Quote:
Originally Posted by lubicon
Counterpoint is that it is only not economically viable in Canada and that is largely due to non market forces. The energy industry is doing well and even expanding outside of Canada. To call it a dying industry is not accurate, we are essentially hamstringing it only in our own country. That is what many Albertans would argue.
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I think this is oversimplification of world energy markets and a way to find somebody concrete to blame. The industry has become increasingly competitive and there is a common assumption that the pipeline is the only issue. No doubt a pipeline would help, but the growth of oil production elsewhere is not a great sign for oil sands development - which is a relatively intensive source of petrochemicals. We boomed for years with existing infrastructure, yet a shift in the market changed the game. Is that really the government's fault?
Also, our oil is located in a pretty inconvenient location, and that creates economic realities that are reflected through politics. Non market forces are really just indirect market forces driven by public opinion and attempts to manage externalities. Where do we draw the line between market and non-market forces? It's not as clear as it may seem, and may not always work out in favour. The decisions of OPEC are arguably non market forces. Yet, without their decisions Alberta production would be even less competitive on the world market.
There is certainly non-market forces at play, but they don't tell the whole story. Furthermore, even if we assume the the only issue was government - do we think we are going to get a better result by starting a game of retaliatory measures? The non market forces at work are still beyond the unilateral power of the provincial government. I think responsible development of oil is fine. But I think we need to beware of blaming our failure to adjust to a shifting market predominantly on regulation while also refusing to make meaningful change. If want to address the non market forces then we need to recognize our existing in a complicated system and systematically deal with the issues, the barriers, including concerns about climate change and environment. Yet the UCP seems to think that the best solution to deal with things outside of our control is to further isolate ourselves.
Oil is a limited resource - at some point its going to run out or will no longer be viable at all. If we are going to develop it, why not do so responsibly? The type of economy Albertan's feel entitled to is neither sustainable, and was kind of a mess socially. Again, why are so keen on putting everything into that one industry?
So while I think there is some truth that some of the issues are "non market" forces, it is still responsible and smart to actually acknowledge and address those forces instead of dismissing them as irrelevant because we don't like what they have to say. I also think it is a way to scapegoat the government - and avoid facing the actual market forces that aren't favourable to us. We're not even able to have the discussion though. Because it feels better to blame Notley and Trudeau.
Do we really want to compete with the parts of the world that don't have to deal with these questions? So we'll have oil that is not only more expensive to produce, but can't even pretend to responsible. Do we think that serves as well in the world market? We keep talking about how our oil is "ethical" but don't want to uphold that allow us to make that claim like rigorous environmental reviews.
I guess my overall point is that many people claim to love the "free market" but need to be careful what they wish for.