We Can't Have It Both Ways

Despite Justin Trudeau's sunny assurances that meeting greenhouse gas emission reduction goals and pipeline expansion are not mutually exclusive, most people, if they think about it at all, will see such a position as both risible and impossible.

That is certainly the assessment of J. David Hughes, who writes that we can't have it both ways:

In 2014 (the most recent year for which we have data), Canada’s emissions were 28 per cent above the 2030 target. Meaning, even with existing levels of oil and gas production, we have our work cut out for us.

But Alberta’s new Climate Leadership Plan allows for a 47 per cent increase in oilsands emissions from 2014 levels (up to a maximum cap of 100 million tonnes per year). And B.C. plans to develop a liquefied natural gas (LNG) export industry, aiming for five large LNG terminals to export fracked gas from province’s northeast. This means a large ramp up of emissions from natural gas production as well.

Under a scenario where Alberta’s oilsands emissions grow to its cap, and B.C.’s LNG industry is developed to the level planned, economic sectors outside of oil and gas would have to shrink emissions by more than half (55 per cent) in order for Canada to meet the Paris commitment. This is simply not feasible, barring an economic collapse.

Hughes, an earth scientist who recently authored a report on the issue, says, in fact, that no new pipelines are needed, as the existing infrastructure is more than capable of moving our fossil fuels.

Detractors of rail should note that bitumen in its undiluted form is highly viscous and much less volatile than the light oil “Bakken bombs” that resulted in conflagrations at Lac Mégantic and in Oregon recently and therefore is unlikely to have such serious consequences in the event of an accident.

Furthermore, the economics of constructing more pipelines make no sense, despite the arguments that getting oil to tidewater will net a price premium on international markets:

Although oil is a globally priced commodity, between 2011 and 2014 the international price (“Brent”) was considerably higher than the North American price (“WTI”). In September 2011 the differential reached $25.26 per barrel. However, the average differential in the six months ending May 2016 was 88 cents per barrel and recently Brent has been trading below WTI.

Not only has the international price advantage evaporated, but Canada’s primary oil export, Western Canada Select, sells at a discount to WTI. That’s because it is a lower grade heavy oil and will sell at a discount whether sold internationally or to North American markets.

There are some very compelling reasons to dampen enthusiasm for new pipelines. However, in the world of high-stakes politics, reason often has but a peripheral role to play in decision-making. Only very strong and principled leadership can promote wise choices.

To say the least, I am not especially optimistic that will play a role here.

Deny All You Want

But it will not alter the truth. Despite anthropogenic-climate-change denier Marco Rubio's publicly professed befuddlement over the causes of the toxic algae blooms in Florida and elsewhere, the answers are not difficult to find: agricultural runoff and climate change are two of the leading culprits.

Says Karl Haven, director of the Florida Sea Grant College Program:

Climate change is expected to result in increased temperatures of nearshore ocean water, and this could lead to increased growth of harmful microorganisms. These include algae that form noxious or toxic blooms, including red tides, and bacteria and other pathogens. This situation could have negative consequences in regard to human health and also Florida’s ocean-related economy.

And there is no reason for anyone to feel smug about this problem, as it can strike anywhere, including the Great Lakes. Especially hard hit over the years has been Lake Erie which, up to this point has suffered largely due to phosphorous runoff. The compounding effect of climate change will undoubtedly aggravate the problem there.

Climate Progress reports on the spreading scourge, which has now claimed even Alaska:

Last summer, one of the largest toxic algal blooms in recorded history hit the West Coast, shutting down fisheries from California to Washington. Scientists were seeing cells of the toxic bloom as far south as Mexico, and as far north as Homer, Alaska. At the time, Vera Trainer, manager of the Marine Biotoxin Program at NOAA’s Northwest Fisheries Science Center, told ThinkProgress that the bloom was uniquely widespread, “more so than we’ve seen in the past.”

But scientists now are saying that, with climate change, toxic algal blooms like the one seen last summer might become more common along the Pacific coastline, impacting marine communities as far north as Alaska with much more consistency than in the past.

In a new study published in the journal Harmful Algae, researchers from the National Oceanic and Atmospheric Administration (NOAA) found the presence of domoic acid — the same toxic acid that shut down West Coast fisheries last summer — in marine mammals along the Alaskan coastline. This was a surprise, because Alaskan waters were previously thought to be too cold to encourage the growth of domic-producing algal blooms. [Emphasis added]

That’s because algae thrive in warmer waters, which both encourage growth in certain kinds of algae and discourage a mixing of ocean waters. Alaskan waters are some of the most rapidly warming waters in the world, having risen by three degrees Celsius in the past decade.

“The waters are warming, the sea ice is melting, and we are getting more light in those waters,” Lefebvre told the Washington Post. “Those conditions, without a doubt, are more favorable for algal growth. With that comes harmful algae.”

Given our seemingly endless capacity for denial, scenes like this are sure to become more common and widespread very, very soon:

Meanwhile, In Other Parts Of The World

.... things are hardly going swimmingly:

Torrential monsoon rains along a stalled frontal boundary near the Yangtze River in China have killed 186 people, left 45 people missing, and caused at least $7.6 billion in damage. In the Hubei Province, 1.5 million people have been evacuated or are in need of aid, almost 9,000 houses have collapsed or are seriously damaged and more than 710,000 hectares of crops have been affected, the provincial civil affairs department said. According to the May 2016 Catastrophe Report from insurance broker Aon Benfield, the $7.6 billion in damage from these floods would make them the world's most expensive and second deadliest weather-related disaster so far in 2016. The only deadlier weather disaster in 2016 was an April heat wave in India that claimed 300 lives.

H/t Mike Hudema

Counting My Blessings

No matter what our problems as a country may be, I couldn't help but feel blessed to be a Canadian as I watched this horrifying story:

More On Corporate Tax Evasion

The other day I posted some letters from The Star about corporate tax dodging and evasion as revealed by the Panama Papers, and included my doubts that Justin Trudeau will do anything to remediate the situation. An anonymous commentator took me to task:

You never miss a chance to attack Justin Trudeau do you? None of the people in the letters say anything about Trudeau so where are you getting that from?

I replied:

I am drawing that tentative conclusion from a couple of troubling indicators, Anon. One, there has been no government expression of opposition to the CRA's policy of shielding the identify of corporate tax dodgers (usually they are allowed to pay their back taxes in anonymity, as opposed to the small taxpayer being named and shamed on the CRA website) and two, Trudeau is a big enthusiast of free trade deals whose main benefits accrue to corporations, not ordinary Canadians. As well, during the campaign, he talked about tax fairness but not a word about increasing tax rates for corporations. Indeed, in May of 2015 he even opined about lowering those rates if Americans do so. All signs point to a man quite disposed to continuing the absurdly favourable treatment business currently enjoys.

Today's lead letter in The Star once more shows that I am hardly alone in being suspicious of our 'new' government's desire to rein in this egregious corporate theft:

Expose tax cheats, Editorial June 28

I’m finding your ongoing Panama Papers series on tax cheating most informative, as well as anger-provoking over the massive robbery of the public purse for decades, and — in one respect at least — puzzling.

My confusion arises from the fact that there seem to be two forms of theft involved: legal tax avoidance, made possible and encouraged — as you’ve reported — by government tax legislation, dating back decades, that leaves vast loopholes through which the very rich can drive truckloads of money into a series of tax havens around the world, thus avoiding their fair share of taxes at home; and then there is tax evasion, which has always been illegal.

I have read and saved every article in your series and, if there is a clear dividing line between legal avoidance and illegal evasion, I have seen nothing to explain that difference. In fact you’ve even lumped the two together as “tax dodging,” which further muddies the waters.

At this point it’s not clear to me whether the federal government intends to pursue avoiders or evaders — or both. Clearly, they can’t go after the former unless they change our laws to make “avoidance” illegal. But, as Marco Chown Oved reported on June 17, after eight months in office the Trudeau government, despite election campaign promises, “has done nothing to staunch the bleeding” that its predecessors made legally possible.

I’ve seen estimates as high as $31 trillion for the world-wide total stashed in tax havens by corporations and the 1 per cent (I’m betting that’s a conservative estimate). But, as your editorial notes, the only people Ottawa continues to “name and shame” to date are “dozens of small-time offenders . . . who have merely fallen behind on their tax payments.” The really big cheaters, even if caught, can apparently cut themselves a deal and stay anonymous under our laws.

We need tough new laws to ensure that everybody pays their fair share toward the building and maintenance of the strong public sector without which no democracy can survive. I’ll believe the Trudeau government is serious about this when I see that at least some of the very rich corporations and individuals, who have for years defrauded the country that made them wealthy, have been: named; required to pay it all back; heavily fined in addition; and deposited in their rightful onshore residence — behind bars.

In the meantime, talk is just talk and our health, education and infrastructure needs, among other essentials, continue to be woefully underfunded.

Terry O‘Connor, Toronto

Tax Fairness: A Doubtful Prospect

Recently I wrote a post expressing doubt that the tax treaties signed by Stephen Harper at the urging of big business will not in any way be amended by Justin Trudeau. Tax Information Exchange Agreements (TIEAs), as manipulated by Harper, allow for the legalized theft of countless billions of corporate tax dollars from the public treasury, thereby limiting what government can do to alleviate social and economic woes here at home.

Judging by some letters in today's Star, I see I am not alone in my suspicion that relief will not be forthcoming from our 'new' government:

Re: Why not outlaw use of tax havens? Letter June 22

Re: Loopholes costing Canada billions in lost revenue page, June 17

Sadly, Robert Bahlieda is a prophet crying in the wilderness. The criminalization of corporate tax avoidance is next to impossible when, as he rightly argues, it is ingrained in our culture and politicians routinely coddle business interests.

While it took great courage for Prime Minister Justin Trudeau to reject austerity and embrace infrastructure spending, it will take even more political chutzpah to entertain radical tax reform when Canadians are unwilling to pay even for the programs and services they need.

In the end it is we the citizens who must object to the privatization of our democracy. We need to care enough about it to insist that our representatives uphold the importance of taxation in a civilized society – the principled starting point of any true reform.

Salvatore (Sal) Amenta, Stouffville

This article should leave no doubt in anyone’s mind about who Western governments, and in particular the Canadian government, represent. It sure as hell isn’t the average voter in Canada.

I resent my hard earned tax dollars being spent on giveaways to multinational corporations like Bombardier, GM, and many others to ostensibly “create” new jobs, or “preserve” current employment, when these wealthy corporations pay next to no Canadian taxes. They then use their profits to buy back shares to better reward their executives, while at the same time cutting employees.

As the article points out, Canadian government policy has been to encourage the offshoring of profits.

The most effective way to stop this corporate gravy train is to eliminate income taxes on profits and replace them with a turnover tax of 1 to 3 per cent on all sales in Canada. Taxes on profits are easily subverted as we have seen with the shifting of taxes between Ireland and other jurisdictions.

A tax on corporate sales for the privilege of selling in Canada would at one fell swoop eliminate all the fancy accounting practices and legal manoeuvres to avoid taxes. Sales are the easiest thing to monitor and the most difficult to obscure.

Don Buchanan, Etobicoke

When discussing corporate tax avoidance the argument is made that Canadian multinationals need these “tools” to give them the “best ability to compete on international and global scale.” We’ve heard this kind of argument in another sphere – doping and steroid use in professional and amateur athletics.

Perhaps it’s time the multinationals were also barred from competition and stripped of their hardware so that the ethical ones can thrive.

Sid Potma, Toronto

The integrity of Canada’s tax system, as it’s currently written, looks disproportionately to its citizens for the tax base to maintain our country. I would appreciate it if some one would publish a list of the Canadian companies/corporations blatently avoiding billions in corporate taxes, thus placing an unfair burden on all of us to maintain the basic lifestyle we have become accustomed to.

Richard Kadziewicz, Scarborough

Anyone Who Refuses To Connect The Dots Here

... will never accept the fact of climate change:



Want more information on the dangers posed by algae blooms? Click here.

And just remember, sports fans, these are only the preliminary rounds.

Oh, and by the way, Happy Canada Day.