons, travel, entertainment -- which in turn sends people into those jobs, and away from manufacturing. This is known as "indirect deindustrialization," or "the spending effect."
Economists are in disagreement about whether Dutch Disease is real, whether it's an important phenomenon, and whether it actually happened in any given economy. Fifty years after the Netherlands' big natural gas find, there is no consensus on whether the country experienced the disease named after it, with many economists arguing excessive social spending was behind manufacturing's decline.
The Canadian Debate
In Canada, Dutch Disease has become a highly polarized political issue. When NDP Leader Thomas Mulcair and Ontario Premier Dalton McGuinty recently referred to what they see as the problem of manufacturing suffering under the weight of a booming oil industry, it prompted accusation of divisiveness from leaders of Western provinces. Economists don't agree either. While a recent study from the Pembina institute argues the phenomenon is real and having a negative impact, others argue the strength of Canada's oil sector is creating internal demand that's offsetting the loss of manufacturing exports. Yet others say Dutch Disease is only a part of the problem, and that other factors -- like offshoring of jobs to developing countries and increases in productivity -- are also to blame for manufacturing's decline.