Category Archives: Politics

Economist: Thanks to Liberals, BC is Canada’s most indebted province

The Liberal Government has already made BC Canada’s most indebted province. Projects like Site C, which Premier Christy Clark is shown announcing here, will only make matters worse (Province of BC/Flickr)

Almost four years ago I prepared an article on the financial affairs of BC, musing about the way BC voters returned the BC Liberals to government. This time I am posting their record before a vote in hopes that there will be a different outcome.

It began with a quotation from “The Divine Comedy” by Dante Alighieri (otherwise known as Dante’s Inferno): The Darkest Places in Hell are Reserved for those who maintain their Neutrality  in Times of Moral Crisis.”

In that same piece, I warned:

[quote]The citizens of BC had a front row seat to an election outcome that remains almost impossible to comprehend. After a determined push-back of the much reviled HST it appeared very probable that the BC Liberal party would go down to a well-earned defeat. It would have been a defeat, not so much because a better option was thought to be on offer, but more because enough voters had lost their trust in those who seemed divorced from contemporary economic realities and who were not serving the public’s interest.[/quote]

Ahead of next month’s election, we seem to be in a similar place as four years ago. The BC Liberals have been shovelling out large amounts of propaganda, some paid for by using the taxpayer’s own money, that include “alternative facts” and an avoidance of mentioning other inconvenient truths. Fact one, as presented by the BC Auditor General, is the staggering amount, $101 billion, of “Contingencies and Contractual Obligations” posted a year past. These obligations come from BC Hydro’s commitments to buy power from private suppliers at far above market rates, and from other infrastructure built under public-private arrangements. As such, it is in addition to our conventional debt and hidden from public view. The Government carefully avoids all talk of this debt and of BC Hydro’s “regulatory assets” accounts, which stand at another $6 billion.

Within Canada, we in BC have the dishonour of having the largest total of this type of debt of all the provinces and about 75% of what is shown for the Government of Canada. Hands-down, BC wins the race to be the most indebted province in Canada (see page 40 in the Auditor General’s report dated Feb. 2017). This condition is not accidental.

Back in 2013, I also wrote:

[quote]Standard & Poor’s issued a public report dated 15 April, 2011 titled “Canadian Provinces Face Tough Choices in Restoring Fiscal Balance”. The report directed provinces to curb rising debt levels and to correct the practices of deficit budgeting. It also recommended operating expense savings to be found in the budgets for health care and education.

“Rising debt service burdens further limit financial flexibility because as these burdens increase as a share of total spending, they crowd out other program spending,” claimed the report. “Debt service expenditures are contractually bound and as such cannot be easily cut.” [emphasis added]

This was an unambiguous disclosure that provincial credit ratings were under negative scrutiny, over two years ago.[/quote]

All those years ago, the credit rating agency gave the provinces the best of their advice so that credit downgrades could be avoided.  The BC Liberal government certainly paid attention to the suggestion that education and health care budgets be trimmed but that’s where it ended. The chart below by Norm Farrell makes it blindingly clear that the BC Government failed to read or heed the recommendation to “curb rising debt levels”.  Between when the S&P report was issued and last year, BC’s total financial liabilities increased from $117.8 billion to a staggering $185.7. That is a near +60%, exactly at the time the credit rating agency is suggesting a “go slow” on borrowing, either by direct means or by the indirect method of signing long-term contracts.

Courtesy of Norm Farrell/In-sights. Updated April 11.

This S&P report is a one-dimensional view of financial affairs – only about spending and borrowing. There should always be an inclusion of the revenue side to deliver balance in such discussions. What the BC Government avoided talking about was government revenues and, my goodness, does it show. For the period 2011 through to 2016 the per person revenue barely increased from $9,228 to $9,844. Removing inflation, this was not a record of growth but the opposite and there is no new evidence that this will reverse.

On that note, eminent geologist and energy expert David Hughes has taken the trouble to examine the reported volume of BC natural gas production (almost totally for export) versus the royalties booked by BC. In 2005, BC’s production was about 2.8 billion cubic feet per day and natural gas royalties were about $2.1 billion per year. Fast forward to 2016 and the respective numbers were 5.2 billion cubic feet per day and $200 million per year. In David’s words, “Production has doubled since 2005 whereas revenue is down 87%”.  If this is not a picture of giving away public resources I can’t imagine worse, unless maybe fresh water. If the public of BC are not benefiting from the extraction and sale of natural gas, then who is? This is the opposite to how the Norwegians do things. Perhaps we should hire folks from there to manage our natural gas industry.

Back to 2o13. Here’s what I said:

[quote]So what did the BC Government appear to do knowing this was like a warning shot across the bow? They did screw down on budgets for education and health care. They did not seriously attempt to find more revenues but rather promoted the fiction that the natural gas industry would provide fiscal salvation, which it did not nor is likely to happen despite election rhetoric. The government certainly did not curb its appetite for ever more debt.

At the end of fiscal 2012 (one year ago) total provincial liabilities reported by the Comptroller General were $70.358 billion or 100% greater than when the Liberal government first came into power. What was even more distressing was the government’s deliberate non-disclosure of “Contingencies and Contractual Obligations” the BC Auditor General publicly reported to be $96.374 billion. This liability amount was separate from the $70 billion, as confirmed directly with the Auditor General’s office. These provincial liability values were directly supplied to the four party leaders just following the writ being dropped, so they all knew, but for what ever their reasons, they remained silent. In a few words, BC voters were clueless about the province’s financial condition prior to voting, virtually all politicians and the mainstream media wanted to practice willful ignorance. It is not hard to understand why Premier Clark avoided this topic but why the others to do so is a big mystery.[/quote]

So what should be in BC’s future? The biggest standout is the rapid increase of provincial liabilities. A credit downgrade has to be a high probability and that will make everyone’s cost of living in BC higher. Suspending projects like Site C would possibly defer any credit downgrade. Carrying on spending and borrowing as before will only make the possibility of the downgrade greater. The second biggest issue is the deliberate reduction in revenues from the extraction of natural resources. If there is no “pricing room” for higher royalties, the solution is not to give away real assets for the sake of a handful of jobs but rather to wait for the next cycle to develop.


Rafe: Christy Clark must go!

British Columbians have had enough of Christy Clark, says Rafe Mair (Province of BC/Flickr)

The Christy Clark government and Clark herself must go!

I am not a socialist but neither are the NDP. Of course, we must have a thriving economy that supports our necessities and has room for earned luxuries. What we can no longer do, if we wish to have a British Columbia useful for enjoyment of life, is let entrepreneurial ambitions and corporate influence on government trump all other values.

Even if you do place the economy above all else, you have to examine the Clark Keystone Kops’ self-proclaimed business acumen, which, even in these good economic times, has doubled the provincial debt and ruined our former crown jewel, BC Hydro, and, having bankrupted it in all but name, committed it to a further $10 billion for Site C for power we don’t need and for which we have no customers

If you’re thick enough to believe that the Liberals’ declared balanced budgets are remotely honest, leave now – you are beyond salvation and will obviously believe anything.

This is my bottom line: Let’s just say that there were no other issues of consequence than these in this election. Would you reelect any government that had doubled the provincial debt in the past 14 years and had presided over the ruination of the largest and most successful public corporation in the history of the Province?

Remember, the Liberals not only kept this secret – the horrific debacle that has ruined BC Hydro has been exposed entirely by private citizens. The IPP issue, the ruination of rivers, the loss of fish, the outrageous sweetheart deals in favour of private power donor pals of Christy to the huge cost to Hydro ratepayers. The pay-offs to cronies was dealt with in the elections of 2009 and 2013 only by private citizens like Tom Rankin, Damien Gillis, Joe Foy of the Wilderness Committee and others including me, who spoke all over the province and have consistently written about it since and acquired their evidence from public-spirited people like Norman Farrell, Arthur Caldicott, and Erik Andersen, all private citizens. And at the end of the day, nothing from the Liberal party loyalist, Suzanne Anton, the pliant Attorney-General, not a resignation from any of the guilty, just massive incompetence with a load of political pay-offs thrown in.

This wasn’t rocket science – it was obvious, easily understood, oozing with incriminatory evidence from every pore. The Liberal government in a dozen years fucked up (no other term works) BC Hydro financially as well as ruining scores of rivers, without sufficient protest from Her Majesty’s Loyal Opposition or a soupçon of help from the Mainstream Media or the Greens. We know that the Green Party leader, Dr. Weaver, who’s about as green as last year’s Christmas tree, supported ruining the environment with so-called “run of river projects” because, without bothering to first look at one like the Ashlu, he proclaimed this outrageous environmental evil “clean, green power!” Here you have a hugely successful Crown Corporation, very popular, with a monopoly, a large customer base, ruined financially by this government, yet if it weren’t for a handful of persistent private citizens, over a decade of never quitting, no one would ever know!

As economist Erik Andersen said very recently:

[quote]I continue to stand by my words of several years ago. The board and management at BC Hydro have been either economic and financial illiterates or dutifully following the orders of those not having the public’s best interests in mind. [emphasis added][/quote]

All this plus, in constant dollars, the government virtually doubled the real provincial debt with Christy Clark, in four years, while pretending to balance budgets.

One has to wonder what else we don’t know!

I’m hard pressed to think of a single accomplishment of this bunch on the fiscal side and on the social services side their incompetence and lack of concern or even elementary decency borders on the cruel.

What about Horgan and the NDP?

BC NDP leadership race down to John Horgan
Time to give the NDP’s John Horgan a chance, says Rafe Mair.

I have no doubt that Mr. Horgan is an honest man and that alone makes him my choice as premier. I know many of his backbenchers and have no doubt of their integrity. I tell you straight that I’m very disappointed in some of Horgan’s stated policies, especially in my riding – specifically the proposed Woodfibre LNG at Squamish.

But I have learned some things over the past 8 1/2 decades, one being that you never really know about a new leader until they’ve had a chance. The premier’s office, in Samuel Johnson’s great phrase, “concentrates the mind wonderfully”.

On the other hand, there’s nothing left to know about Christy Clark. There can surely be no doubt that she’s the worst premier with the worst government in living memory. I would rather support someone for whom there is reasonable hope, and who couldn’t possibly be worse, than have the certainty of 4 more years of Christy Clark.

I don’t know about you but I often look at what’s seen as a minor thing in making my judgment on a person’s character. As we learn here from Mike Smyth, Christy Clark has cost taxpayers, not the Liberal Party, folks, for “photography: $923,374 to be precise, for the salaries and massive travel expenses of two full-time photographers to take still photos and videos for the government.

“The pictures and videos provide positive content for the government’s social-media channels on YouTube, Facebook and Twitter.”

With typical raw, blatant hypocrisy, here’s what Premier Clark says in her latest Liberal Party election pledge:

[quote]Controlling government spending is the foundation, it’s the bedrock, of what we’re trying to do.[/quote]

This woman is not only vain and incompetent beyond description, she’s incapable of telling the truth as she makes us look like fools to the rest of the country and beyond.

Again, Cromwell’a words in dismissing the Rump Parliament seem so apt: “You have sat too long for any good you have been doing lately… Depart, I say; and let us have done with you. In the name of God, go!”


Rafe Mair on Bill C-24 finding out you're a second-class citizen

Rafe to Justin: Kinder Morgan pipeline would drive a permanent wedge between BC and Canada

Rafe Mair on Bill C-24 finding out you're a second-class citizen
Former BC Minister and longtime journalist Rafe Mair (photo: Youtube/CMHABC)

Dear Prime Minister,

I’ve reached a point where I can say what I please without concern for personal consequences. My age of ambition is long gone and social disapproval simply doesn’t matter anymore.

That is where I am and intend to speak my piece.

I’m a native British Columbia born in Vancouver a long time ago. I have a lifetime love of my province from one end to the other and I inherited a sense of deep anger when I see unfairness.

Environment and Climate Change Minister Catherine McKenna with BC Premier Christy Clark (right) announcing her government's approval of PNWLNG (Province of BC/Flickr)
Environment and Climate Change Minister Catherine McKenna with BC Premier Christy Clark (right) announcing her government’s approval of Petronas’ LNG project near Prince Rupert (Province of BC/Flickr)

For as long as I can remember, I’ve resented that my province has been unfairly treated, a resentment that has increased steadily over the years. We have been badly cheated politically and economically, accompanied by an attitude of arrogance from central Canada, which runs everything, an attitude that I find irritating beyond toleration.

Start with the humiliating fact that BC has but 6 senators while New Brunswick has 10 and PEI 4. This, along with the federal government appointing our senators, who are supposed to hold that very government’s feet to the fire, is outrageous. This and the “First Past The Post” system ensures that all political power rests, unchallengeable, in Central Canada. To see how this is resented in BC, you need only look at the 1992 Charlottetown Accord, designed to make one province juridically superior, opposed, thank God, by your father, and rejected by 67.9% of British Columbians!

Because of the Senate and the First Past The Post system in the House of Commons, Central Canada invariably has the Prime Minister who, given a majority, controls all federal legislation and policy. Please don’t pretend that our lot of Liberal toadies have any power except to say “yes sir”.

Most British Columbians care little about the Governor-General since, under central Canadian arrogant navel gazing, none have ever come from this, the third largest province. The G-G is appointed either to mollify Quebec, Bay Street, or the Central Canada artsy fartsy crowd. The present Governor-General, David Johnston, a Tory Grandee, was, by an amazing coincidence, appointed shortly after he, in the pay of Tory PM Stephen Harper, gave former Tory PM Brian Mulroney a “get out of jail free card”. Lyin’ Brian was pleased, Harper was pleased, Johnston was pleased. You have to say this about Central Canada: they look after each other.

An existing BC salmon farm (Damien Gillis)
A Norwegian-owned BC salmon farm (Damien Gillis)

Under the constitution, provinces control their natural resources – except when it comes to fish. The Pacific salmon has been so mismanaged by Ottawa that one is tempted to suggest it’s deliberate. Going too far? How else can one explain the foreign fish farms, not just permitted in BC, but actively promoted by a DFO prepared to destroy the Pacific salmon by disease, sea lice, and, when they escape, crowding them off their spawning redds?

As a BC minister, I examined the history of federal involvement back to 1871 and the record is appalling. Ask First Nations, who are the past, present, and future victims of this gross mismanagement, how they see your stewardship! 

With respect, prime minister, British Columbia and Canada no longer have the same set of values. A nation can survive and prosper with great diversity. It can have many languages, a plethora of different originating cultures, all races, colours, and creeds – yet so long as there is a common set of basic values, it can form a strong nation. That is the critical point. Once that is gone the nation no longer exists in fact, no matter what the Constitution says.

The basic values of British Columbians and Canada diverge on this central question: Which is more important – our way of life, surroundings, and the environment or the growth of industry, resource extraction, and moneymaking?

It’s not all or nothing – each side will always concede a little bit of the other – but the trouble is that our side is compelled to concede virtually all while yours pays lip service only with pallid environmental rules, never enforced if they ever really get in the way. Our side accepts the need for a robust economy, but not at the cost of destroying a way of life that preserves the enormous natural benefits God gave us.

Recent Vancouver rally against Kinder Morgan (Photo: David Suzuki Foundation/Facebook)
Vancouver rally against Kinder Morgan (Photo: David Suzuki Foundation/Facebook)

We in British Columbia have learned some hard lessons, most important of which is there isn’t always another valley full of trees to chop down. The forestry industry in British Columbia, thanks to the courage of many mostly young men and women over the last 60 years, now is in sight of self perpetuation. That has morphed into an overall attitude which takes into consideration those values in British Columbia we have always coveted but are under serious attack by the industry-at-all-costs movement in Canada, of which, by the Kinder Morgan approval, you are now leader. You, the Prime Minister, are our enemy!

It has perhaps come as a surprise to you as it has come as a very unpleasant surprise to much industry, especially the fossil fuel industry, that we so highly regard our environment, especially, though not exclusively, our mountains, lakes, rivers, trees, farmland, coastline and ocean. You don’t seem to realize that Burrard inlet, Howe Sound, the Salish Sea, the Gulf Islands,  the Straits of Juan de Fuca, the west coast are sacred to Btitish Columbians. Other regions have their own sacred values and we support them in their fight to protect them, with particular regard at this moment for the Site C Dam proposal in the Peace River.

I don’t believe I draw too long a bow when I say that we understand that the French language and culture means means so much to Quebec yet you scoff at us in British Columbia because our natural blessings mean just as much to us. I cannot understand why you and other Canadians are unable to understand just how vehemently we are opposed to the Kinder Morgan pipeline and how far we are prepared to go to defend against it. We wouldn’t for a milli-second tolerate this desecration of what we hold dear by a BC Tar Sands, BC financiers and BC tanker companies – why the devil do you think we feel less resolved because it’s the Alberta Tar Sands, Bay Street and other foreign bankers or offshore tanker companies?

Mr. Trudeau, sir, you have this to answer for. Virtually all the world of science agrees that we must wean ourselves off of the use of fossil fuels. You made an instant international reputation for yourself at the Paris conference in 2015 by taking that very stand. We, in this province, took you seriously. We did not believe that the Tar Sands of Alberta, for example, would ever pose a threat to British Columbia under the clear mandate you delivered.

94 per cent opposition to Woodfibre amongst municipal candidates who answered LNG survey
Rendering of Woodfibre LNG project near Squamish, BC

Now, we find that you didn’t mean what you said. Not only have you approved an LNG plant in Squamish, against the wishes of most British Columbians, now you propose grave consequences on an infinitely grander scale, to revive the Tar Sands and place the entire risk for transporting bitumen to market upon British Columbia. Permit me, sir, to correct myself. It is not risk that we’re dealing with but mathematical certainty.

The only question is how bad the damage will be. We are not being told the truth when industry and governments make it appear as if there is almost no chance of tanker collisions, either with each other or something else. One only has to chart the world statistics, which I happen to do, to know that that is absolutely untrue. Industry and your government make it appear that even if there are spills of bitumen that the cleanup facilities are such that there is nothing to worry about. That’s bullshit, sir, and you know it!

Booms intended to corral a fuel spill near Bella Bella are blown apart by stormy weather (Photo: Tavish Campbell)
Booms intended to corral a fuel spill near Bella Bella are blown apart by stormy weather (Photo: Tavish Campbell)

We can read, we can watch television, we can hear what witnesses have to say. We know about the Enbridge/Kalamazoo spill in 2010 and we know that accident has not been cleaned up to this day and it’s unlikely that it ever will be. We know that in a very short time, bitumen sinks and no longer can be effectively cleaned up. We have also seen examples of the Christy Clark’s speedy “world-class cleanup” procedures at work and can only thank God that the spills were moderate considering the pathetic efforts at cleanup.

I don’t wish to carry on any further with that, Mr. Prime Minister, but I do want you to know, as I’m sure you do, that I scarcely speak for the people of British Columbia. Having said that, I believe that we’ve had enough. More than enough! We believe the right to our environment outweighs any so-called right to move dangerous goods over and through our province.

We say that our right to our environment  outweighs any so-called right to move dangerous goods over and through our province. That, sir, is the essential difference in values that we possess and that you possess.

I believe that this is simply a fair assessment and a warning – not in any way a threat – but I can say that if you force the Kinder Morgan pipeline upon us, as you can with your money and your soldiers, you will create a rift between my province and Canada that will never, ever heal. Of course, I could be wrong on that but, sir, I’m not wrong to observe that would be a dreadful legacy to leave when, as with all of us, you must go. You no doubt believe you understand Canada – take my word for it, sir, I understand my province that I have served at the highest level and love every square millimetre of it.  I have lived in several places and taken my fly rod with me to most others.

Mr. Trudeau, we love this province with all our hearts and souls and we’re not about to let you take it away from us.


Trumplandia vs. Clarklandia: How BC stands to lose on LNG, lumber and trade



Part one in a series by Kevin Logan

February 17th 2017

As the faux populist facade fades and the new reality show “Trumplandia” begins to emerge from the ruins of the Democratic elite’s embrace of hedge funds and wall street masters, one thing is crystal clear: Big oil and gas is now in the driver’s seat and Trump is just a hollow front man with a small army of propagandists and zealots hellbent on reshaping the world.

In Trumplandia, Hillary’s replacement for Secretary of State is none other than the CEO of ExxonMobil, Rex “don’t frack my backyard but yours is fine” Tillerson.

Such a raw front bench display of state capture by this industry is remarkable, especially after having been subjected to a so-called populist campaign full of “I feel your pain” rhetoric designed to appeal to the bottom half of the American populace who have been cut loose by the major parties and no longer have a voice.

Masters of the Universe like Tillerson have dominated the globe by crushing and fleecing nations, people and the environment. As a result, anyone expecting something other than a petro-dictator in the Secretary of State’s chair is clearly detached from reality. See Canadian Arch Conservative David Frum’s ominous warning outlining how the new Trump Administration will set the world on fire in a relentless bid to establish The Donald as the richest most powerful autocrat on earth.

Why this matters to BC

The current government hung most of its political capital in the last election on developing a new LNG industry. With grand designs to shoot from nowhere to first and compete with Qatar and Australia, the BC Liberals embarked upon an ambitious agenda scouring the coast for any exploitable opportunity to set up shop and fleece BC of its stash of gas.

BC's gift to the world- Premier Christy Clark
Premier Christy Clark at a recent conference, working hard to build an LNG industry for BC (Flickr CC Licence / BC Govt)

Most of the plays are riddled with shenanigans and BC Liberal insiders as the now retiring Energy Minister himself claimed, “There is lots of wheeling and dealing going on behind the scenes.”

Since the last election, BC has been mired in conflict as Clark’s oil and gas agenda set about a process that many claim is akin to legalized bribery, or in the least a good old fashion greasing of the skids.

Much of the enabling deals have been done with untold millions of taxpayers’ dollars. Though the agreements with relevant First Nations and stakeholders are not publicly available, it does not take long for one to realize that the fleecing of the BC Taxpayer by this industry is already well underway.

This has left coastal communities, First Nations and the rest of BC tattered and torn with the rise of a small, new petro-class emerging as the most influential in our political dialogue, despite being a terribly insignificant contributor to BC jobs and prosperity.

Gas sector a burden on BC treasury

A fracking drill near Dawson Creek in northeast BC (Two Island Films)
BC’s gas sector is highly subsidized by the government (Two Island Films)

In fact, since the last election, the BC gas industry alone has cost the provincial treasury hundreds of millions of dollars. A far cry from the much-vaunted 100 billion dollars in revenue to fill a so-called LNG “Prosperity Fund” promised by Clark. Which, by the way, she recently filled with 500 million of your tax dollars in a brash bid to prove her Government has “delivered” on the prosperity promised last election.

In so doing, Clark simply adds insult to injury. Such bald faced lies and politicking with taxpayers dollars is nothing new for the BC Liberals, but Clark has brought the thing to a whole new level.

Clark’s Crony LNG capitalism hurts communities

One of the most audacious LNG proposals being stick-handled by the Liberals’ former Attorney General Geoff Plant is the Vancouver Island play, Steelhead LNG, that would see both a floating LNG terminal and a huge land-based terminal straddle the entire southern Island with a pipeline that, after coming under the ocean from the US, would make its way from Brentwood Bay to Sarita Bay.

And the proposal comes with all the trimmings of any major oil and gas initiative. Community infiltration, data mining and surveillance of stakeholders both for and against, as well as the typical onslaught of petro-propaganda. In addition to, “legalized bribery,” add community unrest, controlled opposition and political infiltration.

The Island is no stranger to fleecing by major industries, however the oil and gas agenda playing out in BC is unprecedented and its implications will alter the very fabric of Island communities by putting us on a path we have never before traveled.

How Trumplandia threatens Clarklandia’s LNG plans

A quick google of “Trump LNG” reveals the following headlines on the first page of results:

Trump’s America-first energy policy looms as LNG threat

Will Trump make the US the top LNG exporter?

Trump’s energy policy shake-up could threaten Australian LNG

How Trump Could Change LNG Markets

LNG Exports: US to Overtake Australia

Feds Deny LNG Export Through Oregon Developer Turns to Trump

When asked in November if Trump would deliver for his coal company supporters and look to exporting LNG rather than displacing domestic coal power generation, his response was “What is LNG?”

While this clearly underscores the notion that he is simply a front man, void of any real understanding of domestic energy complexities, let alone the very real and strategic geo-political implications, he has stacked his deck with energy zealots who do. That said, we can glean from his “America First” rhetoric some potential outcomes.

In order for him to deliver for his coal supporters and the domestic natural gas industry, it’s very likely Trump will pursue both with great vigour, as the more LNG exports the US embarks upon, the less potential for domestic displacement of coal-generated power.

If Trump decides the US should be the top LNG exporter, as one of the above headlines claims, then LNG in Canada will be officially on notice, and the audacious Steelhead proposal for Vancouver Island would be the first on a very short list for the Trump Administration to review due to the fact they intend on exporting American gas through Canada.

Softwood & LNG: BC’s low-hanging fruit for Trumplandia

Raw Canadian logs for export (Paul Joseph/Flickr CC Licence)
Raw Canadian logs for export (Paul Joseph/Flickr CC)

The Steelhead proposal, much like the Softwood Lumber Agreement, is low-hanging fruit in the new Trumplandia. No doubt, both are up for review in a bid to reflect the strongman’s election rhetoric and “prove” that he was right about how all the countries are “ripping off America” and “stealing good jobs.”

Cracking down on softwood and LNG would fit The Donald’s political persona to a T. They are also deliverables he could manage in fairly short order, just as we have seen with his approval of both Keystone XL and DAPL through executive order.

One way for The Donald to deliver on that style of rhetoric is to disallow the export of American Gas through Vancouver Island and instead channel it to other proposals that have been wallowing under the Obama administration along the US West Coast.

This is very important to consider, mostly due to the fact that Russia is obviously more influential in the new Trumplandia. Putin would clearly prefer North American gas be exported to places like Japan versus Eastern Europe or even China.

Indeed, with the deathblow Trump delivered to the TPP, he clearly intends on renegotiating trade deals and that will be the death knell to some LNG proposals in BC, as Japan (and even Petronas from Malaysia, who has traditionally supplied Japan) had hoped to secure our gas resource for generations with the TPP deal.

But The Donald is having none of it – no more “dumb deals!” Instead, Trump is just gonna one-off nations with bi-lateral agreements designed to deliver for Americans. And that is where your softwood lumber fleecing kicks in and LNG development in BC is threatened.

Clark outmatched

All of this runs up against the Clarklandia fairytale of a BC First LNG utopia, or even a restoration of the moribund forestry industry, as no doubt The Donald would rather see America continue fleecing us of our resources and exporting them from the US so he can deliver on his jobs and prosperity promise.

Clearly, this new realty is finally settling in among Clarklandia cohorts. Clark, who first dismissed The Donald’s influence over the BC Economy, softwood lumber and things like LNG, recently flip-flopped and it’s now her “first priority” to set up a dream team to deal with The Donald.

This could include a new office in DC for Clark’s newly-appointed Trump Czar David Emerson, or maybe even in the Trump Towers in a bid to get his attention and ensure the Trump Train does not displace her government’s economic prosperity mythology with the new and brutal America First reality.

Oil and gas, forestry and other cross-border trade relevant to the success of Clarklandia are all up for grabs. And this is where it gets tricky.

Photo: Gage Skidmore/Flickr CC Licence
Photo: Gage Skidmore/Flickr CC Licence

Does The Donald care about Clarklandia’s economic mythology or her re-election? I doubt it, but no doubt Clark and her party’s rabid right-wing core have some appeal as they have handed the Republicans Billions in the past by dismantling Forest Renewal BC and sending those Billions – that once stayed in BC – over the southern border, which helped fund the re-election of the likes of George W Bush.

So when one considers the billions of dollars up for grabs with trees and oil – and now the new play with gas – one understands why the current Clark Liberals are very interested in sitting down and striking a new deal with The Donald that will see our resources fund his re-election campaign, like her predecessor Gordon Campbell did with the “W.” All in a bid to continue BC Liberal rule of this province and avoid the wrath of an America First protectionist president.

If the dream team is successful in their bid to hold power, the ‘Wrath of The Donald’ will most certainly be delayed until after the re-election of the BC Liberals in May, but after that, all bets are off.


Note to Justin: Pipelines don’t help transition to green economy

Photo: Canada2020 / Flickr
Photo: Canada2020 / Flickr

When Justin Trudeau talks of oil pipeline projects as part of an energy transition, what exactly is he talking about?

That we will be on the path to reducing our dependency on fossil fuels by increasing our oil dependency in the short term? And that by immaculate conception we will reduce these very same dependencies over the long term? Supposedly, we will switch to a green economy sometime between now and when we are all dead, with the help of Adam Smith’s “invisible hand”.

Green is the future for jobs

When the Trudeau government repeatedly indicates we can grow the economy while protecting the environment, it knows full well that it is reinforcing the myth that the resource economy is about economic development and protecting the environment represents a cost. Journalists and most of the general public, who know nothing about green economics, can identify with this myth. This, despite the fact that the green economy offers better economic development models than the traditional resource economy model in terms of job creation.

If Trudeau was serious about working on a transition now, he could pursue his stated inclinations on the international scene to re-direct Canadian subsidies for the fossil fuel industry. For example, he could encourage, among other things, the diversification of the Alberta economy, and the Western Canadian economy in general, to join the global migration to the high-job creation, high-growth, green economy.

Corporate welfare for fossil fuel sector

The International Monetary Fund has estimated that the direct and indirect subsidies for Canadian fossil fuels work out to $46 Billion/year in US 2015 dollars. Reallocating these subsidies to help Western Canada catch up in the migration to the green economy would offer a more sound path to the country’s future prosperity

The pipeline capacity numbers speak for themselves – namely that we are headed in the wrong direction. The Kinder Morgan Trans Mountain project would increase the capacity of that pipeline from 300,000 barrels/day to 890,000; Enbridge Line # 3 would be doubled to 760,000 barrels/day and Keystone XL is set for Canadian and US approvals to carry 830,000 barrels/day. Energy East has not as of yet been approved, but Trudeau has claimed that opposition to the 1.1 million barrel/day Energy East pipeline is not based on science.

Stars aligned for green economy

Science is telling us that to avoid catastrophic climate change, 80% of known fossil fuel reserves must remain in the ground. The 100 megatonne ceiling that Trudeau likes to brag about as an example of putting limits on tar sands development will increase tar sands emissions by 40%.

The time is ripe for beginning the transition because solar and wind have come down so far in cost that they are often cheaper than fossil fuels. China, the world’s largest energy consumer, has figured this out and continues to set the pace for the rest of the planet with a $361 Billion commitment to renewables in its 5 year plan for 2016 to 2020.

Shells leads way diversifying into clean tech

Somehow, it is the oil giants themselves who have come to the realization that they will have to diversify if they are to avoid being left with large volumes of “stranded assets.” Fitch Ratings have gone so far as to forewarn that the oil companies will have difficulty gaining access to capital if they do not diversify into renewables.

Shell gets it! Shell has successfully won a bid for the 630 Megawatt Borssele 3&4 zone offshore wind project off the coast of the Netherlands. Shell’s chief energy advisor claimed “the penny has now dropped that this is the new business space.” Thus Shell will be more active in offshore wind in 2017, currently eying offshore tenders in Germany and the UK. Shell is also planning to divest from the tar sands. Norway’s Statoil has already done it.

France’s Total has ambitions to be a top-three solar player within 20 years after taking over battery maker Saft and having bought out a majority share in SunPower.

Dong of Denmark is divesting from petroleum and has become the world leading investor in offshore wind with 4.4 GW of offshore wind projects presently under construction off Europe’s coasts.

Cleaner cars en route

This brings us to the matter of the transition in the transportation sector. At this point, the US automakers, such as the CEO of Ford, Mark Fields, are gearing up to tell Donald Trump that the current US automobile fuel economy standards – which incrementally become more stringent through to 2025 – will cost US jobs and raise the average cost of vehicles. But the rest of the developed world will continue to require that the industry dramatically reduce its emissions.

A Morgan Stanley report projects that electric car sales will represent 10% to 15% of vehicle sales by 2025. This is less than Volkswagen’s projection of 20% to 25% of sales for the 2020 to 2025 period but nevertheless reinforces the growing consensus that the tipping point favouring electric vehicles will come in the 2020-25 period.

In effect, Fields is conveying half of the truth. That is, the vehicle manufacturers are investing in getting more efficiency out of the internal combustion engine, something which adds to the manufacturer’s costs. But the other half of the truth is that they will reach a point where investing in electric vehicles will be the more cost effective way to reduce vehicle emissions.  This is what can be appropriately called a transition, as opposed to the Trudeau version of the word, which calls for more petroleum production.

No business case for new pipelines

Stanford University’s Tony Seba predicts that the falling costs of electric vehicle technologies will contribute to oil becoming redundant by 2030. That translates into a too-short life span for tar sands pipelines to be an acceptable economic proposition.

Further on the Fields argument on the cost of change, innovation should be regarded as a normal cost of doing business because the alternative is that of no improvements and being outclassed by one’s competitors.

Improved fuel economy a good investment

The US Alliance of Automobile Manufacturers laments about the cost of improved fuel economy. It lies.

The increasing cost of new vehicles has little to do with fuel efficiency improvements and more to do with consumers buying more fully-equipped vehicles for both comfort and entertainment; the shift away from cars to the high-profit margin light duty trucks and SUVs in particular; and automakers’ increasing pursuit of the higher end luxury market.

The reality is that Canada can support a more aggressive transition to zero and low-emission vehicles with standards more stringent than those of the US federal government. In doing so, the Government of Canada could join US states and the Government of Quebec, all of which have taken a different path than that of the US federal government.

Enough of Trudeau’s greenwashing

We could agree with Trudeau’s greenwashing line that we need to engage in a transition and that we can develop the economy while protecting the environment. But the transition needs to begin now to guarantee the economy of tomorrow. To do this we need a green economic development model.


Rafe: BC Green candidate Lia Versaevel brings a lot to the table

Lia Versaevel (photo: BC Green Party)
MLA candidate for Nanaimo-North Cowichan Lia Versaevel (photo: BC Green Party)

This coming election, May 9, is the most unsatisfactory one I can remember since, perhaps, 1952,  when the old Coalition broke up. Most people I talk to throw up their hands, saying such a terrible choice – a corrupt, cheating, lying, government and an opposition that hasn’t shown any leadership at all and gives no confidence they’ll be any better the last NDP bunch.

I tend to agree.

At first, I wasn’t going to do any election interviews, mainly because I knew that neither leader would be much interested and I could see no advantage to the reader in  hearing from most of the candidates, David Eby of the NDP being probably the one exception.

My own political persuasion is Green but I am not a member of the party and while I support Elizabeth May federally, I think that Dr. Weaver is a distinct liability to the BC party. His views on IPPs and BC Hydro, propounded by him since 2009, are so thoroughly discredited that his continuing to hold them surely disqualifies him as leader of any party that cares anything about the environment and fiscal responsibility.

But there is the future to consider. It surely is not going to always be this way but I assume, and I hope I’m right, that the present lot in government have so soiled their nest that the political vacuum in the centre, now being filled inadequately by the NDP, will leave room for the Green party to become a substantial player.

Green space

The Greens are unlike other political parties in that they truly are a “movement” rather than a natural political entity and that brings strengths and weaknesses. The strengths have never been adequately recognized by Greens themselves. As Churchill remarked in his “wilderness years”, “I may be out of office but certainly not out of power.” Thus it is with the Greens in many parts of the world as they develop slowly but steadily into a political force. They are in many countries the conscience of the nation and the ones driving the agenda because governments are afraid of what would happen to their party if the Greens attained office. Great environmental strides have been made in Europe, South America, Australia and, when you think about it, North America as well, partly by reason of the Green presence.

Gaining office is a long, slow process and Greens must recognize that if they’re ever to succeed. With that thought in mind, I looked at a CV and the usual election crap from a woman named Lia Versaevel who is seeking election in Nanaimo-North Cowichan and I was intrigued to the point I wanted an interview. I am very pleased that I did because it turned out to be quite a rewarding experience.

A little about Lia

Lia – she’ll have to forgive my familiarity with a surname like hers – is a youthful 61-year-old teacher, who has a deep and active interest in community affairs. It quickly caught my attention that her central concern is the Salish Sea and, in particular, the fish that are there, but, more importantly, the ones that are meant to be there. What struck me is that she had a specific and very important social and commercial interest to get all “green” about. Coming from Calgary in fairly recent years, this has to be something that catches one’s notice.

I also saw that Lia had been very active in the Lions Club, which itself did not interest me very much except that she rose to be a Regional Director in what has always been seen as a business men’s club, with the little woman sort of a casual appendage for show. Obviously, for Lia, that sort of role won’t suffice.

She may, however, have a great deal to learn about how the political system is only a system for the premier, not the rest of the House and all of the things that I have written about extensively in recent years. I must say, however that she shows all the signs of being a very fast study indeed and when I went over some of the examples of dictatorship from the top she nodded her head and began to think of examples herself. I was satisfied she sensed a serious wrong even if she had not thought it all through yet herself. 

In reporting to you, I felt it important that I could say that she was not likely to just be another fence-post with hair, as all backbenchers turn out to be if they want to survive and be promoted.

I see in Lia the kind of person that a political party must have as a builder if it is going to occupy a position of power in the legislature, not just warm a seat in the chamber.

Greens face tough challenges

I personally think there is a very strong Green element in British Columbia which wants to help the Greens but is cautious, to say the least, in supporting their political party.

After the last federal election, I have no doubt that had Elizabeth May come to BC and led the party here, they would be competitive in the May 9 election. She chose not to and the local party is left with Dr. Weaver, who remains an unrepentant supporter of IPPs without concern for the damage they do or the monetary wreckage they have visited on BC Hydro. If he is a “Green”, he needs a new paint job.

In talking to Lia, I could see that she and Weaver are on a collision course, even though she didn’t completely realize it at the time. Unless I completely misjudge her – that’s happened before – she will not support the IPPs but may be reluctant to have a collision with Weaver in her first year, yet will not support this policy under any circumstances.

Regardless of how the election turns out, I believe that the government elected will need a strong Green element in the legislature and that Lia would be just such a force even on her own, although God knows it’s enough to try to make a difference in a small group, much less by yourself. People have done that though, including the federal leader of the Greens, Elizabeth May. She’s an outstanding person, of course, but she also has a movement that has a much broader appeal amongst the people than the votes indicate, which is more a criticism of the system than of Ms. May or the party.

I don’t say that Lia will be another Elizabeth May but I believe she will be a standout and, most of all, able to take a punch as well as give one and be happier in a mixup than on the sidelines.

Were I a voter in Nanaimo-North Cowichan I would without hesitation cast my vote for Lia Versaevel.


Rafe: BC Liberals taking heavy fire, but NDP need to pour on the gasoline

BCNDP Leader John Horgan (Flickr/BCNDP) and Premier Christy Clark (Flickr/Province of BC)
BCNDP Leader John Horgan (Flickr/BCNDP) and Premier Christy Clark (Flickr/Province of BC)

It’s not easy to write an article on politics in the quiet backwater of British Columbia in light of the tragedy in Quebec. I’m going to make this, then, a doubleheader. 

This past weekend, the initial story, of course, was all President Trump as he found new ways to prod anti-Muslims by pretending to be concerned about national security. At the same time, there was a story out of Austria that they plan to ban the niqab. To say that there is no connection between those and similar stories and the tragedy in Quebec is to be blindly naïve. This is not, of course, to say that Trump or the Austrian government are directly responsible for Sunday’s dead and wounded but it is to say that when leaders talk the same language as the bigot, it encourages the imbalanced, for whom very little encouragement is needed.

None of our business

What I find extraordinary is that anyone can get all worked up about what somebody wears on their face or anywhere else for that matter. There’s no outbreak of violence or bank robberies committed by women in niqabs. Muslim women wear it because that’s their religion and surely they’re entitled to their beliefs. It’s none of our business that we don’t care for some of the customs of Islam – if Muslims have problems with their religion then it’s for them to do something about it. Those who cry out against women would do better to take on the Catholic church, yet, during the long centuries Christianity has discriminated against women. there’s been no attempt I know of by Muslims to break into Catholic churches and insist upon women becoming priests.

There is one axiom which I’ve learned after many painful experiences, namely – it’s a pretty good idea in life to mind your own damn business.

BC Liberals taking heavy fire early on

Onto BC politics. There are three months and a bit to go before the election and no doubt there will be considerably more activity as time goes on than there is now. That said, there are some unusual aspects already.

I don’t ever remember a government being so hammered by so many people so hard and so soon. A lot of that, of course, is from social media, which has only recently become a force, but, aside from that, the mainstream media who have shown absolutely no ability to do their journalistic duty for the past 15 years are now coming out of their bolt holes and criticizing the government. The government must be pretty bad for that to happen.

NDP slow to take advantage

The NDP's only shot at winning in BC: Embrace the NEW ECONOMY
BCNDP Leader John Horgan has a tough road to hoe to win the next election (BCNDP/Flickr)

At the same time, the opposition seems to simply float. Once in a while an issue pops up but it doesn’t last long, not being a key issue on people’s minds. As I’ve said many times, John Horgan has hurt his party badly by taking LNG out of play. This should be a huge issue but won’t make the big stage unless the NDP force it. It’s such a hopeless issue for the Liberals they’re not going to raise it and Mr. Horgan approved LNG, without qualification, because he’s said, “We cannot be against everything.” This has torn a great chunk out of the NDP armoury.

Those who are anxious to see the Liberal government tossed out have no real choice but to vote NDP and it may be that Mr. Horgan’s strategy is to play possum and simply hope that the Liberals fall so hard there is no need for him to do anything except be there. That’s a very dangerous strategy, but I suspect that’s what he’s up to – unless he simply doesn’t know anything about campaigning.

Green Party not really a contender

When you reach my advanced antiquity, you’re entitled to break the rules a bit so I’m going to say that I’m sad that the Green party is not, at least so far, much of a contender. My sympathies are certainly Green and I’m not nearly as troubled as I once was by the notion that they are a one-trick pony. Having seen, in the last 20 years, the two other experienced parties with their hands on the tiller, I can’t see much to be worried about if the Greens took hold.

Rafe- Weaver, BC Greens should quit supporting private river power sham
Dr. Andrew Weaver, leader of the BC Green Party, has long supported IPPs

But they’re not going to take over this time and any seats taken will be a bonus and a surprise. I believe that their leader, Dr. Andrew Weaver, should have stayed in the classroom and left politics to someone who understands the “game” and is prepared to learn the unfamiliar areas.

Weaver was one of the early supporters of the Liberal’s IPP policy, which, as we now know (and had certified in no uncertain terms here recently by Norman Farrell), has been a disaster. It has ruined the rivers involved, including their fish, and has contributed mightily to BC Hydro being essentially bankrupt. We all make errors but Weaver has shown no interest in changing on this issue, even though expert opinion, including Dr. David Suzuki’s, is no longer with him.

On the other hand, he has the human frailty of being unable to risk losing face, so he continues in the belief that IPPs produce clean power – not because that’s so but because he’s unable to admit error. Because of that, he has all but destroyed the chances of the Green party to make the strides that, one year ago, seemed so possible.

A little humour – I just received an offer to go to a Green “do” and on the invitation was “Dr. Andrew Weaver, the current leader” will be there! Dr. Weaver, I’d be looking over my shoulder if I were you!

I regard the Green party in a slightly different light than others in the election because their realistic object is to build and secure a future and leave the attaining of office until better prepared to fight under this preposterous system we have. They are in the position where their greatest virtue will be patience and taking consolation from the fact that their support among people worldwide is far greater than their representatives in various legislatures suggests. What has happened is they are now part of policing governments and even sharing office and their influence is stronger by the year.

I look at the two main combatants as being pretty long in the tooth to be depended upon for anything new, innovative, and helpful – much like old journalists I suppose. That being the case, I believe that the Green party, if it plays its hand well – starting with dumping Weaver after the election – and works like hell on policy and membership, the public will find the party more and more attractive. But you can’t do that unless your leader is attractive.

And he isn’t.


How rich elites took over BC…and the Liberals welcomed them

Imperial Metals' Murray Edwards, Real Eastate magnate Bob Rennie and Kinder Morgan's Ian Anderson
Imperial Metals’ Murray Edwards, Real Estate magnate Bob Rennie and Kinder Morgan’s Ian Anderson

The following is re-published with permission from author Roy Hales and The Eco-Report.

It’s been a fortnight since the New York Times carried the story. The author, Dan Levin, told Global News:

[quote]If this were in Russia or China or the Balkans or some developing-world country, it would just be written off as nepotism or corruption, but here [in British Columbia], because it’s not illegal, it seems to just get a pass.[/quote]

Corporate and union donations to political parties are banned in Nova Scotia, Manitoba, Alberta and Ontario, but not in British Columbia. NDP MLA David Eby believes the corruption runs much deeper than the $50,000-a-year “commission” Premier Clark has been receiving from her party’s campaign chest. In the firestorm of criticism following the Times story, she has swapped her stipend for what is potentially an equally rich expense account, but the issue remains: The rich and connected appear to run British Columbia.

All about access

NDP MLA and Housing Critic David Eby
David Eby, NDP MLA for Vancouver Point Grey

“We seem to be getting further and further away from the idea that citizens can directly influence government through traditional democratic avenues, whether it’s writing a letter or through a protest, or talking to a politician.  We are shifting towards a model where the people who get access to the Premier, to the cabinet, to decisions makers are lobbyists and political donors,” Eby told me in a recent interview.

“The government recently passed legislation allowing unlimited spending until the 30-day-writ period. Previously there had been a restriction on that spending.”

“I couldn’t get my head around why this is happening until we got the results from my conflict of interests complaint and that indicated that the Premier receives a very significant personal benefit from the existing system. She gets $50,000 from the Liberal party of BC, which comes from pooled political donations to that party. So she has a $50,000 incentive, each year, to not change the system. A change in the system would mean she would not have the money to take home because the Liberal party would not have as much money.”

Dermod Travis, executive director of the public watchdog group IntegrityBC, told the New York Times, “When anyone anywhere in the world can donate as much as they want to the system, you have an even bigger threat to the system…What it says to people is money talks and votes don’t.”

Did not respond

Neither the Premier’s Office or the BC Liberal party responded to, or acknowledged, the questions I emailed them.

Pamela Martin (red dress) & Premier Clark (r) 2012 courtesy Amber Strocel via Flickr (CC BY SA, 2.0 Lilcense)
Pamela Martin (red dress) & Premier Clark (r) 2012 courtesy Amber Strocel via Flickr (CC BY SA, 2.0 Lilcense)

This is a stark contrast to the highly efficient performance of individual ministries public relations personal during the past two years.

More so because,  according to a recent article in Common Ground, Premier Clark’s “communication army now numbers more than 200, 10 times the number of reporters in BC’s press gallery.” Many, like Clark’s old friend Pamela Martin, now the BC Liberal director of engagement, are well known media personnel.

Former BCTV Morning host Steve Darling and popular reporter Jas Johol have left journalism to run as BC Liberal candidates.

Eby explained, “The Liberals are confident that the volume of donations that they get insulates them from any public concern because they can just run repeated ads through-out the election cycle and convince people that they are not quite as bad as they might seem in the news reports. They do have millions of dollars to shift public opinion.”

$12 million war chest

Deputy Premier Rich Coleman did tell a group of reporters, including Metro News, that the New York Times story is “laughable.”

He explained, “We go out and work very hard to raise money and make those connections.”

According to a recent NDP press release, 1.5% of B.C. Liberal donors account for half of the more than $12 million the party raised in 2016.

“A tiny number of millionaires have our premier in their pocket, and it has to end,” said NDP leader John Horgan.

Real Estate donations and housing crisis

BC income growth declines to last place in country
Photo: Tourism Vancouver

Eby pointed to the province’s high priced housing as an illustration of what this means.

“We went through a two year period of trying to convince the provincial government that we were in a housing crisis. International money was driving prices beyond the reach of local buyers. Housing prices were putting the local economy at risk. The government made fun of us and said it was crazy.”

“I believe that the reason for the lack of action on the housing crisis is that 7 of their 10 largest donors are real estate development companies. The people who made these donations had a very strong interest to keep the high prices going because they were profiting quite handsomely. During the period that the government didn’t act,  the average house price in Vancouver went up $600,000.”

Kinder Morgan, Imperial Metals among biggest donors

The New York Times suggested that the provincial governments recent reversal of its’ position on the proposed Trans Mountain Pipeline expansion is connected to some timely campaign donations:

[quote]On Thursday, Ms. Clark’s government approved the Kinder Morgan Trans Mountain oil pipeline project, after opposing the proposal at hearings last January. Political donation records show that Kinder Morgan and other oil industry supporters of the project had donated more than $718,000 Canadian dollars, about $546,000, to the BC Liberal party through March 2016.[/quote]

Aerial image after Mount Polley mine tailings spill (Cariboo Regional District)
Aerial image after Mount Polley mine tailings spill (Cariboo Regional District)

Another big contributor is Imperial Metals, owners of the Mount Polley mine.

“When fossil fuel companies are able to throw their money around in our political process, it is a detriment to both our democracy and our climate. It makes our job that much harder,” Peter McCartney of the Wilderness Committee told me. “For a province with such an abundance of natural beauty that is in the cross-hairs of global mining, forestry and fossil fuel companies, that’s a recipe for disaster. It’s very clear British Columbia is far behind other jurisdictions who have banned big money in politics. It’s about time we caught up,”

Site C: latest example of big money’s influence?

Eby did not know if there were sizeable campaign donations behind the provincial government’s obstinate determination to build the Site C Dam.

“I haven’t done that research, but I’d be shocked if there weren’t. I get shocked if there is a major infrastructure project and the person awarded the successful project does not have a history of making donations and does not make a donation in the following year. It just doesn’t happen,” he said.

A recent Insights West poll found that 73% of British Columbians support sending the Site C dam for an independent review of both costs and demand, as recommended by the Joint (Federal and Provincial) Review Panel’s report.

The Clark government has steadfastly avoided this and Harry Swain, former Chair of the Joint Review Panel, has become one of the project’s most outspoken critics.

The Union of BC MunicipalitiesBC Hydro Ratepayers Association,  250 professors from across Canada, Union of BC Indian ChiefsAssembly of First Nations and National Farmers Union are among the many organizations that have voiced their opposition.

Law suits, govt errors may sink Site C Dam
Peace Valley ranchers Ken and Arlene Boon face the expropriation of their home for Site C Dam (Damien Gillis)

This is of limited comfort to Ken and Arlene Boon, whose farm in the Peace River Valley was expropriated by BC Hydro on December 15. They are the third generation to live on this property, which could soon be submerged beneath the dam’s reservoir.

“We are permitted to stay in the house until May 31st.  Then we will move back to our little strip of remainder land to a second small house we have there.  Biggest hope for us is the upcoming election…and maybe we will not even have to move this spring?” said Boon.

He added, “We have to take big money out politics to help take away corruption, or even perception of such.  We are slowly being drawn further into the world of election cycles where big money wins the day, and of course that is just wrong on many levels.  In fact, why do we even allow (corporate?) campaign contributions, and all the problems that arise from that?”

At least one of the companies connected to Site C has made extensive contributions to Clark’s political party. DeSmog Canada reports that KPMG – the accounting firm that reviewed the anticipated costs of Site C for BC Hydro – and its related companies donated $284,994 to the BC Liberals between 2004 and 2014.

Hitting the jackpot

The worst example that Eby has seen was a contract put up by the BC Lotteries Corporation.

“During the tendering process, one bidder made a $50,000 dollar donation to the BC Liberal party. They won the bid. Even if those two processes were completely insulated from each other, that looks pretty bad to someone from the outside. Sometimes the appearance of conflict of interest is as corrosive to public confidence as an actual conflict of interest.”

Having someone make a donation like that in the middle of a bidding process “really stinks.”

$20,000 a plate

“I think this government can’t be trusted to look after the public interest because they are so under the influence of their donors.”

He cited the example of the dinner parties that the BC Liberals now hold at private residences. Do you think participants are paying between $10,000 and $20,000 just to see Christy Clark and her senior cabinet ministers? Or are they hoping to get something for their money? Who do you think the Premier will pay more attention to, someone who writes a letter or the person who pays $20,000 for the opportunity to say, “Listen, I think the province should be doing this, or shouldn’t be doing that.”

“Corruption isn’t handing a bag full of money to someone and saying give us this project. It’s often a relationship built over time, through a series of things like donations and buying tickets for fund raisers and so on. That results in a relationship that causes someone to want to favour one particular proponent. It may not be one to one, but if a company has made 10 donations totalling more than $700,000 over three or four years, that’s going to have an influence over how the government feels about that company and whether or not they get government contracts,” said Eby.

Banning corporate and union donations

After the provincial legislature resumes sitting, on February 14, NDP Leader John Horgan will bring forward a private members’ bill to ban union and corporate donations and limit the amount private individuals can contribute.

This is the seventh time his party has brought a bill of this kind forward. For obvious reasons, they do not expect much support from the Liberal side of the House.

“There are two models. One is where you only permit limited donations from individuals and the other is where you have public funding on a per vote basis. Every vote you get, for example, would result in a 30 cent contribution from the public purse,” said Eby.

“The BC NDP support the model of limited personal donations, not a public funding model. I think that strikes the right balance. You still have to get out there and people have to want to support you, but it also sets limits to your political contributions.”


Liberal pals plundering BC Hydro for tens of Billions



By Norm Farrell

Until the mid-twentieth century, much of British Columbia lacked reliable and affordable electricity. To resolve the privation, W.A.C. Bennett created BC Hydro, a publicly owned utility. The province’s leader acted because the private sector had refused to meet growing needs for electricity. Unlike less effective successors, Premier Bennett was a pragmatist, not an ideologue.

Longtime Bc Premier WAC Bennett's dream is dead
BC Premier and BC Hydro founder WAC Bennett

Existing power producers focused on profitable services in the southwest but Bennett had a province-wide vision. His was an audacious plan, but appropriate and successful. BC Hydro became indispensable to the growth and wealth of British Columbia. However, success sowed seeds of destruction.

BC Hydro’s profitability and financial strength guaranteed corporate raiders would attack, seeking to convert public wealth to private. To be successful, they needed cooperation of modern political rulers and, whether explained by incompetence, philosophical bent or desire for covert rewards, the Liberals cooperated fully.

Looting Bennett’s Legacy

Ironically, among today’s political facilitators of the utility’s destruction is W.A.C. Bennett’s grandson, BC Hydro Chair Brad Bennett, a Liberal apparatchik and close Christy Clark pal. Another is Hydro CEO Jessica McDonald. She was Deputy Minister and confidant to Gordon Campbell in 2006 when the premier’s office invited predators to get rich on electricity. (Blogger Alison Creekside named lucky BC Liberal operatives and allies in her article Gordon Campbell’s Big Jobs.)

A decade ago, Citizens for Public Power member and SFU professor John Calvert wrote:

[quote]B.C. Hydro announced the outcome of its 2006 tender call for electricity from private energy developers. The results were startling. Not only had B.C. Hydro agreed to buy three times the power requested in the tender, it had done so at locked-in prices far above projected market rates.

…The core of that policy was laid out in the 2002 Energy Plan, which prevents B.C. Hydro from building new generation assets, and transforms the Crown corporation from a generator of publicly-owned electricity to a purchaser of energy from the private sector.

The rationale for this change is hard to fathom. The old policy worked very well. By generating its own power, B.C. Hydro ensured that ratepayers enjoyed, on average, the second lowest electricity prices in North America. This is because prices were based on the historic cost of production, not the current energy market price…[/quote]

Dr. Calvert’s warnings were insufficient and subsequent Liberal actions even more egregious. The professor noted early independent power producer (IPP) contracts locked BC Hydro (and BC taxpayers) into financial commitments of up to 40 years. Recently, contracts have extended to 60 years and all are indexed to protect suppliers against inflation. Some required large public expenditures for distribution. Calvert said IPP prices were double the market value but they’ve since risen to even more.

IPP costs explode under Clark

We also know that, instead of costing between $400 million and $500 million every year, IPP payments have climbed beyond $1.3 billion yearly, a number that has increased 188% since 2011 when Christy Clark was appointed Premier.

All graphics courtesy of Norm Farrell
All graphics courtesy of Norm Farrell

Chronically overestimating demand

BC Hydro’s encompassing blunder was failure to recognize technology and market changes revolutionizing the energy industry. Hoping to grow their fiefdoms and deliver value to demanding friends, Hydro executives chose to ignore reality. They steadily issued demand forecasts predicting immense growth. (“If a boy holds a hammer, everything needs pounding.”) Meanwhile, consumers were conserving.

Here’s how badly they’ve gotten it wrong:

  • In 1994, they predicted 52% demand growth by 2004. Actual growth: 18%
  • In 2005, they predicted 20% demand growth by 2016. Actual growth: 0%
  • In 2011, they predicted 20% demand growth by 2016. Actual growth: 1%
  • In 2012, they revised to 9% demand growth by 2016. Actual growth: -1%

Indeed, the utility’s records reveal that electricity consumption by regular customers has been flat for more than a decade.


IPPs get rich on ratepayers’ backs

Despite all the above, over the past decade, amounts paid to IPPs have tripled. Independent power producers more than doubled deliveries to BC Hydro and the utility was forced to dump surplus power outside the province, with trades sales at an average, since 2005, of just 28% of prices paid private producers. And that loss is made worse because of Hydro’s collection and distribution costs.

10-yearsSo, for every dollar we pay them, we lose more than 72 cents.

Consumer demand was not growing, private power supplies were rising and export markets were soft. BC Hydro could only dump power outside the province for little revenue or reduce its internal production. Again, the utility’s own reports lead to a conclusion.

The following numbers are drawn from BC Hydro’s annual and quarterly reports and from U.S. Department of Energy market recaps. They demonstrate that in nine months, BC Hydro paid more than $600 million above market to independent power producers – having purchased the power from IPPs at $85,261/GWh, while the market for selling electricity to the US market was just $28,930 CAD per unit. Unfortunately, the rate of loss is accelerating.



Liberals pulling Hydro’s puppet strings

The Liberal Premier and cabinet failed catastrophically when they directed BC Hydro to contract for private power the utility did not need at prices it could not afford. The extent of this gross mismanagement, unprecedented and ruinous for the crown corporation, remains concealed by government-friendly media that is enjoying millions of public funds spent on advertising and public relations.

The Liberal decision to exercise absolute control over BC Hydro’s management was made clear in 2008. CEO Bob Elton, a qualified professional, was fired by Gordon Campbell after stating publicly, “Conservation is the cleanest, easiest and least expensive way to meet the increasing demand for electricity in B.C. – it’s like building a virtual dam.”

Reducing consumption of electricity simply did not fit with the Liberal gang’s desire to buy private power from their pals for tens of billions of dollars.

The goose that lays the golden egg

More recent opponents of Liberal power policy assume that, beyond grabbing the profits to be made flipping IPP contracts, political operatives aimed to cripple BC Hydro to make its privatization palatable. The writer believes that, while this was the initial plan, the guiding parties decided they could gain more another way.

There was no need to privatize Hydro’s assets and liabilities. Instead, they privatized its profits and left Hydro and the public with all the financial risks.

One example is Site C, which will create more unneeded and unaffordable power. No private investors in the world would fund a hydroelectric dam with environmental issues, First Nations conflicts and near zero prospects of profitable operations. But, if the public pays for the dam and sells power to the private sector at a fraction of cost, there are private profits to be made.

Former TD Bank Comptroller: Site C Dam too costly, unnecessary
Site C Dam will likely run well over its $8.8 Billion price tag

Budgeted at $8.8 billion, if spending on Site C matches other Liberal megaprojects, it will cost substantially more. That money goes straight into the pockets of big construction companies who have donated heavily to the Liberal Party. Far from caring about keeping the project on budget, they have a huge incentive to see that it goes over.

In addition, there are indicators the dam’s output will be less than forecast. In 2011 through 2016, BC Hydro’s three largest facilities annually produced 3.6 times stated capacities. Proponents claim that Site C, with 1,100 MWh capacity will produce 5,100 GWh. That is a ratio of 4.6, considerably above Hydro’s typical experience. Reduced production will mean higher costs for each unit of power the dam generates.

That should set off alarms for residents and small businesses operators. BC Liberal policy enables heavy industries to pay well below the average cost of new power so residents, commercial enterprises and light industry are the utility’s only profit producing customers. High production costs for private power and Site C output and weak export markets make significantly higher domestic prices inevitable.

Liberal donors control Hydro board

Hydro Board, Liberal DonorsClearly, BC Hydro has been in disarray for some time. In fact, it is operating as an affiliate of the BC Liberal Party. Of the eleven people collecting fees as directors of the province’s utility in the last fiscal year, all have records as party contributors or close associates of Liberal politicians. Some have business dealings impacted by business activities of BC Hydro.

Political meddling, moronic contracts, deceptive accounting and the self-serving management of mediocre hacks devastated what was once a competent and professional crown corporation. Not by accident or mere negligence, this was deliberate.

Recovery will not be simple or quick but, if it is to happen at all, a new beginning starts with the provincial election on May 9.

Note: Site C’s output was originally stated as 1,100 GW, which has been corrected to 1,100 MW.

Norm Farrell is a longtime blogger and published of IN-SIGHTS.


Rafe Mair: The BC election no one can win

Christy Clark (Province of BC/Flickr and John Horgan (BCNDP/Flickr)
Christy Clark (Province of BC/Flickr and John Horgan (BCNDP/Flickr)

The election is sufficiently near to develop a few axioms to carry us through the sea of a largely imponderable mass of horse buns that we’ll have to face. I suggest that the following are good starts to our defence mechanisms as our eyes and ears become mercilessly assaulted by heaps of political bullshit, endemic to all campaigns, this one having a master, or should I say mistress, of it?

We can assume the following:

NDP Leader John Horgan probably won’t know what the hell he’s talking about most of the time but he will  honestly believe that it’s appropriate and accurate.

Premier Christy Clark, though it is highly unlikely, may know what she’s talking about on some occasions but no matter what she says, where or when, she’s most certainly lying through her teeth.

In the days and weeks to come, I’ll be examining the Liberal record and Ms. Clark’s role in it with some care. That’s reasonable enough because she has been our elected premier for 3 1/2 years (My God, is that all it is?!) and the Liberals seem to have been in power forever. Let me take a look first at the John Horgan and the NDP.

Horgan missed golden opportunity with LNG

The Official Opposition is supposed to be the “government in waiting” – that is if they really want the public to take them seriously. I don’t imagine at this point that many believe John Horgan has got this done. Most people would be hard-pressed to remember any NDP MLA, with the exception of David Eby, and in some cases their own MLA – and Horgan scarcely looks like a premier-in-waiting. He has saddled the party with an impossible issue, namely blanket approval of LNG. I’ve  mentioned this ad nauseam and am sorry for mentioning it again but it’s of huge importance and Mr. Horgan deserves to wear it.

BCNDP Leader John Horgan touring Metro Van Pipes in 2014 (BCNDP/Flickr cc licence)
BCNDP Leader John Horgan touring Metro Van Pipes in 2014 (BCNDP/Flickr cc licence)

He supports LNG because, he has said, “we can’t be against everything”. What he has done, as I predicted a year and a half ago, has foreclosed the NDP’s right to criticize any part of LNG and it is now stuck with approving things which nobody in their right mind – which is to say a non-Liberal hack – would dream of supporting.  This for a gamut of good reasons – from the atmospheric damage it does, the substantial fracking damage to our water supply, the transportation dangers of natural gas to the refinery, pollution to air and water, immensely dangerous transit by tanker as LNG. Finally, he and his party accept, uncritically, the outrageous expenses of Clark and Coleman selling LNG they didn’t have to people who don’t want it and who, even if they did, could get it much cheaper or make it themselves.

The NDP can’t even point out that scientists have found LNG to be an even worse pollutant than they thought. He must also refrain from challenging the absurd Clark/Coleman statements that LNG will pay off all our debts and fill up their Prosperity Fund to over-flowing.

LNG should be the NDP’s biggest issue but their leader has made it into a big weight in their boots. Horgan would be wise to swallow his pride and make LNG an issue. Since he won’t, his party may lose the election because their leader feared he would lose face, and refused to deal with an issue that the people of British Columbia by and large do not support.

Record on Hydro should dog Clark

If Asian LNG prices keep falling - as analysts predict - this may be as close as BC Premier Christy Clark comes to building even one LNG plant (BC Govt Flickr CC Licence)
Christy Clark playing the LNG game (BC Govt Flickr CC Licence)

Premier Clark and her government have a substantial task on their hands, unless, somehow, the people accept her appalling record, rather than take a chance with a stubborn man whose personal pride has hidden any ability he might possess. (When I stopped and reread that, I thought to myself “what on earth have we done in this province to deserve an election where our choice is between supporting a failed a government or an opposition which gives no confidence it will be any better?”)

I’m not going to deal with the Liberal record overall today but just look at one aspect as being such an unbelievable failure that I’m only surprised it doesn’t have people taking to the streets. I refer to BC Hydro.

When the liberals took power in 2001, BC Hydro was not only a thriving Crown corporation – literally the envy of the energy world – it made a substantial and legitimate profit for the people of BC. It had, over the years, presented profits of several hundred million dollars per annum to the provincial treasury – in fact, close to $1 billion on occasion. They were real profits (with the exception of those gained in the California-Enron scandal) that built hospitals, schools roads and so on.

Hydro didn’t have to borrow money to pay dividends to the treasury as they have under this “business-oriented” government. Admittedly, that appalling practice started with the last NDP government but as Keith Baldrey, scarcely a Liberal-basher, puts it:

[quote]The B.C. Liberals have taken things to an entirely different level altogether. The government has locked-in contractual obligations to independent power producers to the tune of nearly $60 billion, which means that in some years, B.C. Hydro will likely be paying over-market prices for electricity it doesn’t need.[/quote]

(Evidently Mr Baldrey somehow overlooked the inconvenient fact that this is what’s happened from the start and will, assuming the Liberals continue to reward their pals, go on ad infinitum!)

Why BC Hydro always overestimates future power demand- Economist
Headquarters of the once-great BC Hydro

Just think about this for a second and let’s assume you have a small but nicely profitable business. For many years, you made a nice profit and it sustained your family needs. Suddenly, it starts to lose a bundle, and you’re advised that this is due to your incompetence, not bad luck, but you say to hell with them – we want that money, so we’ll borrow every year and because we have some assets, we will act as if everything was just peachy. You would, of course, reach the point where no one would  lend you money and you’re out of business.

That, my friends, is BC Hydro, with this wrinkle – they’ve not gone broke because their banker has to lend that money, whether he likes it or not – because the Banker is YOU, the public of British Columbia, who are forced to pay electricity rates to BC Hydro or be without power!

Think on this when you’re considering how to mark your ballot – as of now, Hydro owes $852 million to the government over the next three fiscal years in mandatory annual dividend payments and, not having the money, they must borrow it — which ratepayers will have to pay  — so that Hydro can meet government’s annual demand for a share of its non-existent profits, thus transferring the debt from us the taxpayers to us the ratepayers!

Did the poor, old, helpless government suddenly find itself in a position where global catastrophes or unforeseeable local conditions made it impossible for the poor Minister of Finance to do any better? Must we excuse the poor devil because he had no way of avoiding this calamity?

Usually, when financial disasters occur, a government has some sort of legitimate excuse. This government of fiscal fuck-ups has no excuse and in the next column I’ll examine how this bankrupting of BC Hydro was deliberate, probably because of Gordon Campbell’s Fraser Institute philosophy that no government-owned company can perform as well as a private company and he set out to prove that with catastrophic results. What we will determine, however, is that it wasn’t all loss, as this disaster unfolded because friends of the government made and continue to make billions of dollars. I will place before you prima facie evidence of wrongdoing by someone, for which the Attorney-General, who’s supposed to be above politics, must authorize a thorough investigation.

That she has not even commented on, much less authorized, an investigation is not an encouraging sign.