No Oil on These Troubled Waters

This "discussion" about oil pipelines, oil prices and Alberta's place in Confederation is really shifting into high gear.  

The issue, as everyone in Canada surely knows, is that Alberta hasn't been able to get its oil to markets, at least to "other" markets, specifically to places other than to the USA, and, as a consequence, there is a backlog of oil that can't get shipped and there is a price discount because there is an oil glut and the matter of the difficulty of refining the tarry stuff that the tar (aka: oil) sands produces.....  It's a significant issue in Alberta and lots is being said about it.  So.

First, let's take a quick look at some assertions about how important Alberta oil is to the Canadian economy.

I've been told, by a few people who should know, and by some politicians who ought to know, that the energy sector is 20% of Canada's GDP.  

All I could find was this:  The total value of the energy sector is 10% of Canada's GDP.   That includes everything - gas stations, electricity, oil and gas, everything related to energy.  Oil and gas contribute about 4% of Canada's GDP and the oil sands is a mere 2% of GDP.

So my question is why do some people seemingly overstate the value of the oil sands sector, in particular, to the Canadian economy?  It's important to Alberta and Saskatchewan, absolutely, and it does contribute to Canada's overall economy, but it's a long ways from being the only game in town.  And as for jobs, the energy sector as a whole generates 2.6% of direct employment to the Canadian economy.

If you want to see how this compares with the auto industry, you can get some information here.

According to the Parkland Institute, the Big Five in the Oil Sands (eg: Suncor, Cenovus, CNRL) had net profit rates above 13.5% in 2017 (Cenovus was closer to 19%).  Which raises the question: Why do taxpayers subsidize the oil and gas industry to the tune of billions each year?  

Canada contributes about $3.3B to the oil and gas sector in various types of subsidies each year.  The article also considers what other uses such money could be put to.  World-wide, subsidies amounted to about $375B in 2015.  On December 17th, 2018, the Federal Government announced another $1.6B in aid (subsidies) to the oil sector.  One would hope this won't be just more money poured into a black hole as was done with the auto sector back in 2008.

So why, given their obvious profitability and the subsidies courtesy the Canadian taxpayer, why are we still paying any attention to cries for help in propping up these businesses?

And given the urgency of dealing with climate change, why are energy companies allowed to expand oil sands production?  The Parkland Institute's article considers that matter as well.

Jim Crow by the Back Door

The New Jim Crow - Mass Incarceration in the Age of Colorblindness

by Michelle Alexander

Many statistics would seem to bear out the author's contention that the War on Drugs (itself, a failed policy) has served to "keep blacks in their place", essentially in the same way that slavery, and later, the Jim Crow laws, served to do.

As the NAACP's website shows:

• Between 1980 and 2015, the number of people incarcerated in America increased from roughly 500,000 to over 2.2 million.
• Today, the United States makes up about 5% of the world’s population and has 21% of the world’s prisoners.
• 1 in every 37 adults in the United States, or 2.7% of the adult population, is under some form of correctional supervision.
• In 2014, African Americans constituted 2.3 million, or 34%, of the total 6.8 million correctional population.
• African Americans are incarcerated at more than 5 times the rate of whites.

As the author points out, a very large proportion of those people in prison ended up there as a result of a conviction for minor drug offenses - possession of marijuana, for example.  And most of them caught up in this have been blacks, despite the fact that drug use is at least as prevalent among white people.  The way the War on Drugs has been enforced has disproportionately targeted blacks, especially young, black, males.

This has had a major impact on black communities across America.  Reduced access to education, housing, jobs and even the right to vote. 

The New York Times posted this review....

As they say: plus ça change, plus c'est la même chose